Competitive bidding: 'Red flags' cause delay

Thursday, October 14, 2010

WASHINGTON – HME providers now have an idea why CMS is dragging its feet in releasing the names of the winning bidders.

During an Open Door Forum yesterday, a CMS official told listeners that the agency has tested a new program integrity tool on the winning bidders and has identified “a number of red flags” that require further examination.

“Given the past history of fraud in the DME arena, especially in Miami, CMS believes that it is prudent to take the time to review these issues to ensure the program is best positioned to service Medicare beneficiaries,” said Michael Keane of the Division of DMEPOS Competitive Bidding, Chronic Care Policy Group.

Originally, CMS planned to release the names of the winning bidders in September.

The delay—and the reason for it—is one more example of how the program is flawed, industry stakeholders say.

“It underscores the reality that it’s a bad system, a bad design,” said Michael Reinemer, vice president of communications and policy for AAHomecare. “Describing this whole bidding program as an anti-fraud device is just preposterous.”

Keane told listeners that the delay would be short-lived.

“We expect to move forward with the implementation of the program very soon, beginning with the announcement of the contract suppliers and continuing our aggressive education and outreach activities for our beneficiaries and other stakeholders,” Keane said.

Even though CMS has started its education and outreach activities, industry stakeholders still worry the agency is running out of time if it sticks with its Jan. 1, 2011, implementation date.

“The issue isn’t just the announcement of the bidders, it’s how it relates to CMS’s ability to educate referral sources and beneficiaries,” said Cara Bachenheimer, senior vice president of government relations for Invacare. “If you constrict the timeframe, it would bode even worse for the program.”