CMS announces new DMEPOS carriers

Sunday, January 8, 2006

WASHINGTON - HME providers in DMERC regions A and D will transition to new carriers come July 1, 2006.

CMS decided early last year to reorganize the DMERCs into two components, each overseen by a specialist contractor. One organization, the Medicare Affiliated Contractor or MAC, will handle a region's billing, customer service and other day-to-day operations. Another organization, the Program Safeguard Contractor or PSC, overseen by a medical director, will handle fraud and abuse, medical review and crafts policy.

CMS announced the new PSAs last fall. On Friday it issued a release announcing the new MACs. They are:

-- Region A, National Heritage Insurance Company replaces HealthNow. (Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island and Vermont)
-- Region B, AdminaStar Federal. (Illinois, Indiana, Kentucky, Michigan, Minnesota, Ohio and Wisconsin)
-- Region C, Palmetto GBA. (Alabama, Arkansas, Colorado, Florida, Georgia, Louisiana, Mississippi, New Mexico, North Carolina, Oklahoma, Puerto Rico, South Carolina, Tennessee, Texas, U.S. Virgin Islands, Virginia and West Virginia)
-- Region D, Noridian Administrative Services replaces Cigna. (Alaska, American Samoa, Arizona, California, Guam, Hawaii, Idaho, Iowa, Kansas, Missouri, Montana, Nebraska, Nevada, North Dakota, Northern Mariana Islands, Oregon, South Dakota, Utah, Washington and Wyoming)

The DME MACs will immediately begin transition activities and will assume full responsibilities for the claims processing work currently performed by the DMERCs on July 1, 2006.

Each DME MAC contract is being awarded in January 2006 and will include a base period and four one-year options. The DME MACs will have the opportunity to earn award fees based on their ability to meet or exceed the performance requirements set by CMS. Those performance requirements are rooted in CMS's key objectives for DME MACs: enhanced provider customer service, increased payment accuracy, improved provider education and training leading to correct claims submissions, and realized cost savings resulting from efficiencies and innovation. In accordance with the MMA, MAC contracts must be put up for competitive bidding at least every five years.

CMS awarded the DME MAC contracts to companies that offered the best overall value to the government, in light of costs, technical qualifications and other considerations, such as past performance, corporate responsibility and their understanding of the special requirements involved in processing claims for medical equipment and prosthetics provided to beneficiaries, CMS stated in its release.