Reprinted with permission, www.dmecompetitivebid.com

The Centers for Medicare & Medicaid Services (CMS) has completed the bid evaluation process and announced the single payment amounts for the first round of the Medicare durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) Competitive Bidding Program. The Competitive Bidding Program will offer beneficiaries in the designated Competitive Bidding Areas (CBAs) access to quality DMEPOS products and services with lower out-of-pocket costs. Under the program, the single payment amount will become the Medicare allowed payment amount for the competitive bidding items for beneficiaries who reside in the CBAs. Consistent with current CMS practice, Medicare will pay contract suppliers 80 percent of the single payment amount for each competitively bid item. The beneficiaries will be responsible for the remaining 20 percent of the single payment amount.

As a result of the competitive bidding process, the amounts that Medicare will pay for the 10 product categories included in round one of the DMEPOS Competitive Bidding Program overall average 26 percent less than Medicare’s previous payment amounts. Savings for beneficiary out-of-pocket cost and Medicare range from 14 percent on negative pressure wound therapy devices and accessories up to as much as 43 percent on mail-order diabetic supplies. Beneficiaries in these CBAs will begin seeing savings on July 1, 2008.

The single payment amounts can be found this site at http://www.dmecompetitivebid.com/SPA?Open&cat=Suppliers~News and Bulletins.

CMS is notifying all bidders of their bid results. Winning bidders will be mailed contracts requiring their signatures. Qualifying bidders whose bids were not in the winning range may still receive a contract offer from CMS if one of the winning bidders decides not to become a contract supplier. Bidders whose bids were disqualified because their bids did not meet the requirements established in the regulations or the request for bids will receive a letter informing them of the reason(s) for disqualification.

After the program begins, bidders that did not become contract suppliers generally cannot receive Medicare payment for competitively bid items. However, they may choose to continue in the Medicare program as grandfathered suppliers for existing customers if they supply certain rented items or oxygen or oxygen equipment to Medicare beneficiaries. Bidders that do not become contract suppliers for the first round of bidding may bid in future rounds of competition.

The current Medicare fee schedule payment amounts will continue for beneficiaries who do not reside in the first round CBAs and for items that are not subject to the Medicare DMEPOS Competitive Bidding Program.

The list of contract suppliers will be available on www.cms.hhs.gov/CompetitiveAcqforDMEPOS.