The COVID-19 Effect and Competitive Bidding This is a big unknown as to accurate forecasting for industry results in 2020. Stakeholders report concern for DMEPOS suppliers (albeit less for those with a large percentage of revenue in respiratory products) who are dependent on certain elective procedures requiring DME. And a recent report/analysis on home health visits from VGM CEO Mike Mallaro suggests many patients, even with referrals, are not following up with their post-acute care—whether it be home health, pharmacy, or acquiring DME—up to 46%. We will closely monitor the data as it becomes available. Additionally, on Oct. 27, CMS announced an update to the Round 2021 Competitive Bidding Program. The notice revealed that only two of the categories will move forward on schedule: knee and back orthotic braces [noninvasive ventilation (NIV) was already out due to CMS’ decision on COVID-19]. This means that 13 categories will not move forward in Round 2021. In conjunction with this announcement, there was also a CMS release relative to a new proposed rule (CMS-1738-P), which, among other things, potentially affects reimbursement for competitively bid product category items on or after April 1, 2021, or “the date immediately following the duration of the emergency period” or, put more simply, when HHS declares the public health emergency over, whichever is later.
CMS competed 16 product categories in 130 competitive bid areas for Round 2021 of DMEPOS, reviewing 49,000 bids. As noted, noninvasive ventilators were removed in April 2020 in response to COVID-19, leaving 15 product categories. Thirteen of the product categories had been bid during previous rounds while off-the-shelf (OTS) back and knee braces were competed for the first time. CMS has decided NOT to award competitive bidding contracts for any of the 13 product categories that were previously competed because “the payment amounts did not achieve expected savings.” Contract offers have been made in 127 competitive bidding areas (CBAs) for the OTS back and knee braces. Winning bidders had to respond to contract offers by Nov. 10, 2020. The memo did not include information on when competitive bidding will go back into effect for the product areas left out of round 2021. However, I believe that unless legislative changes occur, the next competition will have an effectivity date of Jan. 1, 2024. CMS stated it had heard from a range of stakeholders requesting that the agency delay or cancel the Round 2021 program due to the ongoing COVID-19 PHE. Apparently, CMS considered that feedback and, as noted above, is not awarding competitive bidding contracts for the 13 product categories “because the payment amounts did not achieve expected savings.”
HME Past, Present, and Future
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