Stark Says He'll Try to Stop Competitive Bidding

WASHINGTON

At a May 6 hearing convened by the House Ways and Means Health Subcommittee, sentiment swung to HME as Chairman Fortney “Pete” Stark, D-Calif., said he would try to stop competitive bidding.

Calling the program “somewhere between flawed and lousy,” Stark said he was unsure if repeal legislation could pass this year — round one of the program is set to take effect July 1 in 10 initial MSAs — but added he would work with the industry to try to block competitive bidding despite the costs of ending the program.

The lead-off witness at the hearing was acting CMS Administrator Kerry Weems, who testified that “[competitive bidding] will reduce beneficiary out-of-pocket costs, improve the accuracy of Medicare's DMEPOS payments, help combat fraud and ensure beneficiary access to high quality DMEPOS items and services.”

But members of the subcommittee grilled Weems about problems with the program, including the disqualification of 63 percent of the bidders in round one, choosing median pricing rather than lowest pricing and not allowing willing providers to supply products at the lowest price.

Reps. Lloyd Doggett, D-Texas; Phil English, R-Pa.; Sam Johnson, R-Texas; Mike Thompson, D-Calif.; and Pat Tiberi, R-Ohio, all questioned Weems on a range of issues including fraud, transparency in the bidding process, inexperienced contract winners and accreditation, according to a report from the American Association for Homecare.

At one point, Rep. Xavier Becerra, D-Calif., pressed Weems on unaccredited subcontractors in the bidding program. While the acting CMS chief said the accreditation requirement applies only to contract suppliers, he also said it would be a “bad business decision” for a contract winner to enter into a relationship with a non-accredited company.

Becerra said subcontractors should be held responsible as well and highlighted the fact that those with no experience could be utilized. He also noted it seems counterintuitive to have competitive bidding yet limit the number of contractors, stating that a more open competitive process would ensure better prices.

But Weems' troubles really began when Stark asked how round one prices were set from the bids. As Weems explained how median prices were determined to be the best choice, Stark commented, “Sounds like you're price-setting to me. Sometimes you're bidding, sometimes you're not. It's at your convenience.”