CMS Extends Bid Deadline

BALTIMORE

Hours before its first-round window for DMEPOS competitive bidding was set to close on July 27, CMS extended the deadline by 60 days. The extension followed several weeks of intense pressure from legislators and active lobbying by industry stakeholders.

But later that same day, the agency dredged up a $50,000 surety bond proposal left over from the Balanced Budget Act of 1997 — and upped the ante to $65,000.

The deadline for providers to submit bids was extended to Sept. 25, with the deadline for bid registration pushed to Aug. 27. The accreditation deadline for suppliers to be considered for contracts is now Oct. 31.

The extensions followed a concentrated lobbying effort by the industry that culminated in a letter from Senate Finance Committee officials to CMS requesting an extension of 90 days. In the July 20 letter, committee Chairman Max Baucus, D-Mont., and Ranking Member Charles Grassley, R-Iowa, said they had “serious concerns” about problems with CMS’ online bidding system and asked the agency to respond by July 25.

On that day, during a confirmation hearing for CMS Administrator nominee Kerry Weems, committee members made several requests for the extension, citing providers’ difficulties in bidding. Sen. Pat Roberts, R-Kan., wrapped up the hearing with a 20-minute laundry list of providers’ specific bidding problems compiled by the Midwest Association of Medical Equipment Services, buying groups VGM and The MED Group and other industry associations and stakeholders from throughout the country.

Roberts read the examples of problems into the hearing record, including numerous technical difficulties and other issues with the bidding system itself, bid instructions, lack of details about the program, product category issues and changes to the process.

As part of the lobbying effort, providers were encouraged to print out actual error messages from the bidding system, which made a convincing case with legislators, according to John Gallagher, vice president, government relations, for VGM.

While CMS had indicated problems with the system had been resolved, Gallagher said, when “the print screens show errors from their own system, then it’s hard for them to dispute it.”

According to MAMES Executive Director Rose Schafhauser, a 90-day extension would have been preferable, but “you take whatever you can get at this juncture.”

Since registration for bidding opened April 9, providers had reported trouble getting user IDs and passwords, not getting adequate guidance on questions and being shut out of the Internet-based bidding system. Such difficulties prompted MAMES to enlist the aid of Sen. Roberts, Schafhauser said.

“Our whole push through the senator’s office was trying to get this thing delayed and trying to get [CMS] to understand all the issues that providers are facing,” Schafhauser said. She and representatives from Roberts’ office met with CMS officials in late May about incorrect information being dispensed through the Competitive Bidding Implementation Contractor helpline.

Schafhauser said she hopes CMS will use the extra time “not just to pacify folks” but to fix problems with the system and answer bidders’ remaining questions.

Even with the bid extension, the American Association for Homecare urged providers to work toward completing their bids, noting that “there is no certainty that problems faced by HME providers will be addressed during the next 60 days.”

It’s questionable how many providers will actually use the extra time. “They announced the extension so late that everybody who was going to bid was done,” said consultant Wallace Weeks of Weeks Group.

But CMS apparently had a different thought. On the same afternoon it granted the bid extension, the agency proposed a rule requiring all DMEPOS providers to supply a $65,000 surety bond to help limit Medicare’s fraud risk.

A statement about the bond requirement said the bid extension had been granted “to allow suppliers additional time to consider their bid submissions … and have the opportunity to update their bids based on this new proposal.”

That could happen, said Weeks, although he doesn’t think there will be a flood of re-bidders, or newcomers. “I think everybody who had decided they were going to bid had done it,” he said.

While CMS has not released the number of providers who have registered in the first 10 bidding areas, founder Chris Rice of provider forum competingbid.com noted a post from one provider who signed up to bid at the last minute (before the previous registration deadline of June 30) and was given a bidder identification number in the 900s.

“Assuming that’s a sequential number, there are far fewer bidders than expected,” Rice said. “However, it is probably enough for the CBIC to work with.”