Sources sought SOW 07 06 12.docx

May 4, 2012

STATEMENT OF WORK (SOW)

National Supplier Clearinghouse Medicare Administrative Contractor (NSC MAC)

1. SCOPE

A. Background The National Supplier Clearinghouse Medicare Administrative Contractor (NSC MAC) is the single organizational entity responsible for issuing or revoking Medicare supplier billing privileges for suppliers of Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) and maintaining supplier files by using the government furnished Provider Enrollment Chain and Ownership System (PECOS) containing information collected via the Medicare enrollment application (CMS-855S) as well as other data pertaining to DMEPOS supplier enrollment, per regulation.

The NSC MAC was developed because of the unique and specialized requirements that distinguish DMEPOS supplier enrollment from that of other Medicare providers and suppliers. In particular this includes accreditation, surety bonding, special licensing, insurance, inventory, etc. The unique standards that DMEPOS suppliers must meet are contained in 42 C.F.R. 424.57. The NSC MAC assures that enrolled DMEPOS suppliers meet all required supplier standards through various means including site visits and checks of submitted documents. The NSC MAC also develops and investigates for potential non-compliance and fraud of DMEPOS suppliers. This activity has become increasingly important as fraudulent activity among DMEPOS suppliers has increased. The NSC MAC conducts hearings and provides input for appeals of revoked and denied suppliers. The NSC MAC interacts with the Durable Medical Equipment Medicare Administrative Contractor(s), (DME MACs) who are the DMEPOS supplier payment contractors, hereafter referred to as DME MACs. The NSC MAC also coordinates and supplies information to the Zone Program Integrity Contractor(s) (ZPIC(s)) to investigate fraudulent supplier activity.

B. Purpose

The purpose of this Statement of Work (SOW) is to contract with an entity to serve as the NSC MAC who shall properly issue and/or revoke Medicare supplier billing privileges for DMEPOS suppliers and to maintain supplier files in PECOS that contain information collected via the Medicare enrollment application and enrollment process.

The NSC MAC’s primary responsibility is to ensure that DMEPOS suppliers meet and continue to meet all Federal and State requirements to bill the Medicare program. To this end, the NSC MAC shall ensure that all DMEPOS suppliers who are enrolling or who are currently enrolled in the Medicare program meet all required supplier standards found in 42 CFR 424.57(c), Medicare accreditation standards found in 42 CFR § 424.58, Medicare provider/supplier enrollment requirements found at 42 CFR 424.500 – 424.545, and the provisions found in IOM Pub. 100-08, Chapter 15 and that enrollment decisions are documented and processed in an accurate manner.

Specifically, the NSC MAC’s primary responsibility is to:

· Ensure that only qualified DMEPOS suppliers are enrolled or remain enrolled in the Medicare program including taking the necessary actions to revoke enrolled suppliers who no longer meet all required supplier standards;

· Processing DMEPOS supplier enrollment applications and appeals in a timely manner;

· Establish and maintain a fraud prevention and detection program for supplier enrollment;

· Participate in the development, testing and transition/implementation/operation of updates and/or changes to future releases of PECOS for DMEPOS suppliers; and

· Ensure that all DMEPOS suppliers are properly accredited.

II. REQUIREMENTS

1.0 Basic Requirements/Responsibilities

Independently and not as a agent of the Government, the contractor shall furnish all necessary services, qualified personnel, material, equipment, and facilities, not otherwise provided by the Government, as needed to perform the requirements of this SOW.

The NSC MAC will use the information submitted on the Medicare enrollment application (CMS-855S), information obtained during the verification and validation process, and when applicable, accreditation and/or a site visit information to determine if a DMEPOS supplier meets or continues to meet all required supplier enrollment standards found in 42 CFR § 424.500 – 424.545, 42 CFR 424.57(c) and as amended by the provisions of the final rule CMS-6036-F, accreditation standards found in 42 CFR § 424.58 and provisions found in IOM Pub. 100-08, Chapter 15, hereafter referred to as DMEPOS supplier standards, inclusive.

If a DMEPOS supplier does not meet the required enrollment standards, the NSC MAC shall deny the DMEPOS suppliers’ request for Medicare billing privileges. Moreover, if a DMEPOS supplier is found to no longer meet all required supplier standards in 42 CFR 424.57(c), the NSC MAC shall revoke the DMEPOS supplier’s billing privileges. A supplier’s billing privileges that are revoked shall not be reinstated until the CMS is satisfied that all necessary recompense and/or remedial actions have occurred and that the supplier complies with all required DMEPOS supplier standards.

The NSC MAC assists all four DME MAC contractors equally in the conduct of NSC MAC functions, and is not directly involved in the day-to-day conduct of DME MAC processing of claims or provider/supplier relations.

The NSC MAC is subject to the CMS’s requirements for systems security, as stated in Pub 100-17, and privacy as stated in the Privacy Act of 1974, P.L. 93-579, and the corresponding regulations and general instructions.

Section 508 Compliance for Communications The NSC MAC shall comply with the standards, policies, and procedures below. In the event of conflicts between the referenced documents and this SOW, this SOW shall take precedence.

