WASHINGTON--The House of Representatives Committee on Small Business, Subcommittee on Investigations and Oversight, sent a letter to the U.S. Small Business Administration Wednesday to use its muscle with CMS and intervene to delay competitive bidding.
The letter, from Reps. Jason Altmire, D-Pa., and Louie Gohmert, R-Texas, asked that implementation of the rule be halted until the SBA's Office of Advocacy can assess its economic impact on small businesses. The two are chairman and ranking member of the House subcommittee.
"The DMEPOS industry is overwhelmingly a network of small- to medium-sized businesses serving relatively small service areas," the congressmen wrote. "In fact, CMS estimates that approximately 85 percent of registered DMEPOS suppliers are considered small, according to the SBA definition.
"In its final rule, CMS states that the DMEPOS supplier industry is expected to be significantly impacted by this final rule. It is imperative that Advocacy conduct a timely review of the available facts, including a comprehensive economic analysis, in advance of any final implementation of the CMS DME competitive bidding rule. A rushed or flawed implementation process has the potential to severely if not irreparably damage thousands of small businesses."
The letter noted that at a recent subcommittee hearing, "the small business community raised legitimate concerns that they will not be able to compete with large, national firms in the bidding process, thus threatening local jobs and patient access to care."
Given the magnitude of the program, set to be implemented in 10 MSAs in July 2008, Altmire and Gohmert said they were concerned that "CMS anticipated roughly 15,000 suppliers would participate in the initial bidding process, yet only 2,200 were in a position to even submit bids. Once the competitive bidding program has taken full effect, as few as 20 suppliers on average will be initial bid 'winners' in each MSA, putting small suppliers at a tremendous disadvantage."
The letter was sparked by the subcommittee's Oct. 31 hearing on the issue, which drew strong testimony from a string of HME advocates. Representing the American Association for Homecare, provider Georgie Blackburn of Blackburn's, Tarentum, Pa., charged that "since Medicare payments typically comprise 35 to 50 percent of a small provider's revenue, losing the ability to provide competitively bid items for a three-year contract period is essentially a death knell."
For more on the subcommittee hearing, see HomeCare Monday, Nov. 5.