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Montana Home Medical Equipment Providers Push to Repeal Medicare Bidding Program, Back Congressional Bill to End Controversial Program

MISSOULA, Mont., May 18, 2011 /PRNewswire-USNewswire/ -- Montana home medical equipment and services (HME) providers are calling for the repeal of Medicare's "competitive" bidding program for home medical equipment and services. Montana homecare providers have banded together to support H.R. 1041, a bi-partisan bill in the House that would repeal competitive bidding, and they are meeting with Montana Senators to push for the introduction of a similar bill in the Senate.

"The competitive bidding program jeopardizes the health of Medicare patients by limiting their access to potentially life-saving products and services," said Mike Calcaterra, Big Sky Association of Home Medical Equipment Suppliers state chairman. "Five providers that we know of have already closed their doors due to Medicare cuts and programs. This number will grow if competitive bidding reaches our state. When these businesses close, Medicare patients will face further disruptions in services that will compromise their access to quality care."

The bidding program affects millions of Medicare beneficiaries nationwide who require oxygen therapy, enteral nutrients (tube feeding), continuous positive air pressure (CPAP) and respiratory assistive devices, power wheelchairs, walkers, hospital beds and support surfaces, and mail-order diabetic supplies.  The program was implemented on January 1 in nine metropolitan areas and it begins in an additional 91 areas later this year. The first nine areas are Charlotte, Cincinnati, Cleveland, Dallas-Fort Worth, Kansas City, Miami, Orlando, Pittsburgh, and Riverside, California.

"Homecare has always been a cost-effective means of delivering care to seniors and patients," said Calcaterra. "But the government is overlooking the fact that homecare is less expensive than hospital visits and nursing home stays. The 'competitive' bidding program is being marketed as a cost-savings tool, when in reality the only thing it will do is cost seniors and patients their health, and taxpayers more money in the long run to pay for increased hospitalizations. We cannot chance the well-being of America's seniors for political play."

The bill to repeal the bidding program, H.R. 1041, has 98 cosponsors so far in the House of Representatives with broad support from both Republicans and Democrats. Homecare providers in Montana are also meeting with Senators Max Baucus and Jon Tester's staffs to discuss the need for a similar bill to repeal competitive bidding in Senate.  


A number of patient advocacy and consumer groups also support H.R. 1041 including the ALS Association, the Brain Injury Association of America, the Christopher and Dana Reeve Foundation, the International Ventilator Users Network, the Muscular Dystrophy Association, National Emphysema and COPD Association, the National Council on Independent Living, the National Spinal Cord Injury Association, and United Spinal Association, among others.  

The legislation to repeal the bidding program was introduced after hundreds of patients and providers reported problems with the program since its January 1 implementation.  By design, the bidding program severely restricts the number of companies that are allowed to provide the equipment and services subject to bidding.  Since the bidding program began on January 1, patients, clinicians, and homecare providers have reported:

  • Difficulty finding a local equipment or service provider;
  • Delays in obtaining medically required equipment and services;
  • Longer than necessary hospital stays due to trouble discharging patients to home-based care;
  • Far fewer choices for patients when selecting equipment or providers;
  • Reduced quality; and
  • Confusing or incorrect information provided by Medicare.

In January, the American Association for Homecare shared with Medicare a number of problems and concerns related to the bidding program including:

  • Medicare awarded contracts to companies that are bankrupt.
  • Medicare awarded contracts to companies that are not licensed to provide the specific medical items or services.  
  • Medicare awarded contracts to companies with serious credit problems.
  • Medicare distributed incorrect information about the contract winners.

In a November 2010 letter, 167 leading economists and auction experts, including two Nobel laureates, warned Congress that Medicare's bidding design for medical equipment will fail. Those experts found that the bidding program designed by the Centers for Medicare and Medicaid Services (CMS) has irreparable flaws that will prevent it from achieving its objectives of low cost and high quality equipment and services. Under the CMS-designed system, the bidding companies are not bound by their bids, which undermines the credibility of the process and encourages "low-ball" bids that create an unsustainable process and threaten the long-term viability of the program.  

Ultimately, the experts told Congress, the bid design provides "strong incentives to distort bids away from [actual] costs," and lacks transparency, which is "unacceptable in a government auction and is in sharp contrast to well-run government auctions." The experts' letters conclude, "This collection of problems suggests that the program over time may degenerate into a 'race to the bottom' in which suppliers become increasingly unreliable, product and service quality deteriorates, and supply shortages become common. Contract enforcement would become increasingly difficult and fraud and abuse would grow... Implementation of the current design will result in a failed government program."

Big Sky Association of Home Medical Equipment Suppliers is dedicated to promoting ethical and professional home medical services to the patients of Idaho and Montana. Our members adhere to strict professional practices to provide the highest quality services available. Visit

SOURCE Big Sky Association of Home Medical Equipment Suppliers
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