CMS-10169.RFB Instructions

CMS-10169.Final RFB Instructions 5-20-09.pdf

Requests for Bids (RFB) for Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) Competitive Bidding Program

CMS-10169.RFB Instructions

OMB: 0938-1016

⚠️ Notice: This form may be outdated. More recent filings and information on OMB 0938-1016 can be found here:

Document [pdf]

Download: pdf | pdf

Request for Bids (RFB) Instructions for the
Medicare Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS)
Competitive Bidding Program
Table of Contents
Page
I. Introduction

II. Considerations Before Submitting a Bid

A. Eligibility to Submit a Bid

B. Period of Performance

C. Servicing the Entire Geographic Area of a CBA

D. No Discrimination Against Beneficiaries

E. Single Payment Amount

F. Bona Fide Bids

G. Subcontracting

H. Change of Ownership (CHOW)

Common Ownership or Control

J. Specialty Suppliers

K. Networks

III. The Bidding Process

A. Bidding Forms: Forms A and Form B
1.
2.
3.
4.

Overview
DBids: Online Bid Submission Tool
Form A: The Bid Application
Form B: Bidding Form
Certification Statement

B. Checklist of Required Hardcopy Documentation for Bid Submission
1.
2.

Financial Hardcopy Documents
Covered Document Review Date
Non-financial Hardcopy Documents

8
8
8
8
12
14
15
16
18

PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 1 of 21 RFB

a. Legal Contract Between All Network Members
b. Letters of Intent to Enter into a Subcontracting Agreement
c. Settlement Agreement or Corporate Integrity Agreements
C. Bid Submission Requirements
IV. Confidentiality

18
18
19
19
20

V. Changing a Bid Submission

Appendix A: Definitions
Appendix B: Financial Documentation Toolkit
Appendix C: DBidS Flowcharts

Note: The first time any word defined in Appendix A is used it is italicized.
I. Introduction
Section 1847 of the Social Security Act, as amended by the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 and the Medicare Improvements for Patients and
Providers Act of 2008, requires the Secretary to establish and implement a Medicare Durable
Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) Competitive Bidding
Program. The competitive bidding program replaces Medicare’s current fee schedule
methodology for determining payment rates for certain DMEPOS items in competitive bidding
areas (CBAs). Under the program, Medicare determines the payment rates for competitively bid
items using bids submitted by DMEPOS suppliers. This document provides instructions for
DMEPOS suppliers to submit a bid for the Medicare DMEPOS Competitive Bidding Program.
Before submitting a bid, we encourage suppliers to review the various competitive bidding
program requirements which can be found at: http://www.dmecompetitivebid.com. The final
rule, which implements the competitive bid program published on April 10, 2007 in the Federal
Register, can be found at http://ecfr.gpoaccess.gov/cgi/t/text/textidx?c=ecfr&sid=b2a87ab88b1435426279006a18a5f7e3&rgn=div6&view=text&node=42:3.0.1.1.
1.6&idno=42
II. Considerations for Submitting a Bid
The following factors should be considered before submitting a bid:
A. Eligibility to Submit a Bid
(1) A bidder must be a DMEPOS supplier in good standing with an active National
Supplier Clearinghouse Number (NSC#) to be eligible to submit a bid in the competitive
bidding program. The supplier should ensure that its NSC file is up-to-date with current
information, as information in the NSC file will be verified during the registration and
bidding process.
(2) The supplier must be accredited by a Centers for Medicare & Medicaid Services
(CMS) approved accreditation organization for the product categories in order to submit
a bid. CMS cannot award a contract to a supplier that is not accredited. For a listing of
CMS-approved accreditation organizations, please visit
http://www.cms.hhs.gov/MedicareProviderSupEnroll/Downloads/DeemedAccreditationO
rganizations.pdf.
(3) Suppliers submitting a bid for a product category in a CBA must meet all applicable
state licensure requirements for the sale and/or distribution of that specific product
category for all supplier locations (10-digit NSC#) in every state in that CBA. Prior to
submitting a bid for a CBA and product category, the supplier must have a copy of the
applicable state license(s) on file with the NSC. Contracts are only awarded to suppliers
that meet all state licensure requirements for every state in a CBA.
Every supplier location must be licensed in each state in which it provides services. A
supplier with only one location in a multiple state CBA must have that location meet the
PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 3 of 21 RFB

license requirements of each state in the CBA to provide competitive bidding items and
services throughout the CBA. For example, a supplier bidding in the Cincinnati—
Middletown (Ohio, Kentucky, and Indiana) CBA that only has a location in Ohio must
have that location licensed in Ohio, Kentucky, and Indiana.

