What is the Medicare Competitive Bidding Program?

The DMEPOS Competitive Bidding Program was mandated by Congress through the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA). The statute requires that Medicare replace the current fee schedule payment methodology for selected Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) items with a competitive bid process. The intent is to improve the effectiveness of the Medicare methodology for setting DMEPOS payment amounts, which will reduce beneficiary out-of-pocket expenses and save the Medicare program money while ensuring beneficiary access to quality items and services.

Under the program, a competition among suppliers who operate in a particular competitive bidding area is conducted. Suppliers are required to submit a bid for selected products. Not all products or items are subject to competitive bidding. Bids are submitted electronically through a web-based application process. Bids are evaluated based on the supplier’s eligibility, its financial stability and the bid price. Contracts are awarded to the Medicare suppliers who offer the best price and meet applicable quality and financial standards. Contract suppliers must agree to accept assignment on all claims for bid items and will be paid the single payment amount.

Is your Physician PECOS enrolled?

The Provider Enrollment, Chain, and Ownership System (PECOS) is a database of physicians who are enrolled with Medicare. When a physician prescribes an item, such as an OA Knee brace, the supplier must list the physician’s National Provider Identifier (NPI) number on the claim. The NPI number links to the physician’s provider file in the PECOS system.

In order for a DMEPOS item to qualify for coverage by Medicare, a physician or a practitioner who is eligible to order such an item must write the prescription.