Rehabilitation Act, Section 508 Accessibility Standards

1. 29 U.S.C. 794d (Rehabilitation Act as amended)

2. 36 CFR 1194 (508 Standards)

3. www.access-board.gov/sec508/508standards.htm (508 standards)

4. FAR 39.2 (Section 508)

5. CMS/HHS Standards, policies and procedures (Section 508) In addition, all contract deliverables are subject to these 508 standards as applicable.

Regardless of format, all Web content or communications materials produced, including text, audio or video must conform to applicable Section 508 standards to allow federal employees and members of the public with disabilities to access information that is comparable to information provided to persons without disabilities. All contractors (including subcontractors) or consultants responsible for preparing or posting content must comply with applicable Section 508 accessibility standards, and where applicable, those set forth in the referenced policy or standards documents above and below. Remediation of any materials that do not comply with the applicable provisions of 36 CFR Part 1194 as set forth in this SOW shall be the responsibility of the contractor or consultant.

1.0.1 Reserved

1.0.2 Reserved

1.0.3 Reserved

The Director of the NSC MAC is required to direct or oversee all activities and requirements outlined in this SOW, including all activities associated with implementation.

The Director shall possess ten or more years of professional experience with at least 3 years as a manager responsible for managing complex systems and work flow. This experience should include fraud prevention and investigation. In addition, the Director shall possess a bachelor’s degree from an accredited institution, plus a master’s degree from an accredited institution or substitution of 4 additional years of related work experience in lieu of the master’s degree.

The NSC MAC shall have an assistant Project Administrator who is capable of performing the activities as required by CMS in the Director’s absence.

The NSC MAC shall respond to CMS’s PO’s requests/questions within 2 business days. If the request/question cannot be answered within those 2 business days the NSC MAC shall contact the PO and inform them when the information will be available. When key personnel will be out of the office there should be someone in the office that can answer all requests/questions within the 2 business days.

1.1.2 Supplier Audit and Compliance Unit Manager

The NSC MAC shall maintain a Supplier Audit and Compliance Unit (SACU) with the mission of preventing fraudulent and unqualified suppliers from enrolling in the Medicare program and revoking such suppliers’ billing numbers who are already enrolled. The manager of the SACU shall be a Certified Fraud Examiner (CFE) or Accredited Healthcare Fraud Investigator (AHFI) or have similar education qualifications. Team leaders in the SACU shall be encouraged to obtain CFE, AHFI, or education qualifications in fraud investigations. The SACU shall educate suppliers about the Medicare enrollment process and the mandatory requirements to enroll in the Medicare program; participate in Medicare and Contractor sponsored fraud conferences, meetings, and discussions; serve as a point of contact for organizations such as General Accounting Office (GAO), Office of Inspector General (OIG) and Federal Bureau of Investigation (FBI), et. al., on NSC MAC-related Medicare fraud issues; establish contacts among governmental fraud prevention agencies in areas of activity such as site visits; support the site visit process in general; and take whatever steps it deems reasonable, including appropriate travel, in compliance with existing regulations and laws to prevent fraudulent suppliers from gaining and keeping access to the Medicare program. The manager of the SACU shall also be responsible for overseeing the implementation and all activities associated with the implementation of the SACU. The SACU shall conform to the Internal Security Guidelines set forth in Pub 100-18.

The NSC MAC shall have an assistant SACU manager capable of performing the duties of the SACU manager in his/her absence.

1.3.3 Hearings and Appeals Manager

The NSC MAC shall have a manager who has demonstrated experience in the requirements of Medicare hearings and appeals. The Hearings and Appeals Manager shall be familiar with all current policies and regulations concerning these matters. In particular, the Hearing and Appeals Manager should be familiar with 42 CFR § 498 and section 19 of Chapter 10 of the PIM, as well as other applicable sections of the PIM.

The manager shall have overall responsibility for: (1) the managing of the NSC MAC hearings and appeals unit, and (2) assuring proper actions are taken concerning appeals of adverse hearing officer and Administrative Law Judge (ALJ) decisions. The Hearings and Appeals Manger can also function as the Director of the NSC MAC or the SACU Manager.

The Hearings and Appeals Manager shall possess 2 or more years of professional experience with at least 2 years with the responsibility for making decisions involving determinations in accordance with legal principles and preparation of legal document files. In addition, the Hearings and Appeals Manager shall possess a bachelors’ degree from an accredited institution; however, the manager can substitute 5 or more years of related work experience in lieu of the bachelors’ degree.

1.2 Fraud and Abuse Control

The NSC MAC through its SACU unit shall perform initiatives to control fraud and abuse for DMEPOS suppliers.

1.2.1 Development and Use of Fraud and Abuse Index of Risks

The NSC MAC shall perform a fraud potential analysis of all DMEPOS applicants and current DMEPOS suppliers. The NSC MAC shall develop a system where they assess and assign each DMEPOS supplier or applicant a Fraud and Abuse Index of Risk. The Fraud and Abuse Index of Risk shall represent the potential for fraud and/or abuse. Initially, the NSC MAC shall use four Fraud and Abuse Index of Risk codes as follows:

1) Low Risk (e.g., National Drug Store Chains),

2) Limited Risk (e.g., Prosthetist in a low fraud area),

3) Medium Risk (e.g. midsize general medical supplier in a high fraud area), and

4) High Risk (e.g. very small space diabetic supplier with low inventory in a high fraud area whose owner has previously had a chapter 7 bankruptcy).

