BALTIMORE--CMS held a Program Advisory and Oversight Committee meeting last month to give an overview of its Notice of Proposed Rulemaking on DME competitive bidding, but committee members said most of their questions about the proposed rule remain unanswered.

The May 22-23 meeting was the first for the panel--charged with the task of advising CMS on implementing Medicare DMEPOS competitive bidding--since CMS issued its draft proposal on the program last month (see HomeCare Monday, May 1).

But PAOC member Cara Bachenheimer said CMS didn't divulge much new information that couldn't already be found in the draft rule.

"It was kind of a frustrating couple of days," said Bachenheimer, vice president, government relations, for Elyria, Ohio-based Invacare Corp. "People are so hungry for answers to their questions, but they just don't exist at this time. CMS' approach is that the regulation provides a broad framework, and many of the details will be in subsequent documents that they will issue after the final rule comes out."

According to a summary from the American Association for Homecare, the following are among key issues that were covered:

--Quality Standards and Accreditation: More than 5,600 stakeholders commented on the draft supplier quality standards, which were released last November, with the most common complaint that they were "too prescriptive," CMS said. Agency officials agreed and said they are working to adjust the standards. In one clarification of another common complaint--that responding to a beneficiary call within 60 minutes is unrealistic--CMS said it did not intend to suggest that providers had to arrive at a patient's home within 60 minutes and would clarify this point or change the wording.

Officials said they are also considering a number of comments on the business standards in the draft, including the concern that they are overly burdensome and that some of the standards should be left to state and local laws.

But officials said they could not comment about a number of other topics involving supplier standards and accreditation, including whether providers in areas selected for the first round of bidding could be grandfathered in if they are already accredited. The agency said it would provide further guidance on the question and announce solicitation of accreditation organization applications after the final rule has been published. CMS did say it would phase in the accreditation process, and would require accrediting organizations to prioritize their surveys to accredit providers in the initial 10 cities where the bidding program is scheduled to begin.

--Rebates: The rebate provision in the proposed rule drew opposition from several PAOC members, who cited concerns about legal and administrative issues. Under the rebate program, providers who submit a bid below the single payment amount that is set would be allowed to offer a rebate to beneficiaries equal to the difference between their actual bid and the payment amount. CMS said the rebates would allow providers to be more competitive. But PAOC member Dave Kazynski, president of VGM's Homelink, noted that beneficiaries are mainly concerned about quality, not a small rebate. Home care providers "are not looking at market share, they're looking at survival," he said.

--Sustainability: Several PAOC members also said they are worried that unrealistically low bids would distort the process. "There is no provision in the methodology to determine whether the winning amount is sustainable," said attorney Asela Cuervo, who represents AAHomecare on the committee.

Committee members said other issues of concern include the criteria for selecting cities and products for the bid; the bidding process and winning bidder selection; how payment amounts will be set; the absence of small supplier protections; the requirement that a supplier would have to bid on an entire product category; and how a mail order bid would impact the process.

However, Bachenheimer pointed out that the PAOC's role is advisory only. "CMS can hear our opinions but there's nothing that forces CMS to adopt them or even to explain why they reject specific recommendations from the PAOC," she said.

CMS is expected to release the final quality standards this month, and the target date for release of the final competitive bidding rule is October this year.

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To view CMS' Notice of Proposed Rulemaking on competitive bidding, click here.

For a summary of the proposed competitive bidding rule, click here.

CMS is accepting comments on the proposal through June 30. To comment, visit www.cms.hhs.gov/eRulemaking.

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