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Headline News
First-Round Bidders Get One-Week Reprieve
BALTIMORE--In a notice sent through its listserv Friday afternoon--just hours before registration was set to close on Saturday--CMS announced it would extend the deadlines for bidder registration and bid submissions by one week in the first round of its DMEPOS competitive bidding program.

All bids are now due by 9:00 p.m. prevailing Eastern Time on July 20, and the new registration deadline is July 7.

According to the notice:

--On May 15, 2007, CMS issued a request for bids for the first round of the Medicare competitive bidding program. The original due date was 9:00 p.m. prevailing Eastern Time on July 13, 2007. All bids are now due by 9:00 p.m. prevailing Eastern Time on July 20, 2007.

--Suppliers interested in bidding must first register and receive a user ID and password before they can access the Internet-based bid submission system. The original registration deadline was June 30, 2007. The registration deadline is now July 7, 2007.

--Suppliers must be accredited or be pending accreditation to submit a bid and will need to be accredited to be awarded a contract. The accreditation deadline for the first round of competitive bidding is Aug. 31, 2007. Suppliers should apply for accreditation immediately to allow adequate time to process their applications. For a list of the CMS-approved deemed accreditation organizations, visit: http://www.cms.hhs.gov/CompetitiveAcqforDMEPOS/.

Since CMS opened the bid window May 15, industry stakeholders have complained that the program was being rushed.

As late as Thursday, the agency's Competitive Bidding Implementation Contractor was still fine-tuning its instructions to bidders, posting a credit report and score clarification that added Standard & Poor's to the list of approved credit bureaus. The posting notified providers that "both a credit report and a credit score must be submitted as part of the financial documentation."

The CBIC site also carried a notice that the online bid submission system had been "experiencing intermittent technical difficulties."

Last week, the American Association for Homecare said it had requested an extension of the CMS deadlines based on "severe technical problems with bid submissions, late dissemination of critical information about the bidding process and numerous questions about the process that have not been adequately answered." (For more on bidding problems, see HomeCare Monday, June 11.)

On Friday morning, the association delivered a letter urging the agency to extend its bid window so the problems could be resolved. The letter included the following points:

"1. The CBIC online bid submission system is primitive, cumbersome and has been fraught with problems resulting in excessive data input time, loss of submitted data, frequent times when the system was non-operational and inaccessible, and hundreds of hours of staff time that have been lost. Many of the fields on Forms A and B display as individual screens on suppliers' computers. Repetitive information cannot be copied into subsequent screens and instead must be manually entered--over and over again for suppliers with multiple bids in multiple CBAs. Even more significant is the unreliability of the system and the inability to predict when system issues might arise.

"2. Suppliers continue to receive critical information and clarifications after the 60 day period online bidding period began, rather than having all necessary information published before the bidding window opened. Moreover, not all of the critical questions from bidding suppliers have been adequately answered. The CBIC is providing verbal information that is often not supported by the final rule or other official CMS guidance. Further, there is no discernable rationale for the questions that get addressed via updates to the CBIC FAQs and those that are given only a verbal or email response. We are sure you can appreciate the importance of ensuring that all suppliers have the same information in formulating their bids.

"3. Suppliers are receiving conflicting answers and guidance through emails and conference calls that have created confusion. Our members have received incorrect responses to a variety of questions including straightforward issues such as how the transition rules apply. Other CBIC responses have limited or no utility because the answers do not address the question posed by the supplier. Again, because of the lack of reliable written guidance there is no transparency."

The letter concluded that "significant unacceptable problems continue to arise on a daily basis that threaten the integrity of the bidding process and could diminish the overall competitive goals of the program."

To read the deadline extension notice in full, visit the CBIC Web site at www.dmecompetitivebid.com.

AAHomecare, Washington Groups Press for More Time on NCB
WASHINGTON--In response to CMS' one-week extension of its first-round bid deadlines, AAHomecare announced late Friday that it has joined several other stakeholder groups to go after support in Congress for a longer delay in the implementation of national competitive bidding.

While the "announced delay for competitive bidding is welcome," the association said, serious concerns about the program roll-out mean a broader delay is in order.

The association said it has teamed up with several other groups in Washington to gain congressional support through House and Senate "sign-on letters" asking for a delay in the implementation of competitive bidding and an extension in the online bidding window until a number of questions can be answered by CMS. (See "First-Round Bidders Get One-Week Reprieve" in this issue.)

The other groups include the Advanced Medical Technology Association, the Health Industry Distributors Association and the National Association for Support of Long Term Care. The associations are also asking patient groups to alert congressional leaders about their concerns with the implementation and impact of competitive bidding.

AAHomecare said the House letter is being spearheaded by Reps. Tom Allen, D-Maine, and Sam Johnson, R-Texas. Sponsors of the Senate letter are Sens. Kent Conrad, D-N.D., and Pat Roberts, R-Kan.

