Obama administration will expand use of competitive bidding in Medicare

Apr 20 2012

A year-long experiment found that the competitive bidding approach saved money without harming beneficiaries. It also made inroads against waste and fraud.   

The New York Times: In A Shift, Medicare Pushes Bids
The Obama administration said Wednesday that it would vastly expand the use of competitive bidding to buy medical equipment for Medicare beneficiaries after a one-year experiment saved money for taxpayers and patients without harming the quality of care (Pear, 4/18).

The Associated Press: Competition Cuts Down Medicare Fraud
A yearlong experiment with competitive bidding for power wheelchairs, diabetic supplies and other personal medical equipment produced $200 million in savings for Medicare, and government officials said Wednesday they are expanding the pilot program in search of even greater dividends. The nine-city crackdown targeting waste and fraud has drawn a strong protest from the medical supply industry, which is warning of shortages for people receiving Medicare benefits and economic hardship for small suppliers. But the shift to competitive bidding has led to few complaints from those in Medicare, according to a new government report (Alonso-Zaldivar, 4/18).

CQ HealthBeat: Medicare Officials Say Equipment Bidding Program Saved $200 Million
A controversial competitive bidding program to supply medical equipment to Medicare patients in nine markets netted $202 million in savings in its first year, the Centers for Medicare and Medicaid Services announced Wednesday. Contrary to the claims of critics, the program hasn't led to disruptions in access to products such as wheelchairs, hospital beds, and oxygen supplies, Deputy CMS Administrator Jonathan Blum said in a telephone press briefing. Nor has it led to adverse health effects requiring more hospital, doctor, or skilled nursing care, added Blum (Reichard, 4/18).

The Hill: Obama Administration Claims $42.8 Billion In Savings From Health Law Bidding Program
The healthcare reform law's competitive bidding program for durable medical equipment such as hospital beds and wheelchairs is projected to save $42.8 billion over the next 10 years, the Medicare agency said in a report Wednesday. Competitive bidding, an effort to replace Medicare's standard fees with market competition among providers, was created by the 2003 Medicare reform law and began on Jan. 1, 2011 in nine pilot metropolitan areas (Pecquet, 4/18).

California Healthline: A Second Opinion on Medicare 'Double Counting'
[T]he ACA's budget impact -- and its Congressional Budget Office score -- are making headlines again, sparked by a new study from conservative scholar Charles Blahous. Blahous has a prominent perch: He's one of two White House-appointed trustees for Medicare. And he's made an eye-catching contention: The CBO wonks are wrong, and ObamaCare could add as much as $527 billion to the U.S. deficit across the next decade. But this latest debate doesn't expose anything new about the health law. What it does illustrate is the flawed approach to Medicare accounting -- and how easy it is to gin up another fight over health spending (Diamond, 4/18).