Competitive Bidding Round 2; Lessons Learned from Round 1

Chris Rice’s company, Diamond Respiratory Care of Riverside, Calif., was awarded eight contracts in Round 1 of competitive bidding in 2008, an impressive feat in itself.  Then, two weeks into the three-year contract period, everything was thrown out because of wayward paperclips and staples, and the process started over.

Incredibly, in the 2009 rebid, Diamond repeated its sweep in all eight categories of HME products in which Rice submitted bids.

“We kind of pulled it off,” says Rice, who now oversees a very busy HME business and also launched BidPrep, a competitive bidding consultant service, in October at Medtrade. “I figured there were probably quite a few people out there who would want to know what I’ve done.”

That’s logical since competitive bidding is now spreading from its original nine metropolitan areas to another 91, encompassing about 75 percent of the nation’s HME providers. In fact, Medtrade 2011 in Atlanta was filled with experts talking about lessons learned in Round 1 of competitive bidding that could be applied to Round 2. They provided tips on getting organized, methods for focusing bids on key codes and how to avoid missteps with the complicated issue of HME capacity.

Speakers included Cara Bachenheimer, senior vice president, government relations, Invacare; Mark Higley, vice president, development, VGM Group; Alan Morris, alternate care programs, VGM & Associates; and Todd Tyson, president, Hi-Tech Healthcare.

Competitive bidding has three phases—registration, documentation and actual bidding. Registration is simple, about like signing up for a website, and must be completed by Feb. 9. Providers should be working toward a “hard document date”—when financial data, credit reports and information on licensing and accreditation are due. Financial data include the most recent year’s balance sheet, income sheet, cash flow statement and portion of a tax form. In Round 1, three years of financial data were required, but that was reduced for Round 2.

Higley said that in Round 1 many documents were lost because staples and paper clips clogged scanners, and kept electronic versions of some documents from being recorded. That’s why 40 percent of bidders were disqualified and the bid was done over again. “Write your bidder number on everything that goes in the box,” Higley said.