High fraud areas shall be determined by contractor analysis with concurrence of the NSC MAC’s PO. In assessing a Fraud and Abuse Index of Risk, the NSC MAC shall consider such factors as:

1) Experience as a DMEPOS supplier with other payers,

2) Prior Medicare experience,

3) The geographic area,

4) Fraud potential of products and services listed,

5) Site visit results,

6) Inventory observed and contracted, and

7) Accreditation of the supplier.

As a minimum an observational site visit will be performed on all suppliers with a FAIR score of High within 75 days of enrollment and within 120 days for those with a FAIR score of Medium. A regular required site visit can be used in lieu of these observational site visits.

The NSC MAC shall advise the appropriate DME MACs and ZPICs of this information and the Fraud and Abuse Index of Risk assigned on a quarterly basis. The Fraud and Abuse Index of Risk shall be updated based upon information:

1) obtained through the Medicare enrollment process, such as reported changes of information,

2) Obtained by the Office of Inspector General,

3) obtained from CMS, a ZPIC or CMS Satellite Office.

In addition, the NSC-MAC should monitor and assess geographic trends which indicate or demonstrate that one geographic area has a higher potential for having fraudulent suppliers.

1.2.2 DMEPOS Site Visits to Detect and Deter Fraud in the Medicare Program

The NSC MAC shall conduct an unannounced site visit for all newly enrolling DMEPOS suppliers with a fraud indicator of limited, medium or high prior to enrolling the DMEPOS supplier into the Medicare program.

The NSC MAC shall conduct an unannounced site visit for all DMEPOS suppliers who are reenrolling in the Medicare program when the DMEPOS supplier has fraud indicator of medium or high. All revalidations shall require a site visit. All revalidations for suppliers who cite that they supply prosthetics shall receive a formal (non-observational) site visit.

The NSC MAC shall conduct a minimum of two unannounced site visits per year for DMEPOS suppliers who are assigned a Fraud and Abuse Index of Risk of high. In meeting this requirement, the NSC MAC can consider a site visit associated with a reenrollment as one of the two unannounced site visits.

The NSC MAC shall conduct a minimum of one unannounced site visit per year for DMEPOS suppliers who are assigned a Fraud and Abuse Index of Risk of medium. In meeting this requirement, the NSC MAC can consider a site visit associated with a reenrollment as one of the two unannounced site visits.

In addition to the site visits required above, the NSC MAC shall conduct at least 3,000 additional unannounced site visits not required for initial enrollment or reenrollment each calendar year.

1.2.3 Business Telephone Verifications

Deleted.

1.2.4 Telemarketing and Solicitation

To enforce the supplier standard in 42 Code of Federal Regulation (CFR) 424,57(c )(11) the NSC shall review reports supplied by the Office of Inspector General (OIG) which cite beneficiary complaints of inappropriate telephone contact (telemarketing). The NSC will research these complaints by contacting beneficiaries and/or suppliers. The NSC shall take appropriate revocation action in cases where a supplier has been determined to be performing inappropriate telemarketing.

The NSC MAC shall maintain a link to internet PECOS.

1.3.2 PECOS

The NSC MAC shall use PECOS as the primary DMEPOS enrollment system. The NSC MAC shall participate in the development and testing of updates and/or changes for future releases to PECOS. Specifically the NSC shall have several people participate in testing of all PECOS releases.

1.4 Accreditation

The NSC MAC shall be familiar with the requirements for accreditation of DMEPOS suppliers.

The NSC MAC shall ensure that all enrolled DMEPOS suppliers are properly accredited for the products and services that the DMEPOS supplier has listed on the Medicare enrollment application (i.e., CMS-855S). The NSC MAC shall provide the date of accreditation and products and services accredited for to the site reviewers. The NSC MAC shall also use this information in developing supplier Fraud and Abuse Index of Risks.

Task 1.4.1 Competitive Bidding

The NSC shall have 4 dedicated staff to support competitive bidding efforts. The staff needs to be available to assist in 4 separate phases of the competitive bidding program.

· Assist suppliers with updating their records to reflect current information. This will enable suppliers to successfully register to bid in the competitive bidding program. This task will begin as soon as CMS announces the Round 2 areas and product categories in midsummer of 2011.

· Assist the Competitive Bidding Implementation Contractor (CBIC) by providing them access to the NSC Licensure Database with all licensure requirements nationwide. This task will begin as soon as CMS announces the Round 2 areas and product categories in midsummer of 2011.

· Assist the CBIC in verifying and validating licensure and accreditation status of bidding suppliers. This task will begin in spring of 2012 during the bid evaluation phase.

· Assist the CBIC in monitoring the enrollment status of contract suppliers.

· Assist suppliers in maintaining and expediting changes to enrollment record.

The NSC shall provide data and check supplier submitted data to support the operations of the Competitive Bidding Implementation Contractor (CBIC). The NSC shall also answer enrollment related inquiries and process supplier changes in support of the competitive bidding initiative. This includes expedited processing of specific, mutually agreed upon supplier changes required to support the competitive bidding process.

