CMS swaps contractors

Sunday, August 31, 2008

COLUMBIA, S.C.--The HME industry had its fingers crossed that all would go well Aug. 18 when Noridian Administrative Services took over the SADMERC duties from Palmetto GBA.

That concern is not without reason. When Noridian took over as the Region D MAC in July 2006, the result was a gigantic backlog of claims caused by system errors and staffing shortages.

“We are a little anxious,” said Jim Stephenson, Invacare’s reimbursement manager. “We’re concerned that we’re going to have folks there who maybe don’t have the experience and that that is going to create a delay in our process.”

Once Noridian takes over for Palmetto, the SADMERC will become the Pricing, Data Analysis and Coding Contractor (PDAC).

The SADMERC (Statistical Analysis DME Regional Carrier) performs a number of duties. For manufacturers, it reviews products and decides how they should be coded for Medicare reimbursement. If the SADMERC places a product in a code category with insufficient reimbursement, it can hamper sales.

Providers rely on the SADMERC for coding information, product classification, fee schedules and other information, sometimes on a daily basis, say industry watchers.

(Another coding concern: The switch from Palmetto to Noridian could delay the long-awaited revised manual wheelchair codes. For more on this, see page 31.)

As part of the transition to Noridian, the industry must say goodbye to Palmetto’s medical director, Dr. Doran Edwards, who worked well with the industry and understood it, Stephenson said.

“We’ve built a stellar relationship with Dr. Edwards,” he said. “He understands our industry and the equipment. Now we are going to have to break someone else in and get them up to speed.”

Noridian’s mission will not differ from that of Palmetto, but how it accomplishes that mission may, said industry attorney Neil Caesar, president of the Health Law Center in Greenville, S.C. Once Noridian takes over, old relationships will disappear and new ones will have to be forged.

“This is just one more road under construction for the drivers of the HME industry,” he said.