DME and the competitive bidding rules: Freezing out mom-and-pops and patients

Will Congress rip away the ability of independent and small chain pharmacies to sell diabetic supplies and durable medical equipment to Medicare patients?

That's the essential question being debated by the U.S. House Small Business Subcommittee on Healthcare and Technology. The congressional panel is mulling a proposal from some lawmakers to exempt smaller pharmacy operators — defined as those with 10 or fewer locations — from the new Medicare competitive bidding program.

Freeing small pharmacies from those burdensome bidding regulations is critically important, both to patient access to needed health supplies, and to the notion of free-market competition and a level playing field, the National Community Pharmacists Association said. One of its members, independent pharmacy owner Randy Mire of Gem Drugs in Louisiana, testified before the House subcommittee last week in support of H.R. 1936, The Medicare Access to Diabetes Supplies Act. The bipartisan legislation would allow small pharmacies to continue to furnish patients with diabetes testing supplies and personalized counseling on their proper use, without having to submit to lengthy and cost-prohibitive competitive bidding rules.

Mire serves patients in small-town and rural parts of the Bayou State, where access to DME supplies is severely limited for many Medicare beneficiaries. Gem Drugs, he told congressional representatives, "is one of the very few pharmacies still in the area that provides these essential DME supplies to patients." Mire said he wouldn't be able to continue providing diabetic supplies, wheelchairs and other DME if he's forced to bid for the business and accept sharply reduced payments.

He isn't alone. In a survey conducted by NCPA, more than 9-out-of-10 independent pharmacy owners said they would have to exit the Medicare diabetes test supply program if presented with a sharp reduction in payments. And 83% of them said the impact on patients if they had to obtain diabetes supplies from mail order would be significant.

As Drug Store News senior editor Mike Johnsen put it, reducing the costs that the government pays for DME for Medicare patients through competitive bidding would “succeed in reducing the overall cost of care in much the same way the cost of sugarcane would be reduced in a sugar-free zone.

"If you can't access the care, you can't pay for it and, consequently, the cost of that care is less expensive," Johnsen writes. "How's that for backward math?"

Are Mire, NCPA and Johnsen right? Should small pharmacy owners be exempted from competitive bidding, or are they overstating the potential damage to pharmacies and patients that the new bidding requirements would cause? Let us know what you think.