The following activities have been specifically identified for competitive bidding:

· The NSC will ensure that their file has complete and accurate information to be used to validate suppliers interested in submitting a bid. This information includes the Name, Date of Birth, and Social Security Number of the authorizing official. The NSC will expedite any requests received from suppliers located in a competitive bidding area to update any of the fields mentioned above to facilitate the suppliers’ registration and bid submission. The NSC will also expedite any changes made to the Authorized Official information.

· The NSC will educate suppliers and post an article on their website of the importance of keeping their records up-to-date. In particular the significance of the authorized official field.

· The Competitive Bidding Implementation Contractor (CBIC) will update PECOS with all winning suppliers by sending update files to PECOS, and receive extract files from PECOS for monitoring purposes. During the monitoring phase of the program which is the duration of the competitive bidding contract, the NSC will provide assistance to the CBIC regarding questions or issues with contract suppliers.

Task 1.4.2 NSC Task to Verify Enrollment Status

During bid evaluation the NSC shall have employees specifically to assist the CBIC in verifying and validating the enrollment status of bidding suppliers. NSC will assist CBIC in verifying bidding suppliers’ PTAN to ensure the supplier is currently active and in good standing with the NSC. This task will occur during the bid evaluation phase of any phase of competitive bidding.

Task 1.4.3 NSC Task to Verify Licensure Requirements

According to Supplier Standard 1 – suppliers are required to meet all state and federal licensure requirements. At the time of enrollment all suppliers must provide to the NSC proof that they possess the necessary licenses required by the state to provide the services identified on their 855S. Suppliers are also required to notify the NSC of any updated information within 30 days of the information change.

In order for a supplier to submit a bid to furnish a competitive bidding item or service in a CBA they must have the applicable state license. The NSC must maintain a database that identifies at the product level all licenses required for each state.

The CBIC will verify suppliers’ licenses against PECOS data. The NSC will assist and research outliers and discrepancies. In order to provide definitive responses, the CBIC will provide the NSC with a file that identifies each bidder by NSC# , the CBA/Product Category for which they are bidding, and the state(s) the supplier location will be providing products, and the products that will be provided in each state. . The NSC will maintain the licensure database and will notify the CBIC of any changes.

The NSC shall publish and maintain a licensure database for every state in a competitive bidding area.

The following rules will be applied when verifying the licensure status of suppliers:

· Applicable state licenses are required for every location of a supplier (10-digit NSC#)

· Suppliers that have locations in every state of a multiple state CBA, each location in the state must have the applicable state license to provide the competitive bidding item in that state. For example, for the Charlotte CBA which crosses into 2 states North Carolina(NC) and South Carolina (SC), all locations of the supplier located in NC must have the applicable license to provide the competitive bidding item in NC and all locations of the supplier in SC must have the applicable license to provide the competitive bidding item in SC. However, each location does not have to be licensed for both states.

· Suppliers with only 1 location in a multiple state CBA must have the applicable license to provide competitive bidding items and services throughout the CBA. Therefore, they will be required to have a license for each state in the CBA. It will be the CBICs responsibility to notify the NSC which of the above 2 scenarios apply to each supplier location being researched by the NSC. During bid evaluation the NSC shall have employees specifically dedicated to assist the CBIC in verifying and validating the licensure status of bidding suppliers. This task will occur during any bid evaluation phase.

Task 1.4.3.1 NSC Verification of Accreditation Information

As of October 1, 2009 all Medicare enrolled DMEPOS suppliers are to be accredited for the product categories that they furnish to Medicare beneficiaries. Under the competitive bidding program all bidding suppliers are required to be accredited or have pending accreditation for the product category for which they bid. Therefore, the National Supplier Clearinghouse (NSC) and the Competitive Bidding Implementation Contractor (CBIC) must work together to verify that the supplier is accredited for the product category for which they bid. The CBIC will first check the accreditation status of bidding suppliers against PECOS data and/or the Accreditation Organizations Weekly File. The CBIC will then work with CMS to verify the accreditation status of any supplier who does not appear to be accredited according to this file.

During bid evaluation the NSC shall have employees specifically dedicated to assist the CBIC in verifying and validating the accreditation status of bidding suppliers. This task will occur during any bid evaluation phase.

Task 1.4.4 Monitoring the Enrollment Status of Contract Suppliers The CBIC will monitor supplier changes via a PECOS extract file. The NSC will assist CBIC personnel as needed with issues and/or questions.

1.5 Customer Service

The NSC MAC shall utilize an internal review process to continuously improve written and verbal communication. The NSC MAC shall maintain a training plan for all staff based on surveys, trend analysis, and employee feedback. The NSC MAC shall analyze supplier inquiries (both telephone and written inquiries) to identify specific areas of concern and use information gathered from such analysis to improve customer service through outreach and education activities. Written correspondence to suppliers shall contain sufficient information to allow suppliers to readily determine the actions the supplier shall take. The NSC MAC shall work to install a system to monitor supplier telephone calls initiated by the suppliers and potential suppliers.

