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In early March, the Centers for Medicare & Medicaid Services (CMS) announced major changes to the Durable Medical Equipment, Prosthetics, Orthotics, & Supplies (DMEPOS) competitive bidding program for 2021, including plans to consolidate the competitive bidding areas (CBAs) included in the Round 2 Re-compete and Round 1 2017 DMEPOS Competitive Bidding Program into a single round of competition named “Round 2021.” 

The changes are large in scale and are coming fast. Starting July 16, 2019, suppliers will have the opportunity to place bids for Round 2021, which requires suppliers to understand key changes, including: 

•    Lead Item Pricing: Suppliers will submit a single bid for a lead item in the product category. The single payment amount (SPA) will be calculated for that lead item in the CBA based on the highest amount bid within the 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, adding complexity to bid calculations. 

•    Bid Surety Bonds: Bidders must obtain a $50,000 bid surety bond for each CBA for which they submit a bid. 

•    Use of SPAs to Set Rates in Non-CBAs.  CMS also uses the SPAs to set the rates in non-CBAs that are not rural but will set the rural non-CBA rates at what is essentially the SPA plus 10 percent in rural areas.  This means the bids for CBAs will have a direct impact on the rates in non-CBAs.

What does this mean for the DME industry?

In short, it means suppliers must quickly get up to speed about how these changes will impact their business so they can be ready to bid in Round 2021. 

To help suppliers prepare for the changes, a coalition of leading industry trade associations set up an educational website that compiles publicly available information in one place. You can visit it here at www.dmecbpeducation.com

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