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December 02, 2015

By Gary A. Puckrein, PhD

December 1, 2015 | WASHINGTON D.C.

Cost-Saving Program Reduces Access to Diabetes Testing Supplies With Health Consequences for Medicare Beneficiaries

 The National Minority Quality Forum (The Forum) today announced findings that the Centers for Medicare & Medicaid Services (CMS) competitive bidding program (CBP) has raised hospitalizations, mortality and cost for beneficiaries. The Forum’s report “Centers for Medicare & Medicaid Services Competitive Bidding Program: Assessment of Impact on Beneficiary Acquisition of Diabetes-Testing Supplies and Durable Medical Equipment, Prosthetics, Orthotics and Supplies-Associated Health Outcomes” details how CMS’s previously reported findings of no disruption in access to supplies and no adverse health outcomes among beneficiaries are not supported by the data and methodology descriptions originally presented by the federal agency.

In 2011, CMS launched the first phase of the Medicare Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) CBP in nine different test markets, which represented 2.3 million Medicare beneficiaries. The intent of the CBP was to reduce Medicare costs of DMEPOS while ensuring beneficiary access to quality items and services, such as self-monitoring of blood glucose supplies. In 2013, the CBP for diabetes testing supplies was rolled out nationally to 30 million fee-for-service Medicare beneficiaries.

CMS recognized that DMEPOS suppliers in the program “may respond to lower prices by offering lower quality products, delaying routine maintenance, or employing fewer service technicians and customer service representatives, thereby increasing the need for service calls, extending waiting times, and decreasing access.”[1] With this potential built into the CBP, there is an inherent need for continuous safety monitoring to protect beneficiaries from poor health outcomes induced by possible disruptions in access to quality products and services.

Understanding the potential risk to beneficiaries, CMS implemented health-status monitoring of CBP. Based upon that monitoring, in April 2012, CMS reported that they did not detect a disruption in access to DMEPOS products or negative healthcare consequences as a result of the CBP.

In May 2012, the Government Accountability Office (GAO) challenged the CMS report, stating that the monitoring methods used by CMS in assessing the impact of competitive bidding did not show directly whether beneficiaries received the durable medical equipment needed on time or whether adverse health outcomes were caused by problems accessing CBP-covered equipment.

The Forum’s new report affirms the concerns stated by GAO. CMS’s findings of no disruption of access to DMEPOS and no adverse health outcomes among beneficiaries within the nine test CBP markets are not supported by the data and methodology descriptions presented in its reports.

In June 2015, Gary A. Puckrein, Ph.D., president and CEO of The Forum, and some of the nation’s leading endocrinologists presented a late-breaking poster at the American Diabetes Association’s 76th Scientific Session that analyzed the impact of CBP on insulin-treated diabetic beneficiaries using data provided by CMS. The analysis showed that access to self-monitoring of blood glucose supplies had been disrupted among beneficiaries in the nine test markets. This disruption prompted a large percentage of beneficiaries to reduce or cease acquisition of diabetes testing supplies, which was subsequently linked to increased mortality, hospitalizations and associated costs.

“The Forum absolutely supports all efforts to reduce the financial burden of disease and disability on older Americans; however, cost reductions should not be pursued at the expense of patient safety,” said Puckrein. “Because serious unintended adverse health consequences have been detected and can be associated with the CBP, we believe the nationwide implementation of CMS’s competitive bidding program should be suspended until safety monitoring in the program is upgraded.”

Read The Full Report Here

About the Competitive Bidding Program 

The Centers for Medicare and Medicaid Services’ (CMS) Competitive Bidding Program (CBP) is mandated by Congress through the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA). The program required Medicare to replace the fee schedule payment methodology for selected Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) items, such as respiratory devices, mobility equipment and diabetes testing supplies, with a competitive bid process. DMEPOS suppliers must compete to become Medicare contract suppliers by submitting bids, and CMS awards contracts to winning suppliers. The intent of the program is to reduce beneficiary out-of-pocket expenses and save Medicare money while ensuring beneficiary access to quality items and services.


The National Minority Quality Forum received support for the report from Abbott; Acelity L.P. Inc.; LifeScan, Inc., part of the Johnson & Johnson Diabetes Solutions Companies; Roche Diabetes Care; US Healthcare Supply LLC.; American Association for Homecare; and US MED.

[1] Karon S, Jewell K, Hoerger T, et al., Evaluation of Medicare’s Competitive Bidding Demonstration for DMEPOS: First-Year Annual Evaluation Report: HCFA Contract No. 500-95-0061/T.O. #3. September 2000 (revised January 2001), (accessed 15 November 2015), p. 3‑1

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About The Forum

The National Minority Quality Forum (NMQF) is a 501(c)(3) not-for-profit, non-partisan, independent research and education organization. The vision of NMQF is a health services research, delivery and financing system that provides quality and effective health services to the biodiverse American general population of the 21st century. NMQF helps assure that national and local quality improvement initiatives are informed by scientific evidence, and place a priority on the quality of care and patient outcomes in all populations.

Media Contact

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