‘We know the headwind’: Stakeholders react to return of competitive bidding
By Liz Beaulieu, Editor
Updated 10:17 AM CDT, Fri June 6, 2025
WASHINGTON – The home medical equipment industry is bracing for updates on the next round of Medicare’s national competitive bidding program, with a proposed rule expected in July 2025. A key concern among stakeholders is what changes CMS may introduce to the bid submission, evaluation and selection process.
The most recent round of the competitive bidding program included several significant changes, many influenced by industry feedback. These included changing the bid ceiling to the higher pre-2016 Medicare fee schedule amounts and requiring bid bonds. CMS also switched to lead-item bidding rather than bidding on all HCPCS codes in a product category.
“Our biggest fear is that they will take some of the guardrails away,” said Tom Ryan, president and CEO of AAHomecare. “We have to make sure it’s not a debacle like it has been in the past. We’ll be bringing to the attention of the agency and making the argument on the Hill that we need a market-based program.”
On May 30, the Department of Health and Human Services (HHS) released its FY 2026 Budget in Brief, allocating $22 million to restart the program, which has been paused since Jan. 1, 2024. CMS elaborated on this funding in its Justification of Estimates for Appropriations Committees.
Headwind ahead
The last round of bidding failed to deliver anticipated savings, with CMS only implementing bid pricing for off-the-shelf back braces and knee braces in certain areas. The agency maintains, however, that the program, launched in 2011 and expanded to 130 areas, has saved Medicare $11 billion across 16 product categories.
“They’re doing this to save money,” Ryan said. “We know the headwind.”
Post-COVID environment
Industry leaders are skeptical that CMS can achieve cost savings in today’s economic climate, especially given rising labor costs, tariffs and post-COVID inflation.
“Their challenge is to come up with a bid program where the prices go down, but that doesn’t reflect the current environment of increases,” said Cara Bachenheimer, head of the government affairs practice at Brown & Fortunato. “Everything post-COVID has escalated.”
Product predictions
In addition to the process, stakeholders are concerned that CMS will reconsider non-invasive ventilators, which were excluded from the last round, and possibly add new product categories. Based on increased utilization data, continuous glucose monitors could be targeted.
“CMS may think CGMs make sense, but we don’t think it makes sense,” Ryan said. “Diabetes is a chronic disease and it’s one of the most expensive to treat. This is a technology that we shouldn’t be decreasing access to; we should be increasing it.”
Modernized process
One thing stakeholders do know, based on the released documents, is that CMS plans to migrate IT systems from the Competitive Bidding Implementation Contractor (CBIC) to the CMS Cloud environment, which could streamline processes.
“Maybe it will be more automated,” said Ike Isaacson, senior vice president of government and regulatory relations for VGM Group. “We can knock on wood. It’s going to be a lot of effort for providers – all the financial info, all the product info, all the deadlines. There’s a big onus on providers.”
Potential timeline
Based on historical timelines, stakeholders anticipate that if CMS releases a proposed rule in July 2025 and a final rule in November 2025, the bidding process could begin in January 2026, with the program launching in January 2027.
“This is all based on historical timelines,” Ryan said. “Things could change.”
Work ahead
Regardless of the new round’s direction, industry leaders are committed to advocacy and provider support. AAHomecare plans to meet with CMS leadership at a high level before July, and VGM is preparing to educate providers nationwide.
“I believe strongly in the resiliency of the industry,” Isaacson said. “This is going to take a concerted effort and it’s going to be a lot of work, but we’ll be there every step of the way.”
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