Painting with Detail

After adjourning for the elections, Congress will return to Washington in mid-November for a lame duck session. During this time, legislators are likely to move on some “must-pass” pieces of legislation before adjourning for the year. This presents an opportunity for the HME community to focus in on our message to Congress: The serious flaws of the competitive bidding program will undermine beneficiary access to quality care.

It is also important for us to address the fact that the bidding program is not competitive. Instead, it distorts the market by eliminating competition. Should the government really be in the business of forcing the creating of oligopolies in a given market?

Congress must also understand that the DMEPOS bidding program is not an effective anti-fraud program as the Centers for Medicare and Medicaid Services touts. The real solution to keeping criminals out of Medicare is better screening, real-time claims audits and better enforcement mechanisms. Accreditation and surety bonds for home medical equipment providers will also go far toward eliminating fraud.

Finally, we must educate Congress that CMS has been wholly non-transparent with the affected supplier community in its implementation of the DME bid program, despite President Obama’s Jan. 21, 2009, executive order on “Transparency and Open Government.” That order states, in part:

“My Administration is committed to creating an unprecedented level of openness in Government. We will work together to ensure the public trust and establish a system of transparency, public participation, and collaboration. Openness will strengthen our democracy and promote efficiency and effectiveness in Government … Government should be transparent. Transparency promotes accountability and provides information for citizens about what their Government is doing.”

The competitive bid program is hardly a model that reflects the president’s pledge of transparency.

With the desire for more transparency, 136 members of the U.S. House of Representatives sent a letter to CMS in August requesting the agency to provide information regarding the DME providers that were offered Round 1 contracts, since those offerees’ bids were used to calculate the single payment amounts, regardless of whether that same group sign the contracts. The bid prices of winners who do not accept contracts are not removed from the price calculation, which causes bid winners to be affected by the low bids of speculators.

Sen. Sherrod Brown, D-Ohio, and Sen. Debbie Stabenow, D-Mich., sent CMS similar letters, echoing the need for CMS to provide greater transparency.

But in a response from CMS Administrator Donald Berwick, the agency refused the request.

Part of the difficulty we have in explaining to Congress that the bid program is fundamentally flawed is that the devil is in the details. You must delve into the bid program particulars. You must explain, for instance, that bidders are not bound to their bids; that there is no guarantee of volume, making it impossible to submit a rational bid based on expected volume; that the bid program incentivizes small business to submit “suicide bids” in order to survive in the marketplace, even though these low prices may not be able to sustain the business over the long term.

When CMS eliminates 80 to 90 percent of suppliers in each competitive bidding area, there will be detrimental consequences for beneficiaries who will lose choice and access, and quality will deteriorate. Over the long term as the number of suppliers is reduced, the picture gets even worse.

This is the picture we must paint, and paint it with detail, whether we have the opportunity to repeal, replace or delay Rounds 1 and/or 2. And as CMS releases data, we must use that data to fill in even more detail.

Read more Washington Wit & Wisdom columns. View more competitive bidding stories.

A specialist in health care legislation, regulations and government relations, Cara C. Bachenheimer is vice president, government relations, for Invacare Corp., Elyria, Ohio. Bachenheimer previously worked at the law firm of Epstein, Becker & Green in Washington, D.C., and at the American Association for Homecare and the Health Industry Distributors Association. You can reach her at 440/329-6226 or [email protected].