In brief: CMS delays PECOS edit, TSS employees sue

Friday, April 26, 2013

WASHINGTON – CMS is pushing back the start date for edits to the Provider Enrollment, Chain, and Ownership System (PECOS). In a bulletin, CMS cited “technical issues” for delaying the May 1 start date. The edits, once implemented, will deny claims that contain the names of physicians not enrolled in PECOS. CMS said it would advise on a new implementation date in the “near future.” In the meantime, informational edits will continue to be sent for those claims that would have been denied had the edits been in place.

Former TSS employees sue over stock plan

NEW BRAUNFELS, Texas – The Scooter Store founder Doug Harrison and others who manage the company’s employee stock ownership plan (ESOP) now face a lawsuit by former employees. Three former employees filed a class-action lawsuit on behalf of 2,938 plan members in U.S. District Court for the Western District of Texas on April 23, seeking to recover damages and all other forms of relief as a result of “the defendants’ multiple breaches of fiduciary duty.” According to the lawsuit, those breaches include: 1.) Harrison “usurped opportunities” available to the ESOP when he sold or otherwise transferred or conveyed his shares on or after Feb. 1, 2011, to Sun Capital Partners and these shares were placed under the ownership of Sun Scooter Store; 2.) Harrison, in coordination with TSS Holdings, TSS and Houlihan Lokey Financial Advisors, manipulated the price per share for the common stock so that he and/or his family members could sell their shares at prices above fair market value; and 3.) Harrison, Principal Life Insurance Company and First Banker Trust Services failed to diversify the assets in the ESOP when they knew that the value of the common shares was very likely to diminish in value substantially from 2011 through to the present. The lawsuit also claims that $7.5 million in cash in the ESOP as of Dec. 31, 2011, has not been accounted for. The ESOP has 13.48% equity in The Scooter Store, according to the company’s recent bankruptcy filing. Members who are vested can sell their shares when they retire or leave the company. While The Scooter Store, the company, is not named as a defendant in the lawsuit, it also faces two lawsuits, another from former employees and one from the city of New Braunfels.

The outcome of those lawsuits is up in the air as The Scooter Store proceeds with the bankruptcy process.

TSS, CMS reach agreement

NEW BRAUNFELS, Texas – The Scooter Store has reached an agreement with CMS that lifts a payment freeze on the company, according to an article from The company can now receive payments from CMS, allowing it to avoid liquidation, according to the article. After The Scooter Store filed for bankruptcy April 15, CMS said it was entitled to freeze payments to the company to offset millions in overpayments, the article noted. Under the agreement, The Scooter Store will continue to repay CMS $83,000 a month, a figure that will increase to $125,000 a month starting July 1, according to the article. A judge approved the agreement April 25.

Senate panel backs Tavenner nomination

WASHINGTON – Marilyn Tavenner, Barack Obama’s nominee to oversee CMS, received the unanimous backing of the Senate Finance Committee Tuesday, according an article from Reuters. The panel’s support could pave the way for a vote by the full Senate that could make Tavenner the program’s first official administrator since 2006. A former hospital company executive and nurse, Tavenner has been CMS’s acting administrator since 2011, and has broad bipartisan support. Among Tavenner’s supporters is House Majority leader Eric Cantor, R-Va., who introduced her at an April 9 confirmation hearing.

HHS proposes increased rewards for reporting fraud

WASHINGTON – The Department of Health and Human Services (HHS) has proposed increasing to $9.9 million the rewards paid to Medicare beneficiaries and others whose tips about suspected fraud lead to the recovery of funds, according to a press release. The rewards are part of a proposed expansion for the Senior Medicare Patrol Program, which is designed to educate beneficiaries on how to prevent, detect and report Medicare fraud and abuse. “Today’s announcement is a signal to Medicare beneficiaries and caregivers, who are on the frontlines of this fight, that they are critical partners in helping protect taxpayer dollars,” stated Kathleen Sebelius, secretary of HHS. Under the proposed changes, a person that provides specific information leading to the recovery of funds may be eligible to receive a reward of 15% of the amount recovered, the release noted. The changes are modeled on an IRS program that has returned $2 billion in fraud since 2003.

Washington state passes CRT bill

OLYMPIA, Wash. – The Washington state legislature has approved HB 1445, a bill that creates a separate benefit category for complex rehab technology (CRT) within the Medicaid program, according to a press release from NCART. The bill, similar to a CRT bill currently being pursued at the federal level, passed unanimously in the Senate (46 to 0) and overwhelmingly in the House of Representatives (92 to 3). Helping to pass the bill: a state CRT workgroup comprised of manufacturers, providers, consumers and clinicians, the release noted. The bill has three main objectives: protecting access for complex needs patients to necessary technology and services; improving safeguards for the delivery and provision of CRT; and providing patients the opportunity to avoid institutionalization. The legislation is expected to be signed into law in mid-May and take effect Jan. 1, 2014, according to the release.

AOPA: Victims 'will walk and run again'

ALEXANDRIA, Va. – The American Orthotic and Prosthetic Association (AOPA) is leading a coalition to provide access to care for uninsured/underinsured amputee victims of the Boston Marathon bombings, according to a press release. Members and partners of AOPA have pledged to give these amputees and those with related mobility impairment the necessary access to artificial limbs, customized bracing and mobility assistive devices. They would like to ensure that all victims “will walk and run again,” according to the release.

Vendor news

The Strategic Partnerships Division of Harrington Management Group (HMG) has introduced a new direct-response marketing model for certain product categories in the HME industry. HMG provides the proprietary material and ad placement service, and handles all inbound calls…Philips Respironics has launched a new mobile self-management system for obstructive sleep apnea (OSA) patients. The SleepMapper, a web-based solution, allows patients to access personalized feedback, education and interactive tools…Convaid, a manufacturer of custom pediatric wheelchairs, was recently awarded the 2013 Long-Term Investor Award by the city of Torrance, Calif. The award recognized Convaid for its service and contributions to greater Los Angeles County, and for its innovative strategies and partnerships with the city…The Food and Drug Administration (FDA) has cleared ResMed’s variable positive airway pressure (VPAP) device for the treatment of COPD. The ResMed VPAP COPD, which will be sold in the United States, is designed to mitigate acute symptoms for COPD suffers, reducing hospital readmissions…With 22 mergers and acquisitions completed last year, Thomson Reuters has ranked The Braff Group as the leading healthcare M&A advisor for 2012. This was the second year in a row that The Braff Group received top billing.

People news

U.S. Rehab, The VGM Group’s alliance for complex rehab providers, has promoted Greg Packer to president. Packer, whose background includes stints in sales management positions at Pride Mobility Products and Biocore Medical Technologies, has been with VGM since 2009…CarePoint Medicalhas hired Ronald Reed as vice president of business development. Reed will be responsible for helping the company expand into new categories and grow its revenue base…At its 2013 Spring Convention & Exhibition earlier this month, the Midwest Association for Medical Equipment Services (MAMES) presented its “Above and Beyond Award” to John Gallagher, vice president of government relations for Waterloo, Iowa-based The VGM Group; and Lehn Straub, formerly of Lincoln, Neb.-based Jim’s Home Health.

Provider news

Through its acquisition of complex rehab provider Rehab Health Care (RHC), National Seating & Mobility (NSM) has added four new branch offices in Virginia. Founded in 1986, RHC provides products and services in four Virginia cities: Norfolk, Richmond, Fishersville and Charlottesville.