The Centers for Medicare & Medicaid Services has responded to a challenge to provide savings information on a competitive bidding process it's implementing for durable medical equipment.
On Friday, the agency released data indicating Medicare could save an average of 26 percent for some durable medical equipment, prosthetics, orthotics and supplies in selected areas.
That was only two days after the agency received letters signed by more than 100 members of Congress asking for the agency to release data on the program.
The letter also sought information on how the new program, which is being rolled out in 10 metropolitan statistical areas this month, will affect smaller DME suppliers. The letters and DME organizations have expressed concerns that thousands of small suppliers won't be able to bid successfully under the new program because they aren't prepared to serve large MSAs.
The CMS analysis of the new program aims to ease those concerns. The agency said the bidding evaluation process will ensure that "there will be a sufficient number of suppliers, including small suppliers, to meet the needs of the beneficiaries living in the competitive bidding areas."
Suppliers with gross revenues of $3.5 million or less represent about 64 of the suppliers offered contracts in the first round, CMS said. In addition, bidders whose bids "qualified but were not in the winning range" will receive a notice that they may receive a contract from CMS if one of the suppliers that was offered a contract decides not to participate in the program, or they can bid in future rounds of the bidding process.
Information released by CMS notes that beneficiaries living in the first 10 MSAs will be choosing a new Medicare contract supplier, but "suppliers that are not contract suppliers may continue to provide certain rented DME equipment and oxygen and oxygen equipment for existing clients in the Medicare program if they elect to continue furnishing the items as 'grandfathered' suppliers."
CMS touted the savings and other quality aspects of the new competitive bidding program.
"This new program means that Medicare beneficiaries will have access to some medical equipment and supplies at substantially lower prices than they are paying now," said Kerry Weems, acting CMS administrator. "This program represents yet another way to use the competitive marketplace to bring the best possible and most efficient care and services to people with Medicare.
"Because new accreditation and quality standard initiatives are being implemented in conjunction with the phase-in of competitive bidding, this program will provide assurance to beneficiaries that they are receiving high-quality medical equipment for home use," Weems added.
For example, oxygen concentrators will cost $140.82 per month under the new program, a savings of $58.46 per month, or 29.3 percent, under the current allowed charge. Medicare will save nearly $47 as a result of the process, and beneficiaries' share will be reduced by $11.69, CMS data show.