If a beneficiary who resides in a competitive bidding area (CBA) changes from a Medicare Advantage (MA) Plan, either voluntarily or involuntarily, to Medicare fee-for-service (original Medicare), can he/she remain with his/her current managed care supplier even if the supplier is not a contract supplier for the specific competitively bid item the beneficiary receives from the supplier? Will Medicare continue to pay the supplier for the items and services?
Yes. The beneficiary can remain with their current supplier and Medicare may pay for the competitively bid items and services as long as 1) the managed care supplier is Medicare-enrolled, 2) the managed care supplier agrees to become a grandfathered supplier, and 3) the beneficiary was enrolled in the MA Plan at the time the competitive bidding program began. This rule only pertains to those items that are currently being rented to beneficiaries residing in the CBA and to the competitively bid items necessary for the use of the rented item. The supplier must accept assignment on all grandfathered claims. All of the competitive bidding grandfathering rules apply in this situation. For additional information on the grandfathering rules, please review the Grandfathering Information portion of this website.
| 07/30/2014 |
I am a supplier and want to buy or merge with a DMEPOS competitive bidding contract supplier. Can I make the change of ownership (CHOW) contingent upon CMS’ approval of a novation agreement?
No. A CHOW is a business transaction between two DMEPOS suppliers; CMS is not a party to that transaction. However, CMS is a party to any novation agreement involving a competitive bidding contract. CMS will execute a novation following a CHOW only if the successor or new entity meets all program requirements identified in §414.422(d). For more information, please see the CHOW fact sheet by selecting a round from the left hand navigation pane, then selecting Fact Sheets under Educational Information.
| 05/10/2011 |
I am a supplier and want to buy or merge with a DMEPOS competitive bidding contract supplier. Can I make the change of ownership (CHOW) contingent upon CMS’ approval of a novation agreement?
No. A CHOW is a business transaction between two DMEPOS suppliers; CMS is not a party to that transaction. However, CMS is a party to any novation agreement involving a competitive bidding contract. CMS will execute a novation following a CHOW only if the successor or new entity meets all program requirements identified in §414.422(d). Please see the CHOW fact sheet for more information about these requirements.
| 05/10/2011 |
I am a non-contract supplier. If I buy or merge with a contract supplier, will CMS pay for contract items I furnish after the effective date of the change of ownership (CHOW) but before the date CMS signs the novation agreement?
Yes. When CMS signs the novation agreement, it will become effective retroactive to the effective date of the CHOW.
Please wait to submit claims for contract items you furnish after the CHOW until CMS notifies you that the novation agreement has been accepted.
If you submit claims before the novation agreement has been accepted, the Durable Medical Equipment Medicare Administrative Contractors (DME MACs) will not know that you are a contract supplier, and the claims may be denied.
Payment for covered items furnished after the effective date of the CHOW will be made at the single payment amount according to the competitive bidding contract.
For more information, please see the CHOW fact sheet by selecting a round from the left hand navigation pane, then selecting Fact Sheets under Educational Information.
| 05/09/2011 |
I am a non-contract supplier. If I buy or merge with a contract supplier, will CMS pay for contract items I furnish after the effective date of the change of ownership (CHOW) but before the date CMS signs the novation agreement?
Yes. When CMS signs the novation agreement, it will become effective retroactive to the effective date of the CHOW.
Please wait to submit claims for contract items you furnish after the CHOW until CMS notifies you that the novation agreement has been accepted.
If you submit claims before the novation agreement has been accepted, the Durable Medical Equipment Medicare Administrative Contractors (DME MACs) will not know that you are a contract supplier, and the claims may be denied.
Payment for covered items furnished after the effective date of the CHOW will be made at the single payment amount according to the competitive bidding contract.
Please see the CHOW fact sheet for more information about these requirements.
| 05/09/2011 |
Do normal utilization parameters for accessories and supplies continue to apply when a patient transitions from a non-contract supplier to a contract supplier? For example, if a patient received a new continuous positive airway pressure (CPAP) mask in month six and transitioned to a contract supplier in month seven, is the contract supplier eligible to bill for a new mask upon setup? Can the contract supplier still provide these items, or is the patient not eligible since he or she received the mask in the month prior?
New accessories or supplies, such as the CPAP mask in the example given, would not be necessary just because of the transition to the new supplier. The normal utilization parameters continue to apply unless the accessory previously purchased from the non-contract supplier does not work with the new equipment furnished by the contract supplier. If a previously purchased accessory is not compatible with the new equipment, the contract supplier may bill for the new item(s). Due to claims editing limitations, the new item(s) may deny for “same or similar” and require a redetermination. Resolution through the appeals channel is the proper process to follow. Changing base equipment that renders the accessories unusable due to incompatibility is a justifiable reason to replace the accessory.
Note: Most supplies used with PAP devices are dispensed in three-month amounts. With the exception of humidifiers and certain filters, these supplies are regarded as interchangeable between devices. Thus, the supplies obtained in December should be sufficient to meet the beneficiary’s needs until the next quarter, at which time the new supplier may provide and bill for a three-month supply.
| 03/04/2011 |
If a patient using a continuous positive airway pressure (CPAP) device switches to a contract supplier during the 90-day trial period required by the Local Coverage Determination (LCD), does the contract supplier need to get the compliance data from the original provider?
