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Headline News
Watch Those Blackberries: Bidding Could Open Today
BALTIMORE--At an Open Door Forum on Wednesday, CMS officials said the agency will try to hold to its timeline and open the competitive bidding window today, or at least sometime this week.

"We still believe we can meet the timetable at the end of the month. It could happen Monday, but it's not guaranteed," said CMS' Joel Kaiser. He added that if not today, the agency expects to open its 60-day bid window this week.

In a timetable posted on the Competitive Bidding Implementation Contractor Web site, the agency lists "late April 2007" as the start date for the first round of Medicare DMEPOS bidding, and "late June" as the close of the bid window. Aug. 31 is given as the last day for first-round bidders to be accredited.

After that, CMS will conclude bid evaluation and begin the contract selection process in late September. The agency plans to announce winning suppliers in December before taking the program live in 10 MSAs in April 2008.

"Again, it is a 60-day bid window," Kaiser said. "You have two months to submit your bid."

Kaiser said educational materials and information providers would need to submit their bids--including a Web cast that explains the basics of the bidding program--has been posted on the CBIC Web site. By the end of last week, the site also included a "getting started" checklist, a list of required financial information, basic bidding rules, instructions for filling out bid forms and an explanation of the bid evaluation process, along with a few FAQs.

More information will be posted "over the next several weeks," Kaiser said, including a chart "that will be a quick snapshot ... that will contain a lot of information for bidders as they are making a decision about what categories to bid for and what their bid amounts will be."

He said the chart, in the form of a spreadsheet, would include product categories for each area (with HCPCS codes and descriptors); what type of bid suppliers should submit (rental or purchase); how Medicare is going to pay for the items (rental, purchase or both); a base unit that suppliers will need to use when reporting their capacity for each product code; and utilization data for calendar years 2005 and 2006 (although the data for 2006 isn't yet available and will be posted later).

In addition, the spreadsheet will include the weights that will be given to each HCPCS code in a product category. Kaiser said these will be based on volume of use for each item relative to other items in the category (in other words, the higher the volume of use for an item, the higher the weight it will receive).

Fee schedule amounts "that will be used to assure savings under the program" also will be included in the spreadsheet, Kaiser said. "Each bid for each HCPCS code in each product category must be below this fee schedule amount," he explained. "That is a requirement of the program."

In an update to the codes included in the bidding program, Kaiser announced that in the support surfaces product category, HCPCS code E0194 (air fluidized bed)--the only Group 3 code written into the category--has been removed, "so essentially this product category now becomes a Group 2 support surface category." In addition, code A4255 (platforms for home blood glucose monitor, 50 per box), an outdated code that is no longer used, has been removed from the mail-order diabetic supplies product category.

Kaiser said he expected the spreadsheet to be available this week on the CBIC site, and noted that CMS plans to hold "bidders' conferences" after the bidding starts to walk suppliers through the process.

To link to the CBIC Web site, click here.

To access a CMS Web cast about the competitive bidding program, click here.

For a list of product categories included in the bidding program, click here.

For a list of the 10 MSAs selected as the first bidding areas, click here.

For a PDF of CMS' final rule on competitive bidding (401 pages), click here.

For a highlights summary of the final rule, click here.

For a list of CMS' 10 approved accrediting organizations, click here.

Concluded VGM General Counsel Jim Walsh at the press conference, "Invacare has proven that they get it and that we're in a fight for our lives."

Hold 'Em or Fold 'Em? Medtrade Spring Draws Providers in Search of Help
LAS VEGAS--The exuberant atmosphere that so often characterizes Medtrade Spring was largely absent at this year's event, held last week in Las Vegas. But most HME providers who attended agreed the expo was the place to be for those seeking critical information on how to do business in an industry turned inside out.

About 7,500 people, some 1,600 of them manufacturers, turned out for the event, according to show officials. It was the first industry conference since CMS released its final rule on competitive bidding and an Aug. 31 accreditation deadline for providers in the 10 MSAs where bidding will roll out.

Questions about the two topics were pervasive, and providers frantic for answers crowded seminars covering the issues, often overflowing into the halls of the Las Vegas Convention Center.

"Competitive bidding is foremost in everybody's mind, that and the accreditation [deadline] coming up in August," said Sherman Mead of Golden Technologies in Old Forge, Pa. "They're trying to get a feel for what the reimbursement is going to be, the changes [coming up] and how they are going to affect their business."

"Everybody is trying to figure out how to stay in business," said Viola Jenkins, whose HME company, VitaCare Inc., is located in Dallas, one of the first cities where competitive bidding will debut. "Everything we do is in there," Jenkins said about the products included in the bid. "All of our products are going to be affected.

"Medicare is a huge percentage of our business," she continued. "We will bid; we're just trying to figure out how to bid. Should we bid directly or should we join a network?"

Seminar presenters were inundated with questions like Jenkins' and others about competitive bidding, ranging from the very basic "What is competitive bidding?" to "Should I even stay in the business?"

