In a move designed to reduce out-of-pocket expenses for beneficiaries and save the money for the Medicare program, the Centers for Medicare and Medicaid Services (CMS) is seeking to open up bidding for durable medical equipment.
From the press release:
“We intend to implement these DME competitive reforms to get savings for beneficiaries and taxpayers, while maintaining and improving quality,” said CMS Administrator Mark B. McClellan, M.D., Ph.D. “This is another way in which Medicare is now using competition to bring lower-cost, up-to-date care to our beneficiaries.”
The new competitive acquisition program, which is required by the Medicare Modernization Act of 2003 (MMA), would replace the current DMEPOS fee schedule payment amounts for selected items in select areas.
Medical News Today links to a number of reactions. For instance, the Washington Post provides a decent analysis. Also see the Kaiser Network’s comments. The American Association for Homecare doesn’t like the proposed rule, citing concerns about reduced patient choice and the effect on small long term providers.
I believe opening up the process to competition will help lower costs because it will force companies to improve products and offer them at affordable prices. Tom Ryan, AAHomecare Chair and CEO of Homecare Concepts, would disagree with my assessment. He says:
“The reality is some durable medical equipment items have already been set by the government at a price below what the market would set. If a provider cannot bid above a mandated below-market fee ceiling, how does that accomplish the wonders that CMS advertises, which is to ‘harness marketplace dynamics to create incentives for suppliers to provide quality items’? The touted cost savings and market-driven benefits of this restrictive contracting program are unrealistic.”
If you’re a provider and regular reader, I’d like to know what you think about the proposed rules.
