Study: Medicare’s Competitive Bidding Program Not a Danger to COPD Oxygen Users

The Medicare Competitive Bidding Program (CBP) appeared to reduce spending without impacting oxygen prescriptions for beneficiaries with chronic obstructive pulmonary disease (COPD), a study showed.

Implementation of the CBP in two cohorts was not associated with a greater change in probability of a new oxygen prescription (difference in differences [DID] estimate -0.19 percentage points, 95% CI -2.45 to 2.08) or discontinuation of an existing prescription (DID estimate -0.77 percentage points, 95% CI -8.15 to 6.60) compared with controls where the program had not yet been implemented.

Mean monthly allowed charges for supplemental oxygen decreased from $770.64 to $687.11, reported Kevin Duan, MD, of the Gordon and Leslie Diamond Health Care Centre in Vancouver, British Columbia, in JAMA Internal Medicine.

“So there are savings to the Medicare program,” Duan told MedPage Today. “And then based on what we were able to evaluate, we didn’t see any evidence of harm either through changes in oxygen use by patients, nor did we find any clinical outcomes were different at a population level.”

Under the CBP, contracts for certain products including oxygen were awarded to durable medical equipment suppliers through a geographic bidding system instead of a fee schedule starting in 2011 as part of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. Although this change was designed to reduce prices, some professional societies and patient advocacy groups have pointed to a steady decline in the percentage of Medicare beneficiaries prescribed oxygen and alleged that the CBP was incentivizing oxygen suppliers to provide fewer units of oxygen by, for example, cutting costs with fewer deliveries or smaller coverage areas.

A bill introduced in February seeks to remove supplemental oxygen from the CBP in an effort to address patient access concerns. However, Duan said: “Medicare has conducted analyses looking at whether there are changes in certain outcomes related to this policy, and everything that they have ever produced has [suggested] that there’s no effect.” His group aimed to add academic research to help resolve the controversy.

The results are good news, according to Sneha Kannan, MD, of the University of Pittsburgh, and Ishani Ganguli, MD, MPH, of Brigham and Women’s Hospital and Harvard Medical School in Boston. “The findings of Duan et al are particularly important for policymakers. The savings for Medicare are sizable given that patients with COPD who receive oxygen prescriptions usually receive them for life,” they wrote in an invited editorial.

“The decrease in spending without concomitant changes in oxygen prescribing should reassure policymakers that the CBP, at least in the Medicare population, did not appear to cause harmful reductions in access,” Kannan and Ganguli continued. The decline in prescriptions of long-term oxygen therapy, they suggested, could instead reflect “higher value use” of oxygen therapy.

The findings may indicate that “clinicians are better adhering to professional guidelines and prescribing less home oxygen to patients with mild to moderate hypoxemia,” they wrote.

The CBP was implemented based on geography, with rollout to nine areas in January 2011 and 100 more bidding areas added in July 2013. Researchers used data from Medicare fee-for-service files from 2005-2015 for all Medicare beneficiaries ages 65-100 with COPD. Half-year periods of observation ran from January to June and June to December each year to align with CBP implementation dates, and participants had to have been continuously enrolled for the entire 6 month observation period and a 12 month look-back period.

Beneficiaries were assigned to cohorts by zip code, with those living in areas where the CBP was implemented compared against those living in areas where it was not. The study ended when CBP was implemented nationwide in January 2016.

Primary outcomes were new oxygen prescriptions within a 6-month period, defined as the presence of an oxygen claim during at least 4 of the 6 months for beneficiaries without regular oxygen use in the prior 6-month period. Oxygen discontinuation during a 6-month period was defined as 3 or more consecutive months with no oxygen claims among those who were prescribed oxygen in the prior period.

In total, 5.75 million Medicare beneficiaries with COPD were included (55.1% female, 84.1% white, mean 79.2 years of age). Compared with the non-CBP areas, those living in CBP implementation areas tended to be more racially diverse and lived in metropolitan areas with a higher income-per-capita zip code.

Secondary outcomes showed that COPD patients’ mortality increased from 2009 through 2015, but all-cause unplanned and COPD hospitalizations decreased. CBP was not associated with greater change in switching between supplemental oxygen types.

Limitations of the study included the use of claims data during the period when the program targeted largely metropolitan areas, before it expanded nationwide in 2016. The data also did not capture a range of patient outcomes that would indicate a meaningful change in quality of care, for example, delivery times, the quality of the equipment itself, and patients’ symptoms and quality of life. The study also could not evaluate appropriateness of oxygen use or oxygen overuse.