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Are Centers for Medicare and Medicaid Services Showing GPO-Style Thinking?

Posted Oct 23 2008 1:31pm

The Wall Street Journal reportsthat Medicare and Medicaid officials are experimenting with competitive bidding within 10 categories of medical products, including power wheelchairs, walkers, hospital beds and oxygen equipment.

Starting this July in 10 U.S. cities, the program may move to 70 cities next year, and it could ultimately save $1 billion a year, according to the Centers for Medicare and Medicaid Services:

“We know we’re overpaying,” said Kerry Weems, the agency’s acting administrator. He said competitive bidding, combined with the initiative’s quality and financial requirements for bidders, “will hold this industry accountable.”

Vocal opponents are claiming that legitimate bidders have been mistakenly disqualified and that the program will curtail competition:

“It’s going to reduce severely the number of providers,” says Tyler J. Wilson, chief executive of the American Association for Homecare, which represents suppliers and manufacturers.

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