CMS Finalizes DME Bidding Rule for 2015

The Centers for Medicare & Medicaid Services (CMS) issued its final rule late October for durable medical equipment (DME) payment adjustments.

The final rule for calendar year 2015, which is largely unchanged from the proposed rule in July, clarifies certain criteria related to DME, such as methodology for expanding the CMS’ competitive bidding program to rural areas and implementing monthly bundling payments in certain bid areas for select equipment. 

Major provisions of the regulation include adjusted fee scheduled amounts for items and services based on regional prices that are limited by a national ceiling (110% of the average of regional prices) and floor (90% of the average of regional prices). The rule also adjusts fee scheduled amounts for “non-contiguous” areas based on the average of competitive bidding pricing from these areas or the national ceiling, whichever is higher.


The rule also finalizes an expanded policy for rural payment by specifying that the national ceiling will be extended to any area outside a metropolitan statistical area (MSA) designated as a rural area, regardless whether the state meets the definition of a rural state.

Specifically, CMS will define rural areas as zip codes that have more than 50% of its geographic area outside of a MSA, or those that have a low population density—regions at least 400-square miles in area with a population density of no more than 35 people, CMS stated in its final rule. 

CMS also calls for implementing a phase-in for monthly bundled payments in certain bid areas for standard power wheelchairs and continuous positive airway pressure (CPAP) devices furnished under the competitive bidding program in place of capped rental policies.


CMS plans to address specific details regarding the phase-in of this payment rule through additional guidance, the agency said.

View the final rule and fact sheet from CMS. 

Written by Jason Oliva

Companies featured in this article: