BALTIMORE--Earlier this afternoon, the Centers for Medicare and Medicaid Services released the names of the winning contract suppliers for round one of competitive bidding, set to take effect July 1.

In a 2 p.m. press briefing with reporters, acting CMS Administrator Kerry Weems said 325 medical equipment suppliers have signed contracts in the 10 competitive bidding areas selected for rollout of the program.

For a list of the round one winners, click here. Under "Search Tools" select "Find Suppliers of Medical Equipment in Your Area."

"Each and every one of these suppliers met quality customer service and financial standards. In fact, we conducted announced and unannounced audits and site visits so they could prove that they met those standards," Weems said.

Of 1,005 suppliers who submitted 6,200 bids in round one, Weems said, "We offered contracts to 23 percent of the suppliers that submitted bids. These were in the winning range and met the quality and financial standards and discosure requirements.

"Sixty-one percent of the bids submitted were priced higher than the winnning range, and just over half of these high-priced submissions were disqualified because they failed to meet other requirements," Weems continued, adding that the remaining 16 percent of bids would have been in the winning range had they not been disqualified.

Weems also said based on the final contracts, about half of the winning suppliers in each bid area are small suppliers

. "We're confident that they have enough capacity to meet these needs, especially when you put the volume of sales and rentals of competitive bid items into proper perspective," Weems said.

As an example, Weems said in the Dallas CBA, Medicare pays for an average 770 walkers each month. That means of 20 suppliers who won contracts in the CBA, each would be selling about 38 walkers a month.

"In Pittsburgh, there will be 15 suppliers who will be furnishing hospital beds," Weems said. "Medicare currently pays monthly rentals on about 1,300 beds, which is about 89 beds to be furnished by each supplier, on average."

When questioned about companies being awarded contracts without having provided services in the bidding areas, Weems said: "Look at the suppliers on the Web site. Suppliers in those areas in many, many cases have multiple locations in those areas. Ninety percent of suppliers are in the area in which they bid."

Weems also announced an extension of the accreditation application deadline for round two. "This is because a significant number of suppliers in those communities have not yet applied for accreditation," he said.

Under the new deadline, suppliers now must be accredited or have applied for accredreditation by July 21, 2008, to participate in the second round bid. The previous deadline was May 14, 2008.

"We also want to let you know today that we're announcing a new policy for complex rehab power wheelchairs that will allow us to pay non-contract suppliers in certain conditions," Weems said. "Those circumstances are when a power wheelchair was prescribed by a physician before the competitive bid began but the delivery of the item was not made until July 1 or after."

According to Weems, the agency is now beginning "the steps necessary to educate and inform beneficiaries and their providers about their options so they will be able to get the most out of this new program ...

"We have a whole ground game we are going to be rolling out in the next couple of weeks," Weems said, in which "every provider, every prescribing physician and every beneficiary" in the bidding areas would be contacted about the program.

"We understand that the implementation of this program will be difficult for some providers because the law requires that there be both winning and losing bidders," he said. "While winning suppliers must accept lower prices, these amounts are based on their bids, and they have the opportunity to increase the number of beneficiaries they serve.

"We also know there's been a frustration because the new system represents a significant change in how suppliers operate under Medicare compared to the past. CMS will continue to work closely with suppliers and make improvements in the program as we move forward," Weems continued.

"Keeping this program on track and on time to bring high quality products to people with Medicare with lower prices is a priority for CMS," he concluded.

Indeed, in answer to a question on whether he anticipated any delays in the program, Weems responded, "No. We're proceeding."

However, since a May 6 congressional hearing into the program that aired a number of problems with the bidding process, the industry's efforts to delay round one--and to stop the program entirely--have picked up steam. And last week, three California representatives called on Health and Human Services Secretary Michael Leavitt to conduct a full investigation into questionable bidding practices in the Riverside CBA.

Immediately following the press conference, the American Association for Homecare issued a response, noting that "CMS continued to tout the benefits of the competitive bidding program although the home care community and Congress have revealed numerous flaws in the program including threats to services, quality, and unfair treatment of bidding providers."

AAHomecare said a Wasington lobbying fly-in scheduled Wednesday "is an important opportunity to combat competitive bidding at a critical juncture." The association said more than 150 home care providers have registered so far to participate but "there is room for many more."

For information on the AAHomecare event, visit www.aahomecare.org. A CMS press release on the round one winners follows in its entirety.