Summary of Competitive Bidding Provisions in H.R. 6331

WASHINGTON–While the physician payment provisions of H.R. 6331 drove the bill through both houses of Congress, most HME stakeholders are fixed on the Medicare legislation’s delay of competitive bidding.

Provided by Cara Bachenheimer, senior vice president of government relations for Elyria, Ohio-based Invacare, following is a bullet-point summary of provisions in the measure related to the DMEPOS bidding program. If it becomes law, the bill would:

Delay rounds one and two of the bid program for 18 to 24 months
–Terminate contracts awarded under round one and restart the contracting process in those areas in 2009.
–The round two contracting process would begin in 2011.
–CMS cannot apply bid rates in non-bid areas until round two is completed.

Exempt high-end rehab power wheelchairs and related accessories
–Exclude complex rehabilitation wheelchairs, and related accessories when furnished with such wheelchairs, from competitive bidding.

Include an offset to pay for the bid delay
–In January 2009, the product categories included in round one would be reduced by 9.5 percent nationwide. This policy does not affect diabetic supplies furnished by retail suppliers because they were not covered by the bidding program.
–Items that had been subject to the reduction would receive a 2 percent payment increase in 2014, except in any area where a competitive bidding contract is in effect or CMS has otherwise adjusted payment rates.
–Items that are not in a bid area would receive the full CPI update in 2010, 2011, 2012 and 2013. In 2014, these items would receive the CPI update plus 2 percent.

Require bidding process improvements
–Require CMS to notify bidders about paperwork discrepancies and give suppliers the opportunity to correct within a reasonable time frame.
–Provide CMS the authority to subdivide MSAs with more than 8 million people.
–Exempt rural areas and MSAs with a population of less than 250,000 from competitive bidding for at least five years.
–Require that suppliers who bid on diabetic testing supplies offer brands that cover at least 50 percent of the market by volume (does not apply to round one).
–Before using its authority to adjust prices in non-bid areas, CMS must issue a regulation and consider how prices set through competitive bidding compare to costs for such items in non-bid areas.
–Require HHS’ Office of Inspector General to verify the calculations used to determine the pivotal bid amount and winning bid amounts.

Revamp quality measures
–Require all suppliers to be accredited by Oct. 1, 2009. Ensure that all suppliers, whether they are billing Medicare directly or are a subcontractor to another supplier, be subject to accreditation.
–Require contracting suppliers to disclose all subcontracting relationships to CMS.
–Exclude physicians and other practitioners from DMEPOS accreditation requirements until CMS develops provider-specific standards. Allow CMS to waive physician accreditation if the agency determines they are subject to other mandatory quality requirements.
–Establish a separate ombudsman within CMS to handle supplier and beneficiary issues related to the competitive bidding program.

Mandate other changes
–Exclude negative pressure wound therapy from round one and require CMS to evaluate how these items are coded and paid.
–Exclude Puerto Rico from round one re-bidding (the CBA did not receive enough valid bids in original round one for CMS to award contracts).
–Allow physicians and other treating practitioners to supply “off-the-shelf orthotics” to their patients without being awarded a competitive bidding contract.
–Allow hospitals in bidding areas to supply the same DMEPOS items that physicians and other practitioners will be able to supply (those that are considered an integral part of professional services) without being awarded contracts for those items.
–Ensure that podiatrists and other similar practitioners can prescribe DMEPOS items by using a broader definition of “physician” in the Social Security Act. (This relates to a drafting error in the Medicare Modernization Act–which mandated competitive bidding–that pointed to the wrong definition of “physician” in the Social Security Act when requiring face-to-face examination in order to prescribe DMEPOS items.)
–Delay a mandated Government Accountability Office report to coincide with the delay of round one and expand the scope of report.
–Provide CMS implementation funding of $120 million.

In addition, the measure would repeal the transfer of oxygen equipment to beneficiaries required by the Deficit Reduction Act. The title transfer is currently set to take effect Jan. 1, 2009.

For the entire text of H.R. 6331, visit http://thomas.loc.gov and enter “H.R. 6331” in the search bar.