Baird: For Disqualified Bidders, Lawsuit May Be Only Recourse

AMARILLO, Texas–While legislative support appears to be growing
for a suspension of round one of competitive bidding, it may take
legal recourse for HME providers who were disqualified to get their
cases heard, according to industry attorney Jeffrey S. Baird.

Baird, chairman of the Health Care Group at Brown &
Fortunato, Amarillo, Texas, said some providers who were
disqualified and appealed to the CBIC have received letters
indicating their documentation has been re-examined and still found
wanting–even though many said they have copies of complete
documentation that was submitted with their bids.

“I am concerned that the CBIC response is what has gone to
most of the companies whose applications were disqualified without
justification,” said Baird, adding that the letters appear to
be the same except for specifics about which documents the CBIC
said were missing.

“In short,” he continued, “it appears that the
CBIC will be of no help. Unless the industry receives intervention
from Capitol Hill, or unless CMS directs the CBIC to take a
different course of action, then the aggrieved companies will have
no choice but to go to court.”

“I have seen some of the form letters to providers,”
added Michael Reinemer, vice president of communications and policy
for the American Association for Homecare. “I think the
take-away there is to call your member of Congress because the CBIC
is not going to resolve these issues. It appears in many cases that
nothing has changed, even though ample evidence was provided that
the bid was submitted properly.”

Reinemer said the association is exploring the possibility of
filing a lawsuit on the issue.

Meanwhile, other lawsuits targeting competitive bidding are
already in the works.

Waterloo, Iowa-based VGM Group, through its Last Chance for
Patient Choice, is spearheading two lawsuits against the bid
program in the Dallas and Cleveland CBAs.

Last year, the Dallas lawsuit, which, among other things,
alleged that Medicare beneficiaries would receive different, lower
levels of product and/or service quality and that small HME
businesses would be unable to compete under the program, was tossed
out because no harm could as yet be proved.

The Cleveland lawsuit alleges that competitive bidding violates
the Regulatory Flexibility Act requiring all agencies to
“carefully scrutinize ways to minimize the economic impact on
small entities.”

“We’re going to try to get the lawsuit reintroduced in
Dallas and try to get additional plaintiffs in Cleveland and move
forward with a potential constitutional lawsuit based on due
process,” said John Gallagher, vice president of government
relations for VGM.

The latter, he said, “is bigger than we can
produce,” so VGM is soliciting pledges to support it.
“If we can get about $250,000 in pledges from stakeholders
across the board, we would move forward [with the due process
lawsuit],” Gallagher said.