1. DMEPOS Competitive Bidding Program The Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program May 2016

2. Competitive Bidding—A Better Way to Pay  Started in January 2011 for certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) in 9 areas of the country (Round 1)  In July 2013 The program expanded to more areas (Round 2) The National Mail-Order Program was implemented  Limits fraud and abuse in the Medicare program  The Competitive Bidding Program helps people with Medicare Save money Get quality equipment, supplies, and services April 2016Competitive Bidding Program2

3. The Competitive Bidding Program  Suppliers submitted bids to provide certain DMEPOS at lower prices than Medicare was paying  Contracts are awarded to winning suppliers to sell/rent DMEPOS  Amount Medicare pays for DMEPOS is based on bids When Medicare pays less, the 20% coinsurance is less  Contract suppliers must Meet eligibility, quality, and financial standards Be accredited by an independent organization April 2016Competitive Bidding Program3

4. The Competitive Bidding Program—Continued  In most cases, only contract suppliers can Provide competitively bid DMEPOS  The types of items Medicare covers doesn't change  Contract supplier charge can’t exceed single payment amount based on bids received for an item Competitive Bidding ProgramApril 20164

5. Round 1 Recompete Products 1/1/14-12/31/16 Products Included in Round 1 Recompete Respiratory equipment and related supplies and accessories including  Oxygen, oxygen equipment and supplies; Continuous Positive Airway Pressure (CPAP) devices and respiratory assist devices (RADs) and related supplies and accessories; and standard nebulizers Standard mobility equipment and related accessories including  Walkers, standard power and manual wheelchairs, scooters, and related accessories General home equipment including  Hospital beds and related accessories, group 1 and 2 support surfaces, transcutaneous electrical nerve stimulation (TENS) devices, commode chairs, patient lifts, and seat lifts Enteral nutrients, equipment, and supplies Negative pressure wound therapy pumps and related supplies and accessories External infusion pumps and supplies April 2016Competitive Bidding Program5

6. Round 1 2017  Required by law to recompete contracts at least once every 3 years  Current Round 1 Recompete contracts and prices expire on December 31, 2016  Contracts and prices for next period to become effective on January 1, 2017 April 2016Competitive Bidding Program6

7. Round 2 Competitive Bidding  Contracts and prices Were effective on July 1, 2013 Expire June 30, 2016  Program expanded 91 Metropolitan Statistical Areas April 2016Competitive Bidding Program7

8. Products Included in Round 2* Products Included in Round 2 Oxygen, oxygen equipment, and supplies Enteral nutrients, equipment, and supplies Continuous Positive Airway Pressure (CPAP) devices and Respiratory Assist Devices (RADs), and related supplies and accessories Hospital beds and related accessories Walkers and related accessories Support surfaces (Group 2 mattresses and overlays) Standard (power and manual) wheelchairs, scooters, and related accessories Negative pressure wound therapy pumps and related supplies and accessories * Changes from Round 1 to Round 2 in Bold Italics April 2016Competitive Bidding Program8

9. National Mail-Order Program for Diabetes Testing Supplies  Designed to ensure that people with Original Medicare continue to get quality supplies and save money People who choose to have diabetes testing supplies delivered to their home need to know  Medicare won't pay unless a national mail-order contract supplier is used  National mail-order contract suppliers can’t charge more than the deductible and 20% coinsurance People can also choose to get supplies from any local store enrolled in Medicare  Local stores can’t charge more than the deductible and 20% coinsurance if they accept assignment April 2016Competitive Bidding Program9

10. Round 2 Recompete & National Mail-Order Recompete  Round 2 and National Mail-Order Program Contract periods expires on June 30, 2016  Round 2 Recompete and the national mail- order recompete contracts Become effective on July 1, 2016 Expire on December 31, 2018 April 2016Competitive Bidding Program10

11. Round 2 Recompete Products 7/1/16-12/31/18 Products Included in Round 2 Recompete Enteral nutrients, equipment, and supplies General home equipment and related supplies and accessories including  Hospital beds and related accessories, group 1 and 2 support surfaces, commode chairs, patient lifts, and seat lifts Nebulizers and related supplies Negative Pressure Wound Therapy (NPWT) pumps and related supplies and accessories Respiratory equipment and related supplies and accessories including  oxygen, oxygen equipment, and supplies, continuous positive airway pressure (CPAP) devices and respiratory assist devices (RADs) and related supplies and accessories Standard mobility equipment and related accessories including  Walkers, standard power and manual wheelchairs, scooters, and related accessories Transcutaneous Electrical Nerve Stimulation (TENS) devices and supplies April 2016Competitive Bidding Program11