Each location of a supplier, with more than one location in a multiple state CBA, must
have the applicable state licenses for the state in the CBA in which it provides the
competitive bidding items. For example, for the Charlotte—Gastonia—Concord (North
Carolina and South Carolina) CBA, all locations of the supplier located in NC must have
the state license(s) to provide the competitive bidding item in NC and all locations of the
supplier in SC should have the state license(s) to provide the competitive bidding item in
SC. However, each location does not have to be licensed for both states unless that
location is providing items in that state.
(4) Suppliers are not required to maintain a physical location in a CBA to submit a bid for
that CBA unless it is required to obtain state licensure. Suppliers must comply with all
program requirements, including the requirement to furnish items to beneficiaries
throughout the CBA, to be awarded a contract. A supplier should not submit a bid unless
it currently has the ability to furnish items and services throughout the entire CBA. If a
supplier intends to use the services of a subcontractor in order to provide services
throughout the CBA, they must ensure the subcontractor is accredited, licensed, and
performs services consistent with 42 CFR 424.57(c).
B. Period of Performance
Suppliers that are awarded a contract must agree to furnish the competitively bid items
for the full duration of the contract period in the CBA. The length of the contract period
may not exceed three years.
C. Servicing the Entire Geographic Area of a CBA
A contract supplier must furnish competitively bid items to any beneficiary who
maintains a permanent residence in, or who visits a CBA and who requests those items
from the contract supplier. Members of a network share the responsibility to service the
entire geographic area of a CBA.
The only exception to this rule applies to a skilled nursing facility (SNF) or nursing
facility (NF) that elects to become a specialty supplier to furnish competitively bid items
only to its own residents to whom it would otherwise furnish Part B services.
D. No Discrimination Against Beneficiaries
The items furnished by a contract supplier as part of the competitive bidding program
should be the same items that the contract supplier makes available to its other customers.
This means that suppliers should furnish Medicare and non-Medicare customers with the
same selection of DMEPOS brands and models.

E. Single Payment Amount
The Medicare payment for competitively bid items and services is the “single payment
amount,” which replaces the fee schedule amount. The single payment amount for an
item furnished under a competitive bidding program is equal to the median of the bids
submitted for that item by suppliers whose composite bids for the product category that
includes the item are equal to or below the pivotal bid for that product category, see 42
CFR § 414.416. Only bona fide bids from qualified suppliers (those that meet the
applicable quality, financial, eligibility, licensure and accreditation requirements) are
considered in this process. This single payment amount remains in effect for the entire
contract period and is not adjusted by any update factor, see 42 CFR § 414.408(b).
F. Bona Fide Bids
All bid amounts for each item must be bona fide (rational and feasible for the bidder to
furnish at the bid price). Therefore, suppliers should not submit a bid for an item at a loss
just to improve their chances of winning a contract. We will evaluate bids to ensure that
that they are bona fide, and we may request that a supplier submit additional information,
such as manufacturer invoices, so that we can verify that the supplier can furnish the item
to the beneficiary for the bid price. An entire bid for a product category in a CBA will be
eliminated from consideration if there is a non-bona fide bid for any competitively bid
item in that product category.
G. Subcontracting
Suppliers participating in the competitive bidding program must comply with the supplier
standards set forth in 42 CFR 424.57 (c). DMEPOS supplier standards identify the

Medicare services that a subcontractor may perform at 42 CFR 424.57 (c)(4),
(12), and (14). These functions include the purchase of inventory, the repair of rented
equipment, and the delivery and instruction on the use of a Medicare covered item. On or
after October 1, 2009, suppliers furnishing items and services subject to the accreditation
requirements, as established by section 1834(a)(20)(D) of the statute, directly or as a
subcontractor for another entity, must be accredited, unless an exemption applies, by a
CMS-approved accreditation organization.
The contract suppliers have an additional requirement; they must notify CMS of any
subcontracting relationships they have entered into for purposes of furnishing items and
services under the program. They must also disclose whether the subcontractor meets
any accreditation and state licensure requirements necessary to furnish these services.
Contract suppliers are the party that will be held responsible for the items and services
they provide directly or through the use of a subcontractor. See the NSC website at
http://www.palmettogba.com/nsc for a more detailed explanation of subcontracting and
the supplier standards.
H. Change of Ownership
If an NSC approved Change of Ownership (CHOW) occurs before the bid submission
period ends, the supplier must update the information related to the CHOW on the RFB
forms (in the electronic system) and resubmit all accompanying hardcopy documents by
PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 5 of 21 RFB

the close of the bid window. Bid evaluations will be based on the information provided
in the electronic system as of the close of the bid window A supplier that has an NSC
approved CHOW after the bid window closed and has been offered a contract will need
to abide by the CHOW requirements provided in 42 CFR § 414.422(d). Contracts under
this program are not assignable and may not be sold.

