Competitive bidding: 'Everybody's in panic mode'

WASHINGTON - Although it's too soon to gauge how many providers accepted initial contracts for Round 2 of competitive bidding, stakeholders say it's likely that those who did, did so out of fear.

“I am hearing a lot of people saying, 'There's no way I can do this,' but I think a lot of 'no's' turn into 'yesses,'” said John Gallagher, vice president of government relations for the VGM Group. “They are accepting out of fear, but I understand. If you've got a contract in hand, what are you going to do?”

The deadline for accepting contracts was Feb. 12. CMS announced the Round 2 payments, with an average cut of 45%, on Jan. 30.

While it's understandable that providers felt they had no choice but to accept contracts, it certainly doesn't help make the industry's case against the program, say stakeholders.

“The question being asked of us is, 'You guys bid and set the prices, what's the problem?'” said Wayne Stanfield, president and CEO of NAIMES. “How do you combat that, when people not only bid low, but they are signing contracts with these ridiculous fees?”

NAIMES has posted an informal, anonymous survey to see how many contracts have been accepted.

Still, the industry should take heart that a growing clamor from providers and beneficiaries is catching the attention of lawmakers, say stakeholders.

“I am getting calls from the Hill asking us for meetings about (Round 2 pricing),” said Jay Witter, senior director of government affairs for AAHomecare. “That's a change. The announcement was the catalyst; everybody's in panic mode. I don't see that slowing down.”

AAHomecare and others continue to work with Rep. Tom Price, R.-Ga., on the market-pricing program (MPP), which Price has agreed to reintroduce. A big hurdle: It calls for Round 2 payments to remain in place until MPP can be implemented.

“The cut has thrown a wrench, but as much as people don't want to hear it, the political reality is if we don't have a budget neutral package, there's no legislative opportunity,” said Cara Bachenheimer, senior vice president of government relations for Invacare.

One thing all stakeholders agree on: Everyone needs to keep up the pressure. Lawmakers are back in their home districts the week of Feb. 18, a good opportunity for providers to meet face-to-face with their members and educate them about competitive bidding. Next week, lobbying events are planned, including a Washington Fly-In Feb. 26 and 27, which will coincide with a Virtual Fly-In: Shutdown the Switchboard, coordinated by NAIMES and The VGM Group. For more information call 877-4dmehelp or visit www.vgm.com.