NOTABLE & QUOTABLE

“This Medicare bidding program is a train wreck. But as this program jumps off the tracks, the attitude of CMS is clearly ‘full steam ahead.’”
— Tom Ryan, CEO, Homecare Concepts, Farmingdale, N.Y., and former chairman of the American Association for Homecare

Testifying on behalf of AAHomecare at a May 6 hearing on competitive bidding convened by the House Ways and Means Health Subcommittee, provider Tom Ryan laid out industry concerns about the program. Excerpts from his testimony follow:

The bidding program is poorly conceived, it is fundamentally flawed, and it does not account for the way that home care providers currently compete for business.

But the real tragedy is the negative impact on Medicare beneficiaries. Problems with the design and operation of the bidding program will seriously reduce beneficiary access and the quality of care and products that beneficiaries currently receive.

This program is not the free-market miracle that some have characterized it to be.

The term “competitive bidding” is dead wrong. This bidding program will, in fact, radically reduce the number of accredited suppliers that are allowed to compete.

The bidding program’s widely touted savings are misleading. Small suppliers bid unreasonably low to have an opportunity to stay in the game since the alternative is to go out of business. The fact that 64 percent of suppliers offered contracts were small validates that … We believe the extraordinarily low bid rates will be unsustainable over a three-year contracting period, and any savings will be at the expense of services to the beneficiary.

There are 33 business days before round one of the program takes effect. This program would be a historic change affecting as many as three million Medicare beneficiaries in the first phase alone. Yet Medicare has not even announced who has won the round one bids, leaving the education of providers, beneficiaries, and clinicians to the last minute.

For these reasons, the American Association for Homecare urges Congress to immediately halt the implementation of this program. The wide range of problems and questions about the program must be independently evaluated, and an alternative process to determine payment rates for home medical equipment must be explored.