CMS Pub. 100-04, ch. 36, § 20.6

Noncontract suppliers that furnish competitively bid items in a CBA are not eligible for

Medicare payment for the competitively bid items for that CBA unless one or more of the

following exceptions applies:

• Suppliers of Grandfathered DME - Beneficiaries who are receiving oxygen and

oxygen equipment or rented DME at the time the competitive bidding program becomes

effective may elect to continue to receive these items from a noncontract supplier if the

supplier is willing to continue furnishing these items. See section 20.6.1 of this chapter

for more information on grandfathering.

• Repairs/Replacement - Beneficiaries who maintain a permanent residence in a CBA

may go to any Medicare-enrolled supplier (contract or noncontract supplier) for repairs or

replacement parts for beneficiary owned items. Labor to repair equipment is not subject

to competitive bidding and, therefore, will be paid in accordance with Medicare’s general

payment rules. Payment for parts that are not competitively bid items and that are needed

to repair a beneficiary-owned item will also be paid in accordance with these rules.

Payment for replacement parts that are part of the competitive bidding program for the

areas in which the beneficiary resides would be paid at the single payment amount.

Unlike repairs, beneficiaries must obtain replacements of certain base equipment they

own (e.g., wheelchairs or hospital beds) from a contract supplier, when the base

equipment must be replaced in its entirety, rather than replacement parts for the repair of

the base equipment. A contract supplier is required to service all rented items included in

its contract.

• Physicians and Other Practitioners Who are Enrolled Medicare DMEPOS

Suppliers - Physicians and treating practitioners have the option to furnish certain types

of competitively bid items in a CBA to their own patients without submitting a bid and

being a selected as a contract supplier, provided the following requirements are met:

o The items are limited to crutches, canes, walkers, folding manual wheelchairs,

blood glucose monitors, and infusion pumps that are DME.

o The items must be billed using a billing number assigned to the physician, the

treating practitioner or a group practice to which the physician or treating

practitioner has reassigned the right to receive Medicare payment for

competitive bid items.

Physicians and treating practitioners who do not to become contract suppliers may

only provide the bid items identified above to their own patients and will not be

allowed to act as contract suppliers to provide bid items to beneficiaries for

purposes of Medicare payment.

The physician or treating practitioner will be paid the single payment amount

when the furnished item is a competitive bid item and the beneficiary maintains a

permanent residence in a CBA.

• Physical Therapists and Occupational Therapists in Private Practice Who are

Enrolled Medicare DMEPOS Suppliers -- Physical therapists and occupational

therapists in private practice have the option to furnish certain types of competitively bid

items to their own patients without submitting a bid and being a selected as a contract

supplier, provided the following requirements are met:

o The only competitive bid items they may furnish without becoming a contract

supplier are OTS orthotics.

o The items must be furnished only to their own patients as part of the physical

or occupational therapy service.

Physical and occupational therapists in private practice who do not to become

contract suppliers may only provide competitive bid OTS orthotics to their own

patients and will not be allowed to act as contract suppliers for purposes of

Medicare payment.

The physical or occupational therapist will be paid at the single payment amount

when the furnished item is a competitive bid item and the beneficiary maintains a

permanent residence in a CBA.

• Medicare Secondary Payer - If a Medicare beneficiary is required under his or her

primary insurance policy to use a supplier that is a noncontract supplier, Medicare may

make a secondary payment to a noncontract Medicare-enrolled supplier for competitive

bid items. The supplier must have a valid NSC# and be eligible to receive secondary

payments. The amount paid to the supplier will be calculated in accordance with

established Medicare secondary payment rules.

If none of the exceptions above apply, then the noncontract supplier is responsible for notifying

the beneficiary that it is not a contract supplier for the competitive bidding item in the CBA, and

the beneficiary must go to a contract supplier for that item in order for Medicare to make

payment for the item. CMS has a supplier locator tool in order to assist beneficiaries and

suppliers in finding contract suppliers. The supplier locator tool can be found at

www.medicare.gov. Beneficiaries may also call 1-800-Medicare to obtain information about

contract suppliers.