CMS tweaks national competitive bidding

Sunday, July 12, 2009

BALTIMORE - CMS on July 2 published proposed changes to the national competitive bidding program, including a process for Round 1 contract winners to file claims for damages.

But collecting damages from CMS won't be easy, warned healthcare attorney Neil Caesar. The contracts, CMS has stated, indicate that Medicare is not responsible for any expenses incurred by the supplier, other than payment of Medicare claims as authorized under the contracts.

"CMS could take the position that that means they are not going to pay for any set up or expansion costs," said Caesar, president of the Health Law Center in Greenville, S.C. "On the other hand, the proposal contains pages and pages talking about things people can submit for an evaluation of damages, including expenses associated with new leases and new purchases."

The comment period for the proposed changes, which were published in the Federal Register, ends Aug. 31.

Under the proposed rule, subcontracted providers would have no recourse for damages. Additionally, there are strict guidelines for when and how to claim damages.

The proposal also outlines changes to the grandfathering provision, which allows non-contract providers to continue providing rental equipment to beneficiaries. The most noteworthy of the changes: Grandfathered providers must supply all items in a product category.

"Previously, they could choose items code by code," said Cara Bachenheimer, senior vice president of government affairs for Invacare in Elyria, Ohio.

Other changes to the grandfathering provision: guidelines for when and how to claim grandfathered status. For example, providers who do not win contracts must notify beneficiaries 30 days prior to the start of the program that they will be picking up equipment. They must also follow up 10 days and two days beforehand.

"The supplier will need to give the patient and CMS some sort of written notice that they either will or will not be a grandfathered supplier," said Phuong Nguyen, a healthcare attorney with Amarillo, Texas-based Brown & Fortunato. "But on the 10 and two-day follow-up, suppliers are supposed to call beneficiaries to agree on a timeframe to pick up equipment. I am not so sure how well that will work in practice."