This bill would impose new requirements on private firms that are bidding to supply medical products through Medicare. Through amendments to the durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) competitive acquisition program through Medicare, this bill aims to avoid low ball bids on Centers for Medicare and Medicaid Services (CMS) contracts.
Currently, bids for CMS contracts are non-binding — meaning that bidders can bid for the sake of participating, and if their bid is chosen they won’t have to supply the products at that price level.
If passed, this bill would prohibit the Secretary of Health and Human Services (HHS) from accepting a bid from a supplier unless it:
Meets state licensure requirements for the area for all items in the bid submitted for a product category.
Has obtained a bid surety bond of between $50,000 and $100,000 for each bid area.
This bill also outlines how bid bonds should be treated after they are submitted:
For successful bidders that do not accept the contract, if their composite bid rate is at or below the median composite bid for that category - the bid bond would be forfeited and the Secretary of HHS would collect on it.
If a successful composite bid is above the median but the offer is declined, the bid bond would be returned within 90 days of the bidder’s notice of nonacceptance.
For losing bidders, the bid bond would also be returned within 90 days of their notice of nonacceptance.