Ramifications of Medicare's Competitive Bidding for Durable Medical Equipment

I work for a durable medical equipment company who specializes in wheelchairs. In the past when a patient has come to us with a prescription from their doctor for a manual or power wheelchair we would evaluate them for the best type of wheelchair to meet their needs based on their diagnosis, lifestyle and home environment. We would make our recommendation and order the wheelchair if the patient was in agreement.

How we were paid was based on Medicare's allowable. Every wheelchair has a code assigned to it and Medicare has an allowable amount to be paid for each code. Medicare paid 80% of the allowable and the patient was responsible for the co-pay of 20% unless they had secondary insurance. This worked well and patients received the best equipment to meet their needs and all durable medical equipment providers were paid the same allowable so patients could use whoever they preferred.

The allowable Medicare pays is already lower than almost all other insurance companies. Medicare guidelines for providers to follow in order to get the patient a wheelchair has become a long and tedious process as they have changed the documentation requirements. The burden of proof that the patient actually needs the equipment provided has basically fallen to the provider. No matter what the doctor has ordered providers must have medical exam notes, progress notes and other documentation to prove medical necessity for equipment.

Now Medicare has implemented a new program of competitive bidding. This program was implemented to save the government money. Competitive bidding allows Medicare to award contracts to suppliers with the lowest bid. Now I am all for saving the government money and I hate to see money spent unwisely. However, competitive bidding is not the answer.

How does this affect you?

More than half of Medicare's DME providers are expected to go out of business under this program.

Patients will have little choice of who provides their equipment. Consumer choice is reduced or eliminated. Patients will have to go with Medicare's winning bidder.

Patients will in most cases receive the lowest-cost equipment instead of what is appropriate for them and their diagnosis.

Competitive bidding effectively eliminates free market competition that encouraged high quality care for patients.

Elderly patients should not be required to submit to the services of the lowest bidder to Medicare. With competitive bidding Medicare, not seniors, will decide which providers seniors are allowed to purchase any equipment they need from. How can it be beneficial for seniors to lose freedom of choice? Everyone deserves the right to pick their own health care providers.