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Headline News
Industry Accreditors: The Rush Is On
BALTIMORE, Md.--A mid-December meeting between CMS and the industry's 11 DMEPOS accreditors has sent those organizations--and many unaccredited providers--scrambling.

CMS called the meeting to fill the accrediting organizations in on its expectations as competitive bidding rolls out in 10 MSAs this year. But at the all-day session, held Dec. 18, officials handed out a list of 19 possible bidding areas where they said providers should be accredited by spring.

"It's clear CMS is focused on Miami," said Tom Cesar, president of the Accreditation Commission for Health Care. But beyond that location, he added, "it's really like Russian roulette. Who in the world is going to get hit?"

Other cities on the list include: Charlotte, N.C.; Dallas; Riverside, Calif.; Pittsburgh; Kansas City, Mo.- Kan.; Cincinnati; San Juan, Puerto Rico; Cleveland; San Francisco; Atlanta; Houston; Detroit; Seattle; Baltimore; Philadelphia; Phoenix; Boston; and Tampa.

"My opinion is that CMS is going to focus on the areas that have the highest rates of fraud and abuse," said Mary Nicholas, executive director of the Healthcare Quality Association on Accreditation. Others at the closed session also said CMS emphasized its intent to curb Medicare DME fraud.

CMS had earlier released a list of 25 potential bidding sites, with three of the country's largest MSAs--New York, Los Angeles and Chicago--excluded until the second round of bidding in 2009 when the program expands to an additional 80 MSAs. Of the remaining cities on that list, four are not on the latest version: Orlando, Fla.; San Antonio, Texas; Virginia Beach, Va.; and St. Louis. But two cities not previously named--Seattle and Phoenix--do appear.

According to Michael Reinemer, vice president of policy and communications for the American Association for Homecare, the agency has begun "talking to congressional delegations for those MSAs where people need to get accredited to help prepare them."

CMS estimated that 18,000 providers would be affected in the bidding areas it names this year. "But even if we are generous and say that half of those are already accredited," Cesar said, "all of [the accreditors] combined may not get the rest through in such a short period of time."

Several accreditors said that their new CMS-based programs could take from four to six months to complete. And some sources said getting site surveys done could present a problem with an accreditation rush in the bidding areas. For companies with multiple locations that must be accredited, CMS has said it will allow "trending" information to be reported, with site surveys at only a portion of the locations.

Providers in the next 80 bid areas chosen will have to be accredited by spring 2008, CMS told the accreditors, and all providers billing Medicare Part B will have to be accredited within the next three years.

The agency asked accreditors to report names of any new companies they accredit on an ongoing basis. Companies with current accreditation will be grandfathered in until their next expiration dates as long as CMS has approved a crosswalk between the accrediting organization's standards and the agency's mandatory supplier quality standards.

At a CMS Open Door forum on Dec. 20, an agency official said no "drop-dead date" for accreditation has been determined, but accreditors said based on the information they were given, providers should begin the process immediately.

"Everybody has been telling providers for three years to get ready ... and now they have to face it," said Cesar, noting that CMS is "not talking about a grace period for anybody. It's going to be a really tough time for those companies within the 10 areas CMS chooses."

To view CMS' supplier quality standards, visit www.cms.hhs.gov/CompetitiveAcqforDMEPOS/04_New_Quality_Standards.asp.

For a list of the 11 approved DMEPOS accrediting organizations, visit www.cms.hhs.gov/CompetitiveAcqforDMEPOS.

Invacare said new orders for Kuschall wheelchairs were accepted up to Dec. 29, 2006, with quotes up to that point to be honored through Feb. 28. Kuschall parts will still be available in the U.S., and the company is considering U.S. distribution of Kuschall chairs through specialty distributors.

Provider Cites Payment Problems with Noridian
ATLANTA--A major HME provider in the Pacific Northwest says it is shy millions of dollars because its Medicare Administrative Contractor, Noridian Administrative Services, has not processed those claims in two months.

"We have just over $3 million in claims sitting with them," said Angelene Adler, vice president of operations for Care Medical Equipment. Based in Portland, Ore., the provider has 11 branches in Oregon and Washington.

Sarah Hanna, vice president of ECS Billing & Consulting in Tiffin, Ohio, also reported difficulties in getting claims paid in the 17-state Region D. "There's a higher denial rate in Region D related to the 176 code--basically an issue regarding [certificates of medical necessity]," she said.

Noridian officials have told ECS that the denials are occurring because its server was moved to a different location, causing a breakdown in communication between the server and its common working files. That has resulted in the CMNs not being attached to the claims, so the claims are being denied.

Noridian also told ECS that it is three to four weeks behind in processing claims but that it will pay providers interest, said Elizabeth Longbrake, accounts receivable supervisor for ECS.

