The Centers for Medicare and Medicaid Services (CMS) intends to award a Cost-Sharing sole source contract to 3M Health Information Services effective May 15, 2009. With the authorization of the Social Security Act Section 1833 and Section 4523 of the BBA of 1997 to implement a prospective payment system for hospital outpatient services. The current contract with 3M Health Information Systems (3M HIS) was awarded after Full and Open Competitive Bid process. As CMS’ needs have increased, its programs have become more complex with massive development and on-going maintenance of the original software systems. As a result, CMS now has 6 major programs. This new contract will be a 60 month effort to provide the services for efforts described below:

1. ICD 10 PCS – complex conversion from the current International Classification Diseases (ICD), ninth revision, Clinical Modification (ICD-9 CM) to the ICD-10 Procedure Classification System (PCS) and Crosswalk/Map of ICD-9-CM and ICD-10-CM (both ways); 2. Diagnosis Related Groups (DRG) Grouper is used for all inpatient discharge/transfer bills received from both PPS and non-PPS facilities, including those from waiver States, long term care hospitals, and excluded units; 3. Medicare Code Editor (MCE) edits claims to detect and report errors in the coding of claims data; 4. Medicare Integrated Outpatient Code Editor (I/OCE) with Ambulatory Payment Classifications (APCs) combines grouping of outpatient services into APCs and edits claims to detect errors in coding and/or reporting of services; 5. Medicare Long Term Care Hospitals (LTCH) Prospective Payment System (PPS) and Inpatient Prospective Payment System (IPPS) Relative Weight Computation (including development of a Grouper and PRICER); and 6. Home Health Prospective Payment System (HH PPS) Grouper Analytic and Programming Support – Incorporate HH PPS into the overall grouper system and provided annual updates.

The proposed rule for ICD-10 implementation was issued in August 2008 announcing the proposed implementation of ICD-10 in October 2011. CMS worked closely with the Centers for Disease Control and the National Committee for Vital and Health Statistics (NCVHS), an advisory committee to the Secretary, on the implementation of ICD-10-PCS. This was a long and arduous task involving public hearings with extensive parts of the health care industry. 3M is the contractor who developed the revolutionary coding system ICD-10-PCS. 3M also developed the crosswalks (mapping) between ICD-9-CM and ICD-10-CM and PCS. CMS must continue its contract with 3M in order to ensure consistency in the conversion of ICD-9 to ICD-10 systems for inpatient and outpatient prospective payment systems to ensure that they are completed timely and error free.

This sole source procurement is being conducted pursuant to the authority of 41 U.S.C. 253(c)(1), as implemented by FAR 6.302-1, that only one responsible source and no other type of supply or service will satisfy agency requirements. In order to meet CMS’s minimum needs, it is imperative that CMS utilize a contractor that has total knowledge of the design and development of the inpatient and outpatient prospective payment system. The contract will be awarded for a period of 60 months. This is a notice of intent and not a request for proposals.

The Government will award a sole source contract to 3M unless an entity can demonstrate that it can perform the work instead of 3M. Entities that believe they can perform the work should express interest within 15 calendar days of publication of this notice. The entity should demonstrate its unique capability by providing adequate justification to support its claim, i.e. corporate experience, technical considerations, past performance, etc. Information received will be considered solely for the purpose of determining whether to conduct a competitive procurement. A determination by the Government to compete this proposed acquisition based on responses to this notice is solely within the discretion of the Government.

Written responses should be submitted via e-mail no later than close of business September 19, 2008 to Robin Evans at [email protected]. Phone calls will not be accepted.