Editor's Note:

Confidence Is High?

Providers have good reason to stay positive.

• By David Kopf
• Dec 01, 2010

Optimism is a funny thing. When the chips are down, thinking positive despite lousy odds can seem downright Pollyannaish — that certainly seems to be the case for 2010 and leading into 2011 — but it’s also a smart move.

Times are tough indeed, and we are leaving 2010 with the nastiest of all loose ends: competitive bidding. The industry’s grassroots lobbying efforts initially generated a groundswell of bipartisan support for H.R. 3790, the bill introduced by Rep. Kendrick Meek (D.-Fla.) that would have repealed the program, in the House, but that came to naught after the Round One re-bids came in.

After the first attempt at Round One generated cuts that averaged out at 26 percent, the re-bid spawned even lower “suicide bidding” that averaged out at 32 percent. This negated H.R. 3790’s original scoring, and put the bill dead in the water as far as our pay-go congress was concerned.

However, all wasn’t lost. In September, 166 experts with specialization in auction and bidding models slammed CMS’s competitive bidding program on multiple points and said that it violated fundamental rules of auction models and would hurt patients and taxpayers alike. Many in the industry held out hope that the industry would be given a reprieve through a CMS administrative delay. These hopes weren’t without merit; when a Nobel Laureate and bidding experts from the halls of Harvard and MIT say its bid program is no good, one would think CMS would take notice.

But it didn’t. After meeting with representatives of the collective 166 experts, CMS pushed right ahead with the program and announced the contract holders for Round One.

The valiant fight the industry has put up over the past few years to stop competitive bidding — MIPPA’s delay to the program; H.R. 3790’s broad support; the experts’ 11th hour rescue  — has come to naught, and Jan. 1, 2011 looms ahead. It’s enough to make you want to hide under your desk.

Well don’t. For starters, the fight to stop competitive bidding isn’t over. Sure, Round One might get implemented, but as I mentioned in my November column, “House of Cards,” competitive bidding will ultimately fail. As we all know, competitive bidding will ultimately ruin patient access to care, diminish care quality, and will directly harm patients. These are unavoidable facts that will have taxpayers and the lawmakers that  represent them seeing red and demanding accountability at CMS.

Even if the fight to repeal competitive bidding lasts throughout 2011 and into 2012, there is one unavoidable fact: There is a marketplace of patients that need providers that providers can tap into. HMEs might not be able to do it the same way they did before, and patients might not be able to get the DME in the same way they did before — who knows how this will play out exactly — but the market is there. You cannot escape this fact.

If the market is there, then there is room for optimism. Providers that can clear their heads of the frustration, fear and anger that CMS and its misguided policies have sown throughout the industry will be able to think clearly about where the patients are and how to serve them.

Besides being right on occasion, there really isn’t any upside to having a negative outlook, especially when the situation is dire. If you can keep a cool head and be able to say to yourself, “all is not lost, there are ways to keep this business going; I just need to find them,” then you will start doing just that: searching out the opportunities and determining how to tap into them. (One tool to do that is financing. Read this month’s feature, “A Helping Hand,” to learn more.)

And if you are able to develop successful services despite competitive bidding, not only will you have built a business that can withstand healthcare’s equivalent of a hydrogen bomb, but you’ll be in a much stronger position to thrive when CMS comes to its senses (even if that means getting Congress to force it to do so). Staying positive and confident isn’t  being foolish or unrealistically optimistic in the face of reality, it is the smart business play.

This article originally appeared in the December 2010 issue of HME Business.