Concluded Hildebrant, “We definitely believe we will see some results here.”

New HME Expo to Launch in April 2009
ATLANTA--A new trade show and expo for the HME industry will make its debut next spring.

Launched by Atlanta-based Access Business Media, whose principals include three former Medtrade show directors, the HME Exposition & Conference will be held April 21-23, 2009, at the Baltimore Convention Center in Baltimore, Md.

”National competitive bidding and dwindling reimbursement for power wheelchairs, oxygen and other core home medical products have put the industry at a crossroads,” said Cory Smith, vice president of marketing for Access Business Media.

“We recognize the value of producing an event that will address the industry's need to conduct business in a cost-contained environment, to have sessions that provide business strategies/solutions for a changing marketplace and to promote/influence industry change through advocacy,” continued Smith. “An industry event is created by collaborating with the entire HME constituency, and we are excited about the opportunity to serve this industry.”

According to a press release, ABM “will create advisory councils of industry professionals focused on all facets of the event to make decisions on issues such as event location and timing, show format, content and other important issues related to the needs of HME providers, manufacturers and other stakeholders.” The company's Web site notes it specializes in event management, trade shows and business-to-business multi-media communications.

Set to feature more than 250 exhibitors, the new expo “will be a true industry event rather than just an industry trade show,” said Kevin Bird, ABM's vice president of sales. “Our mission is to serve the needs of the HME industry by connecting buyers with sellers, creating networking opportunities, providing relevant business information in a well thought-out conference program and promoting the HME industry to decision-makers in Washington, D.C."

Added Art Ellis, vice president of business development for ABM, “The HME industry has been an overlooked and misunderstood piece of the health care continuum for many years. We will have pre-events designed to promote advocacy on Capitol Hill, as well as specialty forums at the event to attract and promote interaction between members of Congress, CMS and the HME Exposition & Conference attendees.”

Smith served as show director of Medtrade from 2003-2004 and Ellis from 2005-2006. Bird took the reins in July 2007 but left Nielsen Business Media, the venerable trade show's producer, in March. Grayson Lutz, ABM's vice president of operations, was formerly operations manager for Medtrade.

For more information on the HME Expo & Conference, call 678/767-2209 or visit www.hmeexpo.com.

What if CMS Threw a Party and Nobody Came?
ATLANTA--According to HME industry-watchers, one of the most surprising circumstances that has come to light in round one of competitive bidding is the situation in San Juan, Puerto Rico.

Officially described as “San Juan-Caguas-Guaynabo,” the MSA fit all the criteria CMS said it was looking for in the 10 pilot areas selected for rollout of the program. The agency even included a tenth product category--support surfaces--to be bid in only the San Juan and Miami competitive bidding areas.

But in the San Juan CBA, things apparently didn't go as CMS had planned.

According to a tiny asterisk on the agency's posted chart of contract offers for round one, in San Juan, there were not “a sufficient number of qualified, bidding suppliers to meet projected demand for the length of the contract period” in five of the 10 product categories. That means in the San Juan CBA, there will be no reimbursement reductions--at least not set through round one of bidding--for oxygen equipment and supplies, complex rehab, enteral nutrition, hospital beds or support surfaces.

“It seems to me that one plausible explanation is that the providers decided they were just going to tell Medicare to stuff it, because if Medicare doesn't have a sufficient supply, they can't proceed,” said industry consultant Wallace Weeks of Weeks Group, Melbourne, Fla., adding he knows of “no shortage of providers” in Puerto Rico.

When round one of the bidding program was announced, a CMS fact sheet detailing the 10 target CBAs listed 402 suppliers in the San Juan area in 2005, with total Medicare spending for medical equipment and supplies at $60 million. The agency had anticipated $9.6 mllion in savings for the first full year of the program in San Juan, and beneficiary out-of-pocket costs were projected to decrease by an estimated $2.4 million.

“[Competitive bidding] didn't accomplish anything in that market,” said Mary Ellen Conway, president of Capital Healthcare Group, Bethesda, Md. “That's amazing to me. It's like having a party where nobody comes. It's a mandatory program where no one participates.”

Pondered Weeks, “Why can't all DME providers do that? The way to stop competitive bidding is to not participate.”

Weeks pointed to the substantial payment cuts across product categories in all round one CBAs, which CMS has said averages 26 percent.

