As most healthcare suppliers know, Medicare’s competitive bid for all Durable Medical Equipment, Prosthetics, Orthotics, & Supplies (DMEPOS) ended January 1, 2019.
CMS expects a new competitive bid process will be completed and rolled out by December 31, 2020. This reprieve gives suppliers a two-year window to gain market share, maximize effectiveness, and improve workflows.
Medical supplies including oxygen, power wheelchairs, mail order diabetic testing supplies, CPAP Devices, and walkers are all affected by this CMS change and could potentially open additional revenue streams for all DME suppliers.
CMS Competitive Bid History and Where it May Be Going
Back in 2003, Congress passed a bill called the Medicare Prescription Drug Improvement and Modernization Act (MMA), which required CMS to create competitive bidding programs for DMEPOS.
Medicare’s goal was to decrease fraud and abuse, reduce cost, and ensure better overall healthcare for the patient. Now 15 years later, CMS has successfully decreased costs, but the long-term impact on healthcare supply availability has been negative.
For example, the reimbursement for Diabetic Testing Supplies (DTS) has decreased 72% since 2003, and most suppliers can’t cover their costs and are forced to either remove themselves from the competitive bid process or add other supplies to their business model to make it financially worth their time to service the patient.
When competitive bid first began, there were approximately 20 national DTS suppliers that made the cut. Due to a handful of reasons, there are now only about six national suppliers providing DTS.
Patients are continually left underserved due to these constraints on the business owners. With fewer suppliers offering DTS, many diabetics are unable to test their levels, and they dramatically increase their risk of a hospital stay.
CMS is starting to realize these unexpected outcomes and are reviewing all the rules and regulations of how these programs can be improved for both the patient and the business.
Until the new ruling for competitive bid comes out, what are DME suppliers to do in the meantime?
Here are 10 Things All DME Suppliers Should Consider During the Competitive Bid Reprieve
For Competitive Bid Winners…
1. Increase your patient education and patient engagement strategies.
It is critical to reach out to your existing patient base to inform them that nothing needs to change, and they will continue to receive their supplies as they always have.
2. Be proactive and in your communication with your patients and ask health-related questions.
Ask your patients how you can best serve them, and give them thought-provoking questions to guide them toward thinking about taking care of their ailments. You may want to as questions such as:
- Are you satisfied with our service, and are we your sole provider?
- Is there a better medical solution for your condition?
- Are you adhering to your doctor’s plan of care, and are you aware of any changes your doctor may have made to your plan?
- Are there other medical products that you need? If so, could you please tell us so we can look into making these available to you?
3. Try to increase number of supplies you are providing to your patients with each fulfillment.
If you can increase the number of supplies you send to your patients, it helps increase patient loyalty, and it also increases your revenue per patient.
For non-competitive bid winners…
4. Sharpen the internal saw of your organization.
Become experts in the products that have just come out of competitive bid. Most suppliers have experience with these products, but it is important to review the most up-to-date LCD to determine medical necessity.
5. Check your internal database to determine current customer additional needs.
Use ICD10 codes to see if your patients may be eligible for additional supplies or products. Keep in mind you can’t make a phone call to a patient if it has been more than 15 months since your previous communication.
You can, however, send them a letter or postcard with educational materials asking them to call you.
6. Add literature to your current shipments.
Adding brochures and educational materials in your current shipments makes your patients aware of your other offerings and services.
For all suppliers…
7. Review internal operations.
Make sure intake, insurance verification, documentation, fulfillment, and billing is performing as it should be.
8. Look at possibly outsourcing processes.
Compare your internal team’s performance with outsourced services. Look at companies such as Dominion Outsourcing or HealthSplash to help with some of these workflows.
9. Reach out to manufacturers and distributors.
Let manufacturers and distributors know you are expanding into additional product categories. How can they help you with your marketing efforts?
10. Expand marketing efforts to local healthcare facilities and MCOs.
Visit and contact HCOs, MOCs, and healthcare facilities in your area and make sure they are aware that you are now able to supply these products. Look for new potential national partners as well.
The clock starts today. Ask yourself: How can I help reinvent my organization and use this two-year window to move my company from good to great?
