Diabetic Supplies National Mail-Order Bid On the Way

According to a recent notice from CMS:

“MIPPA [Medicare Improvements for Patients and Providers Act of 2008] specifies that a national competition for mail-order items and services is to be phased in after 2010. The regulation includes provisions to implement a national mail-order competition for diabetic supplies in 2011 that includes all home deliveries while maintaining the local pharmacy pickup choice for beneficiaries. We are also implementing the special “50 percent rule” mandated by MIPPA and implementing an anti-switching requirement as part of the terms of the competitive bidding contract.”

While the timing of the national bid has not yet been announced, here are the basics of what the program will look like:

• CMS defines “mail order” as anything other than when the beneficiary or caregiver picks up supplies at the local pharmacy. In other words, “mail order” includes items shipped or delivered to the beneficiary’s home, regardless of the method of delivery, and “non-mail order” includes items that a beneficiary or caregiver picks up in person at a local pharmacy or storefront.
• A special rule requires contract suppliers to provide, at a minmum, 50 percent of the different types of diabetic testing products on the market by brand and model name. This will apply to any bid program after Round 1, national or other, for these products. The Office of Inspector General has conducted a study to determine the products that make up most of the Medicare market, and CMS may use the data when determining whether providers’ mail-order test strip bids comply with the MIPPA “50-percent rule.” (See “Top 19 Medicare Mail-Order Test Strips” for a chart.)
• There is a prohibition included against influencing and incentivizing beneficiaries to switch their brand of monitor and testing supplies from those they are currently using. CMS believes this requirement is essential if it is to enforce the “50-percent rule.”

• Read the main story, “Know Your Numbers,” to learn about providers in the diabetes sector face competitive bidding prices that don’t add up.