CMS expands competitive bidding for DMEPOS to 70 new markets
BALTIMORE —At the beginning of the year, the Centers for Medicare and Medicaid Services named 70 new metropolitan statistical areas that will be part of the second phase of a competitive bidding program designed to help lower Medicare beneficiaries’ out-of-pocket costs and improve their access to certain durable medical equipment, prosthetics, orthotics and supplies.
The list includes several major big-city drug store markets, including Chicago, Las Vegas, Los Angeles and New York, and will bring the total number of MSAs in the competitive bidding program to 80.
The second round of the Medicare DMEPOS Competitive Bidding program also includes eight of the top DMEPOS product categories, including oxygen supplies and equipment, standard power wheel-chairs, scooters and related accessories, complex rehabilitative power wheelchairs and related accessories, enteral nutrients (feeding tubes), equipment and supplies, CPAP devices (usually prescribed to treat sleep apnea) and respiratory-assistance devices, hospital beds and related accessories, negative pressure wound therapy pumps and related supplies and walkers.
DME retailers and suppliers will need to meet quality standards established by CMS and be accredited by one of 10 organizations chosen by Medicare. CMS anticipates beginning the pre-bidding activities of the second phase of the program in spring 2008.
The final deadline for all suppliers to obtain an initial accreditation is Sept. 30, 2009. However, suppliers that want to participate in this second phase of the competitive bidding program will have to be accredited well in advance of that deadline to be awarded a contract with CMS, the agency stated.
“I cannot stress enough the importance for all Part B DMEPOS suppliers to apply for accreditation early, and not wait until Sept. 30, 2009,” cautioned Kerry Weems, CMS acting administrator. “Suppliers considering participating in the second phase of the competitive bidding program should apply for accreditation immediately,” he said.
“Competitive bidding means that Medicare beneficiaries will have access to these products at substantially lower costs,” Weems said. “Since all successful bidders will be required to meet quality standards and be accredited by Medicare, people with Medicare in these 70 new areas can be assured of access, low prices and high quality. Through this accreditation process, our beneficiaries are also provided another layer of protection from fraud.”
Under the competitive bidding program, retailers that wish to offer durable medical equipment—including walkers, automated wheelchairs and other assisted-living devices—and services to people with Medicare will have to submit bids to CMS, indicating the prices at which they are willing to supply these items to beneficiaries.
Currently Medicare—and beneficiaries—pay for items based on a fee schedule that, in general, is based on the average payments Medicare has paid for DMEPOS items in the past. Although the fee schedule is updated annually, CMS believes it is not representative of the true market prices of these items and services. Most beneficiaries pay 20 percent of the total cost for these items and services, and should expect to see savings from this program because when the total cost decreases, beneficiaries’ co-insurance also decreases.
Once the competitive bidding program is fully implemented nationally, it is expected to save beneficiaries and Medicare $1 billion annually, CMS stated.