CHAINED CPI | ||||
| Dear Member, Last week, Social Security Works members made a huge impact on the discussion over the so-called Chained CPI. You held “human chain” rallies in 50 cities across the country and sent over 108,000 emails to members of Congress. Your voices are being heard and momentum is building! Please donate today to keep the pressure on members of Congress who are yet to join our movement opposing the Chained CPI. Social Security is the most successful anti-poverty program in the history of the United States and has not contributed one nickel to the deficit. Yet opponents continue to call for unnecessary cuts through a chained consumer price index or Chained CPI. This would mean if you’re 65 years old today, you would lose more than $650 a year when you reach 75 and more than $1,000 a year when you reach 85. That might not sound like a lot to a member of Congress or a corporate CEO, but if you’re living on $17,000 a year, taking a $1,000 cut is significant. Please support Social Security Works in demanding members of Congress stand with the people and not Big Business and Wall Street CEOs. Donate today to keep the pressure on. July is going to be critical in our fight to preserve our earned benefits, and with your continued support we’re ensuring our voices are being heard in the halls of Congress and in towns and cities across the country. Thank you, Michael Phelan Social Security Works P.S. Your continued support is allowing Social Security Works and our members to change the discussion in Washington away from one of benefit cuts, but much more needs to be done. Please donate $3 today to keep fighting. | ||||
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You are making a difference and the media is beginning to take notice. Yesterday in Des Moines, IA, at a meeting with Senator Tom Harkin (D-IA), the local NBC affiliate highlighted who we are fighting for:
"Near the end of the event Sheryl Tenicat, of Des Moines, told her story through tears. “$624 a month. That’s what I live on. $99 of that goes to my Medicare Part ‘A’ and ‘B’. After I get my check in two weeks, it’s gone. I have nothing. I live on what I eat here [at the senior center]. I don’t want my cost of living cut because I’ve paid in since I was 16..."
"Harkin hosted the event with a number of Democratic-friendly groups, including the Iowa Alliance for Retired Americans, Progress Iowa, The Progressive Change Campaign Committee, Democracy For America, MoveOn.org, Social Security Works, and Credo Action."
Sheryl's situation shows exactly why we are fighting alongside Senator Harkin to expand Social Security. Please ensure the momentum we built in July only gets stronger while our elected officials are home in August.Click here to hear Sheryl in her own words and to donate to Social Security Works today. Together we are demanding that our elected officials expand, not cut Social Security. Thank you, Michael Phelan Social Security Works ============================================================= | ||||
15 Questions To CBIC
From an Accredited Medicare DME Provider
Congress mandated the Competitive Bidding Program through the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA). The goal is to improve the efficiency of the Medicare process by which payment amounts are calculated. This will reduce the out-of-pocket expenses for beneficiaries while saving the Medicare program money. The statute requires that the current Medicare Fee Schedule Calculation Process for select Durable Medical Equipment (DME) be replaced with a competitive bid system.
The system creates a competition among providers who currently operate or are attempting to operate in a particular competitive bidding area (CBA). Each Provider submits a bid in selected CBAs for selected DME products. Bids are then evaluated and Contracts are awarded to Suppliers offering the best price although the details of the criteria for the selection process are not transparent.
On April 10th an Accredited Medicare Provider located in North Carolina sat down in front of a computer and visited the Centers for Medicare and Medicaid Services (CMS) website, typed in a Raleigh North Carolina zip code, and analyzed the Competitive bidding winners.
They found several interesting facts:
- 75% of bid winners (composite of all bid categories) are located more than 50 to 2,826 miles away, to include providers in SC, VA, PA, GA, AL, FL, TX, MN, UT, NY, and CA.
- The average distance for a CPAP provider is 448 miles away – half are over 400 miles away
- When choosing multiple categories, there was only one provider that could provide those multiple categories within 115 miles
The questions the Provider Raised to CBIC were as follows:
1) How can bids and their related capacities from suppliers located such long distances from the CBA's be included in determining the median bid?
2) If your answer is "sub-contractors" (which will be difficult if not impossible to establish given the low reimbursement rates), how is Medicare verifying that these suppliers are establishing the necessary presence by July 1, 2013?
3) If the majority of these "remote" bid winners fail to establish a CBA presence as expected, how is Medicare verifying that those with a presence can handle the demand?
4) Competitive Bid eliminates 90% of CBA home medical equipment suppliers, yet Medicare spokesman Jonathan Blum insists that this program assures local access. How is that possible with only 25% of award winners being within 50 miles? Can you name any other industry that could sustain a steady supply chain under these conditions? Can you imagine what would happen if 90% of all grocery stores were closed, and the remaining 10% (many of which are hundreds of miles away) were forced to reduce their prices 45% to 72%?
