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A Look at Medicare’s Competitive Bidding Program for DME

November 19, 2019

TOA recently sat down with Ross DeRogatis of Matrix Orthopedics to look at Medicare’s Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding program, which will affect back and knee braces.

Ross is the President/Owner of Matrix Orthopedics, an exclusive Donjoy distributor.  He has been in the DME space for over 10 years and currently has a team of 24 servicing accounts throughout the state of Texas (with the exception of the Houston and El Paso markets).

TOA: What is the current status of Medicare’s DMEPOS competitive bidding program?

Ross DeRogatis:  The Centers for Medicare & Medicaid Services (CMS) contracted with Palmetto GBA to operate as the competitive bidding implementation contractor (CBIC) to administer the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program. Palmetto GBA is responsible for conducting certain functions including performing bid evaluations, selecting qualified suppliers, setting payments for all competitive bidding areas, and supporting CMS education efforts. Palmetto GBA also assists CMS and its contractors in monitoring the program’s effectiveness, access and quality.

In 2003, Congress originally authorized CMS to implement a competitive bidding program (CBP) for DMEPOS. Multiple rounds of bidding have been conducted for many different DMEPOS categories over the past decade.

On November 3, 2018, CMS requested feedback on a proposal to include certain off-the-shelf (OTS) knee and back orthotics/braces in the next round of competitive bidding (known as Round 2021, since contracts will become effective on January 1, 2021).

In early 2019, CMS announced that OTS knee and back braces would be included in the 2021 round.

OTS orthotics are defined as products that require minimal self-adjustment, and do not require expertise in trimming, bending, molding, assembling, or customizing to fit to the individual.

TOA: What are the next steps for the industry when it comes to the competitive bidding program?

Ross DeRogatis: DMEPOS suppliers will compete to become Medicare contract suppliers by submitting one bid for the “lead” item within a product category (e.g., knee orthotics/braces) for each competitive bidding area (CBA). There are 130 CBAs included in the 2021 round. Winning bidders must be able to provide the lead item in a product category, as well as all other products included in that category. This can be accomplished through various approaches.

CMS will evaluate bids based on the supplier’s eligibility to provide the identified products within a CBA, its financial stability, and the bid price offered. Contracts will be awarded to suppliers who offer the best price and meet applicable quality and financial standards.

DJO also has been working closely with industry associations and thought leaders to protect access to high quality products needed by our patients and advocated for the exclusion of certain codes of the identified products/HCPCS codes from the CMS competitive bidding process and changes to the correct coding guidance with respect to custom fitted codes.

DMACs issued a revised Correct Coding Guidance in March 2019:

More information is available at these links:

Official CMS website
Industry educational sites like DME CBP Education