CMS expands DME bidding program

Agency plans expansion to eight categories

CMS plans to expand its competitive-bidding program for durable medical equipment to include eight new categories, Modern Healthcare reports.

The categories include:

  • Continuous positive airway pressure and respiratory assist devices;
  • Enteral nutrients and equipment;
  • Hospital beds;
  • Negative pressure wound therapy pumps;
  • Oxygen equipment and supplies;
  • Support services, such as certain mattresses and overlays;
  • Walkers; and
  • Wheelchairs.

Congress in 2003 required CMS to establish the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies competitive bidding program. The first round of the program was limited to nine metropolitan areas. CMS officials said the first round saved roughly $130 million in its first six months.

In its second phase, the program will expand to 91 additional metropolitan areas, including Houston, Los Angeles, and New York City. Officials expect new prices to take effect in July 2013. According to CMS, the second round likely will save $28 billion over 10 years, and about one-third of the savings will go to beneficiaries. CMS Administrator Donald Berwick said that Medicare has paid significantly more than the private sector for equipment in recent years and that the agency is seeking more equitable rates.

Critics say the design of the bidding process is flawed because companies can submit low bids to win but are not required to follow through and accept Medicare contracts, National Journal reports. However, CMS deputy administratort Jonathan Blum said officials intend to screen bids by third-party contractors more thoroughly to ensure their credibility (Lee, Modern Healthcare, 8/19 [subscription required]; Baker, "Healthwatch," The Hill, 8/19; McCarthy, National Journal, 8/19 [subscription required]).

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