Sunday, March 31, 2002

How do you spell disaster?

Q. Is the President's proposal for competitive bidding anything to worry about? Is Florida Medicaid's proposal a concern?

A. My concerns about competitive bidding continue to grow. The President's proposal for nationwide competitive bidding for DME has engendered significant interest on Capitol Hill. The staffs of the Ways & Means Committee and the Commerce Committee in the House are delving into this subject, and Senator Bob Graham (D-Fla.) continues to be an advocate for a nationwide system.

On top of this, the state of Florida's Agency for Health Care Administration (AHCA) has issued a request for proposal (RFP) to implement statewide competitive bidding for hospital beds and respiratory equipment and supplies. The Florida competitive bidding project would award one supplier a winning contract for each of the 11 regions in the state. Winning bidders will sign a three-year contract and must post a performance and payment bond in addition to a bond required with every proposal. The 72-page RFP is extremely detailed and confusing. Completing it is extremely burdensome.

There is no question that states are feeling a financial squeeze at the moment, and they are looking for what they think will be quick savings in the Medicaid program. Draconian measures such as that taken by Florida, however, will create administrative nightmares, eliminate choice for Medicare beneficiaries, and inevitably lead to a diminution in the quality of care. Competitive bidding sounds like apple pie and motherhood. Unfortunately, it will spell disaster for many businesses and Medicare beneficiaries.

It is critical that all of us in the HME industry reach out to policymakers at the federal , state and local levels and teach them that there are very serious problems here.
Tom Connaughton is CEO of AAHomecare. Reach him at (703) 836-6730.