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A Joint Letter from the O&P Alliance to the Orthotic and Prosthetic Profession

The four member organizations of the O&P Alliance (AAOP, ABC, NAAOP and AOPA) write this joint letter to inform our respective members about the status of Medicare DMEPOS supplier accreditation, quality standards, and competitive bidding.

There has been considerable confusion and misinformation in the field on these important issues and this letter is intended to clarify the situation as of this date. It is important to note two things: 1) that this situation is changing rapidly from day to day as CMS implements these new policies, and 2) that your national associations are actively working, in alliance, to advance your interests.

Competitive bidding for DME, supplies and some orthotics was enacted by Congress in the Medicare Modernization Act of 2003 (“MMA”) and is scheduled to be phased-in beginning in October 2007 in ten cities (i.e., Metropolitan Statistical Areas or “MSAs”) throughout the country. These ten cities have not yet been announced although CMS has informally suggested that they will be chosen from a broader list of 28 MSAs under consideration. Rumors in the field that CMS has already selected these ten cities are false.

Prosthetics are completely exempted from competitive bidding by law and many orthotics are as well. CMS has not yet announced which orthotics will be included in competitive bidding but the MMA law states that only “off-the-shelf orthotics” may be included. The term “off-the-shelf orthotics” is defined in the law so CMS must adhere to this definition when it interprets which orthotics are considered “off-the-shelf.” The O&P Alliance is actively working to ensure that the list of orthotic codes that are included in competitive bidding is as short as possible.

Under competitive bidding, suppliers will submit bids to the government to provide items and services to Medicare beneficiaries for reduced fee schedule rates. In exchange, CMS will select a limited number of suppliers for a given MSA. To help ensure that suppliers do not skimp on the care they provide beneficiaries, Congress mandated that CMS create quality standards. CMS will ensure that suppliers in the competitive bidding program are meeting the quality standards through an accreditation model. In fact, this past November, CMS selected 11 private organizations, including ABC, to accredit certain DMEPOS suppliers. A list of the 11 organizations is attached.

All suppliers wishing to participate in the competitive bidding program must be accredited and meet the quality standards and, so, CMS will require accreditation first in those MSAs that are selected for competitive bidding. O&P suppliers in the 10 selected MSAs who do not participate in supplying off-the-shelf orthotics through competitive bidding are not immediately required to become accredited.

However, ALL DMEPOS SUPPLIERS, including all O&P suppliers, must become accredited eventually if they intend to continue participating in the Medicare program, whether or not they participate in competitive bidding. It is not known when CMS will enforce this accreditation requirement by discontinuing Medicare payment to suppliers who are not accredited, but this is likely to be years away. At present, only a small percentage of Medicare’s DMEPOS suppliers are accredited.

There are numerous, complex issues still unresolved and numerous decisions to be made as CMS implements this set of policies. There are also many unknowns at this time. For instance, several organizations selected to accredit DMEPOS suppliers have little or no experience with accreditation, let alone accreditation of O&P facilities. The learning curve for these organizations will be steep and some are likely to discontinue their interest in O&P as the complexities become clear.

ABC and the other ten selected accrediting organizations are in a difficult position at this point. CMS has stated that it expects all suppliers who will be participating in competitive bidding to be accredited by April 2007. But the ten MSAs for competitive bidding have not yet been announced, the list of orthotic codes defined as “off-the-shelf” has not been determined, and CMS has recently suggested its interest in revising the quality standards that apply to orthotics and prosthetics. In addition, it is not clear at this time whether every MSA will include competitive bidding of off-the-shelf orthotics.

You may be contacted by one or more of the 11 accrediting organizations selected by CMS urging you to avoid delay in becoming accredited. We would like to collectively stress that at this point in time, it is important to proceed in a deliberate manner, to keep informed of new developments through your national associations, and to keep the implementation of these new policies in perspective.

We hope this letter lessens the confusion surrounding these issues in the O&P profession. Suffice it to say, we share your frustration with the uncertainties and misinformation and will continue to inform you of developments as they occur. Please contact any of the four groups that comprise the O&P Alliance for further assistance.

Mark DeHarde President National Association for the Advancement of Orthotics and ProstheticsStephen B. Fletcher, CPO President American Board for Certification in Orthotics and Prosthetics

Gary M. Berke, MS, CP, FAAOP President American Academy of Orthotists and ProsthetistsRonald Ted Snell, CP President American Orthotic & Prosthetic Association

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