Medicare Competitive Bidding Program

Medicare Durable Medical Equipment Competitive Bidding Program: An Evaluation

BACKGROUND

The Centers for Medicare and Medicaid Services (CMS) implemented the Medicare durable medical equipment (DME) Competitive Bidding Program (CBP) in 2011. Since then, concerns have been raised regarding access to equipment and adverse health outcomes.

OBJECTIVES

The aim was to evaluate whether the CBP was associated with changes in spending, utilization, and adverse health events (emergency department visits, hospitalizations, and falls).

RESEARCH DESIGN

A comparative interrupted time series over 8 years was used to compare Round1 and Round2 bidding to nonbidding areas. Medicare fee for services claims were aggregated at the quarterly Metropolitan Statistical Area (MSA) level from 2009 to 2016.

RESULTS

For the 3 evaluated DME (continuous positive airway pressure machines, oxygen supplies, and walkers), we found that implementation of the Medicare CBP was associated with reductions in per capita spending without changes in DME utilization or adverse health outcomes in CBP areas compared with nonbidding areas. For example, the slope change in the proportion of oxygen supplies purchasers in Round1 areas after implementation of Round1 was similar to the slope change in nonbidding areas (-0.0002; 95% CI: -0.0004, 0.0001; P=0.189). The difference in slope changes of emergency department visits and hospitalization in Round1 areas for oxygen supplies were (-0.0004; 95% CI: -0.0016, 0.0008; P=0.514) and (0.0002; 95% CI: -0.0010, 0.0014; P=0.757), respectively. Findings in Round2 areas after implementation of Round2 were similar to findings in Round1 areas.

CONCLUSIONS

The Medicare DME CBP lowered Medicare expenditures while not reducing beneficiary access or increasing adverse outcomes.