WASHINGTON (April 15, 2015)—From AAHomecare - In a landmark event for the HME community, provisions to ban nonbinding bids during Medicare contract auctions were included in HR 2, which was passed by Congress late last night.
What does this mean?
In April of 2015, HR 284, stand alone legislation that would require bidders to obtain a bid bond, thus deterring low-ball bidders, was passed by the House of Representatives. When HR 2, commonly known as the "Doc Fix" bill, was brought up for vote in the Senate, the provisions from the binding bids legislation were folded into HR 2. When the Senate passed HR 2, that included the binding bids language.
This new law will make all bids binding and require proof of licensure Medicare contract auctions. It addresses a major flaw in the program and deters speculative bidding without generating a cost.
While this will not affect the current round two recompete already in process, AAHomecare is ready to work with CMS to see this implemented as soon as possible.
There are three main provisions:
Providers will need to prove licensure before they submit bids
Bidders would be required to obtain a bid bond
Bonds will be forfeited if the bidder declines the contract and his bid was at or below the bid price
"Congress has recognized one of the most serious flaws in the competitive bidding program and taken substantive action to eliminate it," said Tom Ryan, president and CEO of the American Association for Homecare. "AAHomecare is dedicated to building upon this effort and making sure this new requirement is effective for the next round of bidding and addressing the drastic cuts in non-competitive bidding areas that are due to take effect on January 1, 2016."
“Thanks to the perseverance of the homecare community, we’ve been able to build strong bipartisan support in the House and Senate," said Ryan. "I would like to thank Representatives Tiberi, R-Ohio, and Larson (D-Conn.) and Senators Portman, R-Ohio and Cardin (D-Md.) for their leadership on this issue."
"AAHomecare would like to thank Invacare, Mal Mixon and Cara Bachenheimer for their dedication to this issue and for working with key Ohio legislators to make this happen," said Ryan. "In addition, without the active involvement of many HME providers, state association leaders and others who worked to keep Congress educated about the ill-effects of this program in their localities, this bill would never have become law."
AAHomecare wants to reassure members that this is only the first step in addressing this critical issue.
"While fixing the sustainable growth rate (SGR) for Medicare physician reimbursement, AAHomecare is pleased that Congress and the White House have agreed to address a major flaw in the compeitive bidding program by including the Tiberi/Larson binding bid bill language in H.R. 2," said Jay Witter, senior vice president of AAHomeare government affairs. "AAHomecare will now work to address the major reimbursement cuts to non-competitive bid areas areas starting in 2016."
Senator Portman released a statement this morning regarding the Senate passage of H.R. 2.
“I am also pleased that this legislation includes my bill to ensure seniors have access to the medical supplies they rely on," said Portman. "My bill will increase transparency and fairness in the bidding process, while also promoting competition and ensuring that seniors have increased access to quality medical supplies. I’m pleased that this bipartisan bill will now be signed into law.”
The new law, H.R. 2, marks a rare bipartisan agreement from Congress, and was introduced as a permanent fix to the sustainable growth rate (SGR) formula which was passed into law in 1997. The measure also extends the Children’s Health Insurance Program for two years past its current Sept. 30 expiration.
