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Grandfathering Information
  • A non-contract supplier that elects to become a grandfathered supplier must provide written notification to each Medicare beneficiary who resides in a competitive bidding area (CBA) and is currently renting competitively bid oxygen and oxygen equipment or durable medical equipment (DME) from that supplier at least 30 business days prior to the implementation of the program. The 30-day notification to the beneficiary must be in writing (e.g., by letter or postcard). For your convenience, we have provided a sample notification letter that includes all required information. If you do not use the sample notification letter, the notification must:
    • Identify the grandfathered equipment the supplier is willing to continue to rent to the beneficiary.
    • State that the supplier is offering to continue to rent the equipment and furnish the related accessories and supplies for the remaining rental months.
    • State that the beneficiary has the choice to continue to rent the equipment from his/her current supplier (grandfathered supplier) or to obtain the equipment from a contract supplier after the end of the last month that a rental payment was made to the non-contract supplier.
    • Provide the supplier's telephone number and instruct the beneficiary to call the supplier with any questions and to notify the supplier of his or her decision to use or not use the supplier as a grandfathered supplier. Provide the beneficiary with Medicare contact information for additional assistance. The beneficiary may call 1-800-MEDICARE or visit the Medicare website at www.medicare.gov.
  • The supplier must maintain proof of delivery of the written notification.
  • The beneficiary may provide his or her decision verbally over the telephone or in person; the decision does not have to be in writing. The beneficiary is not required to sign any documentation regarding his or her decision.
  • The supplier must maintain a record of its attempts to communicate with the beneficiary and document the beneficiary's decision in its records. The record must include the date on which the choice was made by the beneficiary and how the beneficiary communicated his or her choice to the supplier.
  • If the beneficiary chooses to switch to a contract supplier, the non-contract supplier and contract supplier must coordinate the pickup and delivery of the equipment with the beneficiary. The pickup and delivery should be on the first anniversary date that occurs after July 1, 2016, or another date agreed to by the beneficiary. The anniversary date is the date of the month on which the item was first delivered to the beneficiary by the non-contract supplier. It is the date when a new monthly rental period begins.
  • The non-contract supplier must provide the beneficiary with two additional notices prior to picking up its equipment. The supplier must contact the beneficiary ten business days prior to picking up the equipment and again two business days before the pickup.

Grandfathering Requirements for Non-Contract Suppliers Fact SheetOpen in New Window
Non-contract suppliers that furnish competitively bid rented DME or oxygen and oxygen equipment to beneficiaries in CBAs must: (1) decide if they will elect to become grandfathered suppliers, (2) notify beneficiaries of their grandfathering decisions, and (3) fulfill other requirements as described in this fact sheet...
PDF Sample Notification Letter for Supplier that Chooses to Be a Grandfathered Supplier (PDF, PDF - 33 KB)

last updated on 11/30/2017


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