“The reason we have the enormous discounts that we have [from round one] is not because they are necessary or, even moreso, not because they are affordable,” he continued. “It is because people are looking over their shoulder saying, 'There is somebody out there that is going to be crazy [and bid really low], and I am going to be sure I am more crazy than they are so that I get a contract.'”

According to Weeks, “it wouldn't take a whole lot of providers to reduce the supply sufficiently that Medicare couldn't proceed” in any of the MSAs targeted for expansion of the bidding program in round two. Based on the Final Rule, he pointed out, “even if you said you could double what you supply next year, CMS said they were only going to consider that you could increase by 20 percent.

“So, if providers who hold 20 percent of the supply said, 'We will not bid,' then Medicare could not go forward no matter what all the rest of them did.”

However, Weeks continued, “I know people won't boycott competitive bidding. Medicare played our industry beautifully. They knew our industry would not stand aside like [providers] appear to have done in San Juan.”

Neither CMS nor several providers operating in Puerto Rico responded to requests for comment.

To download a PDF of CMS' chart of contract offers for round one, click here.

Baird: For Disqualified Bidders, Lawsuit May Be Only Recourse
AMARILLO, Texas--While legislative support appears to be growing for a suspension of round one of competitive bidding, it may take legal recourse for HME providers who were disqualified to get their cases heard, according to industry attorney Jeffrey S. Baird.

Baird, chairman of the Health Care Group at Brown & Fortunato, Amarillo, Texas, said some providers who were disqualified and appealed to the CBIC have received letters indicating their documentation has been re-examined and still found wanting--even though many said they have copies of complete documentation that was submitted with their bids.

“I am concerned that the CBIC response is what has gone to most of the companies whose applications were disqualified without justification,” said Baird, adding that the letters appear to be the same except for specifics about which documents the CBIC said were missing.

“In short,” he continued, “it appears that the CBIC will be of no help. Unless the industry receives intervention from Capitol Hill, or unless CMS directs the CBIC to take a different course of action, then the aggrieved companies will have no choice but to go to court.”

“I have seen some of the form letters to providers,” added Michael Reinemer, vice president of communications and policy for the American Association for Homecare. “I think the take-away there is to call your member of Congress because the CBIC is not going to resolve these issues. It appears in many cases that nothing has changed, even though ample evidence was provided that the bid was submitted properly.”

Reinemer said the association is exploring the possibility of filing a lawsuit on the issue.

Meanwhile, other lawsuits targeting competitive bidding are already in the works.

Waterloo, Iowa-based VGM Group, through its Last Chance for Patient Choice, is spearheading two lawsuits against the bid program in the Dallas and Cleveland CBAs.

Last year, the Dallas lawsuit, which, among other things, alleged that Medicare beneficiaries would receive different, lower levels of product and/or service quality and that small HME businesses would be unable to compete under the program, was tossed out because no harm could as yet be proved.

The Cleveland lawsuit alleges that competitive bidding violates the Regulatory Flexibility Act requiring all agencies to “carefully scrutinize ways to minimize the economic impact on small entities."

“We're going to try to get the lawsuit reintroduced in Dallas and try to get additional plaintiffs in Cleveland and move forward with a potential constitutional lawsuit based on due process,” said John Gallagher, vice president of government relations for VGM.

The latter, he said, “is bigger than we can produce,” so VGM is soliciting pledges to support it. “If we can get about $250,000 in pledges from stakeholders across the board, we would move forward [with the due process lawsuit],” Gallagher said.

Meuser's Congressional Run Ends with Pennsylvania Primary
EXETER, Pa.--Dan Meuser, president of Pride Mobility Products, lost his bid for the Republican nomination in Pennsylvania's 10th Congressional District in the state's April 22 primary.

Meuser, who ran on his record of successful business experience and economic conservatism, lost to businessman Chris Hackett in a tightly contested race, with both candidates spending heavily, according to press reports. The final tally showed a 52 percent to 48 percent win for Hackett, who will face incumbent Democrat Rep. Chris Carney in November.

After announcing his congressional run at Medtrade in October, Meuser took a formal leave of absence from the company he helped build to begin a full-time campaign. Last week, a Pride spokesperson confirmed Meuser would extend that leave “for a few more months.”

Meuser joined Pride more than 20 years ago to work alongside his father and brother Scott Meuser, the company's chairman and CEO, and during his career became a vocal advocate for HME, particularly regarding power mobility issues.

In 2006, Meuser was a recipient of HomeCare magazine's HomeCaring Award in recognition of distinguished service to the home medical equipment industry. (See HomeCare, January 2007.)

