DMEPOS Competitive Bidding Factsheet

Established under the Medicare Prescription Improvement & Modernization Act of 2003 (MMA).

♦ DMEPOS suppliers compete to become Medicare contract suppliers by submitting bids to furnish certain items in competitive bidding areas (CBAs).

♦ Under the program, a competition among suppliers who operate in a particular competitive bidding area is conducted. Suppliers are required to submit a bid for selected products.

♦ Contracts are awarded to the Medicare suppliers who offer the best price and meet applicable quality and financial standards.

♦ Suppliers must agree to accept assignment on all claims for bid items and will be paid the single payment amount.

♦ Single payment amounts (SPA) determined by using bids submitted by DMEPOS suppliers.

After Temporary Bidding Gap

Round 2021

Becomes effective on Jan 1 2021, extend through Dec 31st 2023.

Product categories: 16

 Commode ChairsE0163
 Continuous Positive Airway Pressure (CPAP) Devices
and Respiratory Assist Devices (RADs)
 Enteral NutritionB4035
 Hospital BedsE0260
 Negative Pressure Wound Therapy (NPWT) PumpsE2402
 Non-Invasive VentilatorsE0466E0466
 Off-The-Shelf (OTS) Back Braces*L0650
 OTS Knee Braces*L1833
 Oxygen and Oxygen EquipmentE1390
 Patient Lifts and Seat LiftsE0630
 Standard Manual WheelchairsK0001
 Standard Power Mobility DevicesK0823
 Support Surfaces (Groups 1 and 2)E0277
 Transcutaneous Electrical Nerve Stimulation (TENS)

♦ Items newly included in the DMEPOS competitive bidding program are (OTS) back braces, knee braces, and non-invasive ventilators.

Lead Item pricing: CMS is implementing the methodology of lead item pricing for all items in the product categories.

The difference now and before:

Rather than submitting individual bids for each item within a category, bidders will only submit one bid for the lead item in the product category.

The suppliers bid for the lead item represents the bid for furnishing the lead item & all other items (non lead items) in the product category.

Bids for the lead item in the product category will be used to calculate the SPA’s for all the items within that product category.

The SPA for the lead item is the maximum bid submitted for that item by bidders whose bids are in the winning range in that CBA and product category combination.

SPAs for the non-lead items within the product category are determined by multiplying the lead item SPA by a relative ratio.

Ratios are based on the historic differences in the fee schedule amounts for the lead item and non-lead items

In prior rounds, the SPA for an item was equal to the median of the bids submitted for that item by bidders whose composite bids were equal to or below the pivotal bid for that product category in a CBA (Competitive bidding area).

In Round 2021, SPA for a lead item is equal to the maximum bid submitted for that item by bidders whose lead item bids for the product category are equal to or below the pivotal bid for that product category in a CBA.

CMS announced plans to consolidate the competitive bidding areas (CBAs) included in the Round 2 Recompete and Round 1 2017 DMEPOS Competitive Bidding Program into a single round of competition in Round 2021

Round 2021

Suppliers interested in Bidding: Qualifications

Getting bonded

All bidders in Round 2021 are required to obtain a bid surety bond in the amount of $50,000 for each CBA in which they submit a bid.

Important to note, however, that bid surety bonds required for bidding in the DMEPOS Competitive Bidding Program are NOT the same as the surety bonds required for DMEPOS supplier enrollment purposes.

Getting licensed

Contracts are only awarded to bidders that meet all applicable licensing requirements by the close of the bid window.

Licensing requirements change periodically, and it remains the responsibility of the bidder to identify, obtain, and have all current, non-expired required licenses reflected in the Provider Enrollment, Chain, and Ownership System (PECOS) by the close of the bid window.

Each supplier location on the bid must be licensed for all lead and non-lead items in the product category by the state in which it furnishes or plans to furnish if awarded a DMEPOS competitive bidding contract.

It is up to the bidder to confirm which states require a license(s).

The NSC provides a DMEPOS State License Directory for each state as a guide

Getting Accredited

Each supplier location on a bid must be accredited by a CMS approved accrediting organization for the lead and non-lead items in a product category.

Any supplier who is interested in bidding for a product category but does not have its location(s) currently accredited for that product category must take action NOW to get accredited for that product category.

Accrediting organizations report any accreditation updates to the NSC, so it is important that suppliers get accredited early so their information will be up to date.

CMS cannot contract with suppliers that are not accredited by a CMS approved accrediting organization.

DMEPOS Competitive Bidding Program: Temporary Gap Period

From January 1, 2019, there is a temporary gap in the DMEPOS CBP that CMS expects will last until December 31, 2020. During the temporary gap, any Medicare enrolled DMEPOS supplier may furnish DMEPOS items and services to people with Medicare.

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