Tuesday, May 31, 2016

New OIG Report Raises More Questions About Competitive Bidding

The Office of the Inspector General (OIG) for the Department of Health & Human Services released a report that raises more concerns about the Centers for Medicare & Medicaid Services’ (CMS) ill-conceived competitive bidding program for home medical equipment.

Looking at contract suppliers in Round 2 of the bidding program identified in complaints from the supplier community and congressional inquiries, the OIG focused on 146 unique contract suppliers that may not have been properly licensed in states requiring licensure for companies providing home medical equipment.

In that group, the OIG found that “63 suppliers did not meet licensure requirements for some of the competitions for which they received a contract. Additionally, 14 suppliers need to be further researched by CMS and its contractors to determine if they met or had not met licensure requirements.”

“The fact that it took two years to get this report just solidifies our view that CMS can't evaluate the patient impacts caused by recent deep cuts for rural providers in just six months before plowing ahead with a new round of cuts on July 1,” said Tom Ryan, president & CEO of AAHomecare.  “That’s why we need Congress to step in and make CMS take the time they need to properly evaluate this program.”

“CMS has dragged its feet on implementing provisions passed in Congress last year that would require CMS to better enforce their own rules requiring that bidders are properly licensed in states requiring licensure,” Ryan continued.  “This isn’t the way to run a program that impacts home medical equipment providers nationwide, and the millions of patients that depend on the essential products and care they provide.”

These revelations come as Congress considers legislation requiring CMS to better assess the direct impact of the recent round of price cuts for patients in rural areas before a new round of deep cuts take effect on July 1.  Current Senate and House legislation, known in both chambers as the Patient Access to Durable Medical Equipment Act (S. 2736 and H.R. 5210), would delay the latest cuts for 15 months and require CMS to report their findings on patient access issues on a regular, transparent basis.

“The message is clear,” concluded Ryan. “The bidding program needs serious examination before it causes further disruption for both providers and patients.”

The OIG's summary and full report can be found here.

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