VGM Assists Dallas Beneficiaries, Providers in Lawsuit to Stop Competitive Bidding

July 1, 2007

On June 12, Medicare beneficiaries and HME providers filed a lawsuit in federal court against the Centers for Medicare & Medicaid Services (CMS) to stop competitive bidding. The suit, filed in the Dallas Division of the U.S. District Court for the Northern Division of Texas, claims the competitive bidding program discriminates in its effect on both beneficiaries and providers.

Plaintiffs in the suit include three Medicare beneficiaries from the Dallas area — Gregory H. Hewitt, Jose M. Salas Jr. and C.W. Bell — and three HME providers, also from Dallas — Oxyonly Inc., M.S.B. Inc. and Cardiorespiratory Home Systems.

The premise of the case is that Medicare beneficiaries in the 10 MSAs would not get the same level of medical assistance in the home as beneficiaries in areas outside competitive bidding, said Jim Walsh, president and general counsel of VGM, which is assisting in the lawsuit.

"We'll use economic testimony to prove that it's impossible for them to get the same service," Walsh said. "What the bid system will do is drive prices down where service has to be impacted. The providers will have to find less expensive equipment and have to service the patients differently than in areas where they get a fair price."

VGM, which is helping to locate interested parties who want to challenge competitive bidding in court and paying for legal fees through a member-funded organization called Last Chance for Patient Choice, expects another suit to be filed in Ohio under a different strategy.