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The Centers for Medicare & Medicaid Services (CMS) has announced its plans for Round 2021 of the Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program (CBP), featuring new “lead item” bidding rules and new product categories.  Following on the heels of this announcement, the Trump Administration proposed additional legislative changes to the CBP that would cut Medicare DMEPOS spending by more than $7 billion over 10 years.

Round 2021 of the CBP

As previously reported, there has been a “temporary gap” in the DMEPOS CBP since the last round of contracts expired on December 31, 2018.  Last week CMS confirmed that it will launch a new competition – dubbed Round 2021 – for contracts that will run from January 1, 2021 through December 31, 2023.  The competition will cover geographic areas included in Round 1 2017 and the Round 2 Recompete, for a total of 130 competitive bidding areas (CBAs).

For Round 2021, CMS is adding three product categories that have never been subject to competitive bidding:  off-the-shelf (OTS) back braces, OTS knee braces, and non-invasive ventilators.  The full list of the 16 product categories included in Round 2021 is as follows:

  1. Commode Chairs
  2. Continuous Positive Airway Pressure (CPAP) Devices and Respiratory Assist Devices (RADs)
  3. Enteral Nutrition
  4. Hospital Beds
  5. Nebulizers
  6. Negative Pressure Wound Therapy (NPWT) Pumps
  7. Non-Invasive Ventilators
  8. OTS Back Braces
  9. OTS Knee Braces
  10. Oxygen and Oxygen Equipment
  11. Patient Lifts and Seat Lifts
  12. Standard Manual Wheelchairs
  13. Standard Power Mobility Devices
  14. Support Surfaces (Groups 1 and 2)
  15. Transcutaneous Electrical Nerve Stimulation (TENS) Devices and Supplies
  16. Walkers

The specific HCPCS codes subject to this round of bidding is posted on the Competitive Bidding Implementation Contractor (CBIC) website.  Note that CMS is not including a national mail-order program for diabetes testing supplies in Round 2021, since the agency is working to implement separate statutory requirements for those items included in the Bipartisan Budget Act (BBA) of 2018.

CMS will use a new “lead item” bidding methodology in Round 2021.  That is, instead of bidding on each item/HCPCS code within a product category, suppliers will submit a single bid for that item in the product category designated by CMS to have the highest total nationwide Medicare allowed charges.  CMS will calculate a single payment amount (SPA) for that lead item in the CBA based on the highest amount bid within the winning bids, rather than the median of winning bids.  The SPAs for non-lead items will be based on the relative difference in the fee schedule amounts for the lead and non-lead items.  A “Lead Item Calculator” is available on the CBIC site to show the impact of the lead item bid amount on the non-lead items in the product category.

The following is the schedule for the Round 2021 competition (dates are subject to change):
Continue Reading CMS Announces Plans to Restart DMEPOS Competitive Bidding Program in 2021; Trump Proposed Budget Seeks Authority for Lower Payments to “Winning” Suppliers

CMS has adopted a number of changes to its Medicare durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) policies for 2017, including new competitive bidding program (CBP) requirements and revisions to the methodology for updating Medicare DMEPOS fee schedule amounts based on CBP pricing.

With regard to the CBP, the final rule implements a Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) provision requiring entities bidding in the DMEPOS competitive bidding program to submit proof of an authorized “bid surety bond” for each competitive bidding area (CBA) in which the supplier is bidding. Under the final rule, the surety bond amount will be set at $50,000 – rather than $100,000 as proposed — for each CBA associated with the bid.  If the bidder is offered but declines a contract for any product category in the CBA, and the supplier’s bid for the product category was at or below the median composite bid rate used to calculate single payment amounts, the bid bond will be forfeited, and CMS will collect on the bond.  In all other cases, the bid bond will be returned to the bidder within 90 days of CMS’s public announcement of the contract suppliers for the CBA.  The rule establishes penalties for bidders that provide falsified surety bonds or accept a contract offer and then renege on it in order to avoid surety bond forfeiture.
Continue Reading CMS Finalizes New Rules for Bidders in Medicare DMEPOS Competitive Bidding Program, Revises DMEPOS Fee Schedule Update Policies

On March 1, 2016, CMS is publishing a proposed rule that would make a variety of changes to the Medicare, Medicaid, and CHIP provider and supplier enrollment requirements.  CMS believes that the proposal would assist in ensuring that individuals and entities posing risks to federal health care programs are removed or temporarily/permanently barred from participation in such programs.  Comments regarding the proposed rule will be accepted for 60 days after publication.

Notably, the proposed rule would implement an Affordable Care Act (ACA) provision requiring certain providers and suppliers to disclose if they have any current or previous direct or indirect affiliations (as defined in the rule) with a provider or supplier that:  has uncollected debt; has been or is subject to a payment suspension under a federal health care program; has been excluded from Medicare, Medicaid or CHIP; or has had its Medicare, Medicaid or CHIP billing privileges denied or revoked.  Under the ACA, the Secretary is permitted to deny enrollment based on an affiliation that the Secretary determines poses an “undue risk” of fraud, waste or abuse.  The proposed rule enumerates the factors that would be considered in such a determination, such as the duration and extent of the affiliation and the nature of the affiliated party’s disclosable event.  CMS proposes a 5-year “look-back” period for determining previous affiliations (as of the date the enrollment application is submitted).

The proposed rule also would authorize the Secretary to: 
Continue Reading CMS Proposes Program Integrity Enhancements to the Provider/Supplier Enrollment Process, including New Affiliated Provider Disclosure Requirements

On March 16, 2015, the House of Representatives is scheduled to consider the following health policy legislation:

  • H.R. 284, the Medicare DMEPOS Competitive Bidding Improvement Act of 2015 — which would require Medicare suppliers that bid under a DME, prosthetics, orthotics, and supplies (DMEPOS) competitive bidding program to submit binding bids or risk forfeiture

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The Chairman of the House Ways and Means Subcommittee on Health is seeking comments on a draft bill, the Protecting Integrity in Medicare Act of 2014, that is “aimed at combating fraud, waste and abuse in the Medicare program.” The bill covers a range of Medicare and Medicaid policies, from establishing new alternative sanctions for technical physician self-referral violations to providing more flexibility in meeting durable medical equipment (DME) documentation requirements. Among other things, the bill would:
Continue Reading Ways and Means Committee Seeks Comments on Medicare Program Integrity Bill

The National Supplier Clearinghouse reports that CMS has clarified the Medicare surety bond and accreditation exemptions for optometrists.  Specifically, optometrists who own their own optical shop and furnish only cataract glasses and cataract lenses are currently exempt from the requirements concerning bonding and accreditation. This applies even if there is an optician at the optical…

CMS has published a final rule correcting a technical error in its January 2, 2009 final rule implementing surety bond requirements for certain Medicare suppliers of durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS). In a related development, CMS has updated the Medicare Program Integrity Manual to incorporate regulatory requirements that certain DMEPOS suppliers obtain a …

On January 2, 2009, the Centers for Medicare & Medicaid Services (CMS) published a final rule imposing surety bond requirements on certain Medicare suppliers of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS). Specifically, suppliers generally will be required to post a $50,000 surety bond from an authorized surety, unless (1) the supplier is a high-risk …