Medicare Announces Substantial Savings For Medical Equipment Included In The Next Round Of Competitive Bidding Program

By Jonathan Blum, Acting Principal Deputy Administrator and Director, Center for Medicare

Last week, the Centers for Medicare & Medicaid Services (CMS) announced new, lower Medicare prices that will go into effect this July in a major expansion of the DME Competitive Bidding Program from nine areas to 91 areas. The CMS Office of the Actuary estimates that the program will save the Medicare Part B Trust Fund $25.7 billion and beneficiaries $17.1 billion between 2013 and 2022. Medicare beneficiaries in these 91 major metropolitan areas will save an average of 45 percent for certain DME items scheduled to begin on July 1, 2013.

To reduce costs and the fraud resulting from excessive prices, CMS introduced a competitive bidding program in nine areas of the country in 2011. Under the DME competitive bidding program, Medicare beneficiaries with Original Medicare who live in competitive bidding areas will pay less for certain items and services such as wheelchairs, oxygen, mail order diabetic supplies, and more. Competitive bidding for DME is proven to save money for taxpayers and Medicare beneficiaries while maintaining access to quality items and services.

Additionally, Medicare beneficiaries across the country will save an average of 72 percent on diabetic testing supplies under a national mail-order program starting at the same time.

Medicare thoroughly vets all suppliers before awarding them contracts in the program. Suppliers must be accredited and meet stringent quality standards to ensure good customer service and high quality items. We have also monitored the program areas extensively, and real-time monitoring data have shown successful implementation with very few beneficiary complaints and no negative impact on beneficiary health status based on measures such as hospitalizations, length of hospital stay, and number of emergency room visits compared to non-competitive bidding areas.  CMS will employ the same aggressive monitoring for the MSAs added in Round 2.

A full list of the new prices and included items is available at www.dmecompetitivebid.com.

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