The NSC MAC shall provide continuous inbound telephone customers service Monday through Friday, for 8 hours a day. Continuous inbound telephone customer service means that callers shall be able to speak to an NSC MAC representative during the hours specified. During other times they should be informed to call back during regular business hours or told that the NSC MAC shall call them back if they leave their phone number. It will, however, be acceptable for some calls to go to a voicemail box during peak call times provided follow-up is conducted within an agreed upon timeframe from receipt of the call. The NSC MAC shall evaluate customer support service desk efficiency on an ongoing basis and recommend appropriate changes to operating hours. The NSC MAC shall ensure that the following customer service center performs at a minimum:

· Inbound calls must be answered no later than the 5th ring;

· Answers to inbound questions shall be answered within 24 hours. If more than 24 hours is necessary the NSC MAC shall contact the requestor within 24 hours and provide an estimated date in which the answer will be provided.

The CMS PO shall approve model language used in all routine correspondence to suppliers prior to use by the NSC MAC. The NSC MAC shall refer all beneficiary inquiries to the appropriate DME MAC contractor.

The NSC MAC shall maintain liaison with the national and state supplier industry representative groups.

Allegations of fraud received by the NSC MAC's telephone service unit shall be entered into a log and referred to the NSC Supplier and Audit Compliance Unit (SACU) for review, development and any further action. The complaint log shall list, at a minimum, the:

· Complaint and nature of the complaint;

· Supplier Name (and Number, if applicable)

· Name of the NSC MAC representative who received the complaint;

· Date the complaint was received,

· Date the complaint was referred to the SACU or resolved by the NSC MAC; and

· Disposition of the complaint.

If the NSC MAC believes, after the SACU’s review of a compliant, that fraud or potential fraud exists which should be investigated by the ZPIC, the NSC MAC shall refer the complaint to the ZPIC.

Supplier Outreach/CMS Liaison – The NSC MAC shall attend meetings of supplier organizations to provide education concerning enrollment. The NSC MAC shall participate in meetings at CMS central and satellite offices as requested.

1.5.1 Enrollment Fee Collection and Review of Hardship Exemptions

The NSC shall ensure that new applicants and revalidating applicants have paid their required application enrollment fee. Requests for hardship exemption determinations shall be processed by the NSC.

1.6 Website Information

The NSC MAC shall maintain a website that provides DMEPOS suppliers with the information needed to complete and submit an enrollment application or reenrollment application, including, but not limited to, frequently asked questions, licensing requirements by product and/or State, insurance requirements, etc.

1.7 Deactivation

If the NSC MAC discovers one location has multiple Medicare billing numbers, the NSC MAC shall deactivate all supplier privileges for that location within 30 calendar days of discovery.

Consistent with manual instructions found in IOM Pub. 100-08, Chapter 15 , the NSC MAC shall deny any applicant who fails to meet the DMEPOS supplier standards, inclusive. The NSC MAC is not required to obtain prior PO approval for denials based upon adverse legal actions.

1.8.2. Rejections and Returns

Consistent with manual instructions found in IOM Pub. 100-08 Chapter 15, the NSC MAC shall reject or return an incomplete or incorrectly completed Medicare enrollment application submitted by a DMEPOS supplier. In rejecting or returning an enrollment application, the NSC MAC shall provide a letter to the DMEPOS supplier stating what information is needed in order to process the enrollment application.

In addition, if a required site visit cannot be completed, the NSC MAC shall reject or return the applicant’s Medicare enrollment application and notify the supplier that the NSC MAC cannot verify the supplier’s compliance with all required supplier standards and shall advise the supplier that it may resubmit an application when a complete site inspection can be conducted. The NSC MAC shall not deny the application.

1.8.3. Revocations

The NSC MAC shall revoke billing privileges consistent with manual instructions found in IOM Pub. 100-08, Chapter 15 . In addition to the manual instructions outlining revocation scenarios, the NSC MAC shall revoke a billing number if one or more of the following occurs:

· The supplier does not meet all required supplier standards in 42 CFR §424.57 as determined by the NSC MAC;

· The entity, and/or its owner(s), and/or managing employee(s), are not eligible to submit claims to the Medicare program because they appear on the Medicare Exclusion Database (MED) or General Services Administration (GSA) Excluded Parties List found at http://www.epls.gov/.

For suppliers who appear to not meet all the required supplier standards the following methodology shall be followed.

· The NSC MAC shall request verification of compliance from the supplier via a process that ensures proof of delivery. The notification shall request a response in 30 calendar days. If no response is received that verifies compliance with standards identified, the NSC MAC shall recommend revocation to the PO.

In cases where the supplier is not present at their location, or where the lack of compliance of the supplier with all the required supplier standards appears to be egregious (including loss of any required accreditation), the NSC MAC can request revocation to the PO without the 30 day notice. Upon approval from CMS, the NSC MAC shall notify the entity of its revocation within 7 calendar days by the same process mentioned previously. The notice shall inform the entity of the reason for the revocation, its right to an appeal, and the instructions on how to submit a corrective action plan. The NSC will ensure that revocations based upon 42 CFRR 424.535 (a) (2)(3) or (5) will not contain any mention of submitting a corrective action plan in the revocation notice.

