CompetitiveBiddingThe Centers for Medicare and Medicaid Services (CMS) released new, lower Medicare prices that will go into effect this July in a major expansion of the Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program. Reimbursement rates for certain durable medical equipment will be, on average, 45% lower than the current rates.  CPAP devices were among the product categories with the steepest cuts at 47%.

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 91 major metropolitan areas will save an average of 45 percent for certain DMEPOS items scheduled to begin on July 1, 2013.

“We rigorously reviewed all bids using our bona fide bid process and ensured that only accredited suppliers that met financial standards and applicable licensure requirements are being offered contracts. This process will ensure that beneficiaries have access to the equipment they need at fair prices,” said Jonathan Blum, deputy CMS administrator and director of CMS’s Center for Medicare. “We will continue to monitor the program closely as it expands to ensure the same success we saw in the program last year, with beneficiaries continuing to have access to all the services they need, while paying a much lower price.”

Medicare’s competitive bidding program replaces its existing fee schedule amounts in selected areas with prices based on suppliers’ bids, saving money for taxpayers and beneficiaries while preserving access to quality products from accredited suppliers. Using market-based prices set through competition will help ensure the long-term sustainability of the Medicare program. Small businesses represent over half of the winning suppliers in these 91 metropolitan areas.

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A full list of the new prices is available at