Competitive bidding predicted to save taxpayers billions on durable medical equipment

by | Apr 20, 2012

According to a report released Wednesday by the Department of Health and Human Services, patients with Medicare are starting to save money on durable medical equipment (DME) through the Medicare competitive bidding program.

As the program expands under the Affordable Care Act (ACA), it could save taxpayers and beneficiaries $42.8 billion over the next 10 years. According to the report, the program saved $202 million in its first year in nine metropolitan statistical areas – a reduction of 42 percent in costs.

“Thanks to the Affordable Care Act, we can expand this successful example of healthcare reform to include more areas and achieve savings on a national level over the next few years. People with Medicare across the country will get the medical equipment they need to live their lives, while saving them and other taxpayers money in the process,” HHS Secretary Kathleen Sebelius said in a press release. “The law is already saving those with Medicare hundreds of dollars on their healthcare needs – from medical equipment to prescription drugs – and they will continue to save in the years to come.”

The report also released results that show, after extensive monitoring by the Centers for Medicare and Medicaid Services (CMS), there have been no negative effects on the health of people on Medicare or their access to needed supplies and services.

Not everyone agrees with CMS that the bidding program has been a success. “It is safe to say that the only organization that views the bidding system as a success is the federal agency in charge of its implementation,” Tyler J. Wilson, president of the American Association for Homecare, told Healthcare Finance News in December.

According to AAH, 30 patient advocacy groups, 244 economists and auction experts and 145 members of Congress oppose the program, citing reduced access to care, flaws in the program design and negative impact on local jobs.