The New DMEPOSCompetitive Bidding Program

What You Need to Know

Medicare-covered Durable Medical Equipment, Prosthetics, Orthotics and

Supplies

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What is DMEPOS?

DMEPOS stands forDurable Medical EquipmentProstheticsOrthotics Supplies

Equipment and supplies covered under Medicare Part B

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Change in Payment for DMEPOS

Congress changedThe way Medicare pays How much is paidWho can furnish these items

Called “Competitive Bidding Program”Begins July 1, 2008 10 initial competitive bidding areas (CBAs)Applies if residing in or visiting a CBA

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Competitive Bidding ProgramBidding process will set Medicare payment

lower than previous amounts Program will help people with Medicare

• Save money • Get quality equipment, supplies and services

Program will limit Medicare fraud and abuse

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Program Evolution

Builds on success of demonstrationsApril 2007: 10 initial areas announced July 2008: Program begins in 10 MSAs

Average savings of 26%

January 2008: 70 additional areas announced

In 2009: Program begins in 70 additional areas

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Who will be Affected?

Beneficiaries whoHave Original Medicare (not apply if have

Medicare Advantage)Permanently reside in a ZIP Code in a CBAObtain items while visiting a CBA

To find out if ZIP Code is in a CBACall 1-800-MEDICAREVisit www.medicare.gov

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Initial CBAs California – Riverside, San Bernardino, Ontario

Florida - Miami, Fort Lauderdale, Miami Beach

Florida - Orlando, Kissimmee

Missouri and Kansas - Kansas City

North and South Carolina - Charlotte, Gastonia, Concord

Ohio - Cleveland, Elyria, Mentor

Ohio, Kentucky, and Indiana - Cincinnati, Middletown

Pennsylvania - Pittsburgh

Texas - Dallas-Fort Worth, Arlington

Puerto Rico--San Juan, Caguas, Guaynabo

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How New Program Works

DMEPOS suppliers submit bidsSuppliers in a CBA must submit a bid to be awarded

a contract

Medicare uses bids to determine payments Contracts will be awarded to sell/rent DMEPOS “Contract suppliers” will be those who

Offer the best priceMeet eligibility, quality, and financial standardsAccredited by an independent organization

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How New Program Works

Only contract suppliers will be able toProvide certain DMEPOS items File claims with Medicare for payment

Contract supplier charge cannot exceedSingle payment amount based on bids

received for an itemMedicare fee schedule allowed amount

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Products Included in the Program

1. Oxygen supplies and equipment

2. Standard power wheelchairs, scooters

3. Complex rehabilitative power wheelchairs

4. Mail-order diabetic supplies

5. Enteral nutrients, equipment, and supplies

6. Hospital beds and related accessories

7. Continuous Positive Airway Pressure (CPAP) devices and Respiratory Assist devices (RADs)

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Products Included in the Program

8. Negative pressure wound therapy devices

9. Walkers and related accessories

10.Support surfaces (Miami only)

To check for specific included products

Call 1-800-MEDICARE Visit www.medicare.gov

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Using Contract Suppliers

Must use contract supplier ifItem included in Competitive Bidding Program

where a beneficiary livesTraveling to or visiting a CBA

Treating practitioner can supply certain items (ex: walkers)

Nursing Facility can only supply directly if it becomes a contract supplier

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Identifying Contract Suppliers

Call 1-800-MEDICARE (1-800-633-4227)TTY users call 1-877-486-2048 Visit www.medicare.gov/supplier

DMEPOS Supplier Locator Tool

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Non-contract Supplier

If in CBA, a non-contract supplier may not furnish bid items

If non-contract supplier used, supplier will issue Advance Beneficiary Notice (ABN)

ABN saysMedicare will not payBy signing, beneficiary agreeing to payIf not sign ABN, beneficiary not responsible

for payment

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Scenario 1

Obtaining an item from a non-contract supplier

Betty lives in Cincinnati, OH (which is in a Competitive Bidding Area) and is diagnosed with sleep apnea. Her doctor prescribes a Continuous Positive Airway Pressure (CPAP) device. If Betty wants to buy the item from a non-contract supplier, the supplier must have her sign an Advance Beneficiary Notice (ABN). The ABN says Medicare probably won’t pay for the item. By signing this notice, Betty agrees to pay for the CPAP device.

If Betty purchases the CPAP device from a non-contract supplier, and she wasn’t informed in writing of the Competitive Bidding Program rules before receiving the item, she is not responsible for payment.

