As discussed in our August 18, 2011 Special Alert, CMS has announced the product categories and specific competitive bidding areas (CBAs) for Round 2 of the Medicare DME, prosthetics, orthotics and supplies (DMEPOS) competitive bidding program. Under competitive bidding, only suppliers who are winning bidders, meet licensing and other standards, and enter into a contract with CMS may furnish selected categories of DMEPOS to Medicare beneficiaries in the CBAs (with very limited exceptions). Contract suppliers are paid based on the winning bids in the CBA, rather than the traditional DMEPOS fee schedule. Round 2 will take place in 100 CBAs, and will include the following product categories: (1) Oxygen Supplies and Equipment; (2) Standard (Power and Manual) Wheelchairs, Scooters, and Related Accessories; (3) Enteral Nutrients, Equipment and Supplies; (4) Continuous Positive Airway Pressure, Respiratory Assist Devices, and Related Supplies/Accessories; (5) Hospital Beds and Related Accessories; (6) Walkers and Related Accessories; (7); Support Surfaces (Group 2 mattresses/overlays); and (8) Negative Pressure Wound Therapy Pumps and Related Supplies/Accessories. In addition, CMS will be conducting a national mail-order competition for diabetic testing supplies concurrent with the Round 2 competition. Bidder registration will open in the fall, and CMS plans to begin bidding in winter 2012. CMS is urging suppliers to take steps now to prepare for Round 2 of the DMEPOS competitive bidding program. First, CMS recommends that suppliers update contact information on file with the National Supplier Clearinghouse (NSC). Second, suppliers should make sure they have all required state licenses for each bidding location and for all of their product categories on file with the NSC. CMS points out that if a CBA includes more than one state, the supplier must have all required licenses for its product categories for every state in that CBA, even if the supplier only has one location. Suppliers bidding in the national mail-order competition must have the applicable licenses for all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, and American Samoa. All licenses must be current; if any required licenses are expired or missing, CMS can reject the bid. Third, suppliers should ensure that they are accredited for each product category for which they will bid. For more information on DMEPOS competitive bidding, see our previous reporting.