DMEPOS Networks: Advantage Chains

CMS currently allows drug stores chains with common ownership to obtain DMEPOS accreditation with only 25 to 35 percent of its locations (accreditor determined) being surveyed; thereby, lowering costs. Obviously, ALL locations must meet CMS’s DMEPOS quality standards; however, this proves to be a big advantage for chain drugstores.

If the 2003 MMA states that small suppliers should have every opportunity to competitively bid, then doesn’t it stand to reason that CMS should provide similar cost savings opportunities to independents?

Pharmacy buying groups currently meet insurer quality standards and bid on behalf of member pharmacies. CMS should take a creative approach to the challenges and costs associated with its accreditation requirements. Lowering accreditation costs WILL result in more community pharmacies competitively bidding; thereby, improving beneficiary access to needed DMEPOS products and services.

Developing…

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Competitive Bidding Final Rule at OMB

CMS's final rule for national competitive bidding is in clearance at the Office of Management and Budget (OMB). This is not the first time the industry has expected, but not seen, the final rule. However, this time, it was actually published on the agency's docket.

What I really don’t understand is that if competitive bidding is to begin in October 2007, as has been signaled to the industry in the past, what challenges are holding up the release.

The Government Printing Office will publish the rule in the Federal Register and CMS will post it on its Web site as soon as it clears the OMB. This should occur quickly.

I expect the rule to outline CMS's timeline for rolling out competitive bidding. I’m hopeful CMS will finally identify the first 10 metropolitan statistical areas AND the DMEPOS product categories.

Keep your fingers crossed that CMS will have the good sense to exclude diabetic testing supplies.

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Observations from NCPA's Steering Committee Meeting

Community pharmacy leaders from throughout the country converged on NCPA headquarters in Alexandria March 8th and 9th to address the challenges and opportunities that lie ahead for our profession.

Regarding DMEPOS, almost every steering committee member I spoke with was still perplexed and a little unsure of the facts. Most were wondering what steps they should take to protect their businesses when accreditation deadlines are set by CMS and competitive bidding for DMEPOS begins.

My best advice for them and you is to sign up for the DMe-Alert newsletter. You will get updates on accreditation and competitive bidding as NCPA receives them from CMS. While NCPA cannot make your business decisions for you, be assured that NCPA will have you asking the right questions to make economically-sound decisions for your pharmacy.

I hope to see many of you at the NCPA Legislative Conference NCPA Legislative Conference scheduled for May 13-16 in Washington, DC.

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The PAOC Blues

It sounded like a good idea at the time. In 2003, one independent pharmacist, yours truly, was selected as one of 20 DMEPOS industry stakeholders to become a member of the CMS Program Advisory and Oversight Committee (PAOC).

Mandated in Section 302 of the MMA, the goals of the PAOC are to provide advice on the following:

1. The implementation of the Competitive Acquisition Program (CAP) (competitive bidding).
2. The establishment of financial standards that take into account the needs of small providers. The establishment of requirements for collection of data for the efficient management of the program.
3. The development of proposals for efficient interaction among manufacturers, providers of services, suppliers, and individuals.
4. The establishment of quality standards.

The problem is that while the committee can propose changes in the development and implementation of the program, CMS is under NO obligation to accept the recommendations.

To be fair, some of our recommendations have been adopted, such as not starting the program in the largest MSAs like New York, Chicago, or Los Angeles in the first round in 2007.

However, in other instances, PAOC recommendations have not been accepted. A case in point was the committee's unilaterally strong objections to the proposed DMEPOS rebate program, which would allow suppliers submitting a bid below the single payment amount to provide a rebate to the beneficiary. Fraught with disturbing accountability fears and disquieting fraud concerns, this program is still on the table.

Regretfully, the PAOC has “no teeth.”

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