Lena Lindahl, llindahl@medpubs.com

At 2:30 in the morning on June 28, bleary-eyed congressional representatives eager to head home for the 4th of July recess passed the Medicare Modernization and Prescription Drug Act of 2002 (HR 4954). This is bad news for providers, Medicare beneficiaries, and yes, even the Centers for Medicare & Medicaid Services (CMS), which will have the unenviable job of reproducing on a national scale the “savings” results of the relatively small competitive bidding demonstration in Polk County, Florida.

I’m no government administration expert, but if getting 100% of airplane luggage screened within a 1-year deadline—a seemingly relatively simple task—is impossible to accomplish, how can a bureaucracy like CMS quickly, efficiently, and most important, inexpensively change its procedures to run competitive bidding in every county in the country?

In addition, take a look at your areas of operation. Does your local market mirror Polk County with exactly 495,923 people—of which 18.3% are over 65 and 79.6% are white—spread over 2,048 square miles with a median household income of $31,030? If not, how can CMS be sure competitive bidding will work the same way in your area as it did in Polk County?

CMS is unlikely to bring up the challenges it would face administering competitive bidding nationally. That would be like admitting competitive bidding for health care products and services is a bad idea.

Furthermore, legislators, eager to find even the smallest savings in the health care budget to help pay for a prescription drug benefit, are unlikely to ask too many probing questions about the feasibility of national competitive bidding.

No, I’m afraid it is up to the HME industry to make clear to legislators the negative impact competitive bidding will have on the health, safety, and quality of life of Medicare beneficiaries. And because the industry is small, in both number of providers and health care dollars spent, no one can afford to sit on the sidelines. Every participant in the industry must lobby his or her congressional representative if there is any hope that the industry’s perspective will be heard.

And don’t neglect your state government. As much pressure as the federal government is under to decrease the cost of health care, it is nothing compared to the pressure faced by state Medicaid programs now that once plentiful tax revenues have dried up as a result of the recession.

At the annual governors’ conference in Boise, Idaho, last month, officials with the governors’ association told The New York Times that Medicaid costs made up 20% of the average state budget this year and the amount of money spent by states on Medicaid had increased by 13% in 2002, following an 11% increase in 2001.

In these hard financial times, competitive bidding for HME begins to look very good to state legislators. Not only does “competitive bidding” sound nice and all-American, the US House of Representatives appears to endorse it and promises monetary savings without giving up any benefits. Florida and North Carolina have already jumped on the competitive bidding bandwagon, and more states could follow. We bring you the latest on this issue in “Medicaid Competitive Bidding” starting on page 21 so you can stay informed. It is a scary thought, but your biggest competitive bidding threat may be in your own backyard.