Moving the HME Industry Forward


Binding Bids Legislation Introduced in Senate

December 8, 2014

WASHINGTON, DC – Senators Rob Portman (R-Ohio) [pictured] and Ben Cardin (D-Md) have introduced the Medicare Competitive Bidding Improvement Act (MCBIA) of 2014—companion legislation to H.R. 4920. Much like the House bill introduced in June, the “short and simple” would help deter speculative bidding in Medicare contract auctions.

“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. AAHomecare is proud to support Senators Portman and Cardin as they fight to bring common sense to the Medicare bidding program. All HME providers and manufacturers should immediately visit to ask their elected Senators to support the bill.”

This legislation will make all bids binding and require proof of licensure for the next rounds of bidding. It addresses a major flaw in the program and deters speculative bidding without generating a cost. There are three main provisions in the bill:
Providers will need to prove licensure before they submit bids.
• Bidders would be required to obtain a bid bond.
• Bonds will be forfeited if the bidder declines the contract and his bid was at or below the bid price.

“Providing strong financial incentives for bidders to honor their bids, and having an outside third party financially vet bidders will significantly strengthen the Medicare bidding program,” said Cara Bachenheimer (pictured), senior vice president of government relations at Invacare Corp. “We are grateful to both Senators for their hard work on this important measure.”  

“Faced with the short lame duck session, the time is now for the home medical equipment community to unite behind this legislation,” said Robert Steedley, president of Barnes Healthcare Services Inc, and chairman of the AAHomecare Board of Directors. “Our national and state advocacy teams are pushing 24/7 to build support for this legislation, but Senators need to hear directly from constituents about why they should support this bill.”

“Binding bids are the most basic function of any auction,” added Jay Witter, senior vice president of government affairs at AAHomecare. “The House and Senate committees recognize this fact and are very supportive of eliminating speculative bidders.”

Click here to tell your elected official to support the Competitive Bidding Improvement Act of 2014. The American Association for Homecare (AAHomecare) last week submitted comments on how to alleviate the current backlog of appeals at the Administrative Law Judge (ALJ) level, in response to a request for information from the Office of Medicare Hearing and Appeals (OMHA).

AAHomecare presented recommendations to adjust current contractor and claims processes to prevent appeals from proceeding to the ALJ level, as well as comments on the statistical sampling and conference facilitation settlement options.  These suggestions have been presented in many forums to CMS, the contractors and to the Senate Finance Committee staff as part of a round table discussion that AAH was invited to participate in.

“We have a number of suggestions for OMHA on how to alleviate this burden on many HME suppliers, so we’re thankful for the opportunity to formally submit recommendations and also for the chances we’ve had to sit down with the staff here and discuss these solutions, like a timely filing exemption,” said Kim Brummett (pictured), vice president of regulatory affairs for AAHomecare. “We don’t have time to wait on this, while suppliers are collapsing under the weight of audit appeals and can’t run their businesses.”

The ALJ appeals backlog stands at approximately 900,000 appeals, with 14,000 new appeals coming in each week. Without additional resources, it will take 12.5 years to clear the backlog, assuming no new appeals are filed.