Common Ownership or Control
Suppliers may not bid against themselves for the same product category in the same
CBA. Therefore, commonly-owned or controlled suppliers must submit one bid that
includes all locations owned or controlled by the supplier that will furnish competitively
bid items in the product category to beneficiaries in the CBA. Separate bids submitted
for the same product category in the same CBA by supplier organizations that are
commonly-owned or controlled are disqualified. Common ownership and control
requirements can be found in 42 CFR § 414.414(e).
If a contract is awarded to a commonly-owned or controlled supplier, then the contract
would include all locations in the CBA that have an ownership or control interest in each
other.

J. Specialty Suppliers
SNFs and NFs are not exempt from the competitive bidding program. A SNF or NF that
also serves as a DMEPOS supplier and wants to become a contract supplier must submit
a bid and participate in the competitive bidding competition. Only those facilities that are
enrolled as DMEPOS suppliers with the NSC and meet the applicable competitive
bidding requirements, including accreditation, may submit a bid in the competitive bid
program to become a contract supplier.
A SNF or NF may choose to become a specialty supplier. A specialty supplier is a SNF
or NF that has been awarded a competitive bidding contract and elects to furnish
competitively bid items only to its own residents to whom it furnishes Part B services.
To become a specialty supplier, the SNF or NF must elect the specialty supplier option on
Form A and be awarded a contract as a specialty supplier. SNFs or NFs that do not
become contract suppliers (either a specialty supplier or regular contract supplier) must
use contract suppliers to furnish competitively bid items to their residents in their CBA.
K. Networks
Small suppliers that are unable to independently service the entire geographic area of a
CBA may choose to become a member of a network. Individual network members are
not required to service the entire geographic area of a CBA, but the network as a whole
must service the entire CBA.
•

Each network must form a single legal entity that acts as the bidder and
submits the bid. A network must identify a primary network member that will
be responsible to submit the bid on behalf of the network. All agreements,
including contracts, required to create the entity must be in place and signed

before the network may submit a bid. These agreements must be submitted
with the other required hardcopy documents.
•

The network must identify itself as a network and must identify all of its
members.

•

Each network member must provide all items in the product category for
which they are awarded a contract.

•

Networks must have at least two, but not more than 20 members.

•

Each member of the network must meet all eligibility, accreditation, licensure
and financial requirements for participation in a competitive bidding program.
During the bid evaluation, if one member of the network does not meet one or
more of the competitive bidding requirements, then the entire network’s bid is
disqualified.

•

Network members can only join one network per product category per CBA.
Suppliers that are members of a network cannot independently bid for the
same product category/CBA. Therefore, commonly-owned or controlled
suppliers that are members of a network must submit one bid including all
locations of such commonly-owned or controlled suppliers in the CBA.
Separate bids submitted by suppliers or members of the network for the same
product category in the same CBA by supplier organizations that are
commonly-owned or controlled are disqualified. Locations of all network
members for which there is common ownership or control within the CBA
must be included on the bid.

•

At the time the network submits its bid; its total market share for each product
category in the CBA may not exceed 20 percent of the total Medicare demand
for that product category in the CBA. If the network has provided greater than
20 percent of Medicare volume for the entire product category in the CBA
during the last calendar year, that network bid is disqualified. See the bidding
chart at http://www.dmecompetitivebid.com.

•

Each network member must provide a statement certifying that they joined the
network because they were unable to independently furnish all of the items in
the product category throughout the entire geographic area of the CBA for
which the network is submitting a bid.

•

Location specific information such as the legal business name, address,
telephone number, NSC #, physical address, and tax identification number
must be provided on Form A.

NOTE: Any commonly-owned or controlled supplier of a network member that
has locations outside of the CBA that would routinely furnish items in a product
category to beneficiaries in the CBA must also be identified on Form A under the
location specific section.
PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 7 of 21 RFB

III. The Bidding Process
A. Bidding Forms: Forms A and Form B
1. Overview
The bid application consists of two forms: Form A and Form B. Form A requests
information about the bidder’s organization and its locations. Form A must be completed
in order for the bidder to be assigned a bidder number. The bidder number must be
included on each page of the required hardcopy documents. Form B requests information
about services provided by the supplier and includes the bidding sheet. Form B also
contains the certification statement that must be signed by an authorized official in order
to complete the bid application.
Suppliers will be required to complete these forms online using the CMS DMEPOS
Bidding System (DBidS). All information captured on the electronic Forms A and B is
the same information as included in the hardcopy forms. See Appendix C: DBidS
Flowcharts for helpful information in completing these forms in DBidS.
2. DBidS: Online Bid Submission System
DBidS will assign a bidder number to each bidder as soon as the bidder has completed all
necessary information that identifies your organization. DBidS will not allow a supplier
to bid unless that supplier has an active NSC# on file with the NSC. A supplier must be
accredited or have pending accreditation in order to submit a bid.
Once the bidding window closes, all bids are considered final and cannot be amended by
the bidder. However, bidders will be able to check the DBidS home page for the status of
their bid(s) (i.e., whether all fields have been completed and the bid certified) and
whether their package of hardcopy documents has been received for at least 15 days after
the bidding window closes.
Please note that any indication that the document package has been received does not
mean that the package received is accurate, complete, or otherwise meets CMS criteria.
It is the bidder’s responsibility to ensure that they have submitted a package that includes
all required hardcopy documents.
CMS reserves the right to seek clarification or corrections from a bidder about elements
of a bid. CMS will seek such clarifications or correction uniformly. CMS will not share
information about any bidder’s proposal with other bidders.
3. Form A: The Bid Application
One Form A must be completed for each business organization type listed on Form A
(supplier with single location, supplier with multiple locations, or network) regardless of
the number of CBAs and product categories being bid. A supplier would need to
PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 8 of 21 RFB

