Overview
The Centers for Medicare & Medicaid Services (CMS) Competitive Bidding Program for Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) was mandated by Congress through the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA). The law required that CMS replace the current Medicare fee schedule payment for DMEPOS items with a competitive bid process.
Under the program, a competition is conducted among suppliers who operate in a particular Competitive Bidding Area (CBA). Suppliers are required to submit a bid for selected products. Not all products or items are subject to competitive bidding. Bids are submitted electronically through a web-based application process and required documents are mailed. Bids are evaluated based on the supplier’s eligibility, its financial stability and the bid price. Medicare will use these bids to set a single payment amount, which will replace the fee schedule amount as payment for those items. The single payment amount must be lower than the fee schedule amount.
CMS implemented two demonstration projects in Polk County, Florida and San Antonio, Texas to determine if competitive bidding among suppliers would be successful in driving down costs to a fair market value while maintaining product quality. Following the demonstration projects, Congress mandated that Medicare phase in the DMEPOS Competitive Bidding Program. Round One of the program was implemented on July 1, 2008 in 10 CBAs.
Two weeks after implementation of Round 1, a temporary delay of the program was enacted by Congress as part of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), which mandated a number of program modifications. MIPPA required CMS to terminate supplier contracts awarded in Round 1 and conduct a new competition in nine CBAs in 2009 (Round 1 Rebid).
CMS is currently evaluating bids submitted by suppliers last fall, and it expects to announce the competitive bidding payment rates in June 2010. CMS plans to announce the contract suppliers in September 2010, and the program is scheduled to go into effect in the nine Round 1 Rebid areas on January 1, 2011.
The supplier competition for the next phase (Round 2) of the program will begin in 2011.
Round 1 Rebid Competitive Bidding Areas and Product Categories
The Round 1 Rebid areas are:
• Charlotte-Gastonia-Concord (North Carolina and South Carolina);
• Cincinnati-Middletown (Ohio, Kentucky, and Indiana);
• Cleveland-Elyria-Mentor (Ohio);
• Dallas-Fort Worth-Arlington (Texas);
• Kansas City (Missouri and Kansas);
• Miami-Fort Lauderdale-Pompano Beach (Florida);
• Orlando (Florida);
• Pittsburgh (Pennsylvania); and
• Riverside-San Bernardino-Ontario (California)
The Round 1 Rebid product categories are:
• Oxygen supplies and equipment;
• Standard power wheelchairs, scooters, and related accessories;
• Complex rehabilitative power wheelchairs and related accessories (Group 2 only);
• Mail-order diabetic supplies;
• Enteral nutrients, equipment, and supplies;
• Continuous Positive Airway Pressure (CPAP) machines, Respiratory Assist Devices (RADs), and related supplies and accessories;
• Hospital beds and related accessories;
• Walkers and related accessories; and
• Support surfaces (Group 2 mattresses and overlays in Miami only)
NASL Action
NASL has been a leading voice in first calling for repeal of the competitive bidding program, and then calling for a restructuring of the by restoring fairness and accountability into the system.
NASL has worked with like-minded groups in pressing Congress to repeal the competitive bidding program, and barring that, at least restore accountability to the program by requiring CMS to report on problems experienced by patients in gaining access to needed services and products and in the decline in the quality of products available to Medicare beneficiaries.
Among other things, NASL has called for these changes to the competitive bidding program:
• Grandfather additional products into the program
• Require suppliers to have a minimum level of experience or to meet special criteria as to product category and geographic area
• Remove long term care facilities from the program
• Require an evaluation period between Round One and Round Two
NASL will continue working with Congress and federal regulators on ways to correct the structural flaws in the program.
Join the NASL Medical Products Committee