12. The Competitive Bidding Program— Who will be Affected?  People who have Original Medicare and Permanently reside in, or are visiting, a Competitive Bidding Area (CBA) and obtain competitively bid items  To find out if a ZIP code is in a CBA or to locate a contract supplier Visit Medicare.gov/supplier, orMedicare.gov/supplier Call 1-800-MEDICARE (1-800-633-4227)  TTY users call 1-877-486-2048  Medicare Advantage Plans should let their enrollees know if their plan is changing April 2016Competitive Bidding Program12

13. Doctors and Other Treating Practitioners Use of Contract Suppliers  Must almost always use contract supplier if Items and services are included in Competitive Bidding Program where a person with Original Medicare lives Someone is traveling to or visiting a competitive bidding area  Doctors, treating practitioners, and hospitals can supply certain items (e.g.: walkers and folding manual wheelchairs) without being contract suppliers  A nursing facility can supply directly to its own residents only if it becomes a contract supplier April 2016Competitive Bidding Program13

14. Staying With A Non-Contract Supplier  A consumer can stay with current supplier that doesn’t have a new contract, provided that Supplier elects to become “grandfathered” The person with Original Medicare permanently resides in a competitive bidding area The person with Original Medicare was renting certain equipment or oxygen when the program (or recompeted round) started April 2016Competitive Bidding Program14

15. Grandfathering  Non-contract supplier Must inform Medicare consumers in writing about whether they’ll continue renting equipment Works with contract supplier to get new equipment if Medicare consumers switch to a contract supplier  The choices are Continue getting services from a grandfathered supplier until rental period ends OR Switch to a new contract supplier April 2016Competitive Bidding Program15

16. Have Other Insurance?  Medicare may make payment to a non- contract supplier if required by primary policy  Non-contract supplier must Be accredited Have a valid Medicare billing number Be eligible to receive secondary payments April 2015Competitive Bidding Program16

17. Non-contract Supplier  A non-contract supplier generally may not provide competitively bid items in a competitive bidding area  If a non-contract supplier is used and no exception applies, people with Medicare aren’t responsible for payment unless the supplier issues an Advance Beneficiary Notice (ABN) By signing the ABN, the person with Medicare agrees to pay entire amount April 2016Competitive Bidding Program17

18. Changing Suppliers Scenario Obtaining DMEPOS items from a new contract supplier Mildred’s permanent residence is in Miami, FL, which is a Round 1 Competitive Bidding Area. She’s currently renting her Continuous Positive Airway Pressure (CPAP) device from ABC Company, which has a Round 1 Recompete contract, but not a Round 1 2017 contract. Mildred receives a notice from ABC Company informing her that they won’t be a contract supplier after December 31, 2016, and that they also won’t be a grandfathered supplier starting January 1, 2017. Mildred must transition to a Round 1 2017 contract supplier for Medicare to help pay. April 2016Competitive Bidding Program18

19. Getting DMEPOS When Travelling  To Competitive Bidding Areas (CBAs) Must generally use contract supplier for that CBA If non-contract supplier used and no exception applies, people with Medicare aren’t responsible for payment unless supplier issues Advance Beneficiary Notice  To non-competitive bidding areas Can use any Medicare-enrolled supplier April 2016Competitive Bidding Program19

20. Specific Brands  Doctor must prescribe in writing  Medical record must reflect need  Contract supplier must Provide the specific brand or form as prescribed OR Work with the doctor or treating practitioner to find a suitable alternative and obtain a revised prescription OR Help locate another contract supplier that can Provide the specific brand or form as prescribed April 2016Competitive Bidding Program20

21. Equipment Repair & Replacement  For beneficiary-owned medical equipment Any Medicare-enrolled supplier can make necessary repairs For replacement, must use a contract supplier For warranty repairs, follow the warranty rules  For rented equipment Repairs are included in rental payment—the supplier must fix at no charge April 2016Competitive Bidding Program21

22. Deductible and Coinsurance  After paying the annual Part B deductible Medicare pays 80% of the Medicare-approved amount for equipment, supplies, and services The consumer is responsible for 20% coinsurance  Contract suppliers can’t bill for more than these amounts  For suspected overpayment or fraud, call 1-800-MEDICARE (1-800-633-4227)  TTY users call 1-877-486-2048 Fraud Hotline of the HHS Office of Inspector General at 1-800-447-8477 April 2016Competitive Bidding Program22

23. Points to Remember  The Competitive Bidding Program does NOT affect which doctors or hospitals a person with Medicare can use  Generally, a contract supplier must be used for Medicare to help pay  A person with Medicare may be able to stay with their current supplier if renting from a supplier who has a new contract or elects to become “grandfathered”  People in Medicare Advantage Plans should check with the plan April 2016Competitive Bidding Program23

24. Resources  Visit Medicare.gov/supplier DMEPOS Supplier Locator Tool  Call 1-800-MEDICARE (1-800-633-4227) TTY users should call 1-877-486-2048  Doctors or suppliers  Administration for Community Living has local information resources April 2016Competitive Bidding Program24