With New Congress, Industry Continues Push for MPP Adoption

• By Laurie Watanabe
• Jan 15, 2013

In a waste-no-time transition between last year and this one, the DME industry is once again urging support for a bill that would repeal Medicare's national competitive bidding program.

H.R. 27 was introduced on Jan. 3 by Rep. Nydia Velazquez (D-N.Y.), a member of the House Small Business Committee.

In reporting on the new bill, Michael Reinemer of the American Association for Homecare (AAHomecare) said H.R. 27 "was referred to the Small Business Committee in addition to the Ways & Means and Energy & Commerce committees."

Reinemer added in a bulletin to stakeholders, "The American Association for Homecare is pleased that Congresswoman Velazquez recognizes the serious problems with the bidding program. We are committed to working with her and other members of Congress to stop the program and replace it with the Market Pricing Program (MPP)."

H.R. 27 effectively takes the place of last year's H.R. 6490, which died when 2012 came to an end.

Industry members who'd fought hard for H.R. 6490 had hoped the MPP would be attached to the last-minute American Taxpayer Relief Act, the "fiscal-cliff" bill that was signed by President Obama. But the MPP was not included in the new legislation.

H.R. 6490 was introduced by Rep. Tom Price (R-Ga.), himself a physician. The bill ended up with 94 co-sponsors, AAHomecare reported.

AAHomecare urged industry and consumer stakeholders to continue to educate legislators on the MPP.

"Assure Capitol Hill that MPP is designed to be budget neutral," a Jan. 9 AAHomecare letter to members said. "AAHomecare has addressed every concern raised by the Congressional Budget Office, and we fully expect the proposal to be budget neutral."

While the MPP would reduce Medicare's DME spending by the same amount as the competitive bidding program, it differs significantly from it.

For instance, the MPP would allow only serious bidders to participate: Bids would be binding, and suppliers would have to put down cash deposits as part of the bidding process.

By contrast, in the current competitive bidding program, bidders are not required to honor their bids. That has enabled suppliers to skew the pricing process by submitting outrageously low bids, then declining the contracts offered by Medicare as a result of those low bids.

To ensure they are homogenous, bidding areas under the MPP would be smaller than the current metropolitan statistical areas being used in competitive bidding.

The MPP would include the same types of DME as the current competitive bidding program, but only two product categories would be bid per bidding area. In each bidding area, the prices for eight more product categories would be reduced based on auctions that occurred in similar bidding areas.