CMS has delayed Round 2. What does that mean?

Thursday, April 7, 2011

BALTIMORE - CMS announced April 5 that it would delay the start of Round 2 of competitive bidding to allow time for "potential structural changes" to the program, said industry stakeholders.

CMS made the announcement during the meeting of the Program Advisory and Oversight Committee (PAOC). Under the revised timeline, the agency will announce contract winners in spring 2013 and it will implement pricing in summer 2013. (See full timeline below.)

"They have been getting significant pressure from the industry, from the 167 economists and from other government officials to make changes," said Seth Johnson, vice president of government affairs for Pride Mobility, who attended the PAOC meeting. "In order to make changes, it would require them to make those changes through rulemaking, (which takes time)."

Despite the delay of Round 2, it was clear to meeting attendees that CMS officials are sticking to the party line: Round 1 has been a smooth transition and there are no significant access issues.

Try telling that to provider Rob Brant. At the meeting, he announced that he plans to close his 14-year-old business on April 30.

"I am closing my business because I can't do CPAP," said Brant, general manager of City Medical Services in North Miami Beach, Fla. "I called companies that won CPAP bids in my area to see if they would take my patients. They said 'We don't do CPAP.'"

The delay of Round 2 does give the industry more time to gain support for H.R. 1041, the new bill to repeal competitive bidding. It currently has 74 co-sponsors.

"I think our mission remains the same," said Cara Bachenheimer, senior vice president of government relations for Invacare, who also attended the PAOC meeting. "We need to make our case up on Capitol Hill using all the data that we have."

The PAOC meeting also included an update on CMS's use of real-time claims monitoring in the nine Round 1 competitive bidding areas to track utilization levels. The only significant change there, according to CMS, was in the mail order diabetes product category.

"There was no question that there was a significant swing from using mail order to using retail," said PAOC member Tom Milam. "And there appears to be a drop in utilization, which could mean the mail order industry made sure beneficiaries got their (three-month) supply in December. But everybody agrees, it's too early for consequences to be known."


Tentative timeline for Round 2:

Summer 2011

Announce Round 2 product categories

Begin pre-registration education for potential bidders

Fall 2011

Announce bidding schedule/schedule of education events

Begin bidder registration to obtain user IDs and passwords

Begin bidder education

Winter 2012

Registration ends

Open bidding

Covered document review process begins

Spring 2012

Bidding closes

Notify suppliers of missing financial documents

Begin bid evaluation

Fall 2012

Bid evaluation ends

Announce single payment amounts

Begin contracting process

Spring 2013

Contract suppliers announced

Begin contract supplier education program

Start intensive beneficiary, referral agent and general supplier education program

Summer 2013

Implement Round 2 and national mail order program contract and prices