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The Return of Competitive Bidding

Published in VGM Government Relations on June 04, 2025

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. 

While specific details regarding the program's structure, start date, and included product categories remain uncertain, insights from previous bidding rounds and current industry trends can provide valuable guidance. Historically, CBP implementation has followed a structured timeline, including a proposed rule and a public comment period. 

Once CMS releases its formal plan, it will be crucial for durable medical equipment (DME) suppliers to participate in the comment period, ensuring industry perspectives are considered in the final policy. 

Below are the details from the FY 2026 Congressional Justification (pg. 21) that provides key details regarding the program's history and implementation. 

One thing remains clear—VGM is here for you! We have supported the industry through previous bidding rounds, and we will continue to stand by you as this process unfolds. Stay tuned for further updates and guidance. 

DMEPOS Competitive Bidding Program (CBP) 

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) required Medicare to replace the fee schedule payment methodology for selected DMEPOS items with a competitive bidding program implemented in areas throughout the country. The DMEPOS CBP helps Medicare establish sustainable prices, saves money for beneficiaries and taxpayers, and limits fraud, waste, and abuse in the Medicare program. In addition to the cost savings, there are several beneficiary protections that help to guarantee access to competitively bid DMEPOS including requiring contract suppliers to provide equal access to all DMEPOS items and services included in the supplier contract to every beneficiary residing in the competitive bidding area.  

First launched in 2011 in nine metropolitan statistical areas and since expanded to 130 competitive bidding areas, Medicare has saved an estimated $11 billion from lower payment for 16 categories of DMEPOS items and services, with beneficiaries saving from lower cost sharing. In addition to the savings obtained in the competitive bidding areas, adjustments made to fee schedule amounts paid in non-competitive bidding areas based on pricing from the DMEPOS CBP has approximately doubled these savings. Payment has generally declined 40 percent compared to the traditional fee schedule methodology.  

The most recent Round 2021 DMEPOS CBP contracts expired on December 31, 2023. As of January 1, 2024, there is a temporary gap period for the DMEPOS CBP.  

CMS will start bidding for the next round of the DMEPOS CBP 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 21  
  • 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  

Budget Request: $21.2 Million 

Upon completion of a formal public notice and comment rulemaking process, CMS must update all the DMEPOS CBP IT systems and bidding materials to reflect the changes from the final rule and educate stakeholders on the bidding program in preparation for the next round. CMS must also perform critical operational tasks such as:  

  • 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, and  
  • 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. 

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