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CBIC Rescinds Position on Supplier Capacity

OAMES, through the NSC Advisory Council and Jurisdiction B DME MAC Council, received the following communication late last week from Elaine Hensley, Chief Liaison, of Palmetto GBA, the Competitive Bidding Implementation Contractor (CBIC) regarding discussions at recent Council meetings and at the NSCAC meeting at Medtrade related to suppliers reaching their capacity in the Medicare bidding areas:

A DME supplier must continue to provide the item.....even if the supplier has reached capacity.

 ou may recall I provided guidance to a question regarding contract suppliers’ capacity at the Jurisdiction Council meeting in July.  I also provided a written answer to a question submitted by the NSCAC around that same timeframe, too.  At that time, I stated a supplier can indicate to the CBIC it met its financial capacity.  I must correct that direction.  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.

Please be sure to spread this news widely given it contradicts the CBIC’s original position which was extensively published this summer.  Contact Kam Yuricich at OAMES if you have further questions or concerns about this reply, especially if you are a small contractor struggling with the demand volume.


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