Washington, D.C. – U.S. Senators Ben Cardin (D-Md.) and Rob Portman (R-Ohio), both members of the Senate Finance Committee, and Reps John Larson (D-CT-01), and Pat Tiberi (R-OH-12), both members of the House Ways and Means Committee, have introduced joint legislation to protect seniors and those who rely on durable medical equipment, prosthetic and orthotic devices, and supplies from predatory business practices.
The Medicare Competitive Bidding Improvement Act (MCBIA), S.148, would ensure a fair competitive bidding program by disallowing intentional low-ball bidding for Centers for Medicare and Medicaid Services (CMS) contracts.
“Good governance and good business practices are both founded on transparency. Our bill would increase transparency in CMS bidding to help those reliant on affordable medical supplies as well as the small business that supply them,” said Cardin. “This is commonsense, bipartisan legislation to help better serve the American people.”
“It’s important that we’re taking steps to ensure seniors have access to the medical supplies they rely on,” said Portman. “This commonsense legislation will increase transparency and fairness in the bidding process, promote competition, and ensure that seniors have increased access to quality medical supplies.”
“The bidding process for medical supplies must reflect the needs of seniors and the disabled. A fair bidding process will improve both access and quality of medical equipment that Medicare beneficiaries across the nation depend on. I am pleased to join my colleagues in reintroducing this commonsense legislation and remain committed to improving access and quality of healthcare for the American people,” said Larson.
“Right now, suicide bids have plagued the DME bid process. These are bids some suppliers propose without the capability to actually supply the products if offered a contract. These bids contribute to unsustainable lower overall rates calculated to reimburse those suppliers who do provide products. For example, during the last bidding round 10 percent of bidders who were offered contracts didn’t accept them, but CMS included these abandoned bids in the bid rate calculation. This contributed to reimbursement reductions of 45 percent on average for suppliers, hurting small businesses and limiting access to necessary supplies for Medicare beneficiaries,” said Tiberi. “Requiring binding bids would insert accountability into the bid process, help seniors access high-quality equipment and services, and improve health outcomes.”
“Because of loopholes in the Medicare bidding process, speculative bidders were allowed to game the system,” said Tom Ryan, president and CEO of AAHomecare. “This bill will help restore accountability, alleviate artificially low prices and deter unlicensed providers.”
Currently, supplier bids are non-binding, meaning if CMS offers a contract to a bidder, that bidder can accept or reject that contract. Non-binding bids can encourage low-ball bids because suppliers know they are not required to supply the products at those bid levels and are only bidding to participate in the program. The Medicare Competitive Bidding Improvement Act would make supplier bids binding, thereby increasing transparency and ensuring reliable and equitable pricing. This legislation would help ensure that suppliers submit bids in good faith, increase competition, and would create more certainty for suppliers and for consumers, giving them increased access to more quality products and services. An identical version was introduced last Congress.
Michael Bennet (D-Colo.), Bob Casey (D-Pa.), and Sens. John Hoeven (R-N.D.), are original cosponsors. Text of the bill can be found here.