If you're bidding in Round 2028, it's important to understand what will be expected of you if you're awarded a contract under the Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program (CBP).
DMEPOS CBP suppliers (contract suppliers) must comply with all terms of their DMEPOS CBP Contracts for the full duration of the DMEPOS CBP contract performance period. You should also refer to the statute and regulations for specific rules and requirements. Below are key requirements to keep in mind as you prepare your bid.
- Contract suppliers, including all contract supplier locations enrolled in Medicare (identified by a Provider Transaction Access Number (PTAN)), must comply with the Medicare enrollment requirements specified in 42 CFR § 424.57(c) and maintain Medicare billing privileges throughout the duration of the contract performance period. The requirements in 42 CFR § 424.57(c) include (but are not limited to) complying with accreditation and state licensing requirements. Only properly enrolled supplier locations that are included in the supplier’s DMEPOS CBP Contract will be eligible to furnish competitively bid items and be reimbursed by Medicare.
- Medicare payment for items under the DMEPOS CBP Contract will be based on the item’s single payment amount (SPA). Contract suppliers are required to accept assignment of all claims for Medicare-covered competitively bid items and services, which means they must accept the SPA as payment in full for the competitively bid item and service. Suppliers must submit the claims for the items and services to Medicare on behalf of the beneficiary and collect coinsurance (20 percent of the SPA) from the beneficiary as well as any unmet Part B deductible. Medicare then pays the supplier 80 percent of the SPA less any unmet Part B deductible. See 42 CFR § 414.408 for more information about the DMEPOS CBP payment rules.
- Contract suppliers are responsible for completing the intake and assessment process, submitting claims on behalf of the beneficiary, coordinating care with the physician, delivering DMEPOS items, and, as applicable, setting up the equipment and providing training/instruction to the beneficiary and/or caregiver(s). Contract suppliers are accountable for ensuring that all services associated with furnishing the item, including subcontracted services, are performed in compliance with the physician’s order and Medicare rules and guidelines.
- Contract suppliers cannot discriminate against Medicare beneficiaries. As specified in 42 CFR § 414.422(c), the items a contract supplier furnishes to Medicare beneficiaries under its competitive bidding contract must be the same items the contractor makes available to other customers. A contract supplier must furnish all competitively bid items under its contract to any beneficiary who maintains a permanent residence in the CBA, or who visits the CBA, and requests the competitively bid item(s) from the contract supplier. As specified in 42 CFR § 414.420(b), if a physician or other treating practitioner orders a specific brand of an item or mode of delivery to avoid an adverse medical outcome for a beneficiary, the contract supplier must:
- furnish that specific brand or mode of delivery,
- consult with the physician or treating practitioner to find an appropriate alternative and obtain a revised written prescription, or
- assist the beneficiary in locating a contract supplier that furnishes that specific brand or mode of delivery.
- For more information, please see the Physician or Treating Practitioner Authorization Process fact sheet.
- The sale of a competitive bidding contract is prohibited and is grounds for contract termination. The Centers for Medicare & Medicaid Services (CMS) may allow for the transfer of the contract to a successor entity that merges with, or acquires, a contract supplier – a change of ownership (CHOW) – subject to certain requirements. However, a CHOW does not automatically grant contract supplier status to a new entity. A contract supplier has specific obligations to notify CMS when it is negotiating a CHOW. The successor or new entity in a CHOW must meet all DMEPOS CBP requirements and assume all rights, obligations, and liabilities of the competitive bidding contract in order for CMS to consider transfer of the contract to the new entity. See 42 CFR § 414.422(d) for more information about the DMEPOS CBP CHOW requirements.
- Contract suppliers are responsible for furnishing competitively bid items directly or through the use of subcontractors. The only permissible subcontracting arrangements are those that comply with the DMEPOS Supplier Standards specified in 42 CFR § 424.57(c) and applicable accreditation requirements. If a contract supplier decides to use a subcontractor to deliver items and services under the contract or perform other subcontracted services, both the contract supplier and the subcontractor must have all applicable state/territory licenses.
- Contract suppliers must notify CMS of any subcontracting relationship(s) that they have entered into for purposes of furnishing items under the DMEPOS CBP. They must also disclose whether the subcontractor meets accreditation requirements necessary to furnish these services. After the award of DMEPOS CBP Contracts, contract suppliers must disclose to CMS within 10 business days each subcontracting relationship that each supplier has in furnishing items and services under the contract. After that initial disclosure, contract suppliers must notify CMS within 10 business days of entering into any subsequent agreements with subcontractors. Notification is completed in Connexion, the DMEPOS CBP’s secure portal.
- The actions or inactions of a subcontractor will not excuse a contract supplier from complying with the terms of its DMEPOS CBP Contract. If a subcontractor does not perform in compliance with the terms of the contract, the contract supplier will still be held accountable for the potential breach of contract. For additional information on subcontracting, please see the Subcontracting of DMEPOS Services fact sheet.
- Contract suppliers are not guaranteed a minimum amount of business.
- Each contract supplier must submit a semi-annual report (Form C) in Connexion including details such as the manufacturer and model of specific items it offers to all customers. The contract supplier should also review and update, if necessary, its information in the Medicare Supplier Directory before submitting the report to determine if the information is current. A Form C containing current information must be submitted to the CBIC within 10 business days after each of the following dates: January 1 and July 1. If the due date for a particular semi-annual report falls on a Saturday, Sunday, or federal holiday, the report is due on the next business day.
Failure to adhere to the terms of a DMEPOS CBP Contract, including but not limited to, compliance with governmental agency or state/territory licensing requirements, constitutes a breach of contract. If a supplier breaches the contract, CMS may take action(s) pursuant to 42 CFR § 414.422(g)(2). For example, CMS could terminate the contract and prevent the contract supplier from participating in the next round of the DMEPOS CBP.