Rural Exemption for Competitive Bidding?

WASHINGTON — Sen. Charles Grassley, R-Iowa, introduced a
wide-ranging health care bill Tuesday that seeks to exempt rural
areas from DMEPOS
competitive bidding. Specifically, the measure applies to MSAs
with a population of 600,000 or less. The provision is one of
several initiatives outlined in the Medicare Rural Health Access Improvement Act of
2009, which Grassley said would also improve Medicare payments
to rural doctors, ambulances and mid-size hospitals.

“The policy changes in this legislation go directly to the
special challenges facing the health care system in rural America,”
Grassley said in a press release. “They recognize the high quality
of health care delivered by rural providers, embrace common sense
solutions and seek equitable treatment from payment systems.”

Reaction to the proposal was varied. John Gallagher, vice
president of government relations for the VGM Group, Waterloo,
Iowa, believes the bill has little chance to become law. “I don’t
think it has a shot,” said Gallagher. “The good thing is that Sen.
Grassley understands that competitive bidding would be a nightmare
for providers. What we need to ensure is that he understands that
crazy competitive bidding bids will still eliminate rural providers
with revised fee schedules based on the bid price.”

Grassley has introduced similar measures in the past, according
to Cara Bachenheimer. However, she believes the new administration
could provide an opening for another bid delay. “We must do
everything we can to suspend the bidding program, which means
working with the new administration and with Congress,” said
Bachenheimer, senior vice president of government relations for
Invacare,
Elyria, Ohio. “Asking the new administration to suspend the rule
could delay the program, but we are also working with Congress to
develop support to further delay or suspend the bid program.”

While the Grassley bill would not solve the HME industry’s
problem since it would not stop the bidding process, “the one plus
is that it could help engender support from other rural members of
Congress,” noted another Washington insider. “Grassley has stature
in the Senate, and other members of Congress may correctly infer
that this bidding program decreases access to care in rural areas,
and in urban areas, too.”

As usual, the industry plate is full and extends well beyond
competitive bidding. Bachenheimer pointed out that at least four
key issues are high on the agenda for 2009. “First, fix the post
36-month payment issue,” explained Bachenheimer. “Second, suspend
the bid program. Third, restore the 9.5 percent cut for complex
rehab. Finally, enact payment reform for home oxygen therapy so the
statute explicitly recognizes and pays for the services providers
routinely provide to beneficiaries.”

After Congress delayed Round One of the Medicare bid in July,
CMS issued an interim final rule on the program Jan. 16, in the
waning hours of the Bush administration (see CMS
Issues Interim Final Rule on Competitive Bidding, HomeCare
Monday Special Alert, Jan. 15). But the rule, which carried an
effective date of Feb. 15, is on hold pending the
Obama administration’s review.

Officials from the Accredited Medical Equipment Providers of America
reported Thursday that during a recent Open Door Forum, CMS
representatives said it is unclear when the new administration will
lift the moratorium. “CMS admitted that they are running at half
strength after the inauguration, with many political positions to
be filled and many former officials resigning,” AMEPA noted in a
message to members.

VGM’s Gallagher agreed the right move now is working to suspend
and then eliminate the bidding program. “We need for [HHS
Secretary-Designate Tom Daschle] to rescind the interim rule and
for a champion to step forward to kill competitive bidding,” he
said. “It’s bad policy that needs to be discarded.”