Disaster Watchdog Questions Implications of Competitive Bidding
MIAMI--Complaints concerning the problems with competitive bidding have been ringing from the rafters recently, but a release from national disaster watchdog the Disaster Accountability Project last week is questioning the program's outcomes from a different perspective--that of disaster preparedness.

“The issue for us is not competitive bidding so much as it is the rules in the competitive bidding process and how many bids are selected,” explained DAP founder and Executive Director Ben Smilowitz. “From our perspective, we are more interested in making sure there is an adequate supply. Our issue is not on competitive bidding in general, it's on the impact,” he said.

Smilowitz said DAP, founded after Hurricane Katrina to keep tabs on the nation's disaster prevention and response systems, became concerned when the organization found that, of approximately 501 oxygen providers in Miami-Dade County, only 44 were offered contracts. In the event of a disaster--specifically Miami's infamous hurricanes--Smilowitz questions whether those providers would be able to cover the entire MSA in the case of an emergency.

“We're not saying that 501 is a great number, and [CMS'] concerns of reducing the number of suppliers may be completely legitimate, but 44 seems like a drastic change--especially for supplies which are required to save lives,” Smilowitz said.

"With two South Florida MSAs located in hurricane alley, the Riverside-San Bernardino-Ontario [California] MSA located in an earthquake zone and the importance of disaster preparedness everywhere, the issue of significantly fewer oxygen distributors presents some major concerns for us, looking at the issue with a disaster accountability lens," he said.

Rob Brant, CEO of North Miami Beach-based HME City Medical Services and president of the newly founded Accredited Medical Equipment Providers of America (AMEPA), said the threat of natural disasters in MSAs in Florida, California and the Midwest are a real concern when it comes to competitive bidding. It was an AMEPA member who first contacted DAP about the issue, he said.

“Having lived through [Hurricane Wilma], that was one of the arguments we had when Miami was chosen as one of the MSAs. We realized this was going to be a big problem,” said Brant, who recalls having to drive over 100 miles during the 2005 hurricane to purchase gasoline and medical supplies for patients who were without power and transportation.

According to Brant, between 2004 and 2005, the state of Florida recorded five major storms that were rated as Category 3 or above--meaning that five big reasons CMS should reevaluate its competitive bidding process may just be Hurricanes Charlie, Ivan, Jeanne, Dennis and Wilma.

While CMS has not issued the names of bid winners in round one, Brant said he believes Apria and Home Medical to be two of the winning bidders in Miami. “Apria and Home Medical are located on the same street,” said Brant, noting that geographic proximity is a major factor in a natural disaster. “God forbid the winning bidders get taken out in the storm. Then where are the patients going to be able to get their oxygen service from?”

This is specifically the question being asked by DAP. In a post on its Web site, DAP poses the following questions: Did Medicare consider disaster scenarios at all when executing this bidding process? Were post-disaster surge capacity needs considered when Medicare limited the number of winning bidders in each MSA?

“With this issue, we're asking questions as to whether considerations for disaster planning were included in the bidding process. We think that CMS needs to answer these questions,” Smilowitz said.

"Is there a plan in place for the distribution of DME like oxygen after a disaster? And how will significantly fewer distributors be able to serve public need after a disaster when as many as half of the distributors (or more) may be off-line for weeks--as was the case after previous storms? Without adequate supplies after a storm, individuals that depend on oxygen, for example, may overwhelm emergency rooms causing further drain to resources and a large expense to the public," Smilowitz said.

He added that disability groups and disaster planners should be involved in the competitive bidding selections process.

“If FEMA was consulted, if Craig Fugate (director of the Florida Division of Emergency Management) was consulted and they found that this was OK, I would like to see how they came to that conclusion, and I think the public deserves to see that information,” Smilowitz said. “This bidding process could affect a lot of people in a very dangerous way, so these questions need to be answered.”


In Brief
The American Association for Homecare will host a "Stand Up for Homecare" fundraiser Tuesday, May 6, at the Hyatt Regency in Long Beach, Calif., in conjunction with Medtrade Spring 2008. Procceds of the event will help fund a public awareness campaign to promote the mission of the home care industry. Nielsen Business Media, Medtrade producer, will sponsor the event along with a continental breakfast at the association's Medicare bidding fly-in on May 21. For information, visit www.aahomecare.org.

