Moving the HME Industry Forward


CMS Does About-Face on Financial Capacity Guidance

November 18, 2013

WASHINGTON, DC – AAHomecare has received clarification from the CBIC on the bidding program issue of financial capacity, the ability of providers to reach such a threshold, and then to decline referrals for this reason.

CMS has advised the CBIC that this is no longer acceptable, even though originally, the CBIC provided guidance that it was. AAHomecare has had several discussions with the CBIC expressing that financial capacity is a real issue with potentially devastating impact.

With the number of contracts awarded to companies hundreds of miles outside of bidding areas, local providers are overwhelmed with requests.

While the Association will continue to discuss financial capacity with the CBIC, as of today, this is the official guidance:

“Per the terms of the contract, the supplier must furnish all items in the product category(ies) and CBA(s) listed in Attachment A in accordance with 42 CFR §414.408 and §414.422. 

“Bidders’ capacities are used during bid evaluation and the contracting process to ensure we award more than enough contract suppliers to meet the demand in each competition. Suppliers are not permitted to “pick and choose” which beneficiaries to whom they provide services within a CBA.

“Contract suppliers are provided a timeframe, via the quality standards, in which they can obtain and deliver the requested items. Therefore, if it is discovered suppliers are refusing to furnish all items in the product category throughout the CBA or if contract suppliers report they can no longer service the competition, they will be in violation of their contract and could have their contract terminated.”

Those with questions are advised to contact AAHomecare’s Kim Brummett at (202) 372-0750.