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President Obama proposes to expand competitive bidding under 2017 budget

On Tuesday, President Obama unveiled the FY 2017 federal budget, which included several provisions that related to the HME industry. After industry analysis of the provisions that are outlined within the U.S. Health and Human Services budget, there is one that the industry will be tracking closely.

Under this budget, CMS would be granted the authority to, “Provide authority to expand competitive bidding for certain durable medical equipment.” The proposal goes on to state, “Currently this program is restricted to certain categories of equipment, supplies and services. This proposal expands the competitive bidding program to additional categories, including inhalation drugs; all prosthetics and orthotics; and ostomy, tracheostomy and urological supplies.” Lastly, CMS expects this expansion would save $3.8 billion in savings over the next decade.

Dennis Clark, president of OPGA, Orthotic and Prosthetic Group of America, a division of VGM, comments, “Including orthotics and prosthetics in the competitive bidding program could cost an additional $3.8 billion in care to Medicare beneficiaries while destroying their quality of life.”

On Wednesday afternoon, HHS Secretary Sylvia Mathews Burwell met before the House Committee on Ways and Means to discuss the proposed budget. The committee discussed several things within CMS, including questions on the progress of improving the audit and appeal process. Due to time constraints, the committee had to speed up the hearing, which may not have allowed representatives to get all of their questions asked. Chairman of the budget, Tom Price (R-Ga.), has indicated that he will be asking Secretary Burwell about the DME, non-CB area cuts.

Just as with past attempts by CMS to expand competitive bidding to include complex rehab technology, expanding this program to include prosthetics and orthotics is a major concern. While the good news is many Republicans on Capitol Hill have almost entirely dismissed President Obama’s budget, the industry will be closely tracking this proposal and a few others.