complete more than one Form A if the supplier was bidding as two separate and distinct
organizations. For example, this would apply when a supplier is bidding as a supplier
with one location in a CBA/product category and is bidding as the primary supplier of a
network in another CBA. In this situation, the supplier must submit separate Form As
and must register twice to access DBidS, the online bidding system, using different and
distinct NSC #s, authorized official information, and receive two distinct bidder numbers.
For every location that will be providing services in the CBA/product category, the
bidder must provide location specific information, including the legal business name,
Doing Business As (DBA) (if applicable), address, NSC #, physical address, and
CBA(s)/product category(s) for which the location is bidding, on Form A. The supplier
receiving payment from Medicare must be the entity furnishing and billing for the
items/services, and the NSC # of the location of the supplier that provided the service
must be the NSC # that appears on the claim for reimbursement.
NOTE: Any commonly-owned or controlled supplier that has locations outside of the
CBA that would routinely furnish the items in the product category to beneficiaries in the
CBA must also be identified on Form A under the location specific section.
The following chart identifies the information necessary to complete
Form A: The Bid Application in DBidS. It also provides some helpful information when
supplying the information requested on this form.

Screen Name
Business
Organization
Information

Section

FORM A---BIDDING APPLICATION
Information
Helpful Information
Requested

Individual
Business
Organization
Information

Specialty
Supplier

Accreditation

Contact
Person

Authorized
Official and
Key
Personnel

Competitive
Bidding Area
(CBA) and
Product
Category

•

Identify the legal
business name
• Select the
appropriate
bidder bidding
type
• Identify the
name of the
network, if
applicable
Indicate whether the
bidder is a specialty
supplier
Identify whether all
locations are accredited
or have pending
accreditation
• Identify the first
and last name(s)
of the person(s)
who should be
contacted to
answer questions
regarding the
business or
network
organization.
• Identify the title,
email and
telephone
number of the
contact person
named.
Identify the first and last
name(s) and titles of the
authorized official(s) or
key personnel for the
business organization or
network
Select the CBA(s) and the
product category(s) for
which your business
organization or network
is submitting a bid.

•
•

•

The legal business name is the name
used for tax purposes.
The bidder bidding type identifies
whether you are a bidder with a
single location, a bidder with multiple
locations, or a network bidder.
The network name only needs to be
identified if the bidder bidding type is
a network.

A specialty supplier is a skilled nursing
facility (SNF) or nursing facility (NF) that
plans to provide competitive bid items only to
its own residents.
Each location must have pending accreditation
or must be accredited. If a location is not
accredited or has pending accreditation, the
location will not be able to bid.
• The person listed should be the
authorized person to answer
questions regarding bids.
• A maximum of 5 contact persons can
be provided.

A maximum of 5 persons can be added.

A minimum of one competitive bidding area
and one product category must be selected.
Failure to select a competitive bidding area
and product category will result in the
competitive bidding area and product category
not being available for location selection and
bid later on in the application.

FORM A---BIDDING APPLICATION, con’t
PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 10 of 21 RFB

Screen
Name

Section

Information Requested

Helpful Information

Location
Specific
Information

Identifying
Information

• Identify the legal business name
• Address, city, state and zip code
• Email
• Telephone number
• Fax number (optional)
• NSC # for this location
• NPI identification number
Provide the physical address for the
location identified by the NSC #
provided.
• Tax Identification Number (TIN)
• Doing Business As (DBA) 1
• Doing Business As (DBA) 2
• Established/Incorporated state
• Previously established/
incorporated state
• Years in business
• Months in business

This is the official legal business name
and mailing address used for tax
purposes. This information may not be
a billing agency, management services
organization, or staffing company.

