Like a horror movie bad guy, competitive bidding keeps coming back. We have heard the warnings so often, it is hard not to get desensitized to them. But the latest presidential budget and the Florida competitive bidding plan have the folks at the American Association for Homecare (AAHomecare) somewhat rattled.

“It is the worst nightmare for the industry being discussed very, very seriously on [Capitol] Hill,” said a concerned Tom Connaughton, CEO of AAHomecare, in a trade press meeting on Monday April 22, the first day of the Medtrade Spring show in Las Vegas. “If you ever called your congressman, now is the time to do it.”

So why the sudden urgency? The difference, Connaughton says, is that the government no longer has the luxury of a tax surplus. Tax revenues are down and expenses (especially military ones) are up. As a result, the president’s budget is looking for savings and a lot of them wherever it can. Former President Clinton’s budget plan anticipated that competitive bidding could save $100 million over 5 years. President Bush’s budget anticipates that competitive bidding could save $200 million in 1 year, AAHomecare says.

Legislators think competitive bidding is a magic bullet that will help them solve their budget woes because in commodity industries it is. The government saves countless dollars each year by making the manufacturers of government vehicles, roads, and even office paper compete for its business.

The problem is that home health care equipment is not a commodity as much as it is a service. Health care products are extremely personal and no one wants to depend on the lowest bidder for something they need to survive and live a high-quality life.

Unfortunately, it seems as if the more legislators need health care cuts to balance the books, the less willing they are to listen to alternate opinions. In Florida it is taking a lawsuit to stop the latest competitive bidding plan, which has the state being divided up into 11 districts with one provider in each furnishing all of the home health care needs of that entire district. “[The Florida legislators] don’t want information because if they get information they will abandon the [competitive bidding] idea,” David Williams told the more than 20 attendees gathered to hear about the Re/hab Assistive Technology Council (RATC) on the first day of Medtrade Spring.

In addition, making the case that a wheelchair, a walker, or a hospital bed is not a commodity is tough. After all, they are manufactured like commodities and look like commodities. And, as Joseph Lewarski, BS, RRT, this month’s guest editor, points out on page 10, our industry is haunted by the popular image of a big burly delivery man unloading medical equipment out of a worn-out truck as if the equipment were tables and chairs for a party.

We have little hard data on the service component because service is by nature nebulous and hard to define. Research, such as the Polisher Research Institute study, which we cover on page 17, is helping to pin down the cost of service and the damage that results from health care cuts. But we could do more.

Lewarski proposes that establishing standards for respiratory care service could help by blocking those companies that approach home care as a pure commodity business from even getting into the game, and standards help define what respiratory providers do. “It is time to fight the battle to unbundle HME products from the professional services that support them,” he writes. I couldn’t agree more.

Lena Lindahl
llindahl@medpubs.com