The Centers for Medicare & Medicaid Services (CMS) has just announced the 70 new areas across the nation that will be part of the second phase of a competitive bidding program designed to help lower Medicare beneficiaries' out-of-pocket costs and improve their access to certain high quality durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS). Ten geographic areas are currently participating in the initial program aimed at providing greater beneficiary access to certain DMEPOS, including standard and complex power wheelchairs, walkers, oxygen supplies and equipment, hospital beds and certain devices.

This expanded program also enables federal officials to prevent unscrupulous suppliers from participating in Medicare. Additionally, once the competitive bidding program is fully implemented nationally, it is expected to save beneficiaries and Medicare $1 billion annually.

"Competitive bidding means that Medicare beneficiaries will have access to these products at substantially lower costs," said CMS Acting Administrator Kerry Weems. "Since all successful bidders will be required to meet quality standards and be accredited by Medicare, people with Medicare in these 70 new areas can be assured of access, low prices and high quality. Through this accreditation process, our beneficiaries are also provided another layer of protection from fraud."
Industry Opposition
While everyone wants to weed out fraud from the system, the home care medical equipment industry has taken the government to task for some of its policies. Concerns include a too-slow adoption of accreditation standards and underestimation of the true costs of equipment and service provision. For example the American Association for Homecare reports that fair market value for oxygen tanks should not be based solely on Internet equipment pricing since patients (many elderly with COPD) also receive important oxygen therapy services from providers. Also, the association estimates that home care medical equipment represents less than 2 percent of Medicare's $400 billion budget.

Another trade group, the Advanced Medical Technology Association has also voiced opposition. "We are deeply concerned that CMS is expanding a program before the first phase has started and the impact on beneficiaries' access to supplies has been evaluated," said Stephen J. Ubl, president and CEO of AdvaMed. "It is not in patients' best interests to further limit the number of DME suppliers. Doing so threatens patient access to important products, which can often mean the difference between a patient being able to remain in their own home and being forced into a nursing home or hospital. Competitive acquisition also hinders the ability of small manufacturers to supply these innovative and unique technologies." He urged CMS to postpone the expansion of the program.

More Industry Headlines