Physical
Address
Business
Information

Type of
Business

Service
Delivery
Sanctions

Select the type of business (Business
Corporation, General Partnership, Joint
Venture, Sole Proprietorship, Professional
Corporation, or Franchise)
Indicate the method for servicing
beneficiaries in a CBA (Retail, Mail
Order, and/or Home Delivery)
Provide information on any past or
current sanctions for this location.

Complete this information if the
information differs from the legal
business address.
• The TIN is issued by the
Internal Revenue Service
(IRS) and is used to report tax
information to the IRS. If a
bidder is a sole proprietor, a
Social Security Number may
be used.
• Indicate a DBA name if the
name is different than the
legal business name. The
DBA is the name the bidder is
generally known by to the
public.
• The number of years and
months in business indicates
the length of time the bidder
has been supplying durable
medical equipment,
prosthetics, orthotics, and
supplies in the CBA.
Space has been provided to describe a
business type other than the ones from
the drop-down list.
Indicate the method(s) that will be
used to provide items and services to
beneficiaries in a CBA.
Bidders must disclose information
about any current and past sanctions,
or debarments that occurred within the
last 5 years in which it was involved.

4. Form B: Bidding Form
PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 11 of 21 RFB

A separate Form B must be completed for each product category and CBA that is being
bid. Form B has three parts that the supplier must complete:

1.
2.
3.

Revenue and volume of business for this product category;
Bid sheet for each product category/CBA; and
Certification statement.

The following chart identifies the information necessary to complete the Form B: Bidding
Sheet in DBidS. It also provides some helpful information when supplying the
information on this form.

Screen Name
Business
Organization

Section
Revenue
From
Product
Category

FORM B---BIDDING SHEET
Information Requested
•

•

Customers
Served

•

Geographic
Area

•

Indicate the total
revenue for this
product category in the
CBA during the past
calendar year.
Identify what
percentage of the total
revenue for this
product category in this
CBA was collected
from Medicare.
Indicate the total
number of customers in
this CBA for this
product category by the
bidder or network
organization during the
past calendar year.
Identify what
percentage of the total
customers for this
product category was
Medicare beneficiaries.
Indicate the counties in
the CBA that the
bidder currently
services for this
product category.
Identify the percentage
of the total geographic
area in these counties
the bidder is currently
serving Medicare
beneficiaries.

Helpful Information
•

•
•

If the bidder is bidding for
multiple locations in the CBA that
share common ownership or
control, the total revenue must be
provided for all locations.
If a network is bidding, the total
revenue must be provided for all
network member bidders.
Good faith estimates are
acceptable.

•

If the bidder is bidding for
multiple locations in the CBA that
share common ownership or
control, the total number of
customers to whom they have
provided items in this category
must be provided for all locations.
• If a network is bidding, the
combined total number of
customers must be provided for
all network member bidders.
• Good faith estimates are
acceptable.
Servicing a customer refers to furnishing
an item and service in this product
category which resulted in payment to the
bidder for that item and service.

Screen Name
Business
Organization

Section
Top HCPCS
Codes

Expansion
Plan

Add
Subcontractors

Bid Sheet

N/A

FORM B---BIDDING SHEET, con’t
Information
Helpful Information
Requested
List by HCPCS code,
the number of units
provided to total
customers in this CBA
during the last
calendar year.
Include the current
and projected
information for staff,
finance, facilities,
inventory control, and
distribution.

Based on CMS data, the top HCPCS codes account
for approximately 80% of the payments for the
product category in the CBA.

This section applies when there is a plan to expand
the business under the Durable Medical
Equipment, Prosthetics, Orthotics, and Supplies
(DMEPOS) Competitive Bidding Program.

Identify the legal
name and expected
function of the entities
with which the bidder
or network anticipates
entering into a
subcontracting
agreement.

•

Provide the total
estimated capacity and
bid price for each
HCPCS code in this
product category

•

This section applies when there is a plan
to add subcontractors under the DMEPOS
Competitive Bidding Program.
Copies of the signed letter of intent, to
sign an agreement with each
subcontractor, must be submitted. The
letter of intent must identify the parties,
describe the function/services to be
performed by the subcontractor, contain
the anticipated length of agreement, be
signed by an authorized official for each
party, and contain language obligating the
subcontractor to abide by State and
Federal privacy/security requirements
including the privacy provisions stated in
the regulations for the DMEPOS
Competitive Bidding Program.
Total estimated capacity indicates the
number of units per HCPCS code that you
estimate you can provide throughout the
entire CBA for one (1) year. For the
definition of a unit you must see the
Bidding Information Chart on the CBIC
website at www.dmecompetitivebid.com.
To determine the capacity for each
HCPCS code, calculate the number of
units that you currently furnish on a
yearly basis and add any additional
number or units or capacity you would be
capable of providing annually at the start
of the contract period. It is anticipated
that suppliers will be capable of
sustaining the same level of estimated
capacity throughout the entire contract
period.
Bid price for each item. The amount must
be less than the fee schedule amount. The
bid price must also be rational and

Manufacturer

N/A

Provide the
manufacturer name,
model name and
model number for
each of the identified
HCPCS codes.

feasible to furnish the item at the bid price
submitted. The bid sheet indicates
whether the supplier should submit a bid
amount for the purchase of the new item
or for the rental of the new item.
• The item description, bid type (rental or
purchase), item weight, and fee schedule
amount will be provided on the bid form
in DBidS.
A minimum of one entry is required per HCPCS
code.

