PwC Stands By Its Predictions

PwC Stands By Its Predictions

Byline: Brook Raflo


National Competitive Bidding for durable medical equipment will not save the federal government nearly as much during the next 10 years as the $7.7 billion the U.S. Congressional Budget Office predicted, PricewaterhouseCoopers said Oct. 28.

Despite the CBO’s adamant defense of this prediction, PwC insisted the prediction is overstated.

“PricewaterhouseCoopers is pleased that the Congressional Budget Office responded to our concerns about the budgetary impact of competitive bidding,” the company said. However, “PwC continues to stand by its main findings that the interpretations of official estimates of savings from competitive bidding on Medicare DME have been subject to overstatement.”

At issue is a provision of H.R. 4954 – a prescription drug bill passed in the House earlier this session – calling for a phase-in approach to NCB. While the CBO insisted that the savings would outweigh NCB’s administrative costs, PwC predicted that administrative costs and changes in Medicare Part B premiums would negate most savings.

In reality, NCB would save the federal government only $1 billion during the next 10 years, and the program could compromise the quality of the equipment and services that Medicare beneficiaries receive, PwC said. “The magnitude of the official estimates should be tempered by the uncertainty associated with not only the level of savings but also the quality of the equipment and services, and the access of Medicare beneficiaries to those items and services,” the company explained.

Additionally, the CBO’s estimate did not consider the power that the provision gives the Secretary of Health and Human Services to implement competitive bidding as he sees fit, PwC concluded.

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