Litigation underway to derail DMEPOS bidding program

June 13, 2008

A suit has been filed to put a stop to the Medicare competitive bidding program for durable medical supplies.

The American Association for Homecare has filed suit against the Department of Health & Human Services in order to put a stop to the Medicare competitive bidding program for durable medical equipment, prosthetics, orthotics, and supplies, the first round of which is scheduled to be implemented in 10 metro areas on July 1. On what grounds was the suit filed? The association explained that HHS did not specify in its rules the financial standards providers must meet in order to be awarded a contract. Also HHS arbitrarily changed the definition of small business supplier from $6.5 million in total annual receipts to $3.5 million, in the process violating several statutes.

An attempt to pass legislation (S.B. 3101) under Senate Finance Committee Chairman Max Baucus (D, Mont.) to derail the bid program just failed.

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