"People are trying to understand what this means for them and what they need to do in their business," said Mike Mallaro, CFO for VGM Group, Waterloo, Iowa. The buying group's booth drew scores of members and non-members alike, many of whom wanted suggestions for new niche markets and cash-only items they could tap into to shore up their bottom lines, he said.

While it appeared difficult for many providers to wrap their minds around the reality of what lies ahead for HME, Mallaro said, "I think most people are beginning to understand. But the devil's in the details."

And the details of the 401-page final rule--such things as the components of a bid, who can be in a network and how bids will be evaluated--are overwhelming for providers to absorb in such a short time, stakeholders said. After releasing the rule on April 2, CMS said it would try to open bidding by the end of this month (see today's top story for more).

"The [providers] I spoke to ... didn't understand competitive bidding at all," said Robert Thompson of DMETrain in West Springfield, Mass., adding that his booth was "swamped" with providers clamoring for information.

The topic of accreditation was equally confusing for those who flocked to accreditors' booths.

Susean Nichols of Millennium Management Services in Long Beach, Calif., said most providers were hoping for easy answers to their accreditation queries, but unfortunately, they were disappointed.

"They're trying to grasp onto the slightest bit of information like that's it. And that's not it. That's just the starting point," she said.

Christine MacDonnell of the Commission on Accreditation of Rehabilitation Facilities also noted that the issue was just "too new" for most providers, especially small company owners who had never before considered accreditation. "They don't know the questions to ask," she said.

Karen Taylor, a physical therapist with Dove Medical Supplies in Cheektowaga, N.Y., called accreditation "a little overwhelming," but added, "we better get it going." She and others from her company, including owner Loretta Carr-Stock, R.N., were checking out all the accreditors to find one that would suit their business.

"With competitive bidding and Medicare changing everything, it seems like everything is coming at once," said Carr-Stock.

While there were new products and new manufacturers on the exhibit floor to generate enthusiasm among providers looking for sparkplugs for their businesses, a number were still questioning whether, in the light of competitive bidding and mandatory accreditation, they would even stay in the business.

It was, perhaps, the biggest--and most disturbing--question of all.

"I think there will be people who throw up their hands and walk away," said Nichols on the last day of the show. "But this industry is built on the backs of small providers. So they can't go away."

AAHomecare Paints Stark Picture, Issues Appeal for Action
LAS VEGAS--One big draw at Medtrade Spring last week was the American Association for Homecare's Washington Update, which attracted enough people at its 7:30 a.m. Wednesday session to fill the chairs and line the walls.

Tyler Wilson, AAHomecare president, started out with an urgent call to action: "You realize that your futures are inextricably tied to what Medicare does. I hope when you leave here today, you'll be energized and turn your information into action," he said.

Wilson and Walt Gorski, the association's vice president of government affairs, painted a stark picture for the HME industry, noting that it is being hammered by competitive bidding, an oxygen rental cap, declining reimbursement, elimination of the first-month purchase option for power wheelchairs and a perception in Washington that "HME spending is out of control."

In addition, there are federal budget pressures with the wars in Iraq and Afghanistan and a growing deficit that are sparking Medicare cuts and, thus, HME reimbursement.

But there are legislative measures that could change the picture. The Tanner-Hobson Bill (H.R.1845) would allow all eligible providers to participate at the competitive bidding rate, as long as they bid under the fee schedule amount. The Home Oxygen Patient Protection Act (H.R. 621) would repeal the 36-month oxygen rental cap mandated by the Deficit Reduction Act. In addition to championing both those bills, AAHomecare is also lobbying to preserve the first-month purchase option for power wheelchairs and seeking to stop any further cuts.

"Right now, our main goal is to stop the bleeding. We are being whipsawed around," said Gorski.

But that costs money and a loud voice, both of which are lacking. AAHomecare membership is currently about 500, and most of its providers are small, 80 percent generating less than $5 million in revenue, Wilson said, adding that the association has only about $10,000 in its PAC coffers.

Those figures prompted A.J. Filippis of Wright & Filippis, an HME, orthotics and prosthetics company in Rochester, Minn., to pledge $5,000 on the spot. "You need to get involved, people," he said to the crowd. "It's imperative that you get to Congress."

Money won't necessarily buy the results HME providers want, Filippis pointed out, but it will buy a much better chance of getting those results. "Money buys you access," he said.

"Everybody thinks that the big guys are going to fight the battles. But everybody needs to be there."

For information on the Tanner-Hobson bill and the Home Oxygen Patient Protection Act, visit the AAHomecare Web site at www.aahomecare.org.

Heard at Medtrade
Competitive bidding and accreditation were the topics of the day at Medtrade Spring, and as usual, show attendees had a range of opinions on both.

On choosing an accreditor:
"The critical fact is, [providers] need to do their homework."
--Christine MacDonnell, Commission on Accreditation of Rehabilitation Facilities, Washington, D.C.

