OIG to Perform Limited Review Of CMS Competitive Bidding Program

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By James Swann  

The Department of Health and Human Services Office of Inspector General will conduct a limited, four-state review of the Centers for Medicare & Medicaid Services' competitive bidding program for durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS).

The review, which will cover Maryland, Michigan, Ohio and Tennessee, comes in response to a June 20 request from Reps. Glenn Thompson (R-Pa.) and Bruce L. Braley (D-Iowa) to investigate licensure issues and identify whether unlicensed DMEPOS providers were awarded contracts by CMS under the bidding program (122 HCDR, 6/25/13).

Braley and Thompson said there had been indications that CMS awarded contracts to DMEPOS providers who were not compliant with program guidelines.

In an Aug. 22 letter to Thompson and Braley, OIG Inspector General Daniel R. Levinson said the limited review would determine how CMS applied “State licensing requirements under Round 2 of the bidding program in these States to suppliers that were awarded contracts.”

In addition, Levinson said, OIG will determine the impact to the competitive bidding program from any potential licensing issues in the four states.

Levinson also said OIG will begin work this year to conduct a full post-award review of Round 2 of the competitive bids program.

The competitive bids program expanded from nine areas to 91 additional areas for Round 2, which began July 1. The new areas include Los Angeles and Chicago. Thompson and Braley have initiated congressional letters to CMS in attempts to delay the second round of the bidding program.

When the 800 suppliers chosen to provide products in the eight categories of Round Two were announced in April, CMS said that the program is expected to save Medicare Part B about $25.7 billion between 2013 and 2022 and that beneficiaries are expected to save an estimated $17.1 billion as a result of lower coinsurance and premium payments (69 HCDR, 4/10/13).