In shock: CMS seeks to not only spread bid rates but also bundle payments

WASHINGTON - Last week's proposal to expand competitive bidding nationwide was likely a rude awakening for HME providers who have been sitting on the sidelines thinking that the program wouldn't directly affect them, say stakeholders.

“Many folks thought it was going to crash and burn,” said John Gallagher, vice president of government relations for The VGM Group. “Folks that haven't been engaged better get engaged.”

Under the Affordable Care Act, CMS is required to either expand the bid program or apply bid rates to non-bid areas by 2016. In an advance notice of proposed rulemaking published Feb. 24, the agency seeks comments on developing a methodology to adjust rates in non-bid areas based on bid rates; and on bundling payments for certain DME, including complex rehab and enteral nutrition.

Stakeholders are particularly concerned about the prospect of bundled payments.

“Is their whole goal just to reduce payment levels, which is what you always suspect,” said Cara Bachenheimer, senior vice president of government relations for Invacare. “Are they looking for specific directions or just creative ways to change the payment methodology? There's not a sufficient amount of information.”

The bundled payments would include all related equipment, supplies and service. That would make for difficult business decisions for providers, say stakeholders.

“How do I know how long this person is going to need this equipment or how many supplies they will need,” said Denise Leard, an attorney with Brown & Fortunato.

Nothing in the proposal seems to address the underlying problems with the existing program, including lack of transparency and non-binding bids, say stakeholders.

“We're analyzing the proposal and the statute itself,” said Jay Witter, vice president of government affairs for AAHomecare. “We've got some concerns with the way it's written. We've already talked to members of Congress about it and we need to build as much pressure as possible.”