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BREAKING: New CMS Proposals to DME and ESRD Programs Released

Article Source: VGM Legislative Alert

Today, the Center for Medicare and Medicaid Services (CMS) released its proposed updates to policies and payment rates for the ESRD program, the DME industry, and the competitive bidding program. In a press release, CMS Administrator Seema Verma says, “Today’s proposals will help secure sustainable access to durable medical equipment and reward dialysis facilities that adopt innovative new therapies.”

The ESRD and DMEPOS proposed ruling is one of many rules for the 2019 calendar year.

These are some of the proposed changes for the DMEPOS competitive bidding program and the fee schedule payment rules:

  • Revise the DMEPOS CBP by implementing “lead item pricing.”
  • Revise the definition of “composite bid” to mean the bid submitted by the supplier for the lead item in the product category.
  • Establish a new method for establishing SPAs under the CBP using maximum winning bids.
  • Establish three different temporary fee schedule adjustment methodologies depending on the area in which the items and services are furnished:
    • Further, CMS is proposing a specific fee schedule adjustment methodology for items and services furnished within former CBAs. They propose to establish a methodology for adjusting fee schedule amounts paid in areas that were formerly CBAs during periods when there is a temporary lapse in the CBP (that is, after Dec. 31, 2018). CMS proposes to adjust the fee schedule amounts for items and services furnished in former CBAs based on the SPAs in effect in the CBA on the last day before the CBP contract periods of performance ended (again, Dec. 31, 2018), increased by the projected percentage change in the CPI for all Urban Consumers (CPI–U) for the 12-month period on the date after the contract periods ended (Jan. 1, 2019).
  • For items and services furnished in non-CBAs that are not rural or non-contiguous areas with dates of service from Jan. 1, 2019, through Dec. 31, 2020, the fee schedule amount for the area is equal to 100 percent of the adjusted payment amount. (Again, to be clear, there is no 50/50 blend.) 
  • CMS will add new payment classes for portable liquid oxygen equipment only, portable gaseous oxygen equipment only, and high-flow portable liquid oxygen contents. It also proposes “to establish a new methodology for ensuring that all new payment classes for oxygen and oxygen equipment added since 2006 are budget neutral…”
  • Establish new rules regarding how to pay for certain ventilators that also perform the function of other items of durable medical equipment.
  • CMS has yet to begin the process for recompeting DMEPOS CBP contracts, and the current DMEPOS CBP contract periods of performance will end on Dec. 31, 2018. Beginning on Jan. 1, 2019, beneficiaries may receive DMEPOS items from any willing supplier (until new contracts are awarded under the DMEPOS CBP). CMS will provide additional information about the DMEPOS CBP in the future.

VGM is currently reading further into the proposed changes and will have more detailed updates for you in the coming days. Be on the lookout for these updates in our social media, legislative updates, videos, and other through other channels. 

Please contact Mark Higley at with questions and comments.

To read the full CMS article, click here:

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