"They are not making the 14-day turnaround," Hanna said.

Adler said her company, which generates revenues of about $35 million a year, first noticed a problem in November. Since then, the payments have been dribbling in. So far this month, Care Medical branches have received checks ranging from 14 cents to $34,000.

Adler said the company's payments for claims have dropped 67 percent, and it is unable to process third-party payer claims. "We can't even bill these as denials because there's no movement at all," she said. "It's going beyond Medicare. It's affecting our Medicaid and HMO [claims]."

Care Medical's attempts to talk to Noridian officials regarding the claims have been fruitless, Adler said. Company staff members have been told Noridian will only accept written complaints, but their e-mails have either not been satisfactorily answered or not responded to at all, Adler said. "They tell us to wait 30 days, but we can't afford 30 days."

In last year's switch from Durable Medical Equipment Regional Carriers to DME MACs, CMS awarded Noridian the bid for Region D over Cigna, which had been the area's DMERC.

Adler said she is concerned that Noridian cannot handle the work. She said staff members have received calls from Noridian employees asking what a capped rental is and what a K0011 is.

"What we would like to see is Cigna reclaiming the contract," she said.

When HomeCare Monday contacted Noridian's corporate office in Fargo, N.D., about the payment issues, a representative who answered the phone said she did not have time to comment.

According to Ann Howard, director of federal policy for the American Association for Homecare, the association had previously been talking with CMS about a different problem with Noridian experienced by a California provider. Related to that issue, she said AAHomecare wants to determine whether Noridian's participation in a three-state test as a Recovery Audit Contractor--rewarded for rooting out erroneous claims on review--conflicts with its job as a claims processor.

AAHomecare will follow up with CMS on Care Medical's situation, said Howard, noting that the association has heard from other sources that additional providers are having problems. Meanwhile, Howard says AAHomecare is trying to learn through state associations and individual companies how far-reaching the payment problems may be and if any have been resolved.

"This is serious stuff," she said. "We need to hear from other providers if they are having this same problem. If it is a systemic problem, then we will have to get a fix on the program rather than just trying to work on each case as it comes along, and, if need be, get Congress involved ... We're totally prepared to do that if we have to."

NCART Reaches Out to State Medicaid Directors on PMD Fee Schedule
WASHINGTON--The National Coalition for Assistive and Rehab Technology has sent a report to state Medicaid directors urging caution in the adoption of Medicare's new power mobility device fee schedule.

NCART said the report, "Adopting Medicare Power Mobility Policies Will Impact the Provision of Appropriate Client Services," is an attempt to work proactively with state programs as they implement the 64 new HCPCS codes for power mobility. It includes background information, documentation and data on the various Medicare PMD polices and how they are related.

The report also highlights two issues--pricing and coverage policies--which the coalition said could "dramatically impact access to appropriate technology for Medicaid recipients if caution is not used in adopting these Medicare policies."

The report is accompanied by a letter, copied to each state's governor, explaining that CMS' new fee schedule, which took effect Nov. 15, is a discount off previous power mobility pricing. "Even with the latest adjustments, the fee schedule still represents a 10-30 percent decrease in reimbursement when compared to the fee structure in effect prior to Nov. 15," NCART Executive Director Sharon Hildebrant explained in the letter.

She also pointed out that suppliers who provide complex rehab and assistive technology must employ trained specialists and are burdened by costs, with 97 cents out of every dollar spent on providing the equipment. "Any efforts to further reduce pricing from the Medicare fee schedule will block access to medically appropriate technology," Hildebrant wrote.

"The Medicare fee schedule must be viewed as the minimum payment level by all state Medicaid programs. Moreover," the letter continued, "consideration should be given to increasing reimbursement above the Medicare fee schedule should your state be primarily rural in nature or other special circumstances exist, such as additional processing requirements."

NCART also gave the state directors a recommended coverage policy for power wheelchairs that removes the restrictive reference to "in the home" used by the Medicare program.

To view the report and the letter, visit www.ncart.us.

Competitive Bidding Forms Posted
WASHINGTON--Last month, a request for comments on the latest competitive bidding forms was published in the Federal Register, including request for bids information collection.

Instructions include the following basic bidding rules:

--CMS will not allow more than one bid per item in a product category from a supplier.

--Suppliers that share common ownership, as will be defined in the Medicare DMEPOS competitive bidding final rule, can only submit one bid.

--Network member suppliers will not be allowed to bid separately from their network for the same product category in the same competitive bidding area. Network members can only join one network per product category per CBA.

--Network members and suppliers with multiple locations who share common ownership must bid on the same product categories within the CBA.

