1. Medicare Auction Reform

    12:21

    from Peter Cramton / Added

    1,621 Plays / / 0 Comments

    Controlling Medicare costs is essential to our health care system. Yet as we look to the future, unfunded Medicare expenses are estimated to be about 70 trillion dollars—an unsustainable amount. Effective use of market methods in Medicare is our best hope for controlling these costs while maintaining quality. Unfortunately, the current Medicare auction program is fatally flawed. This 12 minute video summarizes the problems and the solution. Experts from government and industry voice their concerns and propose a path forward.

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    • Medicare Auction Update Panelists

      41:59

      from Peter Cramton / Added

      85 Plays / / 0 Comments

      On 24 May 2011, a Medicare competitive bidding update was presented to Congress. The event organized by Congresswoman Nancy Johnson and Professor Peter Cramton included a diverse and talented panel of experts: Peter Cramton, Professor of Economics, University of Maryland; Tom Milam, Member, Program Advisory and Oversight Committee (PAOC), Former COO, AmMed Direct; Barbara Rogers, PAOC Member and President/CEO National Emphysema/COPD Association; Paul Gabos, Chief Financial Officer, Lincare, Round One Re-Bid Winner [on Video]; Robert Brandt, Owner, City Medical Services, Round One Re-Bid Winner. Congresswoman Sue Myrick (R-NC), the event’s sponsor, provided comments. A frank and honest assessment of the DME competitive bidding program was give. About 60 Hill staffers learned about the fatal flaws in the program. The briefing included a diversity of viewpoints. Barbara Rogers, a PAOC member, is a knowledgeable and articulate advocate for Medicare beneficiaries, a voice that too often goes unheard until there is a train wreck. Paul Gabos and Robert Brandt both represent DME providers who were winners in the Round One (Rebid). A second abbreviated briefing was presented to Senate Staff on the Impact of the CMS Competitive Bidding Program for Durable Medical Equipment.

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      • Medicare Auction Update Panelists

        41:59

        from Peter Cramton / Added

        48 Plays / / 0 Comments

        On 24 May 2011, a Medicare competitive bidding update was presented to Congress. The event organized by Congresswoman Nancy Johnson and Professor Peter Cramton included a diverse and talented panel of experts: Peter Cramton, Professor of Economics, University of Maryland; Tom Milam, Member, Program Advisory and Oversight Committee (PAOC), Former COO, AmMed Direct; Barbara Rogers, PAOC Member and President/CEO National Emphysema/COPD Association; Paul Gabos, Chief Financial Officer, Lincare, Round One Re-Bid Winner [on Video]; Robert Brandt, Owner, City Medical Services, Round One Re-Bid Winner. Congresswoman Sue Myrick (R-NC), the event’s sponsor, provided comments. A frank and honest assessment of the DME competitive bidding program was give. About 60 Hill staffers learned about the fatal flaws in the program. The briefing included a diversity of viewpoints. Barbara Rogers, a PAOC member, is a knowledgeable and articulate advocate for Medicare beneficiaries, a voice that too often goes unheard until there is a train wreck. Paul Gabos and Robert Brandt both represent DME providers who were winners in the Round One (Rebid). A second abbreviated briefing was presented to Senate Staff on the Impact of the CMS Competitive Bidding Program for Durable Medical Equipment.

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        • Medicare Auction Update Opening

          33:20

          from Peter Cramton / Added

          105 Plays / / 0 Comments

          On 24 May 2011, a Medicare competitive bidding update was presented to Congress. The event organized by Congresswoman Nancy Johnson and Professor Peter Cramton included a diverse and talented panel of experts: Peter Cramton, Professor of Economics, University of Maryland; Tom Milam, Member, Program Advisory and Oversight Committee (PAOC), Former COO, AmMed Direct; Barbara Rogers, PAOC Member and President/CEO National Emphysema/COPD Association; Paul Gabos, Chief Financial Officer, Lincare, Round One Re-Bid Winner [on Video]; Robert Brandt, Owner, City Medical Services, Round One Re-Bid Winner. Congresswoman Sue Myrick (R-NC), the event’s sponsor, provided comments. A frank and honest assessment of the DME competitive bidding program was give. About 60 Hill staffers learned about the fatal flaws in the program. The briefing included a diversity of viewpoints. Barbara Rogers, a PAOC member, is a knowledgeable and articulate advocate for Medicare beneficiaries, a voice that too often goes unheard until there is a train wreck. Paul Gabos and Robert Brandt both represent DME providers who were winners in the Round One (Rebid). A second abbreviated briefing was presented to Senate Staff on the Impact of the CMS Competitive Bidding Program for Durable Medical Equipment.

