CMS files the Proposed Rule that sheds light on the next round of the Competitive Bidding Program

Published in Government Relations on July 01, 2025

On June 30, 2025, CMS filed the anticipated Proposed Rule that includes updates to the Competitive Bidding Program (CBP). Public comments are due 60 days from June 30, 2025.  

Below is a high-level summary of the rule. It is critical to note that, according to the Proposed Rule Fact Sheet dated June 30, 2025, CMS has stated that they have not announced the specific product categories they are bidding or the specific timeframe for the next competition. Those specifics will be forthcoming in a future CMS announcement. 

Proposed Rule Highlights: 

Products Redefined And Recategorized For Potential Inclusion 

  • Ostomy, tracheostomy, and urological supplies (Definitions were revised to categorize each as medical equipment and thus subject to CBP inclusion). 
  • Continuous Glucose Monitoring (CGM) and insulin pumps (reimbursed on a bundled monthly rental basis for both CB and non-CB areas and reclassified under the frequent and substantial servicing payment category). 

Remote Item Delivery (RID) CBP – Two RID CBP options proposed for a given product category:  

  • Establish one nationwide RID CBP. 
  • Establish multiple RID CBPs covering different regions of the country. 

Accreditation 

  • Require DME suppliers to get reaccredited annually instead of every three years 

SPA Calculation 

  • Revise the lead item SPA calculation to use the 75th percentile of winning bids for the lead item. 
  • Revise the ratio for non-lead items in a product category to be based on the 2015 fee schedule rate for each specific area instead of the average of the 2015 fee schedule rate for all areas. 

Contract Award Determinations 

  • Revise how CMS determines the number of contracts to award by using supplier utilization information for product categories included in prior rounds and current supplier utilization for new product categories. 

SPA Increase 

Allow for an annual increase to SPAs to account for inflation for multiyear contracts. 

Bid Limits And Conditions For Awarding Contracts If Savings Are Not Expected 

  • Items included for the first time: the bid limits would be the amounts otherwise paid for the items. 
  • Previously included items: the bid limits would be the most recent SPA for the items plus 10 percent. If it has been more than a year since the SPA was last in effect, the inflation-adjusted SPA plus 10 percent. 
  • In no event would the bid limit be allowed to exceed the unadjusted fee schedule amount. 

Financial Documentation Changes 

  • Remove requirement to submit a tax return extract, income statement, balance sheet, or statement of cash flows. 
  • Continue requiring submission of a credit report with a numerical credit score and/or rating from one of the four approved credit reporting agencies during the bid window, and by the CDRD if the supplier wants to be eligible for the process for reviewing covered documents. 
  • Continue using a five-tier scoring system in the evaluation of the credit report with a numerical credit score and/or rating, which will be utilized to establish a financial score. 
  • Cease using supplier financial scores when determining the capacity to assign to each supplier to meet projected beneficiary demand. 
  • Require suppliers attest that they meet the small supplier threshold in the DMEPOS Bidding System (DBidS), or any successor system, if applicable. 

New Contract Clause 

  • Addition of a new clause allowing CMS to unilaterally terminate or modify supplier contracts if certain conditions are met due to a PHE allowing CMS to revert to the general fee-for-service program requirements. 

The VGM Government Relations team will continue to analyze, develop action items, and provide updates as they become available. 

From Our Experts

Senate Narrowly Passes HR1, Sending It Back to House for Final Approval thumbnail Senate Narrowly Passes HR1, Sending It Back to House for Final Approval President Donald Trump's sweeping legislative package, formally titled the One Big, Beautiful Bill Act, now referred to as HR1., cleared the Senate today in a dramatic 51–50 vote, with Vice President JD Vance casting the tie-breaking vote. The bill now returns to the House, where lawmakers must decide whether to adopt the Senate's revised version or negotiate further changes before it can reach the president's desk. Several Prominent Medicaid Provisions in Senate's Budget Bill Deemed in Violation of Byrd Rule thumbnail Several Prominent Medicaid Provisions in Senate's Budget Bill Deemed in Violation of Byrd Rule Senate Parliamentarian Elizabeth MacDonough advised this week that multiple Medicaid provisions in the Senate's reconciliation bill would violate Senate procedure by violating the Byrd Rule. The Byrd Rule is a Senate-specific procedural process that allows Senators to prevent or block inclusion of extraneous provisions in reconciliation bills. Other provisions are still under review. Evaluating the Value of a Payer Contract thumbnail Evaluating the Value of a Payer Contract In our last article, Key Payers Denied Your Application Citing Their Network Is Closed – Now What?, we discussed strategies for addressing payer contracting denials due to a closed network. As indicated, this process can be an extremely time-consuming exercise with no guarantees and mixed results. Below are a few things to consider as you evaluate whether a contract is worth the extra effort. Webinar: Webinar: "Navigating The New CMS Landscape: RADs, HMVs, and Supplier Survival" on June 25 at 1 p.m. CT. The Centers for Medicare & Medicaid Services (CMS) has released its final National Coverage Determination (NCD) for RADs and HMVs used in treating chronic respiratory failure due to COPD. While the rule potentially expands access to bilevel ST therapy (RADs), it also introduces complex compliance requirements, tighter usage criteria, and increased documentation burdens—without additional reimbursement. The Return of Competitive Bidding thumbnail The Return of Competitive Bidding The Centers for Medicare & Medicaid Services (CMS) appear to be laying the groundwork for another round of the Competitive Bidding Program (CBP). While full implementation will take a couple of years, an official announcement is expected this summer—potentially as early as July. Out With The Old RAC, In With The New thumbnail Out With The Old RAC, In With The New On April 28, 2025, CMS awarded Cotiviti GOV Services LLC, the new RAC Recovery Audit Contractor (RAC) Region 3, 4, and 5 contracts. RAC Region 3 includes the following Medicare Administrative Contractor (MAC) jurisdictions: JJ, JM, and JN. RAC Region 4 includes jurisdictions: JE, JF, and JL. And RAC Region 5 includes jurisdictions: JA, JB, JC, JD, as well as the HH/H MACs: J6, J15, JK, and JM. Iowa Leads the Charge! All Four Representatives Back H.R. 2005—Will Your State Step Up? thumbnail Iowa Leads the Charge! All Four Representatives Back H.R. 2005—Will Your State Step Up? At VGM Group, Inc. we have the pleasure of serving our members and partners throughout the country.  One of the many ways we do this is through legislative advocacy, working with our partners to create a more equitable and effective healthcare system. All our VGM units are dedicated to advancing our partners' businesses, streamlining operations, and working every day to enhance reimbursement for the quality in-home healthcare our industry provides all people. Mike Hamilton Of ADMEA Honored With The Mal Mixon Advocate Award thumbnail Mike Hamilton Of ADMEA Honored With The Mal Mixon Advocate Award Last week, during the 2025 AAHomecare Washington Legislative Conference, Mike Hamilton, Executive Director of ADMEA, was honored with the prestigious Mal Mixon Advocate Award.