No. A supplier that chooses to become a grandfathered supplier for an item must continue to provide the item to all beneficiaries who choose to continue receiving the item from the grandfathered supplier.

A grandfathered supplier for oxygen and oxygen equipment must continue furnishing the oxygen and oxygen equipment for any period of medical need for the remainder of the reasonable useful lifetime (five years) of the equipment.

A grandfathered supplier for other rented durable medical equipment (DME) must furnish the item for the remaining months of the rental period, unless the item is no longer medically necessary. For capped rental DME, the grandfathering relationship ends when the ownership is transferred to the beneficiary or the item is no longer medically necessary. For example, if a non-contract supplier grandfathers the rental of a CPAP device, the supplier must continue to rent the item to the beneficiary unless the ownership is transferred to the beneficiary or the item is no longer medically necessary.

After the DMEPOS Competitive Bidding Program is implemented, when a new period of continuous use begins following a break in need of greater than 60 days plus the days remaining in the last paid rental month, the beneficiary must obtain new or additional equipment from a contract supplier.

For more information, please view The DMEPOS Competitive Bidding Program Grandfathering Requirements for Non-Contract Suppliers fact sheet, which you can find on this website by selecting Educational Information, then Fact Sheets.

No. Contract suppliers are eligible to begin a new capped rental period or entitled to receive additional payments for oxygen only when a beneficiary is otherwise eligible to receive equipment from a grandfathered supplier. Regulations at 42 CFR 414.408(j) indicate that suppliers can become grandfathered suppliers only for beneficiaries permanently residing in a CBA who were renting DME or oxygen from them prior to the implementation of the program. Beneficiaries not residing in a CBA at the time the program began are not eligible for the grandfathering option. Therefore, the capped rental period for DME does not restart and the contract supplier is not entitled to receive additional oxygen rental payments, as specified in 42 CFR 414.408(h).

Beneficiaries moving into a CBA after the competitive bidding program becomes effective must use a contract supplier to receive competitively bid oxygen and DME. The moving beneficiary must return his/her rented item to the original supplier and receive replacement equipment from a contract supplier. A contract supplier is entitled to receive payments for the remainder of the rental period or until the equipment is no longer medically necessary, whichever occurs first.

The competitive bidding program has not changed the coverage criteria or medical necessity documentation requirements for competitively bid items.

A new detailed written order is required when a beneficiary switches suppliers. Each supplier that bills for an item must, in the event of an audit, be able to produce sufficient information to show that the coverage criteria and related medical necessity documentation requirements are met. The Medicare law requires that the supplier that furnishes the oxygen and oxygen equipment during the 36th month of continuous use must continue to furnish the oxygen and oxygen equipment after the cap for any period of medical need for the remainder of the reasonable useful lifetime of the equipment.

For more information, please view the DMEPOS Competitive Bidding Program Grandfathering Requirements for Non-Contract Suppliers fact sheet, which you can find on this website by selecting Educational Information, then Fact Sheets.

A contract supplier is responsible for repairing equipment that the supplier is currently renting to a Medicare beneficiary, including oxygen equipment furnished after the equipment rental payment cap. 

The monthly rental payments made by Medicare for durable medical equipment (DME) and oxygen equipment include payment for necessary repairs, maintenance and servicing of the rented equipment. For oxygen equipment, the statute and regulations require the supplier to continue furnishing the oxygen equipment after the rental payment cap for any period of medical need for the remainder of the reasonable useful lifetime of the oxygen equipment. A contract supplier may repair the rental equipment itself or subcontract for this service.

CMS recognizes that contract suppliers may not have the training or expertise to repair all brands or types of equipment; therefore, a contract supplier is not obligated to repair beneficiary-owned equipment. Any Medicare-enrolled supplier may perform repairs to beneficiary-owned equipment.