In late October, an important House Subcommittee focusing on ensuring the viability of small businesses held an oversight hearing to examine implementation of the CMS' competitive acquisition program for DMEPOS items. The House Small Business Committee, Subcommittee on Oversight and Investigations' October 31 hearing—Competitive Bidding for Durable Medical Equipment: Will Small Suppliers be Able to Compete? focused on the specific problems small businesses face under this bidding program. Industry, physician, retail pharmacy, and manufacturer representatives testified about the problems with this program, and how CMS has taken no meaningful measures to ensure that small business will be able to survive under this program.

In opening remarks, the Chairman and Ranking Minority members described how small business is the backbone of our country, and provides more than 50% of the new jobs. Throughout the hearing, members of Congress questioned the ability of small business to survive as CMS implements the bidding program.

Industry witnesses were Georgetta Blackburn of Blackburn's Physician's Pharmacy (representing the American Association for Homecare); John Shirvinsky, executive director of, and representing, the Pennsylvania Association of Medical Suppliers; and Carol Gilligan, president of Health Aid of Ohio (a high-end rehab provider), in Cleveland. Accompanying Gilligan was consumer David T. Williams (coauthor of this column) to better communicate the consumer impacts of the bidding program.

After the hearing, Committee Chair Jason Altmire (D-Pa) and Ranking Minority Louie Gohmert (R-Tex) spent considerable time talking with David and the providers about the bidding program, and the problems it is creating for small business and consumers.

The hearing presented an opportunity to highlight not just the ill effects of the bidding program on small business, but, more importantly, how consumers will be affected. As CMS continues with implementation, providers and consumers must continue to inform members of Congress about how the program is, and will, impact them.

The following extended excerpt from Gilligan's statement at the hearing is a good example of the strongly worded arguments that were posed that day:

Imposing a competitive bidding process on complex rehabilitative services will substantially undercut the quality of life for thousands of persons with disabilities. Each new consumer our company serves requires a different evaluation and assessment, measuring, fitting, simulations and demonstrations, mixing and matching of products, refitting—and then additional modifications. The service component inherent in each specialized piece of equipment is very high, and simply is not amenable to the bidding structure being implemented by CMS.

In CMS' bid program, if the bid price ends up being unreasonably low, consumers will suffer. For example, these consumers typically need sophisticated seating systems to prevent pressure sores. Seat and back cushions are customized to the individual's specific body to minimize the possibility of decubitus ulcers. If the bid price is unreasonably low, based upon low ball bidders, consumers will likely not have access to the more expensive customized cushions that prevent pressure sores, and will likely end up being hospitalized as a result. Healing decubitus ulcers in the hospital can cost up to $70,000. This is truly penny wise and pound foolish policy.

To provide the most medically appropriate items to consumers, we must employ specially trained personnel. My employees and the therapists we work with are specially trained to assess and evaluate consumers with severe needs. These are individuals who have been trained and tested to ensure they have the requisite knowledge, experience and expertise to provide the most clinically appropriate items.

Overall, while CMS made some noise about addressing small business issues, I don't believe that CMS has taken any meaningful steps to address the special needs of small business and our ability to participate in this program. I am very concerned about my company's ability to win one or more of the bids, and even if CMS asks us as a small business to participate to meet its 30% small business target, I sincerely doubt that the bid prices will represent a rational business decision for my company. In the end, whether I win or lose the bids, my company will be severely impacted, and may not be able to survive. As a small business, I believe we are disproportionately negatively impacted by this bidding program.

Cara C. Bachenheimer, JD, is VP of government relations for Invacare Corp. David T. Williams is a political and legislative strategy consultant.