Really? Round 1 Collusion? Again?

BALTIMORE — In a listserv message sent Monday, CMS
repeated its caution to Round 1 bidders to watch the federal
antitrust laws. “The Centers for Medicare & Medicaid Services
(CMS) takes these laws very seriously and will not tolerate
violations. Any supplier suspected to have violated federal
antitrust laws by engaging in practices such as price fixing, bid
rigging or other forms of collusion will be referred to the
Department of Justice for investigation and is subject to having
its bid rejected,” according to the reminder.

During an Open Door Call on Dec. 2, the agency’s Joel Kaiser
told listeners CMS had “heard concerns about acts of collusion that
may be occurring during this round of bidding … I can’t
stress enough how important it is for everyone to realize that if
you are participating in such an act, there is real and serious
risk that you will have your bid rejected, and maybe possibly more
serious repercussions.”

Kaiser said CMS would be monitoring the situation, “and there
could possibly be bids rejected as a result.” (For more, see
CMS:
We’re Watching for Collusion, Dec. 3.)

In the original Round 1, Exeter, Pa.-based Pride Mobility
Products said it had uncovered potential problems in the Riverside,
Calif., competitive bidding area and called on then-Health and
Human Services Secretary Michael Leavitt to launch a full
investigation. In a May 2008 letter to Leavitt, Pride Chairman and
CEO Scott Meuser said the manufacturer had reports that 18 (out of
19) winning standard power wheelchair bidders in the CBA all had
price, product supplier and consultant in common.

Meuser received a response noting that his letter had been
received, “but we haven’t heard anything else,” Seth Johnson,
Pride’s vice president of government affairs, said Friday. Neither
have any of the California legislators representing the Riverside
CBA who also asked for an investigation of the matter, Johnson
said.

Industry sources said attention in the Round 1 rebid is again
focused on possible similar activities in the Riverside bidding
area. One insider familiar with last year’s situation in the CBA
said “the whole thing just stunk, stunk, stunk.

“If this is happening again and I’m a provider, I don’t know how
to bid fairly — I don’t even know if there’s a hope of being
able to be a winning contractor. If [these activities] are legal,
then I want to know about it because I’m at a disadvantage and I
need to be able to compete on the same terms.”

A CMS spokesperson had no further comment on where or what types
of activities are under watch. But in its Dec. 14 message, CMS
included the following Q&As for bidders using a consultant in
bid preparation:

Question: May bidders use a consultant
for the preparation of their bids?

Answer: While bidders may use consultants to
assist in the preparation of their bids, each bidder is responsible
for validating and submitting its own bid. All bids must comply
with all terms and conditions of the Request for Bids (RFB), regardless of whether a
consultant is used.

Question: Are certain consultants
or certain consultant services not appropriate for assisting in bid
preparation?

Answer: If a bidder decides to use a
consultant, any consultation service must be consistent with the
DMEPOS competitive bidding program authorizing regulations and the
RFB and permissible under all applicable federal laws.

If a supplier uses a consultant, the supplier may not knowingly
use a consultant that compares that supplier’s bid with, or
knowingly makes bid item prices identical or substantially the same
as, the bid of another bidder(s). Consultants must not violate any
federal antitrust law or engage in anticompetitive behavior (e.g.,
comparing different suppliers’ bids or knowingly advising different
suppliers to submit identical or substantially identical bid
prices) in preparing bids. CMS reviews the financial capacity
of each bidder to supply DMEPOS at the bid price and determines
whether a bid is bona fide, and, generally, whether the bid
complies with the applicable law, regulations, and RFB. CMS will
reject a bid that is not bona fide or does not otherwise comply
with the law, regulations, or RFB. If you suspect a consultant may
be engaging in practices that violate antitrust laws, please
contact the CBIC Customer Service Center at 1-877-577-5331.

If a bidder uses a consultant, the bidder needs to verify that
the information prepared by the consultant is accurate and can be
certified as true by the bidder. Bidders certify that their bids
are true, accurate, and complete when they approve Form B in DBidS.
Approving Form B also certifies that the bidder understands that
any omission, misrepresentation, or falsification of any
information contained in the bid and all required attachments and
supplemental information or contained in any communication
supplying information to CMS or the CBIC may be punishable by
criminal, civil, or other administrative actions including
revocation of approval, fees, and/or imprisonment under federal
law.

Read the CMS notice in its entirety on the CBIC Web site. Round 1 bids are due Dec.
21.

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