On getting accredited:
"[Providers] have to be as efficient as possible in this climate, and I think the process of [accreditation] will help them do this."
--Susean Nichols, Millennium Management Services, Long Beach, Calif.

"[Accreditation] is just one more hoop I'd have to jump through. And I don't know if I want to jump through any more hoops."
--Mary Ostendorf, Lavender 'n' Lace, Freeport, Ill.

On competitive bidding:
"I've noticed some doom and gloom among providers, but we're very, very positive ... because there are opportunities for growth, opportunities to grow our business. [Competitive bidding] just forces us to be better at what we do."
--Richard Davis, Barnes Healthcare Services, Valdosta, Ga.

"Competitive bidding doesn't give the patient any freedom of choice. It's taking that choice away from the Medicare patient."
--Jim Goldman, Havasu Medical Supply, Lake Havasu City, Ariz.

"Why would anybody want to [bid]? All I see is a nightmare ... you're going to wind up losing money no matter what you do."
--Don Adler, Care Medical and Rehabilitation Equipment, Portland, Ore.

"If the people that are making the decision to go ahead with competitive bidding use [what comes out of the first round] as the new allowable, they could save all of the waste of money [and] the loss of some dealers, too."
--Nagle Bridwell, Ultimate Resource, Newtown Square, Pa.

"A lot [about competitive bidding] is open to interpretation. It's very difficult to get a true understanding as to what the guidelines really are."
--Michelle Hermann, Chad Therapeutics, Chatsworth, Calif.

"Payers, and especially CMS, have increasingly come to expect the industry to provide the services of a hands-on supplier while being paid as a hands-off dealer. In the not-too-distant future, I foresee our industry changing into a two-tiered delivery system with hands-on, full-range services going only to those patients who satisfy the necessary criteria and those payers who will pay appropriately. Arriving at that resolution, however, may well be a nasty fight."
--Neil Caesar, Health Law Center, Greenville, S.C.

"As far as competitive bidding, I thought we were prepared for it, but I was really excited that it didn't come to Atlanta and I didn't have to worry about it in the first round. [When it comes if we don't win a bid], we would try to maintain service and grandfather with most of our patients ... I certainly want to stay in there and stay strong and continue in the industry. I'm very optimistic because I feel like there are a lot of opportunities still."
--Todd Tyson, Hi-Tech Healthcare, Norcross, Ga.

"I think [competitive bidding is] a terrible idea. Would you want your parent or loved one to get equipment that went to the low bidder? And quite frankly the way it's currently set up, we're going to have, I think, a loss of patient access to high quality innovative new products."
--John Ledek, Invacare, Elyria, Ohio

Coming Up
The Association of Indiana Home Medical Equipment Services (AIHMES) will hold its Hoosier Home Care, Hospice and HME Conference May 1-3 in Indianapolis. For more information, call (866) 225-6335 or visit www.aihmes.org.

Industry consultants Sarah Hanna of ECS Billing & Consulting and Lisa Bargmann of Bargmann Management will hold a one-day session called "Demystifying Third-Party Payer AR and Patient-Owed Receivables: A Fresh Perspective" on May 3 in Tampa. For information or to register, call (866) 633-9291.

The South Carolina Medical Equipment Services Association (SCMESA) will hold its annual meeting and trade show May 3-4 in Myrtle Beach, S.C. For more information, call (803) 926-1772 or visit www.scmesa.com.

The Essentially Women Group Purchasing Organization will hold its annual expo, this year called "Focus on the Future 2007," May 7-9 in St. Charles, Mo. For more information, call (800) 988-4484 or visit www.essentiallywomen.com.

The National Community Pharmacists Association (NCPA) will hold its National Legislation and Government Affairs Conference May 13-16 in Washington, D.C. For more information, call (703) 838-2682 or visit www.ncpanet.org.

The New York Medical Equipment Providers Association (NYMEP) will hold its annual meeting in White Plains, N.Y., May 14-16. For more information, call (518) 436-9637 or visit www.nymep.org.

Dynamic Seminars and Consulting will hold a teleconference called "Monitoring and Tracking Your Sales" on May 22. For information, call (954) 435-8182 or visit www.dynamicseminars.com.

The American Physical Therapy Association (APTA) will hold its Federal Government Affairs Forum May 22-24 in Washington, D.C. For more information, call (800) 999-2782 or visit www.apta.org.

"Turning a Challenge Into an Opportunity: How to Succeed with Competitive Bidding" is scheduled for June 4 in Miami. Speakers Jeffrey S. Baird of Brown & Fortunato and Jane Bunch of CareCentric will provide the latest information on competitive bidding in this one-day session, including the ins-and-outs of network bidding, bid preparation and submission, and survival strategies if you are not a successful bidder. For information, visit Medtrade Conferences On the Road at www.medtrade.com.

The American Association for Homecare will hold its annual Legislative Conference June 5-7 in Washington, D.C. For information, call (703) 535-1887 or visit www.aahomecare.org.

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

Visit this week's sponsor at www.dynamicenergy.com.