House Subcommittee Appeals to SBA for Competitive Bidding Delay
WASHINGTON–The House of Representatives Committee on Small
Business, Subcommittee on Investigations and Oversight, sent a
letter to the U.S. Small Business Administration Wednesday to use
its muscle with CMS and intervene to delay competitive bidding.
The letter, from Reps. Jason Altmire, D-Pa., and Louie Gohmert,
R-Texas, asked that implementation of the rule be halted until the
SBA’s Office of Advocacy can assess its economic impact on small
businesses. The two are chairman and ranking member of the House
subcommittee.
“The DMEPOS industry is overwhelmingly a network of small- to
medium-sized businesses serving relatively small service areas,”
the congressmen wrote. “In fact, CMS estimates that approximately
85 percent of registered DMEPOS suppliers are considered small,
according to the SBA definition.
“In its final rule, CMS states that the DMEPOS supplier industry
is expected to be significantly impacted by this final rule. It is
imperative that Advocacy conduct a timely review of the available
facts, including a comprehensive economic analysis, in advance of
any final implementation of the CMS DME competitive bidding rule. A
rushed or flawed implementation process has the potential to
severely if not irreparably damage thousands of small
businesses.”
The letter noted that at a recent subcommittee hearing, “the
small business community raised legitimate concerns that they will
not be able to compete with large, national firms in the bidding
process, thus threatening local jobs and patient access to
care.”
Given the magnitude of the program, set to be implemented in 10
MSAs in July 2008, Altmire and Gohmert said they were concerned
that “CMS anticipated roughly 15,000 suppliers would participate in
the initial bidding process, yet only 2,200 were in a position to
even submit bids. Once the competitive bidding program has taken
full effect, as few as 20 suppliers on average will be initial bid
‘winners’ in each MSA, putting small suppliers at a tremendous
disadvantage.”
The letter was sparked by the subcommittee’s Oct. 31 hearing on
the issue, which drew strong testimony from a string of HME
advocates. Representing the American Association for Homecare,
provider Georgie Blackburn of Blackburn’s, Tarentum, Pa., charged
that “since Medicare payments typically comprise 35 to 50 percent
of a small provider’s revenue, losing the ability to provide
competitively bid items for a three-year contract period is
essentially a death knell.”
For more on the subcommittee hearing, see
HomeCare Monday, Nov. 5.
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