A second phase of a competitive bidding program, to be nationally implemented by the Centers for Medicare and Medicaid Services, will enable the agency to prevent dishonest suppliers from participating in Medicare.
The program is designed to help lower Medicare beneficiaries' out-of-pocket costs and improve their access to certain high-quality durable medical equipment, prosthetics, orthotics and supplies.
After the program is fully implemented, it is expected to save beneficiaries and Medicare $1 billion annually.
Some 70 new areas across the nation will be part of the expanded bidding program, CMS said. Ten areas currently participate in the program, providing greater beneficiary access to certain DME, prosthetics, orthotics and supplies, including standard and complex power wheelchairs, walkers, oxygen supplies and equipment, hospital beds and certain devices.
Suppliers also must meet quality standards established by CMS in 2006 and be accredited by one of 10 organizations chosen by Medicare.
"Competitive bidding means that Medicare beneficiaries will have access to these products at substantially lower costs," said CMS Acting Administrator Kerry Weems. "Since all successful bidders will be required to meet quality standards and be accredited by Medicare, people with Medicare in these 70 new areas can be assured of access, low prices and high quality. Through this accreditation process, our beneficiaries are also provided another layer of protection from fraud."
While the American Association for Homecare supports the CMS program, it questioned why the agency took so long to impose effective measures to prevent fraud.
According to CMS, under the competitive bidding program, suppliers that want to offer certain items and services to Medicare beneficiaries will have to submit bids to CMS, indicating the prices at which they are willing to supply these items to beneficiaries – prices that CMS believes will be closer to the prices charged in the current market. Currently, Medicare – and beneficiaries – pay for items based on a fee schedule that, in general, is based on the average payments Medicare has paid for these supplies in the past.
The final deadline for all suppliers to obtain initial accreditation is Sept. 30, 2009. The CMS expects to begin pre-bidding activities of the second round, such as announcing the specific ZIP Codes that constitute the CBAs, specific items in each product category, and bidder education and registration for user IDs and passwords, this spring. The bidding period is expected to run 60 days and is planned to begin this summer. A more detailed timeline will be provided when pre-bidding activities begin.