HHS Budget Proposes Restarting DMEPOS Competitive Bidding

WASHINGTON—The Department of Health and Human Services (HHS) released more details on the agency’s budget request for the 2026 fiscal year in its 51-page Budget in Brief, along with a 194-page Justification of Estimates for Appropriations Committees for the Centers for Medicare and Medicaid Services (CMS).

The Budget in Brief mentions a 2026 fiscal year budget item for $22 million to restart the DMEPOS Competitive Bidding Program (CBP) while the longer CMS Appropriations document provided additional details. The appropriations document notes the current gap status for the bidding program and indicates CMS will start bidding for the next round of the DMEPOS CPB after:

• Re-engineering and migrating the information technology (IT) systems located within the Competitive Bidding Implementation Contractor’s IT environment into the CMS Cloud environment
• Completing the formal public notice and comment rulemaking process
• Implementing necessary DMEPOS CBP changes to
  • Establish sustainable prices
  • Save money for Medicare beneficiaries and taxpayers
  • Help limit fraud, waste and abuse in the Medicare program
  • Ensure beneficiary access to quality items and services

The appropriations document also provides details on additional “critical operational tasks” in the bidding process, including:

• Bidder Registration – CMS must assist potential bidders in obtaining user identification and passwords to gain access to the bidding system.
• Solicitation of Bids – Managing call center operations to respond to bidding questions.
• Begin the Bid Evaluation Process – Preliminary bid evaluation and screening include tasks such as:
  • Licensure and accreditation validation.
  • Reviewing bid surety bond submissions, and identifying those bidders that met the covered document review date, then determining if those bidders have missing documentation.

AAHomecare (AAHC) said it is aware of a new durable medical equipment proposed rule that includes competitive bidding that has been under review at the Office of Information and Regulatory Affairs (OIRA), a unit of the White House’s Office of Management and Budget (OMB), since late April. AAHC said its regulatory experts indicate that these types of proposed rules are normally published by July 1.

AAHC said it will continue to partner with industry stakeholders and members of Congress to ensure that bidding processes lead to the “sustainable prices” indicated in the bullets above.  

AAHC aims to prioritize efforts to require bidders to be properly qualified and able to stand by their bids, to ensure appropriate price-setting mechanisms and transparency throughout the process and to limit CMS’s ability to once again cancel the bidding results if it is not satisfied with the prices established. The first part of this effort will be working with the home medical equipment community to make sure the industry collectively provides comments when the proposed rule is released.