NOTE: Check the Form B Bidding Form to determine whether the bid should be
submitted on either a purchase or rental basis. Purchase bids are required for some items
that are routinely paid for on a rental basis. Rented items will continue to be paid for on a
rental basis, regardless if a purchase bid is required. See
http://www.dmecompetitivebid.com
In addition, suppliers must provide the manufacturer, model name, and model number for
the designated high volume Healthcare Common Procedure Coding System (HCPCS)
codes within a product category. This information may be used to populate the Medicare
Supplier Directory on the Medicare website (www.medicare.gov). This directory will list
the manufacturers, model names, and model numbers provided by contract suppliers to
allow beneficiaries to make informed choices among suppliers. The Medicare Supplier
Directory is used by Medicare beneficiaries, caregivers, referral providers and 1-800MEDICARE customer service representatives when assisting beneficiaries. Therefore, it
is important that bidders provide accurate information on Form B.
Certification Statement
Bidders must certify that the information provided on Form A, Form B, and in the
package of required hardcopy documents is true, correct and complete. This statement
allows CMS and/or the CBIC to verify this information. Only an authorized official of
the supplier may certify the bid by completing the certification statement on the
electronic on-line bid application.
Separate hardcopy certification statements are not required to be submitted along with the
hardcopy package, unless the bidder is a network.
If the bidder is a network, the primary network member along with each member of the
network must complete and print out a hardcopy of the online certification statement and
submit it along with their other required hardcopy documents. This statement certifies
that the network member joined the network because it is unable to independently furnish
the items in the product category to beneficiaries throughout the entire geographic area of
the CBA.
PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 14 of 21 RFB

B. Checklist of Required Hardcopy Documents for Bid Submission
In addition to completing Form A and Form B on DBidS, hardcopy documents must be
submitted to the CBIC as one complete package. Only one package of hardcopy
documents is required regardless of how many Form B bids are submitted. All
documents must be postmarked by [time] on [date]. Each page of every document must
include the supplier’s bidder number to ensure that the documents are associated with the
correct Form A and Form B(s). You must complete the organization section of Form A
before a bidder number is assigned.
We recommend that the package be sent by a method that can be tracked and that
requires a signature upon receipt. Send to the following address:
Certified Mail Address:
CBIC
Bldg. 200, Suite 400
Augusta, GA 30909

NOTE: All hardcopy documents should be submitted in a loose page format.
Do not use binders, folders, staples, or paper clips.
The following is the checklist of the required financial and non-financial hardcopy
documents that must be included in the package:
• Financial Statements for the last calendar year:
• Income Statement
• Balance Sheet
• Statement of Cash Flow
• Credit Report with numerical Credit Score completed within 90 days
prior to the date on which the supplier submits its bid.
• Tax Return Extract for the last calendar year
• Networks: Legal Agreement
• Networks: Network Certification Page signed by each member
• Subcontractor: Signed Letter of Intent to Enter into an Agreement, if bidder plans
to use subcontractors
• Settlement Agreement and Corporate Integrity Agreement, if applicable

Financial Hardcopy Documents

All bidding suppliers are required to submit financial documents for the immediate one
(1) year prior to the date on which the bid is submitted. New suppliers, those that have
been in business for less than one (1) year from the date on which the bid is submitted,
must submit the appropriate combination of actual or pro forma data equal to the length
of time it has been in business to represent the three types of financial statements. For
example, a supplier in business for six months would submit actual financial statements
for the six months prior to bid submission and pro forma or prospective financial
statements for the following six months.
A supplier that requests an extension of time to file his/her tax return with the Internal
Revenue Service (IRS), for the immediate tax year prior to the date on which the bid is
submitted, must submit a copy of the tax extension form filed with the IRS. In order for
the bid submission to be complete, a copy of the tax extension form must be included in
the same package along with the other required financial documents.
If the actual tax extract is not available before the bidding window closes, and an
extension is required, the supplier must submit the tax extract that was filed to the RIS by
the due date of the extension. The tax extract must be sent to the CBIC within three (3)
business days of filing the return with the IRS. Tax returns that are dated after the date of
the extension to file with the IRS are not acceptable and the supplier’s bid will be
rejected.
See Appendix B: Financial Documentation Toolkit for more information on submitting
financial hardcopy documents.
All organization types (e.g., corporation, sole proprietorship, partnership etc.) must
submit the hardcopy financial documentation detailed in the chart below.

