The industry got an opportunity to confront CMS regarding its national competitive bidding program since CMS issued its interim final review to re-bid round one at the Program Advisory and Oversight Committee (PAOC)’s June 4 meeting in Baltimore, Md.

A new PAOC was formed when MIPPA extended the PAOC for two years, through Dec. 31 2011, and the meeting came on the heels of CMS’s announcement of further details regarding its round one re-bid.

The PAOC board that met with CMS includes various industry representatives and homecare stakeholders, (a full roster can be found here), and approximately 200 providers and other industry members were in the audience for the meeting.

Walter Gorski, AAHomecare’s lobbyist and vice president for Government Affairs, who sits on the PAOC engaged in what AAHomecare described as “sometimes heated” discussion with CMS staff.

A lynchpin issue was how CMS calculates the number of providers that are needed to provide patients in competitive bidding areas with sufficient care. In last year’s attempt at round one, of the 4,127 providers that bid, only 376 received contracts, with some providers not having much capacity to serve product categories for which the won. Even if a winning provider was readily equipped to handle a given category, it might have to ramp up the capacity to serve as much as 20 percent of a CBA — a daunting prospect.

“If a provider is denied a contract, based on a flawed capacity calculation by CMS, the provider’s financial viability immediately comes into question,” Gorski said. “We will not be able to fix these types of mistakes six months or a year from now.”

Other concerns expressed at the meeting:

• Inadequate licensure for winners. It was suggested that every provider location must be licensed in the state in which it provides services, and providers bidding in multi-state CBAs must meet licensure requirements for all states in the CBA and, if required, have at least one physical location in the state where it provides service.
• The program’s impact on patients’ continued access to an adequate range of choices in terms of providers, services, and products.
• The sustainability of prices after implementation of bidding.
• NCB’s impact on diabetes patients.
• CMS’s calculations for setting single payment amounts.

Gorski said that AAHomecare will follow up with CMS on the issues raised with the meetings and will work with the PAOC co-chairs to develop agenda items for future meetings. That said, the industry is still fighting NCB on multiple fronts.

“Some overtures from CMS at the PAOC were seen as positive, however it remains to be seen if any good will come from the recommendation of the advisory committee,” read a statement from the National Association of Independent Medical Equipment Suppliers, which had several members at the PAOC meeting.

“We will also need to remain dogged on Capitol Hill to make sure lawmakers join us in pushing CMS to fully address the concerns that we emphasized on June 4,” said AAHomecare President Tyler Wilson. “In the past, the PAOC left the HME sector with more questions than answers. Our work with the PAOC will not diminish our effort to stop the program through legislative action by Congress.”