5) It is now confirmed that many providers have no physical presence in dozens of CBA's in which they were awarded contracts. They have little to no possibility of establishing such a presence in just a few months, and have put their companies up for sale. Merger & Acquisition experts / analysts agree that it will be difficult at best to sell these businesses, as the new payment schedules are largely unprofitable. How will beneficiaries receive the equipment that they need under this scenario?
6) The Prior Approval demonstration project (part of CB) for power mobility devices now has a rejection rate of 80% nationally. DME claims are denied at the rate of 85%. An entire industry exists just to try to educate providers on how to navigate Medicare's complex rules and documentation requirements, yet the failure rates remain off-the-charts. Frustrated physicians are increasingly refusing to complete the documentation necessary for power mobility, and patients aren't receiving the equipment that they need. Does CMS consider 80% – 85% failure rates acceptable? Has CMS considered that given an entire industry's failure, that its requirements are excessively complex?
7) An independent accounting firm (Hogan, Hanson) contacted Medicare regarding Competitive Bid, asking two questions: 1) if a particular type of medical equipment (walker, hospital bed, wheelchair, etc.) is subject to competitive bid and 2) if a particular zip code is in a Competitive Bid zone. The wrong answers were provided 96% and 98% respectively. Was this merely incompetence, or a deliberate attempt to mislead the public?
8) Industry analysts and stakeholders agree that if Competitive Bid continues to move forward, as many as 85% of the nation's home healthcare equipment providers will close their doors. The results of Round 1 support this projection, and over 200+ leading economists and auction experts agree that this program is unsustainable. On what basis do you ignore these projections and put access to quality healthcare equipment and services to America
9) Firms that were awarded contracts are about to realize substantial sales increases to their businesses. Are you aware of any company that was awarded a contract that is NOT trying to stop Competitive Bid? Why would a company that was just awarded a large contract NOT be fighting to keep Competitive Bid in place?
10) Why does Medicare refuse to disclose its financial review criteria for award winners? Can you please explain how a tiny DME Provider which has one small location next to a liquor store in Hollywood, FL, 3 employees, and a high credit limit of $8,000, could be awarded contracts for 8 CBA's in FL? Could their inability to supply the capacity Medicare assigned to them (and won't disclose) be the reason that they are trying to sell their business?
11) CMS touts Competitive Bid's significant savings to DME expenditures (less than 2% of CMS spending). Has CMS considered that these savings will result in even higher expenditures in other areas, e.g. emergency room visits, hospital stays, and assisted living facilities? Keeping people in their homes is the most cost effective solution – do you not see significant risk of beneficiaries being forced from their homes due to restricted access to home healthcare equipment and services?
12) If a provider outside a CBA is competing for a cash sale with a provider who was awarded a contract, and the customer is located outside the bid zone, the non-contract provider is excluded from being able to compete even outside the CBA. By Medicare rules, the contracted supplier can sell the product 45% below the non-contracted supplier, who cannot sell below the Medicare allowable outside a CBA. With a cash sale, there are virtually hundreds of dollars in cost savings in the form of documentation, claim filing, appeals, and audits versus selling through Medicare. How is this fair to a non-CBA supplier?
13) Has CMS considered the impact to local and state economies by the closing of thousands upon thousands of small businesses and industry estimates of 85,000 – 100,000 job losses?
14) National DME Providers have lost about Billions over the past two years and some have declared Bankruptcy. How do you anticipate that they will be financially viable after their reimbursement rates are cut 45%? How will you monitor this going forward? What is the contingency plan if substantial supplier(s) close their doors due to the new rates being unsustainable?
15) Given the rash of legitimate concerns and likelihood of this program destroying the entire infrastructure of the nation's home healthcare equipment providers, will CMS consider postponing the implementation date, or simply choose to ignore the advice of the vast majority of industry experts?
These questions and worries are valid concerns in the DME Industry today. DME Providers can look to cut costs by purchasing cheaper products, providing a lesser service, laying off employees or looking to outsource pieces of their business such as DME Billing Services.
Making the situation even more complex is an Auditing program enacted by CMS to fight fraudulent claims. Once a Provider finds itself in an Audit the automated processes of submitting claims to payors can be extremely altered. The effect is a detrimental increase in the time it takes to receive reimbursement on claims.
Through discussions with winning Bidders from Round 1 of Competitive Bidding It appears the Algorithms used to begin an Audit on a Provider are closely tied to Volume changes in specific Categories. Competitive Bidding Winners usually see a drastic change in Volume in the categories they win contracts.
By medbillllc Further information on the DME Competitive Bidding Program can be found at www.cms.gov.
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