CMS expands competitive bidding program

The Centers for Medicare & Medicaid Services (CMS) has announced that 70 new areas across the country will be part of the second phase of a competitive bidding program.

CMS believes the expanded program “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.”

Stephen J. Ubl, president and CEO of AdvaMed, said that 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.”

Under the competitive bidding program, CMS said suppliers that wish to offer certain items and services to people with Medicare will have to submit bids to CMS, indicating the prices at which they are willing to supply these items to beneficiaries – prices that CMS believes will be closer to the prices charged in the current market. Currently Medicare – and beneficiaries – pay for items based on a fee schedule that, in general, is based on the average payments Medicare has paid for DMEPOS items in the past. 

Ubl said the company urges “CMS to postpone expansion of the program until it fully evaluates the impact of requiring DME suppliers to compete primarily on price, which might mean patients are denied the most appropriate treatment and, in the longer term, may discourage investment in new, superior products.”

Suppliers that want to participate in this second phase of the competitive bidding program will have to be accredited well in advance of that deadline to be awarded a contract with CMS. “I cannot stress enough the importance for all Part B DMEPOS suppliers to apply for accreditation early, and not wait until Sept. 30, 2009,” Weems said.