Representatives Give CMS a Week on Bidder Names; Brown Backs Them Up

WASHINGTON — After sending a letter asking CMS
Administrator Donald Berwick for specifics on how the Round 1 single
payment amounts were calculated, Reps. Jason Altmire, D-Pa.,
and Ralph Hall, R-Texas, asked that the names of those providers
whose bids were used to arrive at the rates be released by Aug.
20.

The letter was signed by 134 of their colleagues in the House of
Representatives.

The letter’s original deadline had been Aug. 13, but the
additional week was set as the answer date to give CMS time to
consider the request, insiders said. (To view the Altmire-Hall
sign-on letter, see Altmire, Hall Call for
Release of Bidder Names, Aug. 3.)

On Friday, Sen. Sherrod Brown, D-Ohio, wrote Berwick a letter of
his own reiterating the request for the Round 1 rebid names.

“This transparency is essential in order to assess the quality
and access impact of this program on Medicare beneficiaries,” Brown
told Berwick. “It is also important as a means of determining the
impact on trusted local providers who have served Medicare
beneficiaries in good faith and at reasonable costs for years, and
who now may be at risk of closing their doors …

“I continue to believe that DMEPOS competitive bidding as it is
currently conceived is a dangerous path for Medicare to take. It
risks local, service-oriented provision of goods and services that
are crucial to the health and wellbeing of vulnerable Medicare
populations, and it sets the stage for fiscally irresponsible
monopoly pricing by a few large providers.”

(To read a letter from Sen. Debbie Stabenow, who also wrote
Berwick last week asking questions about the competitive bidding
program, see “Stabenow
Questions Berwick on Competitive Bidding,” Aug. 12.)

The Aug. 13 letter from Brown follows in its entirety.

Dear Administrator Berwick:

I am writing to reiterate the request of more than 130 members
of the House of Representatives, who asked that the Centers of
Medicare and Medicaid Services (CMS) disclose the list of the
providers whose bids were used to calculate payments under the
re-bid of the competitive bidding program for durable medical
equipment, prosthetics, orthotics, and supplies (DMEPOS). This
transparency is essential in order to assess the quality and access
impact of this program on Medicare beneficiaries. It is also
important as a means of determining the impact on trusted local
providers who have served Medicare beneficiaries in good faith and
at reasonable costs for years, and who now may be at risk of
closing their doors. Such an outcome would not only be detrimental
for these critical local businesses and the fragile economies to
which they contribute, but it could reduce beneficial
competitiveness in the DMEPOS market.

During the initial Round One bidding process in 2008, flaws in
the system permitted provider to win contracts for DMEPOS services
who were not equipped to fulfill these contracts. Some bidders did
not have the financial capacity to respond to increased demand;
others had no experience in the product categories for which they
were awarded bids. I understand that several of the winning bidders
had not obtained the certification or licensure required to provide
the devices and services for which they were awarded contracts.
Others did not even have a physical location in the area. These
flaws would have had a direct bearing on my constituents, and I was
among the members of Congress who pushed for a delay in
implementation of the program.

I continue to believe that DMEPOS competitive bidding as it is
currently conceived is a dangerous path for Medicare to take. It
risks local, service-oriented provision of goods and services that
are crucial to the health and wellbeing of vulnerable Medicare
populations, and it sets the stage for fiscally irresponsible
monopoly pricing by a few large providers. These broader concerns
notwithstanding, at the very least it is crucial that qualified,
readily accessible providers are chosen to provide DMEPOS to
Medicare beneficiaries and that benchmark payment rates are
sufficient to cover the cost of providing DMEPOS. There is no
excuse for subjecting Medicare beneficiaries to any gaps in
quality, service or access.

I understand that CMS intends to release the names of the
winning providers in September. However, a better understnading of
the re-bid is required now, before the process moves forward. A
list of the suppliers, product categories and competitive bidding
areas for each of the suppliers whose bids were used to determine
the payment amounts will shed light on the appropriateness of the
payment amounts and help Congress evaluate the impact on local
DMEPOS access, associated service capability, and overall quality.
As members of the House requested, I ask that this information be
provided no later than Friday, August 20.

Ensuring that Medicare does not pursue payment schemes that are
harmful to the Medicare population or that will ultimately prove
counterproductive from a financial perspective is an important
facet of the critically important role you play. I trust your
leadership and thank you for your efforts to ensure that Medicare
and Medicaid are administered in a manner that is both fiscally
responsible and puts the needs of Medicare beneficiaries first.

Sincerely,

Sherrod Brown

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