The Grandfathering for Rented DME fact sheet indicates that the current supplier and the new contract supplier must coordinate the pickup and delivery of the equipment so that service to the beneficiary is not disrupted. The current supplier should provide copies of all supporting documentation, such as the physician order or Certificate of Medical Necessity (CMN) when applicable, to the new contract supplier. The CPAP compliance data would be an example of supporting documentation. The contract supplier needs to obtain all documents and information necessary to demonstrate adherence to coverage requirements set forth in statute, regulation, rule, or national or local coverage determinations.
For more information, please view the Grandfathering for Rented DME fact sheet, by selecting a round from the left hand navigation pane, then selecting Fact Sheets under Educational Information.
| 03/04/2011 |
If a patient using a continuous positive airway pressure (CPAP) device switches to a contract supplier during the 90-day trial period required by the Local Coverage Determination (LCD), does the contract supplier need to get the compliance data from the original provider?
The Grandfathering for Rented DME fact sheet indicates that the current supplier and the new contract supplier must coordinate the pickup and delivery of the equipment so that service to the beneficiary is not disrupted. The current supplier should provide copies of all supporting documentation, such as the physician order or Certificate of Medical Necessity (CMN) when applicable, to the new contract supplier. The CPAP compliance data would be an example of supporting documentation. The contract supplier needs to obtain all documents and information necessary to demonstrate adherence to coverage requirements set forth in statute, regulation, rule, or national or local coverage determinations.
For more information, please view the Grandfathering for Rented DME fact sheet, which you can find on this website by selecting Educational Information, then Fact Sheets.
| 03/04/2011 |
What does a contract supplier need to do in cases in which the non-contract supplier does not furnish documentation during the transition period prior to May 1, 2011, or the documentation received from the non-contract supplier is not sufficient to document adherence to Medicare guidelines?
In these cases, the contract supplier will need to obtain a new written order by May 1, 2011. For the four-month transition period (from January 1, 2011, through April 30, 2011), the contract supplier may deliver and bill for competitively bid items without a new written order after obtaining a new verbal or preliminary written order from the treating physician. It is the responsibility of the contract supplier to ensure that a detailed written order and other documents and information necessary to demonstrate adherence to the Local Coverage Determination (LCD) are obtained.
| 03/04/2011 |
When a beneficiary transitions from a non-contract supplier to a contract supplier, does a new order need to be obtained by the contract supplier?
Medicare program integrity guidelines require a new order when there is a change in suppliers. When a beneficiary transitions from a non-contract supplier to a contract supplier, this constitutes a change in suppliers and a new detailed written order is required.
The coverage criteria for an item are unaffected by the competitive bidding status of a supplier. Each supplier that bills for an item must, in the event of an audit, be able to provide sufficient information to show that the reimbursement criteria are met. Suppliers may share information among themselves. If required information is not available, it may be necessary to repeat testing, required trials, physician visits, etc., in order to be able to justify payment. Medicare claims payment history does not provide the type of information necessary to demonstrate that coverage criteria have been met.
| 03/04/2011 |
When a beneficiary transitions from a non-contract supplier to a contract supplier, does a new order need to be obtained by the contract supplier?
Medicare program integrity guidelines require a new order when there is a change in suppliers. When a beneficiary transitions from a non-contract supplier to a contract supplier or from a contract supplier to a contract supplier, this constitutes a change in suppliers and a new detailed written order is required.
Under competitive bidding, most transitions from non-contract suppliers to contract suppliers will occur during the first few months of the contract period. In order to facilitate transition for new competitive bidding contract suppliers and avoid disruptions in service during the first few months of the contract period, the new contract supplier is only required to obtain a new dispensing order from the treating physician prior to providing a competitively bid item. The new contract supplier does not need to acquire a detailed written order before submitting a claim for a competitively bid item furnished prior to May 1, 2011, but must obtain the detailed written order on or before May 1, 2011. For changes in suppliers that occur on or after May 1, 2011, the new contract supplier does need to acquire a detailed written order before submitting a claim for a competitively bid item.
In addition, for changes in suppliers that occur before May 1, 2011, a new dispensing order must be obtained before submitting a claim for a competitively bid item if the contract supplier is not able to obtain or validate the original order and other required documents from the non-contract supplier. If documentation in the beneficiary’s medical record as of the date of the transition is obtained from the non-contract supplier and meets Medicare requirements for documenting medical necessity, the contract supplier does not have to obtain a new written order until May 1, 2011. Copies of documents, rather than original documents, are acceptable during the transition period prior to May 1, 2011.
For the Round 1 Rebid, this policy applies to changes in suppliers for competitively bid items from a non-contract supplier to a contract supplier in which the transition to the new supplier and initial date of service for the new equipment takes place from January 1, 2011, through April 30, 2011.
