If you have Original Medicare and need DME for use in your home, you need to learn about the competitive bidding program and how it may affect you. In many areas, called competitive bidding areas, you must get most DME from a select group of suppliers chosen by Medicare.

Begin by calling 1-800-MEDICARE or go to www.medicare.gov/supplier to find out answers to the questions listed below.

1. Is the area where you live or plan to travel to a competitive bidding area?

Starting July 1, 2013, the demonstration program will affect areas in most states in the United States. Certain states, such as Alaska, Maine, Montana, North Dakota, South Dakota, Vermont and Wyoming have no regions in the demonstration.

If you live outside of or will travel outside of competitive bidding areas, you may have different costs and coverage.

2.  Does the item you need fall under the competitive bidding demonstration? 

Keep in mind that the competitive bidding demonstration includes most DME items. However, a small number of items may be left out such as, nebulizers equipment and supplies.

Also, if you order your diabetic supplies through mail order, be aware that the demonstration will include them in all areas starting July 1, 2013. Mail order can mean diabetes supplies that are sent to you by a supplier in the mail, or that are delivered to your home by a pharmacy.

There are certain types of items that are included in the demonstration. If the item you need is left out of the competitive bidding demonstration, you do not need to use a contract supplier. Instead, learn more about how to keep costs down if you are not affected by the competitive bidding demonstration.

3. What suppliers can I use if the competitive bidding program affects me?

In competitive bidding areas, it is very important for you to use contract suppliers. Contract suppliers are the only suppliers in the area who can bill Medicare for competitive bidding items. Medicare will not usually pay for your DME if you do not use a contract supplier.

Because the demonstration applies to mail order diabetic supplies in all areas, you will always need to use contract suppliers if you get your diabetic supplies through the mail. If you pick up your diabetic supplies from a local pharmacy, you should make sure it accepts assignment.

Keep in mind that contract suppliers can only charge you a certain amount for DME. Medicare will pay contract suppliers 80% of the approved amount (after you meet your Part B deductible) and you will pay 20% of the balance.

Understand that if you get your equipment from a supplier that is not a contract supplier, you may need to pay the full cost of the equipment. Suppliers who are not contract suppliers must let you know ahead of time and have you sign an Advanced Beneficiary Notice (ABN). This notice states that you are understand that Medicare will not cover the DME and 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.

There are a times when you don’t need to use a contract supplier. Your doctor may give you a walker or folding manual wheelchair during an office visit even if they are not contract suppliers. A hospital can give you these items when you are in the hospital or on the day you leave the hospital.

4. If you are already renting equipment from a supplier, find out if you can still use the supplier or must switch to a different one. 

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 if it chooses to become 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 cannot charge you more than the 20% coinsurance.

It is usually cheapest to stay with a grandfathered supplier. Changing suppliers can increase the amount of time you must rent your equipment and can cost you more in the end.

If your supplier chooses to become a grandfathered supplier, it should send you a letter no later than 30 days before your competitive bidding program starts. You can choose to continue using the grandfathered supplier or change to a contract provider.

If you get care from a home health agency and want to get DME from it in a competitive bidding area, the agency must either be a contract supplier or work with a contract supplier in the area.

If you are confused or unhappy with competitive bidding in your area, call 1-800-MEDICARE to report those problems.