CMS Set To Announce Round-One DME Contract Suppliers

The following is from Inside Health Policy and was also posted on the CRE Website.

CMS may announce as early as Friday (Oct. 29) the contract suppliers for the first round of the durable medical equipment competitive bidding program, industry sources say, though other insiders suggest it “may slide” until next week and CMS would not confirm the date. A CMS e-mail to industry states that the agency is holding a Nov. 8 call with medical equipment suppliers who did not win contracts under the first round of the competitive bidding program for durable medical equipment (DME), which is an indication that CMS does not plan to postpone the round-one bid start date, sources say — even though several lawmakers are questioning the program’s design, and one House Democrat is calling for a delay to the first round.

“Please hold the date for a national provider education call on the Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program,” the CMS e-mail to providers states. “The target audience for this call is DMEPOS suppliers that will not be contract suppliers in the program. The call will take place on Mon Nov 8, from 2pm to 3:30pm EST, and more details (including registration instructions) will be shared in the days to come.”

The agency likely would not schedule that “losing bidder” call if it were not on the verge of announcing the winning bidders, sources say. The winning bidder announcement is “forthcoming,” a CMS spokesperson stated in an e-mail, “so we had to begin notifying suppliers to schedule
for a meeting.”

CMS is more than a month late in announcing the winning bidders in round one. Some say it will soon be too late to educate DME suppliers and Medicare beneficiaries of changes to the program that take effect Jan. 1, but announcing winners on Friday would leave two months for outreach, which an industry lobbyist says suffices. CMS said it delayed the announcement because of program-integrity concerns, though it declined to elaborate.

Lawmakers from both parties are demanding that CMS say whether it plans to change the design of the bidding program. House Ways and Means health subcommittee Chair Pete Stark (D-CA) was the first to lean on the agency after a group of more than 160 independent economists, computer scientists and operation researchers signed a letter outlining what they consider serious flaws in the design of the bidding process. That letter has since been forwarded to CMS by at least four other lawmakers: Reps. Bruce Braley (D-IA) and Patrick Tiberi (R-OH) and Sens. George Voinovich (R-OH), Robert Casey (D-PA).

Braley was the only lawmaker to actually call for a delay of the round-one bid. “CMS should delay implementation of Round 1 of the bid program until a bid program is crafted that is consistent with Congress’ expectations, and consistent with the parameters detailed by leading experts in the field,” according to his letter.

Various polls and pundits predict that the Republicans will regain control of the House this midterm election, but a GOP aide said it is unlikely that Republicans would repeal the competitive bidding program because they would have to find $20 billion to pay for the lost savings that the Congressional Budget Office has projected. There is bipartisan support for a bill by Rep. Kendrick Meek (D- FL) to repeal the program, but the aide said opposition to the program has less to do with party affiliation and more to do with whether lawmakers have many DME suppliers in their districts.

As for delaying the program, a DME supplier says CMS has been telling beneficiaries that the new program starts on Jan. 1 and changing that date would be confusing. Also, a separate lobbyist said postponing the program would violate the round-one contracts, which would mean that CMS would have to go back and get suppliers to sign a second time. Some of those suppliers might get cold feet, the source says, as there have been rumors that CMS is having a difficult time getting some suppliers to participate in the program. However, another industry source says companies have put a lot of thought into their decisions to participate and it is doubtful that companies would sign contracts the first time, then balk were the program postponed. –John Wilkerson, 10/28/10