--Bids must include the cost of furnishing the item throughout the geographic area that makes up the CBA, except for entities that are eligible for limited participation in the competitive bidding program, as defined in the final rule.

--Furnishing the item includes the cost of providing the item and any requisite services directly associated with the item, such as proper beneficiary and caregiver training and follow-up, manufacturer's shipping charges, maintaining rented equipment in proper order, education, delivery, set-up and retrieval.

--The bidding form will identify if a product will be paid on either a rental or purchase basis and whether the bid should represent a purchase or rental amount.

--The RFB form requires suppliers to identify the item for which they are bidding by manufacturer, model name and number. We recognize that suppliers may change models in later periods of the bidding cycle.

The forms and instructions can be viewed at: http://www.cms.hhs.gov/PaperworkReductionActof1995/PRAL/list.asp#TopOfPage. Scroll down the list to form CMS-10169.

AAHomecare Joins Coalition to Repeal Competitive Bidding
ALEXANDRIA, Va.--The American Association for Homecare has joined other health care stakeholders in forming a coalition to explore the repeal of competitive bidding.

The Coalition to Ensure Beneficiary Access will "reach out to a wide array of patient and provider stakeholders to demonstrate broad support for a repeal of competitive bidding," the association said. An initial meeting of the group included representatives from the National Association for the Support of Long Term Care, the Health Industry Distributors Association, several industry providers and manufacturers, and the ITEM Coalition, whose members include more than 70 health care advocacy organizations.

"AAHomecare has consistently questioned the merits of competitive bidding and expressed concerns about its effects on patient access to home care and its impact on small providers," said Tyler Wilson, association president. "We also question whether competitive bidding will produce the savings for Medicare that have been projected."

Because DME competitive bidding was enacted into law as part of the Medicare Modernization Act of 2003, Congress must pass another law to repeal it.

CMS is ramping up its bidding program now and is expected to name 10 MSAs where bidding will begin later this year. The program will expand to another 80 areas, including New York, Los Angeles and Chicago, in 2009.

The coalition effort will focus on five principles:

1) Accreditation and quality standards are critically important and a positive step forward. The Medicare program has taken the necessary steps to combat fraud and abuse and to ensure that beneficiaries have access to high-quality DMEPOS items.

2) Beneficiaries lose under competitive bidding. The administrative process of bidding within select regions for select products will result in reduced availability of products to individuals in certain areas of the country. If fully implemented, beneficiaries would be the ultimate losers.

3) Competitive bidding will create a bureaucracy. In order to implement competitive bidding, CMS will also construct a bureaucracy, and the full costs are not taken into consideration. These expenses may negate any potential savings of competitive bidding.

4) Small businesses will be harmed. Small businesses will be unable to be as price-competitive as larger companies. CMS also stated that as few as two suppliers could be selected for a product category in a competitive bid area, which would result in further erosion of the small business community.

5) There is a better approach to competitive bidding. The coalition will pursue an approach that secures savings, foregoes a new federal bureaucracy and protects beneficiaries and small businesses.

For questions about the new coalition, contact Walt Gorski, AAHomecare's vice president of government affairs, at waltg@aahomecare.org.

Independent HMEs Muscle Up to NCB
TAMPA, Fla.--With national competitive bidding looming, some HME providers are banking on networks or rollups to give them the muscle to compete--and to survive.

Thirty-five small to medium providers in the Tampa, Fla., area in December formed Med Trust Tampa Bay LLC, a sister to Med Trust Corp. of Southern Florida, which was organized early last year.

Med Trust Tampa Bay is aggressively preparing for competitive bidding, said Robert M. Arado, administrator. His company, Caremed Respiratory Services, is spearheading the effort.

"[We are] forging ahead to meet all the requirements to satisfy CMS guidelines for the competitive bid," he said, noting that most of the Med Trust members are accredited. "We are rigorously working with those who are not to get them accredited."

Arado said he hopes all members of Med Trust will be accredited in four months.

In addition, he said, "We're asking all members to increase the credit lines with their vendors. We need to come in as a network with big dollars in credit lines ... Medicare will see that we are a strong player."

Meanwhile, three South Carolina providers--Adaptive Medical in Spartanburg, ApneaRx in Clemson and Mobile Health Care in Greenville--were rolled up into the newly formed Southern Home Medical, a publicly held company that debuted last month. Nearly a dozen more companies are considering joining SHM, according to Greg Tucker, owner of Adaptive Medical and president and CEO of the new company.

Dennis Nowak, RT, owner of ApneaRx, believes the move positions his company and the others for competitive bidding.

"It's a great alternative for anyone who is worrying about competitive bidding and other things that are facing us in DME," he said, noting that under the Southern Home Medical umbrella, "you can purchase better equipment, get better pricing and make a profit at lower charge rates."

