• Q and A: Cramton goes behind the numbers

    From: HME News

    By Theresa Flaherty, Managing Editor

    BALTIMORE – Prof. Peter Cramton set the competitive bidding debate on fire earlier this month when he reported that the number of claims submitted for home medical equipment in Round 1 areas plunged in 2011. Cramton, an economist with the University of Maryland and an outspoken critic of the program, obtained the data through the Freedom of Information Act (FOIA). He spoke with HME News last week about some of his preliminary conclusions.
    HME News: Did you expect to see such a steep decline in claims in Round 1 bid areas?
    Peter Cramton: I would have expected some drop, but I am surprised it’s as large as it seems to be. The biggest explanation, as we learned from the auction outcome, is that the whole market was radically transformed, with the vast majority of providers being removed from the supplier list.
    HME: The data shows that there are claims being made by non-contract suppliers.
    Cramton: I suspect that is the grandfathering aspect. For most of the products, there was a period where (the beneficiaries) could continue with their existing supplier. That, to me, is cause for concern because grandfathering will end and when it does end, if they haven’t found a new supplier, that’s going to be a serious issue.
    HME: The data also shows an increase in negative health outcomes in bid areas vs. non-bid areas.
    Cramton: The point of that set of figures is to show that the sharp decline in claims, assuming that it isn’t all attributable to fraud–and I would be shocked if it was–is likely leading to a decline in utilization. The decline in utilization means there are more non-utilizers, which means there are more bad health outcomes. Those are all indicators that the program, rather than saving the taxpayers money, has a very real but hidden cost, which is that the cost simply falls in a different category within the Medicare system.
    HME: Why were complex rehab codes included? They weren’t in Round 1.
    Cramton: The FOIA request was just for the categories that were included under the program. I think what happened–I am not sure–is that some product codes within the standard and complex wheelchairs categories changed, and so it caused that anomaly.
    HME: Do you think CMS could spin this data to prove competitive bidding has resulted in a decline in fraud and abuse?
    Cramton: I don’t see how they could draw that conclusion. Driving down claims and driving out fraud is largely a separate issue. It’s not the auction itself that prevents fraud. I guess what they would argue is, absent competitive bidding, CMS was required to deal with a potentially unlimited number of suppliers that they didn’t really have the resources to check who is doing the right thing and who is not. I think it’s not so much the number of suppliers but rather the checks that you make to confirm that the services being provided are legitimate.
  • VGM Gets Clarification on Credit Report Score for Competitive Bidding

    From: VGM


    Posted on: January 24th, 2012 by Mark Higley

    Many HMEs have been expressing concern over recent fax receipts from third party consultants and others, which have been picked up by several state associations and distributed to their memberships.  The issue is in regard to whether the Round 2 potential bidding companies must have a credit report dated before January 30.  Somewhat directly stated — this is NOT true.  A detailed explanation follows below. 

    But first, here is an example of the releases distributed during the past several days:


  • Data from Round 1 show sharp decline in HME claims, and higher risks for death, hospitalization

    From: Home Care Magazine

    The American Association for Homecare reported last week that an analysis of data from Round 1 of the Competitive Bidding Program showed a sharp decline in claims for HME products in bidding areas. Data also showed a significant risk of death and hospitalization among Medicare beneficiaries not getting necessary home medical equipment.

    “The startling and dramatic numbers from Round One underscore the fact that the current competitive bidding program is dangerously flawed and must be stopped,” AAHomecare reported.

  • “Doc Fix” and Competitive Bidding

     From: Health Insider

  • Mergers and acquisitions: Will Round 2 make the big guys buy?

    From: HME News 

    By Theresa Flaherty, Managing Editor 

    YARMOUTH, Maine – Competitive bidding expands to an additional 91 competitive bidding areas in Round 2, but it’s too early to tell whether national providers have their eye on acquisitions in those markets, say analysts.   

    “We see them putting their feet in the water a little bit, but they’re not aggressively chasing opportunities,” said Rick Glass, president of Tarpon Springs, Fla.-based Steven Richards & Associates. “And it’s not necessarily in Round 2 areas vs. not in Round 2 areas. I think to a large extent, a lot of them view it as they’ll wind up getting the business anyway.”   

  • Bidding in Round Two? These are the codes that COUNT!

    From: VGM

    As I have explained numerous times in conversations with VGM members and in seminar sessions, of the almost 400 codes available in the nine categories only a handful of codes actually affect your overall composite bid.

    Simply stated, your composite bid compares you to your competitors that are also vying for a contract in your CBA.  Assuming other qualifications are met (e.g., financial, licensing, accreditation et al) the program is purely a mathematical function. 

  • Now Available: New Webcast for Round 2 and National Mail-Order Bidders

    From: CMS

    A new educational webcast for the Round 2 and national mail-order competitions of the Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program is now available on the Competitive Bidding Implementation Contractor (CBIC) website at www.DMECompetitiveBid.com. This webcast, titled Program Rules, explains important rules detailed in the Request for Bids (RFB) Instructions that you should understand before you prepare your bids. The webcast also provides resources to assist you with bidding.

  • Bid program to dominate conference

    From: HME News

    By Theresa Flaherty, Managing Editor

    ALEXANDRIA, Va. – The HME industry needs all hands on deck if it wants to be heard during this year’s AAHomecare Washington Legislative Conference, association officials say.

    “We can’t pass up an opportunity to make sure everybody knows what HME is about and why it’s important to preserve access to this type of care,” said Michael Reinemer, vice president of communications and policy. “Everyone else is here banging pots and pans and insisting their issues are the most important.”

  • Now Available: New Webcast for National Mail-Order Bidders

    From: CMS

    A new educational webcast for the national mail-order competition of the Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program is now available on the Competitive Bidding Implementation Contractor (CBIC) website at www.DMECompetitiveBid.com. This webcast, National Mail-Order Competition for Diabetic Supplies, covers rules that apply specifically to this competition and provides resources to assist you with bidding.

    This webcast is available on demand to view at your convenience – 24 hours a day, seven days a week. There is no charge to view the webcast, and a transcript is also posted on the website. To view the webcast, please go to the CBIC website, select Bidding Suppliers: Round 2 & National Mail-Order, and choose Education Events.

  • Bid program: Providers go through the motions

    From: HME News

    By Liz Beaulieu, Editor

    YARMOUTH, Maine – Their hearts aren’t really in it, but left with no choice, home medical equipment providers have set out to meet CMS’s timeline for Round 2 of competitive bidding.

    The first deadline: CMS “strongly encouraged” registering for Round 2 of competitive bidding by Dec. 22. Some providers were in less of a hurry than others.

    “We’ll do it first thing in 2012,” said Andy Simmons Jr., vice president of Cornerstone Medical in Atlanta. “We figured we’d let everyone else get past this imaginary target date and then we’d get in.”