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DMEPOS rebid education

July 1, 2009
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Supplier bid window opens this fall

The Centers for Medicare & Medicaid Services (CMS) has announced the next steps in the implementation of the Round One Rebid of the Medicare Competitive Bidding Program for durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS), including the general timeline for opening the bid window in the fall of this year.

“Congress mandated that competition for the Round One Rebid occur in 2009. CMS is announcing the next steps to implement the DMEPOS Competitive Bidding Program now to give the supplier community ample time to prepare as well as inform other stakeholders,” said Charlene Frizzera, CMS acting administrator. “This program generated substantial savings for Medicare and beneficiaries who used these items and supplies in the competitive bidding areas last summer and is consistent with CMS' goal to pay appropriately for Medicare items and services.”

CMS will now begin general “pre-bidding” supplier awareness and education efforts on key steps suppliers need to take now to be ready for registration and bidding, including getting appropriate state licenses, updating Medicare enrollment files with the National Supplier Clearinghouse and getting accredited and bonded. A detailed timeline for the program should be revealed this summer. The bidder registration period is expected to begin this summer before bidding opens in the fall. CMS has made a number of process improvements for the Round One Rebid, such as an upgraded online bid submission system, early bidder education, and increased oversight of bidders that are new to product categories or competitive bidding areas to ensure they meet CMS' requirements.

As part of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), Congress enacted a temporary delay of the competitive bidding program and mandated certain changes in the program. The law required CMS to terminate contracts awarded in Round One and to conduct the competition for the Round One Rebid in 2009. Additionally, the new law establishes a financial document review process and a requirement for contract suppliers to report subcontract relationships with other suppliers. MIPPA also excluded certain DMEPOS items and areas from competitive bidding and provided an exemption to the program for hospitals that furnish certain types of DMEPOS items to their own patients. However, MIPPA did not fundamentally change the nature of the competitive bidding program as established by the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) or the existing competitive bidding regulations that were finalized in 2007. From a beneficiary standpoint, there will be no immediate effect on the Medicare DMEPOS benefit and Medicare beneficiaries may continue to use their current DMEPOS suppliers at this time.

Round One of the DMEPOS competitive bidding program was implemented on July 1, 2008, in 10 competitive bidding areas, as mandated by the MMA. The Round One competitive bidding process resulted in average savings of 26% compared to the prices Medicare would have paid for the competitive bid items under the existing DMEPOS fee schedule in 2008. These lower prices would have directly translated to lower out-of-pocket costs for Medicare beneficiaries, who are responsible for 20% coinsurance on these items and services after any unmet Part B deductible.

Additional information on the DMEPOS competitive bidding program is available at http://www.cms.hhs.gov/DMEPOSCompetitiveBid/01_overview.asp#TopOfPage.

Long-Term Living 2009 July;58(7):41

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