Besides, he noted, "There's a chance I wouldn't be in business if I didn't do it."

Waterloo, Iowa-based VGM Group is also forming a network for its members who want to participate.

"We decided to do this because we knew [providers] were going to need help and, simultaneously, we were getting requests," said Jim Walsh, president and general counsel for the buying group.

Walsh sees some benefits, especially for small providers. Being in a network could mean they wouldn't have to work outside their geographical area or service needs they are not equipped or accustomed to handling, he said.

But not everyone favors networks. In a September HomeCare magazine survey, 61 percent of providers said they planned to bid on their own rather than as part of a network, with 32 percent saying they'll take the network route. While 49 percent of respondents said they think networks are workable, 43 percent said they aren't, giving as their main concerns too much dependence on other companies and headaches with administration and billing. (See "Ready or Not," HomeCare, September 2006.)

Walsh also had some cautions for providers. "We are concerned that smaller providers might fall into networks that don't get the job done," he said. The network "has to be able to technically handle the business ... do the paperwork associated with this, get the payments out to the individual providers without tripping over the obstacles CMS is famous for putting in your way ... Network administrators are going to be holding their money."

Providers must choose wisely, Walsh said. "They're putting their business at risk. Once that deadline goes by, they aren't doing Medicare for a long while." When the bid contracts are awarded, they will extend for three years.

Arado is confident his network has its ducks in a row. "The only drawback we see is if the whole thing is a wash with Medicare and they aren't able to take care of competitive bidding, and we would have put in all this money. But without [the network], we're going to see a fallout of providers that we haven't ever seen before. We have a better chance as a group than by ourselves."

Meanwhile, VGM, under its Last Chance for Patient Choice organization, remains poised to file a federal lawsuit challenging competitive bidding on constitutional and other grounds. All it's waiting for is the announcement from CMS of the 10 MSAs.

"Once those unfortunate entities have been announced," said John Gallagher, VGM's vice president, government relations, "we'll be looking for articulate end-users who would be willing to sign onto a class-action lawsuit."

For more information on Last Chance, visit www.lastchanceforpatients.org.

For more on Southern Home Medical, see "Taking Stock of the Market," HomeCare, December 2006.

Coming Up
Dynamic Seminars & Consulting has scheduled its January teleconferences, called "Up Your Service" and "What You Must Know About All the New Medical Documentation Requirements," for Jan. 24 and Jan. 30, respectively, from 12 p.m.-1 p.m. EST. For more information, call 954/435-8182 or visit www.dynamicseminars.com.

CMS has scheduled its next Home Health, Hospice and DME Open Door Forum on Tuesday, Jan. 30. For more information, visit www.cms.hhs.gov/OpenDoorForums.

The North Carolina Association for Medical Equipment Services (NCAMES) has set its winter meeting and legislative conference Jan. 31-Feb. 1 in Raleigh, N.C. For more information, call (919) 387-1221 or visit www.ncames.org.

Discovery Through Design's Rolling with Style gala will take place Feb. 6 in New York. Hosted by Lesley Stahl, the event proceeds will benefit the Christopher Reeve Foundation, the Miami Project to Cure Paralysis and the Spinal Cord Injury Project at Rutgers University. Discovery Through Design is a not-for-profit that creates awareness for paralyzed women's health initiatives and spinal cord injury research. The organization was founded by four women in wheelchairs, including Sunrise Medical's Marilyn Hamilton, founder of Quickie. For more information, visit www.discoverythroughdesign.org.

The National Association for the Support of Long Term Care will hold is Wiinter Legislative & Regulatory conference Feb. 7-9 in Arlington, Va. For more information, call (703) 549-8500 or visit www.nasl.org.

Sarah Hanna of ECS Billing & Consulting and Lisa Bargmann of Bargmann Management will hold a seminar on Feb. 8 in Dallas called "Demystifying Third-Party Payer and Patient-Owned Receivables." For more information, call (888) 811-2250 or e-mail sbare@bright.net.

The American Physical Therapy Association (APTA) will hold its Combined Sections Meeting Feb. 14-18 in Boston, Mass. For more information, call (800) 999-2782 or visit www.apta.org.

The National Community Pharmacists Association (NCPA) will hold its Multiple Locations Pharmacy Conference Feb. 14-18 in Palm Beach, Aruba. For more information, call (703) 683-8200 or go to www.ncpanet.org.

The National Home Infusion Association (NHIA) will hold its annual conference Feb. 26-Mar. 1 in Savannah, Ga. For more information, call (703) 549-3740 or visit www.nhianet.org.

To revisit this news any time during the week, go to www.homecaremonday.com.

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