Note: The coverage criteria for an item are unaffected by the competitive bidding status of a supplier. Each supplier that bills for an item must, in the event of an audit, be able to produce sufficient information to show that the reimbursement criteria are met. Suppliers may share information among themselves. If required information is not available, it may be necessary to repeat testing, required trials, physician visits, etc., in order to be able to justify payment. Medicare claims payment history does not provide the type of information necessary to demonstrate that coverage criteria have been met.
| 03/04/2011 |
When a beneficiary transitions to a contract supplier, would the contract supplier be required to have the patient repeat a facility-based sleep study?
| 03/04/2011 |
When a patient renting capped rental DME from a non-contract supplier switches to a contract supplier, a new 13-month rental payment period begins. Does the 90-day trial period required by the Local Coverage Determination (LCD) start over as well?
No, assuming the patient met the coverage requirements during the initial 90-day trial.
| 03/04/2011 |
Does the hospital exemption for the DMEPOS Competitive Bidding Program allow a hospital to bill for walkers furnished to its patients with Original Medicare on the day of an outpatient hospital service? 
| 01/03/2011 |
Does the hospital exemption for the DMEPOS Competitive Bidding Program allow a hospital to bill for walkers furnished to its patients with Original Medicare on the day of an outpatient hospital service?
| 01/03/2011 |
If a beneficiary has been renting a competitively bid durable medical equipment (DME) item from a supplier that does not become a contract supplier and chooses to switch to a contract supplier at the start of a competitive bidding program, what month should the new contract supplier start billing? When can the non-contract supplier pick up its equipment?
The non-contract supplier must continue to furnish and bill for the rented DME item up to the first “anniversary date” that occurs after the start of the Competitive Bidding Program. (The anniversary date is the day of the month on which the item was first delivered to the beneficiary. Please note that an anniversary date can change if there is a break in service or need of more than 30 days.) Under no circumstances may the noncontract supplier discontinue services by picking up a medically necessary item prior to the end of a month for which the supplier is eligible to receive a rental payment, even if the last day ends after the start date of the Competitive Bidding Program. If a beneficiary chooses to switch to a contract supplier, the non-contract supplier and the contract supplier must make arrangements for the pickup of the old equipment and delivery of the new equipment that are suitable to the beneficiary. Such arrangements need to be coordinated between the non-contract and contract suppliers to ensure that the beneficiary has continued access to medically necessary equipment. The contract supplier can start billing beginning with the first anniversary date that occurs once the Competitive Bidding Program begins.
| 10/19/2009 |
If a beneficiary has been renting a competitively bid durable medical equipment (DME) item from a supplier that does not become a contract supplier and chooses to switch to a contract supplier at the start of a competitive bidding program, what month should the new contract supplier start billing? When can the non-contract supplier pick up its equipment?
The non-contract supplier must continue to furnish and bill for the rented DME item up to the first “anniversary date” that occurs after the start of the Competitive Bidding Program. (The anniversary date is the day of the month on which the item was first delivered to the beneficiary. Please note that an anniversary date can change if there is a break in service or need of more than 30 days.) Under no circumstances may the noncontract supplier discontinue services by picking up a medically necessary item prior to the end of a month for which the supplier is eligible to receive a rental payment, even if the last day ends after the start date of the Competitive Bidding Program. If a beneficiary chooses to switch to a contract supplier, the non-contract supplier and the contract supplier must make arrangements for the pickup of the old equipment and delivery of the new equipment that are suitable to the beneficiary. Such arrangements need to be coordinated between the non-contract and contract suppliers to ensure that the beneficiary has continued access to medically necessary equipment. The contract supplier can start billing beginning with the first anniversary date that occurs once the Competitive Bidding Program begins.
For more information, please view the Fact Sheet.
| 10/19/2009 |
Who is responsible for repair and maintenance once an item is furnished?
Under the Competitive Bidding Program, the contract supplier is responsible for maintaining rented equipment. Maintenance and servicing of beneficiary-owned equipment may be performed by any supplier with a valid Medicare billing number. All Medicare-enrolled suppliers, including contract suppliers, must be in compliance with all of the supplier standards and be accredited. The Medicare-enrolled supplier is always responsible for meeting the supplier standards under 42 CFR 424.57, regardless of whether it chooses to make repairs or perform maintenance directly or through a subcontractor.
For more information, please view the Repairs and Replacement fact sheet, which you can find on this website by selecting a round from the left hand navigation pane, then selecting Fact Sheets under Educational Information.
| 10/01/2009 |
Who is responsible for repair and maintenance once an item is furnished?
Under the Competitive Bidding Program, the contract supplier is responsible for maintaining rented equipment. Maintenance and servicing of beneficiary-owned equipment may be performed by any supplier with a valid Medicare billing number. All Medicare-enrolled suppliers, including contract suppliers, must be in compliance with all of the supplier standards and be accredited. The Medicare-enrolled supplier is always responsible for meeting the supplier standards under 42 CFR 424.57, regardless of whether it chooses to make repairs or perform maintenance directly or through a subcontractor.
For more information, please view the Repairs and Replacement fact sheet, which you can find on this website by selecting Educational Information, then Fact Sheets.
| 10/01/2009 |