Home Health & Hospice Week

CMS will firm up time frame soon.

Home medical equipment suppliers in most of the nation's larger cities are now face to face with Medicare's competitive bidding program--a reality that will end with some leaving Medicare behind as a payer.

On Jan. 8, the Centers for Medicare & Medicaid Services officially launched phase two of Medicare's fledgling competitive bidding program for durable medical equipment, prosthetics, orthotics and supplies (DMEPOS). That has essentially laid to rest the hope that the program might sputter to a halt or be revamped before touching the majority of suppliers.

CMS released the news at a press briefing focused squarely on its effort to rein in fraud within the DMEPOS arena.

"It's a different spin" than the cost-cutting rhetoric that marked the announcement of the program's first phase, Walt Gorski of the American Association for Homecare tells Eli. But the link to the fraud crackdown isn't surprising, he says. "CMS is trying to show that it is taking steps to save Medicare from fraudulent players."

CMS cast a spotlight on the high costs of Medicare fraud in announcing the bidding expansion, estimating that 10 to 20 percent of total Medicare spending goes out to fraudulent providers.

When competitive bidding rolls out nationally in 2010, the program is expected to save Medicare $1 billion annually, says CMS--a level of savings that critics maintain doesn't justify the cost of establishing the competitive bidding program.

CMS' projected annual savings from bidding is about 2 percent of the agency's estimate of Medicare fraud, notes Wayne Stanfield of the National Association of Independent Medical Equipment Suppliers in Halifax, VA. "All this bureaucracy to save just that little bit seems pointless," he adds.

'Get Accredited' Is Still The Refrain

In any event, suppliers should begin preparing for competitive bidding, urges Stanfield.

All bidders must be accredited by the time contracts are awarded, and possibly sooner.

And some industry experts worry that the accrediting bodies will have a hard time keeping up with the new demand for accreditation: All existing home medical equipment suppliers that bill Medicare must secure accreditation no later than Sept. 30, 2009.

Pre-bidding activities including announcements of specific zip codes that constitute the competitive bidding areas (CBAs), specific items in each product category, and bidder education and registration for user IDs and passwords will commence this spring.

"Suppliers considering participating in the second phase of the competitive bidding program should apply for accreditation immediately," urged Kerry Weems, CMS acting administrator, in the Jan. 8 release.

To see how immediately competitive bidding may affect you, take stock of the following:

What: Phase two of the DMEPOS competitive bidding includes eight product categories and affects suppliers and beneficiaries in 70 metropolitan areas. The product categories, which changed little from phase one, are the following:

• Oxygen supplies and equipment,
• Standard power wheelchairs, scooters and re-lated accessories,
• Complex rehabilitative power wheelchairs and related accessories
• Enteral nutrients, equipment and supplies,
• Continuous positive airway pressure (CPAP) devices, respiratory assist devices and related supplies and accessories,
• Hospital beds and related supplies,
• Negative pressure wound therapy pumps and related supplies and accessories, and
• Walkers and related accessories.

Phase two omits two categories:  mail-order diabetic supplies and support surfaces and mattresses. The latter category applied only in one of the 10 phase one competitive bidding areas (CBAs), Miami/San Juan, Puerto Rico. Talk that CMS will take the mail-order diabetic supplies bidding national any time soon is a rumor, says Gorski.

When: CMS expects phase two bidding to begin in winter of 2008, with prices taking effect in summer of 2009, agency officials said in the press briefing.

That time frame differs from CMS' projections contained in a news release circulated during the briefing. In that missive, the agency says, "The bidding period is expected to run 60 days and is planned to begin in the summer of 2008."

Resource: For more details, go to www.cms.hhs.gov/CompetitiveAcqforDMEPOS/.