The Centers for Medicare & Medicaid Services (CMS) home health calendar year 2026 final rule revives Medicare’s controversial competitive bidding program and requires annual accreditation for durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) suppliers who bill Medicare.
The long-awaited final rule was published on Nov. 28.
Accreditation to become an annual requirement
Accreditation, which has been required every third year, will become a yearly requirement because “we believe that program integrity vulnerabilities have risen substantially in the DMEPOS accreditation program over the years,” CMS said in its Nov. 28 fact sheet on the final rule.
CMS pointed out that accreditation rules “have not been updated since their original promulgation in 2006.”
The agency said its main concerns are that accrediting organizations are accrediting suppliers who don’t meet DMEPOS quality standards, and that suppliers “are falling out of compliance with the quality standards (sometimes for extended periods) after becoming accredited.”
New regulations will require suppliers to be resurveyed and accredited annually.
The final rule also included changes for accrediting organizations, with CMS saying the new regulations provide “stronger oversight of the accrediting organizations.”
The regulations will increase the amount, specificity and frequency of data that accrediting organizations submit to CMS; expand the agency’s ability to monitor and review accrediting organizations’ operations; and strengthen CMS’s ability to respond to accrediting organizations it believes are performing inadequately.
CMS ‘improvements’ to Medicare competitive bidding includes urological supplies
Competitive bidding had been largely paused as of 2021, with CMS citing insufficient savings from the program.
Now DMEPOS suppliers who bill Medicare face the restart of competitive bidding with substantial changes.
“CMS is finalizing improvements to the DMEPOS competitive bidding program so that we can protect the Medicare trust funds, and beneficiaries can benefit from lower copays,” CMS said in its fact sheet. “We expect to announce the product categories for which we will solicit bids and the specific timeframe for the next competition shortly.”
Remote Item Delivery (RID) product categories — for items typically provided via mail order — for the next round include urological supplies, though hydrophilic catheters won’t be included in that category. CMS listed hydrophilic urinary catheters as a separate category.
Ostomy supplies are also listed as a RID product category to be competitively bid. All states, territories and the District of Columbia are included in the nationwide RID competitive bidding program.
The final rule also listed tracheostomy supplies as “medical equipment items mandated for inclusion under the DMEPOS competitive bidding program,” though tracheostomy supplies were not included in the final rule list of RID product categories.
In response to public responses that asked for urological, ostomy and tracheostomy supplies to be excluded, “We do not agree with the commenters that prior competitive bidding demonstrations for urological supplies provide evidence that ostomy, tracheostomy and urologicals are not well suited for inclusion in a competitive bidding program,” CMS said.
“Contract suppliers for each product category will be responsible for furnishing all items under the product category to all Medicare beneficiaries regardless of where they live. Only contract suppliers can furnish items included under the nationwide RID CBP that are covered under Medicare Part B.”
CMS estimated that eight national contract suppliers will be chosen for the urological supplies and ostomy supplies categories.
“The actual number of contract suppliers will be based on 2025 or 2026 claims data and will be announced in late spring/early summer 2026,” the fact sheet said. “If less than 30% of the winning suppliers are small suppliers, additional contracts may be offered towards the goal of meeting the 30% small supplier target.”
Competitive bidding timeline announced
CMS plans to start a pre-bidding supplier awareness program this month. In late spring to early summer 2026, CMS will announce the dates for competitive bidding program registration and bidding, as well as the lead items for product categories and the number of contracts to be awarded for every product category. During that period, CMS will also launch its bidder education program.
In the late summer to early fall 2026, participating companies will obtain user IDs and passwords, and the bidding window will open.
In the late summer-early fall of 2027, contracts will be awarded, and single payment amounts will be announced. CMS will start its beneficiary education program at that time.
No later than Jan. 1, 2028, competitive bidding contracts and single payment amounts are scheduled to go into effect, and the six-month transition period for beneficiaries to switch to contract suppliers will start.
In announcing the program’s timing, CMS said those dates “are target dates.”
CMS also said all bidding-related information and systems have been consolidated into a single Connexion system. “In past competitive bidding rounds, suppliers submitted bids (Form A and Form B) electronically through DBidS and all other documents through Connexion,” the agency said. “Bidders will no longer have to log into two different systems to submit their bid information. In addition, the bidding system will contain a ‘country of origin’ question to obtain information on where the product(s) is manufactured.”
Single payment amounts (SPAs) will be “calculated using the 75th percentile of winning bids, instead of the maximum winning bid. In addition, the SPAs are updated at the beginning of the second year and third year of the contract period by the percentage change in the consumer price index for all urban consumers for the 12-month period ending six months prior to the start of the second (and third year, if applicable) of the contract period.”
The industry reacts
In a Nov. 29 bulletin to stakeholders, the American Association for Homecare (AAHomecare) said it was reviewing the 762-page final rule.
But the association also shared initial comments from its President/CEO Tom Ryan.
“The 2026 DMEPOS/home health final rule is a direct threat to patients and providers,” Ryan said. “By reviving the competitive bidding program without important guardrails established under the previous Trump administration and expanding the program to include diabetes equipment, as well as ostomy, urological and tracheostomy supplies, CMS is setting the stage for more stress on the home medical equipment sector.
“Smaller, community-based suppliers will be hit particularly hard, and many patients and family caregivers will lose access to highly experienced and trusted partners who have been providing their care.”
“We support efforts to protect the Medicare trust fund and lower out-of-pocket costs for patients, and we support CMS’s ongoing commitment to improving the program’s integrity,” said Scott Whitaker, president/CEO of AdvaMed, an industry association for medtech companies, in a Nov. 30 press release. “At the same time, we remain focused on ensuring that patients with type 1 and type 2 diabetes — as well as those who rely on ostomy and urological supplies — continue to have access to the latest clinically proven technologies that meet their medical needs.
“While this so-called competitive bidding program still has significant shortcomings and we remain concerned about its potential impact on patient access, we appreciate CMS’s willingness to consider stakeholder feedback throughout its development. We are encouraged by the extended implementation timeline and the expansion in the number of contracts awarded — issues we raised directly in our letter to the agency.”
Sandra Canally, RN, founder and CEO of The Compliance Team, an accrediting organization, said in comments to HME Business on Dec. 1 that she and her team are waiting for CMS to give further guidance for implementation.
Canally added that The Compliance Team “is prepared to implement annual DMEPOS accreditation to providers,” and that her organization “specifically designed and implemented an annual, CMS-approved DMEPOS accreditation program that for over 14 years helped providers stay compliant.”
Ryan said AAHomecare would “continue to engage the Trump administration, CMS and Capitol Hill” in seeking to delay competitive bidding implementation and to develop an alternative plan that would preserve patient access to home medical equipment and protect small businesses.
“A new bidding round without a fair bid-setting mechanism is sure to produce rates that force suppliers to use cheaper, lower-quality products and leave patients with fewer choices,” Ryan said. “The end result will be higher costs to the Medicare program thanks to increased ER visits and hospitalizations, and more strain on caregivers.
“This is not reform, it’s regression.”
