Competitive Bidding/Acquisition for DME

The Medicare program has been moving for years towards replacing the fee schedule reimbursement system with one of competitive bid or competitive acquisition. The AARC has throughout the years consistently raised the concern that competitive bidding to provide oxygen equipment and supplies could result in awarding “contracts” to those who offer to provide the equipment at the lowest possible price. We have insisted that the Medicare program must recognize that home oxygen services constitutes more then just delivery of equipment and supplies. Many companies provide respiratory therapists to assist the oxygen dependent Medicare patient. Under Competitive Bidding/Acquisition companies may no longer provide these important services.

Information obtained through the DME demonstration projects showed cost savings to the Medicare program. Based on the data from the demo projects, in 2003 Congress enacted the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) which required, beginning in 2007  a phase out of the current DME reimbursement system. To read more about this, and other DME policies go to the CMS website.

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