Required Financial Documents by Business Type
Business
Type
Corporations,
including
Limited
Liability
Corporation
(LLC),
Professional
Corporation
(PC), S and C
Corporations

Sole
Proprietor

Income
Statement

Balance
Sheet

Statement
of Cash
Flow

Tax Return Extract

•
•
•

one year

Form 1120 OR*
Form 1120S OR*
Form 1120-A for one
year

Pages 1 & 2 and supporting
schedule for “Other
Expenses”

Credit report with
numerical score
completed within 90 days
of bid submission

Schedule C, including detail
for Part V, “Other Expenses”

Credit report with
numerical score
completed within 90 days
of bid submission

Form 1065 for one year

Partnerships

one year

Credit Report &
Numerical Score

Pages 1 & 2 and supporting
schedule for "Other
Expenses"

Credit report with
numerical score
completed within 90 days
of bid submission

Form 2007 990 (pages 1 & 2)
or 990-EZ (pages 1 & 2) for
one year
and supporting schedule for
"Other Expenses"
OR*

Non-Profit
Organization

one year

Form 2008 990 (pages 1, 9 &
10) or 990-EZ (pages 1 & 2)
for one year
and supporting schedule for
“Other Expenses”

Credit report with
numerical score
completed within 90 days
of bid submission

Required Financial Documents by Business Type con’t

Business
Type

Municipality
and State
Owned
Organization

New
Suppliers

Networks

Income
Statement

one year

Submit
income
statements to
represent 12
months
with actual
and pro
forma data
separately
prepared for
the months to
which they
apply.

one year for
each network
member

Balance Sheet

Statement of
Cash Flow

Tax Return
Required

Credit Report & Numerical
Score

Credit report with numerical
score completed within 90
days of bid submission

one year

Submit balance
sheets to
represent
12 months with
actual and pro
forma data
separately
prepared for the
months to which
they apply.

Submit cash
flow
statements
to represent
12
months with
actual and
pro
forma data
separately
prepared for
the months to
which they
apply.

Pages 1 & 2
and supporting
schedule
for "Other
Expenses," as
appropriate

If a credit report is not
available for the business,
the principal
business owner must supply
a personal
credit report with numerical
score within the same
constraints.

one year for
each network
member

Submit
appropriate
revenue and
expense
information
from tax return
based on
type of business
on behalf
of each network
member.

Credit report with numerical
score
completed within 90 days of
bid
submission - for each
network member

one year for
each network
member

Credit report with numerical
score
completed within 90 days of
bid
submission date

Note: Financial statements should be prepared in accordance with generally accepted accounting principles.

Covered Document Review Process
PROCUREMENT SENSITIVE: INFORMATION NOT RELEASABLE TO THE PUBLIC UNLESS AUTHORIZED BY LAW
This information has not been publicly disclosed and may be privileged and confidential. It is for internal government use only and must not be
disseminated, distributed, or copied to persons not authorized to receive the information. Unauthorized disclosure may result in prosecution to the
full extent of the law.
Page 18 of 21 RFB

Bidders who submit financial documents on or before the “covered document review
date,” as defined in 42 C.F.R. § 414.414(d)(2)(i), will be notified in writing if there are
any missing “covered” financial documents. Bidders missing any of these required
hardcopy financial documents will receive notification within 45 days after the covered
document review date. The notification will inform the bidder which financial document
is missing. Bidders may only submit the documents requested and not submit corrections
to other documents. Bidders have 10 business days from the date of the notice to submit
the missing document(s). CMS will not reject the supplier’s bid on the basis that any of
the covered documents are missing, if all the applicable missing documents identified in
the notice are submitted to CMS no later than 10 business days after the date of such
notice.
Bidders who submit the required financial documents after the covered document
review date will not be notified if there are any missing financial documents. For
more information on the covered document review date, visit the CBIC website at
http://www.dmecompetitivebid.com
This notice only applies to the receipt of the financial documents listed on the chart titled
“Required Financial Documents by Business Type” on the previous page. It does not
indicate or address whether the documents are valid, acceptable, or complete. In
addition, this notice does not apply to or address any other parts of the bid, either
hardcopy or electronic.
2.
a.

Non-financial Hardcopy Documents
Legal Agreement Between All Network Members

Networks must form a single legal entity for the purpose of submitting a bid as a
network. All agreements, including contracts, between the network’s members must be
in place and signed before the network entity may submit a bid. A copy of the legal
contract must be submitted with the other required documents. In addition, a network
must submit the network certification page from each network member (including the
primary member) certifying that the network member joined the network because it is
unable independently to furnish all of the items in the product category for which the
network is submitting a bid to beneficiaries throughout the entire geographic area of the
CBA.
b.