1.9. Appeals and Corrective Action Plans (CAPs)

The NSC MAC shall provide an appeals process for suppliers in accordance with the manual instructions found in IOM Pub. 100-08, Chapter 15 . This includes providing an adequate number of contractor hearing officers to conduct hearings within the required timeframes. Special process directions in addition to the manual instructions are as follows.

The NSC MAC shall provide for submittal of corrective action plans (CAPs) for revoked suppliers as follows:

· If the CAP submitted by the revoked supplier provides confirmatory evidence that the supplier was actually in compliance with all the required supplier standards at the time of revocation, then recommend reinstatement of the supplier effective as of the date of revocation.

· The NSC MAC should consider recommending reinstatement of the supplier if the revoked supplier makes changes to be in compliance and the following applies:

a.) the problem has been corrected, or is to be corrected, and b.) is minor and/or the amount of billed for out of compliance items is small, and c.) this is the first time the supplier has been determined to be out of compliance.

The proposed effective date shall be the date of actual compliance with the supplier standards.

· If the circumstances described in the two preceding bullets do not apply to the revoked supplier, the CAP can be recommended for acceptance if:

a.) the supplier makes changes to be in compliance and b.) has a definitive repayment plan or has made financial restitution for any overpayments attributable to non-compliance.

The NSC MAC shall make a recommendation concerning the reinstatement date dependent upon the circumstances of the case. All of these cases should be discussed with the PO prior to submission of any recommendation to reinstate.

Note: CAP options apply only when the ownership has not changed and the supplier number will remain the same.

For a revoked or denied supplier - If a CAP has been rejected, the NSC MAC shall send a letter to the supplier advising them of this fact. The letter to the supplier should also advise the supplier of (a) their rights concerning hearings/appeals, (b) their right to reapply and (c) the fact that a CAP rejection cannot be appealed. The supplier should be advised that information submitted as part of the CAP submission will not be automatically applied to a reapplication and that they must make a formal reapplication.

The decision whether to request a carrier hearing and/or submit a corrective action plan is solely at the discretion of the supplier. The NSC MAC shall be responsible for reviewing and appropriately acting upon information provided by revoked and denied suppliers. The NSC MAC shall provide advice to all CMS and HHS components involved in the hearings and appeals process.

1.10 Participation Enrollment

The NSC MAC shall receive an address file from PECOS containing the first mailing address for the first active supplier under a Medicare billing number. The NSC MAC shall use this file to conduct the annual participating physician/supplier (PAR) enrollment in accordance with Pub 100-04, with modifications to fit DMEPOS supplier needs (e.g., fee schedule information should not be provided). The information contained in the address file from PECOS shall allow the NSC MAC to send one PAE correspondence per entity. The participation status open season for changes shall take place from November 14th to December 31st. The NSC can send a post card in lieu of the letter distributed in previous years.

The NSC MAC shall maintain a link from the NSC MAC website to the CMS Supplier Medicare Participating Physician/Supplier Directory (MEDPARD) website.

1.11 HIPDB

The Secretary of the U.S. Department of Health and Human Services, acting through Office of Inspector General (OIG), was directed by the Health Insurance Portability and Accountability Act of 1996 to create the Healthcare Integrity and Protection Data Bank (HIPDB) to combat fraud and abuse in health insurance and health care delivery. The HIPDB, developed by HRSA (Health Resources and Services Administration), is an alert tracking system that serves as a comprehensive review of practitioners, providers, and suppliers of adverse action.

The NSC is required to participate in the data transmission of adverse suppliers who have had their supplier numbers revoked. Revocation of a supplier number, for purposes of this instruction, is the result of the supplier location failing one or more of the supplier standards. However, suppliers who have been revoked due to a lack of a surety bond or accreditation shall not be reported to the HIPDB as these are not considered to be adverse actions. Only suppliers who are revoked for being non-operational or who lack a required license shall be reported.

The Data Bank ID (DBID) will allow NSC the ability to query the HIPDB. The NSC will utilize the CMS DBID when submitting reports to the HIPDB on adverse actions against suppliers.

According to the Federal Register on October 26, 1999 the time frame for submitting reports to the HIPDB will be (1) within 120 days from the date the final adverse action was taken or the date when the reporting entity became aware of the final adverse action (the NSC will allow another 30 days for appeal), or (2) by the close of the NCSA’s next monthly reporting cycle, whichever is later. If an error or omission is discovered after the final adverse action is reported, then NSC shall send an addition or correction to the HIPDB within 60 calendar days of the discovery. NSC will utilize the CMS DBID for submitting reports to the HIPDB.

NSC will submit a separate HIPDB file for each adverse action being recognized by the HIPDB. For example, if a total of 120 suppliers are being reported to the HIPDB during a single data transmission, 120 separate files will be created by NSC and transmitted to HIPDB.

Only adverse findings on organizational entities will be transmitted to HIPDB. Therefore, all files submitted will be categorized as organizations.

Monthly update files may or may not include: 1) additional supplier numbers who have been revoked or 2) suppliers who had previously received an adverse action and have now submitted an appeal or 3) suppliers who have submitted an appeal and their supplier number has been re-instated.

