HME Community Rallies Around Hobson-Tanner Bill

WASHINGTON–HME leaders are mobilizing to drum up early support for the newly introduced Hobson-Tanner bill, which many stakeholders say will help level the playing field when competitive bidding takes effect.

Under the MMA, competitive bidding, or “competitive acquisition” as the government calls it, is scheduled to begin in 10 of the country’s largest metropolitan statistical areas (MSAs)–but not necessarily the top 10–beginning in 2007 and expand to others in 2009.

Introduced by Reps. David Hobson, R-Ohio, and John Tanner, D-Tenn., the legislation would not repeal competitive bidding, but would make changes to the MMA’s structure to ensure beneficiaries’ access to DME and protect small providers as follows:

• The MMA allows contracts with only as many providers as deemed necessary by the HHS secretary to meet the demand of the bid area. Any provider not awarded a contract would be prohibited from participating in Medicare for up to three years. The Hobson-Tanner bill would allow small businesses that do not receive a contract to continue to provide DME at the winning bid rate as long as they have submitted a reasonable bid.
• The MMA explicitly prohibits administrative or judicial review for competitive acquisition of DME. This means that providers do not have legal recourse to appeal the bid amount or contracts. The Hobson-Tanner bill would restore appeal rights, which exist elsewhere in the Medicare program, for competitive acquisition of DME.
• Under the MMA, an item can only be competitively acquired if doing so would result in significant savings to Medicare. The Hobson-Tanner bill would require the government to show that competitive acquisition of an item would result in savings of at least 10 percent.

• Under the MMA, the bid rates in one MSA can be used to set the reimbursement for another MSA. The Hobson-Tanner bill would require that before doing so there must be a comparability analysis of the two MSAs, which would help prevent any applications of bid rates outside of an MSA that are inappropriate.

“The Hobson-Tanner bill provides some fairness and corrects some of the inequities that the MMA has in the [competitive bidding mandate],” said Ray Darcey, AAHomecare vice chair and vice president of Norfolk, Va.-based Sentara Enterprises. “We think some of the small MSAs should be excluded. We think there should be some standards, but something small businesses can meet. And we think in competitive bidding of products, people participating should be located in the MSA. Those things weren’t really spelled out [in the law].”

Darcey, who also is a member of AAHomecare’s small business committee, said its members have been busy talking with state associations about the bill and urging providers to take a stand for the legislation.

Last week, AAHomecare launched an online survey to gather information about how small businesses will be affected by competitive bidding. The findings will be presented to members of Congress to solicit their support, said committee member Tim Pederson, president and CEO of Rapid City, S.D.-based WestMed Rehab. “I’m optimistic. I fully expect we’ll have enough co-sponsors [to get Congress’ attention].”

Industry lobbyists are suggesting that now–while legislators are home on recess–is the best time to act in enlisting co-sponsors for the measure. For more information about the Hobson-Tanner legislation, visit www.aahomecare.org, www.vgm.com or www.medgroup.com. To find your members of Congress, click here.

The text of the Medicare Durable Medical Equipment Access Act of 2005, H.R. 3559, is available at http://thomas.loc.gov.

To take the AAHomecare small provider survey, which is open to all providers, click here.