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MedPAC Comment Letter Calls for Competitive Bidding Program Reform

CQRC applauds MedPAC for recognizing the need to reform the flawed bidding process for home respiratory therapy and services, which threatens patientsí access to lifesaving oxygen.

Washington, DC, September 13, 2018 --( The Council for Quality Respiratory Care (CQRC) – a coalition of the nation's leading home oxygen therapy provider and manufacturing companies – today lauded the Medicare Payment Advisory Commission’s (MedPAC) comments to the Centers for Medicare & Medicaid Services (CMS) on a newly-proposed rule to reform existing regulations related to the competitive bidding program (CBP) for certain Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS).

The letter, submitted to CMS Administrator Seema Verma, expresses MedPAC’s support for reforms that will simplify the bidding process and avoid problematic results that were prevalent under the current CBP methodology. Instead of creating composite bids that lead to price inversions and force oxygen suppliers to provide home respiratory supplies and equipment at prices lower than the actual cost, MedPAC supports CMS’s proposals to implement lead-item pricing and use maximum winning bids to set single payment amounts (SPAs).

“We are pleased that MedPAC supports much-needed reforms to Medicare’s flawed competitive bidding program for DMEPOS like home oxygen supplies and equipment,” said Dan Starck, Chairman of the CQRC. “It has become increasingly clear that the current CBP is unsustainable for oxygen providers, forcing many to make the daunting choice of closing up shop or cutting services to communities they have served loyally for decades. We hope that CMS continues to work with CQRC, physicians and patients to make the competitive bidding program more sustainable and effective at serving the needs of patients with chronic obstructive pulmonary disease.”

CQRC applauds MedPAC’s recommendations to reform the CBP. Because CMS had previously set its reimbursement rates far below the actual cost of supplying home respiratory therapy equipment and services under the CBP, home oxygen providers found it increasingly difficult to stay in business, especially in rural areas. As a result, many oxygen providers have had to exit the market, even as the total Medicare population grew by one-fifth and the number of Medicare patients diagnosed with COPD - the third leading cause of death in the U.S. - rose by nearly 60 percent between 2008 and 2014, according to CMS.

However, CQRC is concerned by MedPAC’s recommendations to apply budget neutrality to oxygen since such provisions have been problematic and have resulted in serious access problems, especially for liquid oxygen, as CMS has recognized. CQRC believes there must be sufficient time to implement the new methodology and allow stakeholders to adjust. CQRC supports using existing contracts as the best course of action, but CMS has indicated it does not have authority to do so. Therefore, CQRC continues to support an updated SPA rate beyond what CMS has proposed.

To read the full text of MedPAC’s letter, please click here.

About the Council for Quality Respiratory Care
The CQRC is a coalition of the nation's seven leading home oxygen therapy provider and manufacturing companies. To learn more, visit and follow CQRC on Twitter at @TheCQRC.
Contact Information
The Council for Quality Respiratory Care
Ellen Almond

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