1.12 Collaboration with Other Entities

The NSC MAC shall:

· Share information with the OIG on suppliers related to sanctioned individuals or businesses;

· Support the Contractors in the “Do-Not-Forward” initiative for both checks and remittance advices, including controlling all materials received from all the Contractors in this effort, issuing appropriate and timely alert codes when required, developing the cases to determine whether the suppliers identified are still in compliance with supplier standards, and inactivating Medicare privileges where suppliers do not comply.

· Collaborate with independent accreditation organizations selected by CMS to implement the DMEPOS Quality Standards.

· Collaborate with surety bond companies.

The NSC MAC shall participate in meetings and discussions with law enforcement and other organizations, including CMS, to discuss fraud prevention initiatives. These meetings will require travel by NSC MAC personnel.

1.13 Quality Assurance Requirements

All work performed under this contract shall be International Standards Organization (ISO) compliant. ISO registration and compliance are defined as follows:

ISO Registered - The ISO Registrar Accreditation Board shall register the work processes performed under this SOW according to the ISO standard by an approved registrar.

ISO Compliant - The work processes performed under this SOW conform to the ISO standard and would pass an ISO registrar’s examination if one were requested.

The Government will monitor the contractor’s performance under this contract by periodically reviewing contractor records to determine if they meet the requirements shown in the Key Performance Standards Summary (which may include on-site progress meetings and performance evaluations) and reviewing required reports submitted to the CMS PO.

1.14 Review Process

The NSC MAC shall process all new supplier applications for billing numbers and update supplier information in accordance with this SOW, IOM Pub. 100-08, Chapter 15 , other Manual requirements and existing laws and regulations. Where the manuals do not address requirements for completing the application from suppliers of DMEPOS (i.e., the CMS 855S form), the NSC MAC shall use instructions for the 855B, found in IOM Pub. 100-08, Chapter 15, where appropriate. This SOW has precedence over any Manual requirements where there is a conflict. The CMS project officer shall advise the NSC MAC of the correct policy to follow when new manual requirements or Technical Direction Letter (TDL) do not appear to be compatible with efficient processing of NSC MAC applications or NSC MAC fraud and abuse prevention efforts.

The NSC MAC shall have a completed supplier number application on the currently authorized Form CMS 855S before it processes the application. The supplier shall have an active billing number before it may receive payment. A billing number cannot be assigned and no payment can be made to a supplier without a complete disclosure of ownership and other business information. In general, the supplier billing number will be effective as of the date the supplier is moved to an approved status in PECOS.

The NSC MAC shall maintain all records until permitted to destroy them by the PO. Hard copies of all materials shall be stored in a secure location and shall be readily retrievable.

The NSC MAC's methodology for processing applications for enrollment includes:

· Ensuring that all applications are complete and information is consistent internally; developing applications for missing or ambiguous information in accordance with Provider Enrollment Manual Requirements; and

· Notifying the supplier of disposition of the applications.

Internal Revenue Service (IRS) documents are not required for additional location applications if one is already on file with the same legal business name. In addition, IRS documents and insurance documents are not required for large (i.e., 25 or more active locations) chains. Such documents are also not required for reenrollments and reactivations.

1.14.1 Exemptions from Manual Requirements

The NSC MAC shall collect and review initial electronic funds transfer (EFT) forms from all new applicants. The NSC MAC shall check that the legal business name and signatures are correct and shall transfer this information to the appropriate DME MAC contractors at least once a week. All other EFT agreements received that are not part of a new application shall be forwarded to the appropriate DME MAC(s) weekly without further verification.

1.14.2 Verification

The NSC MAC shall establish procedures in accordance with IOM Pub. 100-08, Chapter 15 of the PIM to validate the information provided by applicants on the applications for Medicare billing numbers and additional documentation furnished for that information that is not automatically validated by PECOS. The NSC MAC shall apply these procedures to all new applicants.

Additional validation procedures shall include, at a minimum, the following actions:

· Check that the applicant has a business phone number that is answered by an employee or owner of the applicant who can answer beneficiary questions. This shall be accomplished by calling the applicant. This is not required for additional locations of chain store suppliers with more than 25 locations. Verification of a correspondence phone number is not required.

· Querying all existing records in the PECOS supplier file to determine if common owners correlate to multiple tax identifications, and to determine if different companies are reporting common names and/or addresses;

· Conducting a site visit for all suppliers by using the Office of Management and Budget (OMB) approved site visit questionnaire at the physical location for which a number is being requested. However, site visits for hospitals, skilled nursing facilities , physicians, ambulatory surgical centers and locations of chain suppliers which have more than 25 locations can receive only an observational site visit which does not require use of the OMB approved form. The observational site visit shall only confirm that the supplier is in operation and appears to be a supplier of the type requesting enrollment.

· Checking against a NSC MAC developed database of licensure requirements to ensure that appropriate licenses have been included. The database shall be correct and continuously updated;

· Checking the validity of required licenses submitted. To assist in this process the NSC shall obtain quarterly written confirmations from the State licensing agencies which advise of their current licensing requirements. These confirmations shall be for all known items which have been, or are announced to be, competitively bid.

