Congratulations, You’re a Winner?

COLUMBIA, S.C. — “We would like to extend our
congratulations to you on winning the contracts
for the Round 1 rebid. And we most importantly want to welcome
you as a vital part of the success of this competitive bidding program, and
we do look forward to working with you over the next few years,”
Cindy Dreher told listeners on a call for bid winners held Nov.
10.

According to Dreher, the CBIC’s manager of policy and content,
“There’s already been a flurry of activity to ensure that everyone
affected by this program is ready, and most importantly that
beneficiaries experience a smooth transition and uninterrupted
access. And the activities continue to intensify as we get closer
to Jan. 1.”

She wasn’t kidding. After CMS’ announcement of bid winners only
a week ago (Nov. 3), Dreher reminded her audience that a trio of
deadlines is coming up next week:

• By Nov. 17, non-contract suppliers must notify CMS — and
  their Medicare patients — of whether or not they will
  
  become grandfathered suppliers.

• By Nov. 18, contract suppliers must disclose subcontracting
  arrangements.

• Nov. 19 is the cut-off date for bid losers to make inquiries to
  the CBIC about why they lost out.

That timeline was a little too intense for one provider from the
Kansas City CBA who called in to ask for an explanation.

“We are a contracted bid winner for the Kansas City area, but
there are also some categories that we are not contracted on,” said
Steve Stanholtzer of Unimed. “I am just curious what the
explanation is or how CMS could possibly say that is it reasonable
to expect us as suppliers to notify all of our beneficiaries
regarding grandfathering in less than two weeks, when the original
intent was to give us two-and-a-half months to do so. It just seems
unreasonable to make that expectation when CMS was two-and-a-half
months late in making the announcement of contracted winners.”

Replied Dreher, “We appreciate your comment and I think we’ve
addressed that earlier.”

Nope, said Stanholtzer. “You haven’t addressed how it’s
reasonable that we can do that in two weeks when we were originally
supposed to be given two-and-a-half months.”

But Dreher noted there were “sample forms available to help you”
and said that regulations require the notification date to be 30
business days prior to the implementation of the contracts.

Walt Gorski of the American Association for Homecare also told
Dreher the association was hearing about the beneficiary
notification date both from contract and non-contract
suppliers.

“As we’ve expressed, there is some serious concern among the
supplier community that there are an awful lot of patients to
notify. I’m curious,” Gorski said. “What is CMS’ penalty if the
17th deadline of notifying patients is missed?” He also asked for
an explanation of what “proof of delivery” means according to CMS,
and how either CMS or the CBIC would be tracking the information
regarding the letters sent to beneficiaries.

“Suppliers do not have to send a certified letter to their
patients, which of course would be the absolute proof of delivery,
but that is not a requirement. It’s much like when you send the
purchase option letter for the rental of equipment,” responded
Dreher. “You would just need to take the letter, make a copy of it,
put it in the file and document when the letter was mailed,” she
said. About tracking, she said, “We aren’t going to be visiting
every supplier to find out if the letter is in there, but in case
we would ever ask for it, it would need to be made available.”

While Dreher did not point to a specific penalty for missing the
deadline, she said the final rule requires that the letters “be put
out there 30 business days prior to the implementation of the
program, so of course we would expect that suppliers who choose to
grandfather or not grandfather inform the beneficiaries by that
date.”

Gorski also noted that the statute calls for an Office of
Inspector General review of the calculations under competitive
bidding, but CMS’ Michael Keane said there was no further
information on the OIG study.

During her presentation, Dreher ticked through a list of
CMS/CBIC education and outreach activities, the CBIC ombudsman
program, marketing guidelines (contract suppliers can say they are
a “Medicare contract supplier,” she said) and contract supplier
obligations, including this reminder:

“The regulations require that a contract supplier comply with
all terms of the contract for the full duration of the contract
period. This means that contract suppliers must be ready to furnish
all items in the product categories in the CBAs for which they are
awarded a contract and meet all program requirements on Day 1,
which is Jan. 1, 2011, of the contract period and then continue to
meet all program requirements until the contract period ends.”

The three-year contract term is up on Dec. 31, 2013, for all
product categories except diabetic supplies; that contract ends
Dec. 31, 2012.

That category is one Andrew D’Onofrioof Diabetes Providers in
Jupiter, Fla., called in about. The cost for some of the brand name
products that many of his 222 diabetic patients use is higher than
the allowed amount, he commented. “I have checked with some of the
suppliers and they can’t supply my patients with items they are
currently on …

“The problem we ran into in the first bid was that patients
could not receive the supplies they were accustomed to,” said
D’Onofrio, specifically pointing to Bayer, Roche, FreeStyle
(Abbott) and LifeScan. “There is no provider that I have spoken
with who can purchase those goods at a price that will allow them
to stay in business,” he said, “so how will you verify that my
patients will not be switched to a lower-priced imported item?”

“We will be closely monitoring what items are provided to
Medicare beneficiaries,” Dreher said, through claims analysis,
following up with ombudsmen and “using all the usual channels.”
Contract suppliers will also be required to report “what items by
brand names and the approximate number that were furnished to
beneficiaries during the previous quarter,” she said, adding that
under the bidding rules, Medicare beneficiaries must get the same
products that are provided to other patients.

What about now, asked D’Onofrio? “I’m trying to find placement
for my more than 200 patients for products. Seventy percent of the
products we sell are Bayer products, and they all cost more than
the allowed amount … so when my patients have to go elsewhere
they are going to be calling me to help them find a new provider,”
he said. “I’d like to know which providers are providing those four
particular brands so I can send my patients there.”

Dreher said the supplier directory at www.Medicare.gov
would have brand information for the top codes in each bid category
so beneficiaries can call 1-800-Medicare for that information.

Added Keane, “We did award contracts to suppliers that said that
they are going to provide these mentioned manufacturer names, and
in late December, we will be posting all the manufacturer brands on
the locator tool so folks can go on there and look and find a
contract supplier in their area and locate those particular items
and manufacturers.”

Dreher said a replay and transcript of Wednesday’s call would be
posted on the CBIC website.

The CBIC has scheduled another call for contract suppliers on
Wednesday, Nov. 17, with registration information to come.

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