The durable medical equipment (DME) competitive bidding program is designed to reduce your out-of-pocket expenses and help ensure that you have access to quality DME, supplies, and services from suppliers you can trust. The program affects you if:

  • You have Original Medicare
  • Live in a competitive bidding area
    • Most states have areas affected by competitive bidding. However, certain states, including Alaska, Maine, Montana, North Dakota, South Dakota, Vermont, and Wyoming, have no regions in the demonstration.
  • And, need DME that falls under the competitive bidding program
    • Most DME items are included in the competitive bidding program, but a small number of items are excluded.

In a competitive bidding area, you will almost always get DME from a contract supplier. These suppliers:

  • Are required to provide covered items to any Original Medicare beneficiary living in the area or traveling to the area.
  • Must take assignment, meaning they accept Medicare’s approved amount for health care services as full payment.
  • Are the only suppliers in the area who can bill Medicare for competitive bidding items. In most cases, Medicare will not pay for your DME if you do not use a contract supplier when you should be doing so. This means you will have to pay the full cost of your DME if you buy or rent from other suppliers.

Note: If you live or travel outside a competitive bidding area, you will have different costs.

In certain situations, you may not be required to use a contract supplier:

  • Some skilled nursing facilities (SNFs) are specialty suppliers, meaning they may provide DME to their own patients.
  • Your doctor may give you a walker or folding manual wheelchair during an office visit, even if they are not a contract provider.
  • A hospital may give you a walker or folding wheelchair while you are in the hospital or the day you leave.

Medicare will still cover these items as long as you meet Medicare’s DME coverage requirements.

In most other cases, if you are in a competitive bidding area and have Original Medicare, suppliers who are not contract suppliers must let you know ahead of time and have you sign an Advance Beneficiary Notice (ABN). This notice states that you understand that Medicare will not cover the requested DME and that you will be responsible for the full cost. If the supplier does not have you sign an ABN, you do not owe money to the supplier for the DME.

Note: If you live in a competitive bidding area and plan to get DME from a home health agency, make sure they are or work with a contract supplier.

Mail order diabetes supplies

If you have Original Medicare and order your diabetic supplies through mail order, you must use a contract supplier. Mail order includes diabetes supplies that are mailed to you by a supplier and those that are delivered to your home by a pharmacy. If you pick up your diabetic supplies from a local pharmacy, you are not necessarily covered by the competitive bidding program, but you might be. Check to see if the pharmacy is a contract supplier if you are in a competitive bidding area. If you are not in a competitive bidding area, you should make sure the pharmacy takes assignment to reduce your out-of-pocket costs.

Grandfathered suppliers

Medicare typically covers DME on a rental basis. If you are already renting equipment when the competitive bidding program starts in your area, you can keep using your current supplier if it becomes a contract supplier or a grandfathered supplier. Grandfathered suppliers are non-contract suppliers who agree to continue renting you equipment until your rental period ends. Like contract suppliers, they must take assignment.

You may find that you pay the least if you use a grandfathered supplier. Switching suppliers can increase the period of time you have to rent the equipment, meaning you may end up paying more.

If your supplier becomes a grandfathered supplier, it should send you a letter no later than 30 days before the competitive bidding program starts in your area.