· For a Rehabilitation Agency the NSC MAC shall obtain from the applicant a copy of the letter from the Regional Office (RO) which assigns the Online Survey Certification and Reporting System (OSCAR) number. No site visit is required for rehabilitation agencies;

· Verifying insurance policy with the insurance agent and ensuring that the NSC MAC is a certificate holder; and

· For licenses, insurance policies and certifications submitted within 60 days of expiring, following-up with the insurance agent within 30 days of issuance of supplier number, after a PECOS provided report of this information is received by the NSC MAC.

· Ensure that DMEPOS suppliers obtain oxygen from a State-licensed oxygen supplier (applicable only to those suppliers in States that require oxygen licensure (§424.57(c)(27)).

· Ensure that suppliers maintain ordering and referring documentation consistent with the provisions found in §424.516(f). (§424.57(c)(28)). DMEPOS suppliers are required to maintain written order from a physician or eligible professional.

· Ensure that DMEPOS suppliers do not improperly share a practice location with certain other Medicare providers and suppliers (§424.57(c)(29)).

· Ensure that DMEPOS suppliers remain open to the public for at least 30 hours a week, except physician, licensed non-physician practitioners furnishing services to his or her own patient(s) as part of his or her professional service or a DMEPOS supplier working with custom made orthotics and prosthetics (§424.57(c)(30)). To qualify for the exemption regarding custom-made orthotics and prosthetics, the supplier must indicate, in section 2-D of the 855-S, one or more of the following products:

· Breast Prostheses and/or Accessories;

· Cochlear Implants;

· Diabetic Shoes/Inserts-Custom;

· Eye Prostheses;

· Facial Prostheses;

· Limb Prostheses;

· Ocular Prostheses;

· Orthoses-Custom Fabricated;

· Prosthetic Cataract Lenses;

· Somatic Prostheses; and/or

· Voice Prosthetics.

The only other products that can be provided with the above and still qualify for the exemption is non-custom or prefabricated orthotics and prosthetics.

Suppliers that meet this exemption are permitted to be open “By Appointment Only.” To indicate “By Appointment Only” in PECOS until the system is set up to accept this, the NSC MAC will enter the hours of operation as “closed” each day.

The NSC MAC will enforce this rule for all new suppliers, during review of High and Medium FAIR suppliers, and all reactivation requests.

· Ensure that the DMEPOS supplier maintains a physical facility on an appropriate site. The appropriate site must meet the following:

· Except for State-licensed orthotic and prosthetic personnel providing custom fabricated orthotics or prosthetics in private practice, maintain a practice location that is at least 200 square feet.

· Is in a location that is accessible to the public, Medicare beneficiaries, CMS, the NSC, and its agents. (The location must not be in a gated community or other area where access is restricted.)

· Is accessible and staffed during posted hours of operation.

· Maintains a permanent visible sign in plain view and posts hours of operation.

· Is in a location that contains space for storing businesses records (including the supplier’s delivery, maintenance, and beneficiary communication records.

42 CFR section 424.57(7) states that a supplier must maintain a physical facility on an appropriate site. This standard requires that the location is accessible to the public and staffed during posted hours of business. The location must be at least 200 square feet and contain space for storing records.

With the implementation of CMS 6036-F, supplier standard 7 now requires supplier locations to be a minimum of 200 square feet, with exceptions for state-licensed orthotic and prosthetic personnel providing custom-fabricated orthotics or prosthetics in private practice. This information can be obtained in sections 2B and 2D of the 855-S and the attached licenses. This exemption will NOT apply to any other supplier type, nor will it apply to any orthotist or prosthetist that is not state licensed, even if the state does not provide/require licenses.

The 200 square feet includes all space within the supplier location (storage, administrative areas, etc.) but does NOT include any off-site areas (inventory and/or records storage, etc). The NSC MAC will enforce this rule for all new suppliers and suppliers requesting a reactivation. For existing suppliers, the NSC MAC will enforce during review of high and medium FAIR suppliers, using the “grandfathering” provision with the regulation regarding long-term leases.

In addition, a “gated community or other area where access is restricted” will be defined as:

Any residential community or single residential or non-residential structure to which vehicular or pedestrian access is restricted by secured barriers including, but not limited to fences, security doors, gates, or other devices that are not directly affixed to the physical structure housing the supplier’s facility if a single unit building or the supplier’s leased space if in a multi-tenant building. Access under these circumstances is deemed restricted and not appropriate unless one of the following applies:

1. The physical barrier to the community and/or structure is staffed (in person) by security personnel, receptionist or similar individual that could immediately grant entrance and direct a beneficiary or CMS representative to the supplier’s facility or could notify the supplier so that they can escort the visitor to their facility that is located beyond the security barrier.

1. The supplier has a clearly identified means of electronic/voice communication immediately adjacent to the secured physical barrier and that communication is sent directly to and answered by an employee of the supplier that could grant immediate access to the facility.

The intent is to deem inappropriate those residences behind gates where a beneficiary must call a phone number via a call system that is not clearly marked with the name of the business to get access or that does not have a security officer that can immediately make contact with the supplier. It is the intent to not prohibit suppliers from operating in facilities that do have appropriate and reasonable security features that may slightly delay access but not restrict it.

· Ensure that the supplier does not use cell phones, beeper numbers and pagers as a primary business telephone number.