Industry files new suits

Monday, June 30, 2008

WASHINGTON--The industry in June hit CMS with four lawsuits that seek to halt national competitive bidding (NCB).

AAHomecare filed suit June 9 in the District of Columbia on behalf of its members. The association requests an immediate injunction against the July 1 start of the program and a permanent injunction to prevent Rounds 1 and 2 from moving forward.

“We’ve always thought it was important to challenge this program on multiple fronts,” said Tyler Wilson, AAHomecare president and CEO. “We’ve raised concerns with Congress, but some concerns are better addressed by the courts.”

The complaint argues that the implementation of the program has resulted in numerous violations of the Medicare Modernization Act of 2003, the Small Business Act and the Administrative Procedures Act.

“The secretary of HHS did not specify the applicable financial standards that HME providers were required to meet to be awarded contracts,” Wilson said.

AAHomecare’s suit also asks that CMS adopt the Small Business Administration’s definition of a small supplier as one with $6.5 million in annual revenues, as it originally proposed, instead of the “arbitrary” $3.5 million in the final rule.

Also in June, industry attorneys at Brown & Fortunato filed a federal lawsuit on behalf of several providers in Dallas. Funded by Last Chance for Patient Choice, the lawsuit asks for both a temporary and permanent cessation to the program. Jeff Baird, an attorney with the Amarillo, Texas-based firm, said he planned to seek an expedited hearing for the preliminary injunction.

“Even if we get legislative relief, our intention is to continue with the lawsuit,” he said. “The only reason we would back off is if NCB goes away.”

It is the second time Last Chance has brought suit against CMS in Dallas. The first lawsuit, filed last June, was dismissed in December. Last Chance also has a suit pending in Cleveland.

Two other suits were filed in June: Two Miami law firms filed a lawsuit on behalf of the All Florida Network, a group of providers who believe they were unfairly disqualified from competitive bidding; and a Washington, D.C., law firm filed a suit on behalf of Carolina Medical Sales and AmeriCare Health Systems, two providers North Carolina.

While it may seem like individual lawsuits are counterproductive, there are tactical reasons for separate complaints, Wilson said.

“This is not to divide the industry in any way,” he said.