AAHomecare retained the Washington, DC law firm of Sidley Austin earlier this week in a continuing effort to address complaints from providers who may have been unfairly excluded from round one of competitive bidding. Despite letters from legislators (see Friday Report industry news), round one is still set to go into effect on July 1, 2008, in: Charlotte, NC; Cincinnati; Cleveland; Dallas-Fort Worth; Kansas City; Miami; Orlando; Pittsburgh; Riverside, Calif; and San Juan, Puerto Rico. Associates at Sidley Austin are reviewing more than 150 examples submitted to AAHomecare by providers across the country.

Meanwhile, attorneys at Brown & Fortunato (B&F) were also weighing options, paying particular attention to crucial rules governing legal standing. “The big challenge we had was trying to figure out if we can get around the statutory language in the MMA [Medicare Modernization Act] that says there can be no judicial review,” says Jeffrey S. Baird, JD, chairman of the health care group at B&F, Amarillo, Tex. “We have researched that, and feel that we can. We feel that the prohibition against judicial review is not so broad as to prevent somebody from going to court and questioning a blatant mistake by the CBIC [competitive bidding implementation contractor].”

The competitive bidding statute (MMA of 2003) makes every effort to prevent administrative or judicial review of CMS’ steps to enforce the law. The bidding structure, the number of contractors, the awarding of contracts, and the establishment of payment amounts are all mentioned as actions by CMS that are exempted from administrative or judicial oversight. However, AAHomecare officials agree with B&F’s analysis and assert that “arbitrary and capricious activity by a government agency in implementing a regulation” is likely outside the bounds of the MMA.  

In an email letter earlier this week, AAHomecare reminded members that for many providers, being shut out of Medicare will mean going out of business—forcing thousands of Medicare beneficiaries to switch to new and sometimes multiple DME providers. For providers in the winning column, many had to decide whether to accept contracts as early as this week. Despite this 10-day decision window for winners, Baird says there is likely still time for legal action, or preferably, a favorable decision by CMS. “In the coming days, AAHomecare will be reaching out to other organizations and companies in the industry that may have enlisted legal teams,” said Tyler J. Wilson, president of AAHomecare. “We intend to lead the industry and coordinate the various efforts to ensure resources are not wasted and that every legal option is explored. Cooperation and coordination within the industry is critical to our collective success.” 

With the national association of independent medical equipment services (NAIMES) also testing the legal waters, Baird hopes that ultimately all parties will come together for the good of the industry. “We have no desire for glory on this one,” says Baird. “I support and applaud AAHomecare’s hiring of Sidley Austin. By hiring them, AAHomecare is telling the industry they will go to court if necessary. I can take a leading position on behalf of B&F clients, or support AAHomecare’s law firm.”