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TrailBlazer Loses MAC Bid Protest

TrailBlazer MAC Texas Medicare

(March 6, 2012): Unfortunately, it is true — TrailBlazer Health Enterprises LLC (TrailBlazer), the current Medicare Administrative Contractor (MAC) for Texas, Oklahoma, New Mexico and Colorado, has announced that it has lost its MAC contract with the Centers for Medicare & Medicaid Services (CMS).

The impact of the recent TrailBlazer announcement hit most of us like an episode of Ripley’s Believe it or Not.”  For most Texas, Oklahoma, New Mexico and Colorado health care providers, TrailBlazer is the only Medicare contractor they have ever known.  Over the years, they have succeeded where some other contractors around the country have often failed — they were able to build a professional partnership with health care providers.  Moreover, these providers learned that they could rely on TrailBlazer’s counsel.  Were they perfect?  Far from it.  Nevertheless, at the end of the day, we believe that TrailBlazer will be sorely missed.  Good luck to all of our friends (and sometimes opponents) at TrailBlazer.  We will miss your professionalism and good cheer.

I.  Here’s What Happened When TrailBlazer Protested the Award of the Contractor:

Originally requesting solicitation for the A/B MAC Jurisdiction H in March of 2011, CMS subsequently awarded the contract for this jurisdiction to Highmark Medicare Services, Inc. (HMS) several months later. Because TrailBlazer had held this contract for a number of years prior to CMS’ bid solicitation, it vigorously protested the award of the contract and filed a formal protest with the Government Accountability Office (GAO) initially in August  2011, amending the protest in November and December 2011.

However, TrailBlazer announced on Thursday, March 1, 2012, that the bid protest had been reviewed and denied by the GAO, upholding the initial decision by CMS. As a result, HMS and TrailBlazer will soon begin the process to transition HMS into the MAC role.  According to TrailBlazer, the companies will work together over the summer of 2012 to ensure a smooth transition for Medicare beneficiaries and providers alike. Subsequently, HMS will be responsible for processing both Part A and Part B Medicare claims in this region.

II.  Effect on Texas, Oklahoma, New Mexico and Colorado Providers:

 The transition to HMS may have significant effects, both positive and negative, on providers in Region H. Initially, it has been our experience that transitions from one contractor to another have never been entirely smooth, though TrailBlazer claims it will work closely with HMS to do so. Providers in the middle of administrative appeals of Medicare post-payment audits, or those participating in extended repayment plans (ERPs), may find that HMS does not have sufficient administrative information or controls to ensure that all information or payments are accounted appropriately. In similar situations, such as the switch from CIGNA Government Services to Palmetto GBA in North Carolina, the transition was far from smooth, with several of our clients experiencing problems when the change-over took place.  Moreover, contacts that providers have developed at TrailBlazer over the last decade may no longer be available once Highmark takes control of the region. It may be difficult to establish relationships with new counterparts at HMS. As this process moves forward, providers should consider contacting their TrailBlazer contacts and asking for the name and future contact information of HMS employees who will be taking over similar job responsibilities, when it becomes available.

 Despite the inevitable confusion inherent in any switch of this size and compexity, HMS and their staff are highly experienced and well-suited to take over TrailBlazer’s responsibilities.  The organization has a long history of effective and efficient claims processing. Having said that, we strongly recommend that you keep a close eye out for any new Local Coverage Determinations (LCDs) that may be issued by HMS.  Although the basic rules are typically the same, it is not at all uncommon for their to be differences from contractor to contractor when it comes down to the highly specific documentation requirements applied.   It is imperative that you conduct a claims review once the transition is underway to help determine whether you will need to make any changes in your documentation and / or procedural practices in order to fully meet HMS’ expectations.

Healthcare LawyerLiles Parker is a full service health law firm with offices in Washington D.C., Texas, and Louisiana. Our attorneys apply decades of focused experience when representing clients and are skilled in reviewing LCDs and other coverage guidance. In addition, we assist health care providers with Medicare appeals, implementation of extended repayment plans, compliance training and reviews, and other important health law activities. For a complimentary consultation, please call Robert W. Liles at: 1 (800) 475-1906.

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