The global ambulatory and bathroom aids market will top $1.8 billion by 2010, according to a new report from Global Industry Analysts. In the United States, walkers are projected to register the fastest growth in the ambulatory aids segment with a 7 percent annual increase for the period 2000-2010. Market drivers include a rapidly aging world population and a universally growing trend toward alternative site care facilities, according to the report. Due to the steadily expanding orthopedic market, manufacturers are focusing more on the ambulatory product market, adding to the growth momentum.

Last week, the DME MACs reminded providers the May 23 deadline for sending NPI-only claims is just a few weeks away. Because CMS has reported a low percentage of claims being submitted with an NPI alone in the primary provider identifier fields, the MACs recommended testing a small batch of claims with the NPI only now, which would allow time for any corrections prior to the deadline should the claims reject.

The DME MACs also reminded providers of another upcoming deadline. All providers must begin using the new Advance Beneficiary Notice (CMS-R-131) no later than Sept. 1, 2008. The form and notice instructions, in both English and Spanish, are posted on the Beneficiary Notice Initiative Web page at www.cms.hhs.gov/bni.

In the eighth trial conviction for the Medicare Strike Force, a federal jury in Miami has convicted a local pharmacy owner for his role in a $3 million fraud scheme and for money laundering. A jury found Gustavo Smith, 43, guilty of 17 counts from a September 2007 indictment, among them conspiracy to commit health care fraud, to submit false claims to Medicare and money laundering. During the six-day trial, the jury heard testimony from patients whose names were used by Smith's Medstar pharmacy to bill Medicare for negative pressure wound pumps, wound care supplies and pharmaceuticals the patients testified they had never received and didn't need. The jury also heard evidence that Smith owned another company, Orthotics Fitters, through which he was billing Medicare for the same equipment being billed through Medstar. Sentencing has been scheduled for July 2. Smith faces a maximum of 130 years in prison.

The U.S. Supreme Court has refused to hear a legal challenge brought by AARP concerning an Equal Employment Opportunity Commission ruling that employers can reduce benefits for retirees who reach age 65 and become eligible for Medicare. Published in the Federal Register, the EEOC ruling allows employers to create two classes of retirees--those younger than age 65 and those older than 65--and offer different benefits to each group. In addition, the ruling allows employers to eliminate or reduce benefits provided to spouses or dependents of retirees older than 65. Supporters of the ruling say it ensures continuation of benefits for seniors, but AARP, which was “deeply disappointed” by the decision, argued that the EEOC ruling violated age discrimination laws.

Coming Up
The VGM Group concludes its Competitive Bidding Seminar Series with final stops in Long Beach, Calif., on May 6 and Minneapolis on May 13. For more information, call 319/274-6509 or visit www.vgm.com.

Medtrade Spring will take place May 7-8 at the Long Beach Convention Center in Long Beach, Calif. Medtrade/AAHomecare have scheduled several pre-show sessions, including the Continuum of Care, Reimbursement and Competitive Bidding conferences on May 6. For more information, call 800/933-8735 or visit www.medtradespring.com.

The Pennsylvania Association of Medical Suppliers (PAMS) will host its Annual Meeting and Conference May 18-20 in Harrisburg, Pa. For more information, call 717/795-9684 or visit www.pamsonline.org.

The National Community Pharmacists Association (NCPA) has set its Legislation and Government Affairs Conference May 19-21 in Washington, D.C. For more information, call 800/544-7447 or visit www.ncpanet.org.

The American Associaton for Homecare has scheduled a Medicare Bidding Fly-In on May 21 in Washington, D.C., to lobby Congress for suspension of round one and delay of round two of the competitive bidding program. For information, visit www.aahomecare.org.

Dynamic Seminars' Louis Feuer will conduct a sales training teleconference May 22. For more information, call 954/435-8182 or visit www.dynamicseminars.com.

On May 29, the American Association for Homecare and the University of Pittsburgh will hold a Best Practices Workshop on Mobility Assistive Documentation. Participants can attend in person at the University of Pittsburgh or via an online webinar. For more information, visit www.aahomecare.org.

The North Carolina Association for Medical Equipment Services (NCAMES) will host its Summer Meeting and Exhibit June 4-6 in Wrightsville Beach, N.C. For more information, call 919/387-1221 or visit www.ncames.org.

The VGM Group will hold its Heartland Conference in Waterloo, Iowa, June 9-12. For more information, call 800/642-6065 or visit www.vgm.com.

The American Physical Therapy Association (APTA) will host its Annual Conference in San Antonio, Texas, June 11-14. For more information, call 888/999-2782 or visit www.apta.org.

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

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