Signed Letters of Intent to Enter into a Subcontracting Agreement

Signed Letters of Intent to enter into a subcontracting agreement must include the
following information:
•

Identification of the parties;

•

Language clearly indicating that the subcontractor has agreed to supply
items/functions/services;

•

Anticipated length of agreement;

•

Attestation that the subcontractor currently possesses all required state
license(s) for every state in the CBA for which they will be servicing;

•

Attestation that the subcontractor currently meets all applicable quality
standards and is accredited by a CMS approved accreditation organization;

•

Signature of both the bidder’s authorized official and the subcontractor; and

•

Language obligating the subcontractor to abide by state and federal
privacy and security requirements, including the privacy provisions
stated in the regulation for this program.

Note: See the NSC website at http://www.palmettogba.com/nsc for more information.
Suppliers participating in the competitive bidding program must comply with the supplier
standards set forth in 42 CFR 424.57(c). The supplier standards describe the services a
Medicare enrolled DMEPOS supplier may subcontract to another entity. In general,
functions that a subcontractor can perform are limited to those functions described in the
DMEPOS supplier standards found at 42 CFR 424.57(c)(4), (12) and (14); all other
services should be provided directly by a Medicare enrolled DMEPOS supplier
c. Settlement Agreement or Corporate Integrity Agreements (if applicable)
The bidder must submit a copy of any settlement agreement or corporate integrity
agreement that has been reached between the supplier and any federal agency.
C. Bid Submission Requirements
•

Suppliers may choose the product categories and CBAs for which they will submit
bids. Suppliers need not submit a bid for all product categories and CBAs.
•

•

The bidding window will be open for 60 days. The bidding window will
open on [insert actual date].

The bidding window will close at midnight on [insert actual date]. A complete,
approved and certified bid must be submitted by the close of the bidding window. A
bid is approved when the authorized official or back up authorized official reviews
the bid and selects the “Approve” button in the online bidding system. Hardcopy
documents must be postmarked by midnight on [insert actual date]. See the
Checklist of Required Hardcopy Documentation section for requirements of
hardcopy documents that must be submitted before your bid will be complete.
NOTE: Once the bidding window closes, the electronic bidding system will be
closed and no further bid information can be submitted. Any hardcopy documents
postmarked after the bid window closes will not be accepted, with the exception of
any documents requested by the Competitive Bidding Implementation Contractor
(CBIC) as part of the Covered Document Review Process set forth in 42 C.F.R. §
414.414(d)(2), published on January 16, 2009 in the Federal Register. This rule can
be found at http://edocket.access.gpo.gov/2009/E9-863.htm .

•

Each bidder must submit its bid electronically to CMS via DBidS at [insert weblink].
DBidS captures the information collected on the Office of Management and Budget
(OMB) approved Request for Bids (RFB) forms (Form 10169A: Bid Application
and Form 10169B: Bidding Form). Every effort will be made to notify bidders in
advance when DBidS will be unavailable for maintenance. See the DBidS: Bid
Submission System section of this document for additional information.

IV. Confidentiality
CMS will maintain the confidentiality of bidders’ proprietary and financial information.
CMS will protect this information to the extent provided by law and will follow the
procedure stated in 45 CFR § 5.65. However, an independent evaluator may be granted
access to bidders’ or networks’ bidding information. Any reports that are created to
evaluate the program will be reported in an anonymous or aggregate format. Bidding
information may be reviewed as required by law by the US Government
Accountability Office (GAO) and the Department of Health and Human Services
(DHHS) Office of Inspector General (OIG), and the Department of Justice (DOJ), as
permitted by law. CMS will request that the GAO and DHHS/OIG report bidding
information in an anonymous or aggregate format.
Contractor staff with access to bid information will be required to sign a statement
agreeing to maintain the confidentiality of each bidder’s information.
V. Changing a Bid Submission
Bidders have 60 days to submit their bids in DBidS. Bidders may amend their bids as
many times as necessary prior to the close of the bid window. Hardcopy documents may
be amended prior to the close of the bid window as long as the amended package is
postmarked by midnight of the last day of the bid window. Once the bidding window has
closed, no further amendments to the electronic bid will be permitted, and CMS will only
accept hardcopy documents requested during the covered document review process.

File Type	application/pdf
File Title	BIDDING INSTRUCTIONS FOR THE MEDICARE DURABLE MEDICAL EQUIPMENT, PROSTHETICS, ORTHOTICS AND SUPPLIES (DMEPOS) COMPETITIVE BIDDIN
Author	Owner
File Modified	2009-05-20
File Created	2009-05-20