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Temporary Visits

To CBA:Must use contract supplier

If non-contract supplier used, supplier will issue Advance Beneficiary Notice (ABN)

If not sign ABN, beneficiary not responsible for payment

To non-CBA:Can use any Medicare-enrolled supplier

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Scenario 2

Obtaining DMEPOS items while traveling

Mildred’s permanent residence is in Rhode Island (which is not a Competitive Bidding Area), but she travels to Miami, FL. While she’s in Miami, her doctor prescribes a walker. Since Miami is in the Competitive Bidding Area, Mildred must receive the walker from a contract supplier. If Mildred wants to buy the walker from a non-contract supplier, the supplier must have her sign an Advance Beneficiary Notice (ABN). The ABN says Medicare probably won’t pay for the item. By signing this notice, Mildred agrees to pay for the walker.

If Mildred travels to Jacksonville, FL, which is not a Competitive Bidding Area, she may purchase a walker from any Medicare-enrolled supplier of durable medical equipment, prosthetics, orthotics and supplies.

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Specific Brands

Doctor must prescribe in writingMedical record must reflect needIf specific brand not available

Supplier will work with practitioner to find suitable alternative OR

Help locate another contract supplier who can meet the need

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Stay With Current Supplier

Can stay with current non-contract supplier if all of the followingSupplier elects to be “grandfathered” Beneficiary permanently resides in a CBARenting the equipment before July 2008

If current non-contract supplier elects not to be “grandfathered”Must switch to a contract supplier

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“Grandfathered” Supplier

SupplierNotifies beneficiary confirming desire to

continue services

BeneficiaryMay continue getting services until rental

period ends ORMust switch to a contract supplier

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Scenario 3

Grandfathering Process for Rented Items

George lives in Kansas City, MO (which is in a Competitive Bidding Area) and has been renting oxygen and oxygen supplies from his supplier. His supplier was not awarded a contract with Medicare under the new Competitive Bidding Program. George’s supplier decides to become a “grandfathered” supplier which means the supplier can continue to furnish the oxygen items and receive the Medicare payment amounts under the new Competitive Bidding Program. George may continue receiving his oxygen items from the grandfathered supplier until his contract ends.

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If Not “Grandfathered” Supplier

SupplierShould confirm desire to discontinue servicesPicks up equipment

BeneficiaryMust switch to contract supplierRetains documentation of pick-upIf not hear from supplier, check with supplier

or Medicare

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Equipment Repair & Replacement

For owned medical equipmentAny Medicare-enrolled supplier can make

necessary repairs or get replacement partsFor complete replacement must use contract

supplier Owned medical equipment includes

• Items purchased by beneficiary• Items for which beneficiary took the purchase

option within the rental period

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Scenario 4

Repair and Replacement

Elaine has a wheelchair and lives in Dallas, TX (which is in a Competitive Bidding Area). The wheel on her chair breaks and she needs to have it repaired. She may have her wheelchair repaired by either a contract supplier or by any Medicare-enrolled, non-contract supplier.

If Elaine’s wheelchair needs a replacement part, she may have the replacement part installed by either a contract supplier or any Medicare-enrolled, non-contract supplier.

If it is determined that Elaine’s wheelchair cannot be repaired and she needs a new wheelchair, she must receive it from a contract supplier in the Competitive Bidding Area.

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Deductible and Coinsurance

Annual deductible and 20% coinsurance remain in effect

Contract suppliers cannot bill for more than these amounts

For suspected overpayment or fraud call 1-800-MEDICARE Fraud Hotline of the HHS Office of the

Inspector General at 1-800-447-8477.

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Have Other Insurance?

Medicare may make payment to a non-contract supplier if required by policy

Non-contract supplier must Meet Medicare enrollment standardsBe eligible to receive secondary payments

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Points to Remember

Program does NOT affect which physician or hospital you use

May need to change DMEPOS supplier to continue your Medicare coverage

May be able to stay with current supplier if renting from supplier who elects to be “grandfathered”

If in MA plan, program is not applicable

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What You Need To Do

If you live in or will visit a CBA and need medical items included in the programFind out if the ZIP Code where you live or

visit is included in a CBAFind out which suppliers are included in the

Medicare Competitive Bidding Program in that area

Visit www.medicare.gov or call 1-800-MEDICARE to find this information

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Questions?

1-800-MEDICARE (1-800-633-4227), TTY users should call 1-877-486-2048.

www.medicare.gov website Supplier Locator ToolConsumer fact sheets

Your physician or supplierMedicare’s local information resources

(SHIPs, AoA, etc)

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