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          • Medicare Auction Second Panel: Product Design and Ensuring Performance

            37:48

            from Peter Cramton / Added

            49 Plays / / 0 Comments

            Moderated by Thomas Milam, Member of Program Advisory and Oversight Committee (PAOC); Speakers: Cara Bachenheimer, Senior Vice President Government Relations, Invacare Corporation; Michael Iskra, Chief Operating Officer, Simplex Healthcare; Scott Lloyd, Co-founder and President, Extrakare LLC; Mike Pfister, Executive Vice President, Government Relations, The SCOOTER Store; John Shirvinsky, Executive Director, Pennsylvania Association of Medical Suppliers

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            • Medicare Auction Demonstration

              50:28

              from Peter Cramton / Added

              72 Plays / / 0 Comments

              On 1 April 2011, 110 stakeholders in the Medicare Durable Medical Equipment (DME) industry came to the University of Maryland to discuss how the CMS’ current competitive bidding program could be improved. The participants included Medicare providers, government leaders, and auction experts. A major part of the event was the conduct of a mock auction based on the auction design proposed in Cramton (2011a). This design addresses the fatal flaws in the CMS design (Letter from experts, 2010). The proposed design has been shown to be highly effective in theory (Cramton et al. 2011), in the experimental lab (Merlob et al. 2010), and in practice (Ausubel and Cramton 2004, 2006). This paper presents the mock auction results. The mock auction demonstrated the feasibility of the proposal as well as its excellent performance. Despite the complex bidding environment, the mock auction achieved extremely high levels of economic efficiency. Moreover, the participants were able to understand the auction format and auction platform, and successfully execute bidding strategies for 6 products in 9 regions, all in a matter of hours.

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              • Medicare Auction First Panel: Sustainability, Market Structure, and Beneficiary Choice

                43:18

                from Peter Cramton / Added

                107 Plays / / 0 Comments

                Moderated by Lance Leggitt, Chair, Federal Health Policy, Baker Donelson; Speakers: Zachary Schiffman, President, United States Medical Supply; Nancy Lutz, Program Director, Economics, National Science Foundation; Joel Marx, Chairman, Medical Service Company; Amy Law, Vice President Government and Healthcare Strategy, KCI, Inc.; Paul Gabos, Chief Financial Officer, Lincare

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                • Medicare Auction Proposal

                  40:20

                  from Peter Cramton / Added

                  72 Plays / / 0 Comments

                  An auction design for Medicare Durable Medical Equipment is presented. The design addresses the flaws in the current program. Bids are binding commitments. Each bid binds the bidder to particular performance obligations depending on the auction outcome. The bids are made credible through a rigorous qualification one month before the auction. Each bidder provides a financial guarantee in the form of a bid bond or a deposit in proportion to the bidder’s capacity. Capacity is objectively estimated based on the bidder’s supply in recent years, with the most recent year given the most weight. Each winner provides a performance guarantee in proportion to the winner’s estimated volume won. The auction establishes a market clearing price for each product in each service area. The price paid to all suppliers is the clearing price that balances supply and demand. These prices are found in a simultaneous descending clock auction, a simple price discovery process that allows both substitution across items and complementarities. Competition in the auction comes from new entry or the expansion of existing suppliers into new product categories and service areas. After the auction, the winners compete for Medicare beneficiaries by offering quality products and services. Thus, beneficiary choice is used to further strengthen incentives to provide high quality products and services.

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                  • Medicare Auction Final Panel: What Have We Learned?

                    58:57

                    from Peter Cramton / Added

                    220 Plays / / 0 Comments

                    Moderated by Peter Cramton, Professor of Economics, University of Maryland. Speakers: Tom Bradley, Chief, Medicare Cost Estimates, Congressional Budget Office; Walt Gorski, Vice President, Government Affairs, American Association for Homecare; Nancy Johnson, 24-year Congresswoman (R-CT), Senior Public Policy Advisor, Baker Donelson; Thomas Kruse, President and CEO, Hoveround Corporation; Evan Kwerel, Senior Economic Advisor, Federal Communications Commission; Wayne Sale, Chairman, NAIMES, and President and CEO, Health First

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                    • Medicare Auction Opening Remarks

                      30:36

                      from Peter Cramton / Added

                      214 Plays / / 0 Comments

                      Opening remarks of Peter Cramton, Professor of Economics, University of Maryland, and Jonathan Blum, Deputy Administrator, Centers for Medicare and Medicaid Services, at the Medicare Auction Conference, held at the University of Maryland on 1 April 2011. The Medicare Auction Conference, sponsored by the National Science Foundation and the University of Maryland brought together 106 stakeholders to collaborate on how to improve the Medicare DME Competitive Bidding program. The Medicare auction program is currently in a pilot stage, but will soon be expanding nationwide (with Round 2). This was a critical opportunity to debate the basic issues as well as learn about the latest auction methods that could simplify and improve the effectiveness and sustainability of the auction program. In addition, the conference provided a forum to debate whether auctions are feasible in the Medicare setting and how they can best be structured.

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