MedPAC Report Suggests Adding Products to Bidding

Despite CMS’s acknowledgement of competitive bidding problems in its IFR, annual report to Congress doubles-down on program by suggesting additional products.

 The Medicare Payment Advisory Commission’s (MedPAC) recently released annual report to Congress, and the American Association for Homecare has characterized it as “another missed opportunity” when it comes to addressing the problems with Medicare’s competitive bidding program and the expansion of bidding-derived rates to rural and non-bid areas.

In the document, "Report to Congress: Medicare & the Health Care Delivery System" (available at, MedPAC’s primary solutions for improving any possible problems with competitive bidding are to expand the program by adding more products and to cut reimbursement rates for non-participating providers.

Chapter Six of the report, available at, details MedPAC’s suggestions for expanding the competitive bidding program with tables of codes that focus on the 25 non-competitively bid products on which Medicare spends the most.

“Medicare’s bidding program for DME and the expanded use of bidding-derived pricing beyond the original scope of the program continues to be a bad deal for both patients and suppliers,” said Tom Ryan, president and CEO of AAHomecare. “Instead of examining ways to improve the bidding program and putting patient access to DME on a sustainable footing going forward, MedPAC is suggesting adding even more products into the flawed program and further stressing an industry already working under razor-thin or negative margins on many products under competitive bidding.

“In addition, MedPAC suggestion to cut reimbursement rates for non-participating suppliers, even as they acknowledge that DME assignment rates remain high, is a solution in search of a problem,” he continued. “To suggest taking away the flexibility that billing non-assigned provides for both suppliers and patients without any data to support that idea should be a non-starter for policymakers.”

Ryan added that MedPAC’s ignored CMS’s recently released Interim Final Rule which acknowledged that both providers and beneficiaries are facing challenges due to bid expansion. The IFR noted that there has been a 7 percent decrease in the number of DEMPOS suppliers from 2015 to 2016. A review of the IFR by AAHomecare cited several passages from the IFR in which CMS acknowledges that its monitoring of claims data doesn’t alert the agency to “present and imminent threats to beneficiary access that stakeholders have raised in recent months.”

“If CMS continues to pay the fully adjusted payment rates in rural and non-contiguous areas, it could further jeopardize the infrastructure of suppliers that beneficiaries rely on for access to necessary items and services in remote areas of the country,” the IFR reads. “… We recognize that reduced access to DME may put beneficiaries at risk of poor health outcomes or increase the length of hospital stays.”

“Perhaps MedPAC would benefit by taking a closer look at CMS’ recently released Interim Final Rule (IFR) related to DME for inspiration on the issues that need more serious scrutiny,” Ryan said. “… Instead of doubling down on a flawed bidding program, addressing these real concerns needs to be the focus for regulators and Congress to put Medicare reimbursement policy for DME on a sustainable path going forward.”

About the Author

David Kopf is the Executive Editor of HME Business and DME Pharmacy magazine. Follow him on Twitter at @postacutenews.



Fri, Jun 22, 2018

Expanding the flawed bid program will hurt Medicare beneficiaries and suppliers and there suppliers so who does that leave that it helps

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