Mountain View Medical Supply

Wednesday, May 4, 2011

Medicare Competitive Bidding and What it Means For the Consumer

Chances are, you or someone you know have purchased or will have to purchase Durable Medical Equipment at some point. What is "Durable Medical Equipment"? According to, Durable Medical Equipment (DME) is a term used to describe certain Medicare benefits/items. The exact items are defined by Title XVIII the Social Security Act. Some examples are wheelchairs, iron lungs, hospital beds, blood testing strips, and only the seat-lift mechanism of a lift chair (why the seat, back and frame is not covered is still a mystery).

Competitive Bidding, or HR 6331, states among other things, that Medicare recipients will receive their DME from medical suppliers who have agreed to accept the lowest prices paid by Medicare for equipment and supplies they sell to Medicare recipients. Medicare’s intention is to reduce fraud and overall cost of DME, thus reducing the national deficit.

What they dont tell you, is that the reimbursement rate to suppliers is so minimal that only large, chain type suppliers will be able to participate in competitive bidding. In fact, all verbage in the application to be a provider is geared toward having many, many locations with one corporate office to make billing with Medicare simple. Volume, huge volume, is the only way to make any type of profit with this program. This eliminates any mom-and-pop medical supply shop from participating. Isnt that shame?

What does this mean to the Medicare Recipient? They still get the DME covered by Medicare, however where they get it from will likely change. In our experience, convenience is important for the population that Medicare serves, however recipients may no longer be able to patronize their neighborhood supplier unless that supplier is a competitive bid winner.

Another issue that has arisen with round one of the competitive bidding process is where consumers go for warranty issues for their DME. Because HR6331 is not clear on who is supposed to cover these issues, competitive bid winners are refusing to help consumers because if they do, any profit they made will be lost, and non-bid winners didnt sell the item in the first place, so why should they help? Imagine Joe, who is not able to get around without his walker, and on a fixed income, having to run around to get his broken walker fixed.

Round two of competitive bidding is in the works, because Medicare has decided it is working well. Are the best interest of our elderly population being served?

For more information from HME News, our industry voice, and CMS, visit:
Competitive Bidding
Centers for Medicare & Medicaid Services


  1. Since competitive bidding has been implemented, fewer providers exist to service beneficiaries, which have resulted in delayed hospital discharges. Medicare spending for additional days in the hospital is much greater than the cost of home care.

    When Medicare accepts a low bid, the consequences are lower quality equipment, which means more potential for equipment breakdown and less specialization for individual needs.

    Just as there is less specialization, there is also a decreased opportunity to provide advancements in technology to treat the diverse needs of individuals.

    In the past, beneficiaries could get many of their services through one company. With the bidding process, they may have to go to many separate companies to get service for each piece of equipment, which is confusing and time consuming.

    There is no guarantee that the company that services them is located in their city or state even, which has created delays.

    Studies show that patients in rural America will have trouble finding timely service for their needs.

    The HME industry is a personal one. Patients count on their provider to know them and know their stories to help them find the best equipment possible. This ‘relationship’ is lost with competitive bidding, where fewer providers are charged with serving more customers.