The association is urging HME stakeholders to contact their legislators to sign on to the letters by July 10.

For more information, contact AAHomecare's Walt Gorski, waltg@aahomecare.org, or Stacey Harms, staceyh@aahomecare.org.

Lack of Transparency in Bid Process Frustrates Stakeholders
ATLANTA--In questions raised during a recent CMS competitive bidding telelconference, a persistent issue popped up again: the agency's lack of transparency in how it is implementing the program.

During the June 21 open call, The Med Group's Don Clayback, senior vice president of networks, asked whether estimated capacities for each provider would be totaled for comparison with others. Officials with Palmetto GBA, CMS' Competitive Bidding Implementation Contractor, told him they couldn't "go into specifics as far as our internal processes."

Later, they told another caller who voiced similar concerns that they weren't "trying to be coy," but that bid evaluation was "an internal process" and further information could not be given.

"So it's not a transparent process," the caller responded.

No, industry experts note, it's not. And there's nothing to force CMS to make it that way, either.

"The rule is written in a way that allows a lot of discretion in how [CMS] implements competitive bidding," said Washington attorney Asela Cuervo, Law Offices of Asela Cuervo. "There's a lot of administrative process that just is not defined under the rule."

That makes the process of bid evaluation very subjective, according to Cuervo.

"It's a black hole," added Cara Bachenheimer, vice president of government relations for Elyria, Ohio-based Invacare Corp. "You put together a bid, based on hopefully fairly informed, educated analysis of your operation, but how is CMS going to look at that data? We have no idea."

For example, Bachenheimer said, CMS has said that it would throw out unreasonably low bids. But exactly how "unreasonable" would be defined, CMS has not said.

"[CMS] released the financial ratios several weeks ago, but do they have pass-fail measures?" Bachenheimer questioned. "Who knows? If you submit a bid, you can figure out what your numbers are, but presumably they're making some analysis of those numbers to determine whether you're financially viable. What in their view is financially viable--and what's not?"

The fact that CMS was provided such huge discretion in the competitive bidding statute means the industry does not have much leverage, she pointed out, noting there's nothing to compel the CBIC to reveal its bid evaluation criteria.

What's more, providers can't appeal the bid decisions, so they have no way of knowing what happened at any stage of the evaluation process if, for example, they lose a bid.

"It could be a simple mathematical or clerical error," Bachenheimer said, but the bidder may never know.

Bachenheimer stressed the importance of getting the industry-backed Tanner-Hobson bill, H.R. 1845, passed. In addition to its "any willing provider" provision--which would allow qualified providers who had submitted a bid to continue doing Medicare business--the bill would require due process protections and bring congressional oversight into the program. (See HomeCare Monday, April 2.)

According to Bachenheimer, H.R. 1845 and its Senate companion S. 1428 would "make a dramatic difference in how CMS carries out this program and their accountability in the process.

"Legislative relief is our only opportunity," she said.

Clayback added that it would help providers put together bid information if they only had more detail about how the bids would be judged.

"When everything is being done behind closed doors, people are concerned [about] mistakes or misinterpretations that might occur, and how do you become aware of those?" he asked. "That's really what the issue is. Fine, they don't want to tell us, but [although] it isn't specifically required, it may help facilitate the process."

For a transcript of the June 21 teleconference, click here.

Subcontractor Accreditation? Not Right Now, According to Rule
WASHINGTON--Tripped up by the competitive bidding final rule, officials with CMS have done an about-face on the issue of subcontractor accreditation.

For weeks, providers were told that subcontractors involved in Medicare competitive bidding had to be accredited. But it turns out that the final rule implementing the program does not include that requirement.

"The final rule says they are not requiring subcontractors to be accredited at this point," said consultant Mary Ellen Conway, president of Capital Healthcare Group, Bethesda, Md.

"CMS has said they will not evaluate subcontractors to determine if they meet the accreditation quality, financial and eligibility standards," added Walt Gorski, vice president of government affairs for the American Association for Homecare.

The discrepancy prompted Louis Feuer, president of Dynamic Seminars and Consulting, Pembroke Pines, Fla., to question the government's methods in ensuring quality service and products for all providers to Medicare patients.

"It is astounding that the consumer is not going to be guaranteed that they will be working with an accredited company," Feuer said. "Hundreds of companies are working diligently, investing both time and money to improve their company operations, while others will apparently be allowed to service the consumer without receiving national recognition by an approved accrediting organization."

According to the final rule, CMS is apparently relying on its contract suppliers to carry the standards banner--and will hold them responsible if the subcontractors somehow fail.

"We believe that the eligibility standards, applicable accreditation standards and financial standards will ensure that contract suppliers are reputable, viable businesses and not just companies that subcontract their work," the rule reads. "In addition, we will hold the contract supplier responsible for meeting all the terms and conditions of its contract, whether or not one of those terms is actually performed by a subcontractor."

