WASHINGTON, D.C. (June 18, 2018)—The June 15 release of MedPAC’s report to Congress on Medicare and the health care delivery system represents another missed opportunity by the Commission to address the serious problems with Medicare’s competitive bidding program for durable medical equipment (DME) as well as the disastrous application of bidding-derived pricing to rural and other less-populous communities, stated the American Association for Homecare (AAHomecare).

“Medicare’s bidding program for DME and the expanded use of bidding-derived pricing beyond the original scope of the program continues to be a bad deal for both patients and suppliers,” said Tom Ryan, president and CEO of AAHomecare. “Instead of examining ways to improve the bidding program and putting patient access to DME on a sustainable footing going forward, MedPAC is suggesting adding even more products into the flawed program and further stressing an industry already working under razor-thin or negative margins on many products under competitive bidding.”

“In addition, MEDPAC’s suggestion to cut reimbursement rates for non-participating suppliers, even as they acknowledge that DME assignment rates remain high, is a solution in search of a problem,” added Ryan. “To suggest taking away the flexibility that billing non-assigned provides for both suppliers and patients, without any data to support that idea, should be a non-starter for policymakers.”

“Perhaps MedPAC would benefit by taking a closer look at CMS’s recently released Interim Final Rule (IFR) related to DME for inspiration on the issues that need more serious scrutiny,” Ryan said. “While the scope of relief in that regulation needs to be broadened and solidified on a long-term basis, the IFR acknowledges the continuing sharp declines in DME supplier numbers, shortcomings in monitoring the effects of the bidding program, and the risk of adverse health outcomes and increased hospitalizations when access to DME is reduced. Instead of doubling down on a flawed bidding program, addressing these real concerns needs to be the focus for regulators and Congress to put Medicare reimbursement policy for DME on a sustainable path going forward.”

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Chapter 6 - Issues in Medicare’s medical device payment policies from Report to Congress: Medicare & the Health Care Delivery System – June 2018

Executive Summary

The full report can be found at medpac.gov.