CMS has announced the contract prices for items included in the Medicare durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) competitive bidding “Round 1 Recompete.”  As discussed in our previous reports, this phase of bidding applies to nine geographic areas where competitive bidding has been in effect since 2011, but it includes a broader array of products. The contract period for the Round 1 Recompete is January 1, 2014 through December 31, 2016.

Contract prices under the Round 1 Recompete will average 37% below Medicare's fee schedule rates for the six product categories, according to files posted by the Competitive Bidding Implementation Contractor (CBIC) on October 1, 2013. The weighted average savings by product category are as follows:

Click here to view table.

These savings compare to a 45% average cut for suppliers participating in Round 2 of the competitive bidding program and a 72% reduction under the national mail order competition for diabetic testing supplies; contracts for both of these programs went into effect July 1, 2013.

The CBIC also posted statistics on the number of Round 1 Recompete contract offers extended for each competitive bidding area (CBA) and product category and the number of supplier locations represented in those offers.  The contracting process for the Round 1 Recompete is now underway. Bidders who were not “winners” will be notified of the reasons they were not offered contracts. CMS plans to announce the names of contract suppliers this fall.