Providers depending on subcontractors must therefore be cautious about the companies they contract with, experts said.

Gorski and Conway also cautioned that providers should not see the situation as a long-term accreditation loophole.

While CMS has set an Aug. 31 deadline for accreditation of those who win contracts in the initial 10 competitive bidding areas, it has yet to set a date for accreditation of all HME providers. Conway believes the absence of a subcontractor accreditation requirement could push CMS into deciding on that date sooner rather than later.

"They are going to give us that date, and that will be someday soon," she predicted.

And just because CMS is not requiring subcontractors to be accredited now does not mean the issue is resolved. "This is a very interesting issue, the reason being that this may be left up to the individual accreditor to determine," Gorski suggested.

Sandra Canally, president of The Compliance Team, Spring House, Pa., agreed. "I thought there had to be a mistake there," she said of the final rule. But she pointed out that does not mean accreditors "are not requiring something of subcontractors. We've actually specified in our application that if what subcontractors are doing relates to patient services and equipment management, they need to meet our standards as well.

"In some cases," she added, "we are visiting the subcontractor."

News of the "mistake" did not appear to curb accreditation applications, according to Canally.

"We're down to the wire and we're still taking them," she said, noting that this week will be the cutoff for providers to get their applications in and have any hope of being accredited by the Aug. 31 deadline.

Tom Cesar, president of the Accreditation Commission for Health Care, Raleigh, N.C., said that after CMS issued the final rule in April, applications for the quarter increased more than 200 percent. While he could not guarantee accreditation, Cesar said, "what we are assuring applicants is that if they submit all of the required preliminary evidence with application and deposit by July 6, we will survey them and have results by Aug. 31."

Meanwhile, Conway advised all providers, including potential subcontractors, to start the accreditation process even if they are not in one of the initial CBAs.

"The second round is coming," she said. "They should start in September and get done by April."

No NPI Info Till August, CMS Says
BALTIMORE--On Tuesday, CMS announced it would postpone release of the National Provider Identifier registry until Aug. 1.

While CMS had said the registry would be available June 28, a notice from the agency said the delay would give providers more time to analyze their own information for the new Internet database and to make any updates, changes or deletions they feel are necessary. Along with the new NPI numbers, the registry will include information obtainable though the Freedom of Information Act. (See HomeCare Monday, June 4.)

May 23 was the official deadline to begin use of the NPI, which replaces all other identifiers for health care providers. CMS said approximately 98 percent of the estimated 2.3 million covered health care providers now have NPIs.

According to the notice: "CMS understands that the health care industry is in urgent need of the FOIA-disclosable [National Plan and Provider Enumeration System] health care provider data; however, CMS believes it is in the best interests of the industry, and the health care providers in particular, that the NPPES data we will be disclosing be as accurate as possible."

When it is ready, CMS said the data would be available in an initial downloadable file, to be updated monthly, that users can query by name or NPI. To ensure the inclusion of any changes in the initial file, the agency said they must be received by July 16.

In addition, CMS said it is now asking providers to test a small number of claims by submitting them using only their NPI. "If no claims are rejected, the submitter can gradually increase the volume," the notice said. "If any claim is rejected due to provider identifier issues, first verify your NPI to make sure it was entered correctly. If the NPI is correct, then data in either NPPES or Medicare provider files is incorrect ... It is critical that you start testing with your NPI now."

CMS said it is currently working on a special edition "MLN Matters" regarding verifying NPPES data and will announce the article as soon as it is available.

For the latest information on the NPI data dissemination, as well as a list of the FOIA-disclosable data elements, click here.

Providers can make changes to their data online at https://nppes.cms.hhs.gov, or can call the NPI enumerator at (800) 465-3203 to request a paper application.

Medtrade Taps Bird as Show Director
ATLANTA--Nielsen Business Media, producers of Medtrade and Medtrade Spring, announced last week that Kevin Bird will take over operation of the events with his promotion to group show director-health care.

Bird has been with the show organizers since 1998, and has worked with Medtrade in various positions since 2000, most recently as national sales director. Elizabeth Sommerville, who has been the shows' director since December, will join Nielsen's hospitality design division.

Acknowledging the HME industry's coming changes, Bird said both he and Medtrade are ready for the challenge. "Despite the lobbying efforts of AAHomecare and other organizations, competitive bidding is here, and that's the reality ... I know competitive bidding is going to be a huge knock, but I also believe we are a strong industry, and if you have the will to survive, you can find other avenues to keep your business alive."

Bird said he intends to make sure providers can find those avenues at Medtrade, adding that the show will continue its dual role as both a buying and educational event. "Our goal has always been to provide the industry with an event that will give providers the education they need as well as the ability to meet with their manufacturers and to find out about new products on the show floor.

"That, in a nutshell, is Medtrade, and that's what it's always going to be."

Medtrade 2007 will be held Oct. 2-4 in Orlando, Fla.