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As anticipated, CMS has released the “winning” bid prices for the DME competitive bidding program, touting that the program will save an average of 32 percent, saving tax payers and Medicare patients $$$. The press release fails, however, to highlight the fact that the program will cost over 100,000 jobs, reduce patient access to medically necessary equipment and services, sever long-standing patient/provider relationships, and ultimately cost taxpayers additional dollars.
To view pricing offered through competitive bidding contracts in detail, click here.
What’s Next?
Following CMS’ bid rate announcement, bidders will begin to receive one of three letters from the agency. The three types of letters a provider might receive include:
- Contract offer: Providers may receive a letter stating that they are being offered a contract, and will have X days to either accept or reject the offer. Prior to the letter, however, bid "winners" will receive an e-mail stating that a contract will be mailed. To view the text of the e-mail, click here.
- Qualified but no offer: Providers may receive a letter stating that they met all bidder eligibility requirements, but submitted a composite bid above the pivotal bid threshold. Providers will be advised that, should contracts be rejected by those offered, they may be offered a contract at a later date. If contract rejections take place, follow-up and additional offers are likely to be made throughout late July and August.
- Did not qualify: Providers may receive a letter stating that they did not qualify to be offered a contract. This may mean one of several things, including but not limited to: failure to meet financial standards, lack of sufficient financial documentation, lapsed accreditation or surety bond, or lack of proper state licensure.
If you receive letters other than a contract offer, we want to know about it! E-mail your story to NCBhelp@vgm.com, and let us know the details. VGM continues to work with the provider community to educate our legislators on the many issues surrounding the “suicide bidding” program. CALL YOUR LEGISLATORS NOW!
As State/Regional associations, VGM, and other industry leaders continue the fight to STOP competitive bidding, all providers are urged to take action immediately and remind their Congressional members what the program will do to patient access and to providers’ jobs. Remind your House representatives to urge House leaders to move the H.R. 3790 forward. Contact your senators and express your concerns about the program, along with the need for a bi-partisan, budget-neutral companion bill. More support in the Senate is needed!
If you have not yet contacted your legislator about the issues and concerns of competitive bidding, NOW IS THE TIME TO START! All providers, including those in rural or non-CBAs should take action. Once competitive bidding is implemented, reimbursements from third-party payers may begin to reflect the low bid prices from the program. Legislators need to know that the rates are too low for even the winning bidders to sustain their businesses.
The following are points to make when discussing the issues of competitive bidding with your legislator:
WILL COST MORE THAN 100,000 JOBS – The bidding program will result in the closing of thousands of small businesses and result in more than 100,000 jobs lost nationwide. In a political environment where the government is working to create more jobs, Congress must be reminded that additional job loss should be avoided. Please use the Jobs Handouts for reference.
SACRIFICES CARE FOR SENIORS AND PEOPLE WITH DISABILTIES - Competitive bidding will reduce patient access and choice for quality HME items and services.
SACRIFICES QUALITY CARE – Because the contracts have gone to low bidders, the quality of the products will be sacrificed, as well as service. Additionally with the loss of local providers, efficient deliver and quality service will also be eliminated.
PROGRAM IS ANTI-COMPETITIVE – During the first round of competitive bidding in 2008, 90 percent of home medical equipment and service providers would have been barred from providing items and services to Medicare beneficiaries. Because the bid program reduces the number of market competitors, competitive bidding is anti-competitive.
NOT COST-EFFECTIVE FOR MEDICARE – Competitive bidding will lead to more expensive, longer hospital stays, shifting costs from Medicare Bart B to Part A. Home medical equipment is the most cost-effective and a preferred alternative to expensive institutional care. It is also the slowest-growing portion of Medicare. For example, a day of oxygen therapy costs less that $7 per day. Meanwhile, a day in the hospital costs more than $5,500 per day. The bidding program will increase Medicare costs.
Do You Know Your Game Plan?
As the DME industry continues to fight the competitive bidding program, VGM’s National Competitive Bidding Services team wants to ensure our providers know what to expect for the next round of contracting. The NCBS team will be co-hosting full-day competitive bidding seminars, “Contracting Time is Here: Do You Know Your Game Plan?” along with corresponding state associations, visiting each of the nine Round One bidding areas throughout July and August. These seminars will be presented by Mark Higley, vice president-development; John Gallagher, vice president-government relations; Alan Morris, regulatory analyst, all from VGM; and attorney Neil Caesar, president, Health Law Center.
When asked about the effort to repeal the program, VGM’s John Gallagher said: “Our focus remains on moving repeal legislation through Congress, and I remain very confident we’ll get it done. However, we can’t help but recognize the importance in preparing providers for the possibility that this program will move forward on Jan. 1, 2011.”
The series is designed for all providers affected by the bidding program and will focus on:
- Detailed overview of the contractual obligations for bid winners.
- Discussion about financially evaluating a bidding contract, including a take-home comprehensive Contract Evaluation Toolkit.
- Legal advice and legal document templates for subcontracting and change of ownership.
- Dos, don’ts, and tips on marketing your competitive bidding contract or subcontracting agreement.
- In-depth legislative update on activity on Capitol Hill related to the effort to repeal competitive bidding, as well as other DME industry issues.
VGM and DME state association members will pay $229, while non-members will pay $279. To register, visit www.vgmNCBservices.com. For more information, contact the VGM National Competitive Bidding Services team at (800) 642-6065.
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