Durable Medical Equipment (DME) Medicaid Reimbursement


Federal 21st Century CURES Act and Centers for Medicare and Medicaid Services (CMS) Authority

Effective January 1, 2018, federal law at 42 U.S.C. § 1396b(i)(27), also codified as section 1903(i)(27) of the Social Security Act, as amended by section 5002 of the 21st Century Cures Act, Public Law No. 114-255, places a limit of the amount of federal reimbursement states may receive for certain items of durable medical equipment (DME). Specifically, if any state's annual Medicaid spending for certain DME items, in total, is more than what Medicare would have paid (at its lowest price, including its Competitive Bidding Program), then the Centers for Medicare and Medicaid Services (CMS) is required to take back federal matching funds for any amounts more than what Medicare would have paid.

CMS calculates that Connecticut Medicaid is $3million over the cap. Connecticut has only 9 months left in the year to bring this spending in line or risk losing federal funding. To meet the time frame, the Department issued notice to decrease DME rates to 75% of Medicare, effective April 1, 2018, to bring spending within the cap while minimizing adverse impacts on providers and Medicaid members.

CMS Tool and Calculation for Connecticut Medicaid DME $3million Over the Cap

In implementing the cap effective this year, Congress accelerated its original effective date by one calendar year to offset the costs of other Congressional actions. The first formal guidance from CMS regarding DME cap implementation was delayed until December 27, 2017, giving states only two business days to plan implementation. Further, CMS guidance was preliminary and final guidance was not issued until February 2018.

Given the delayed CMS guidance, Connecticut's Medicaid DME fees are considerably higher than those paid by Medicare's Competitive Bidding Program, and that Connecticut is left with less than a full year to bring DME spending below the federal cap, the Department opted to publish notice on February 28, 2018 for fee decreases effective April 1, 2018 in an effort to minimize the ultimate impact of the federal policy upon DME providers and the Medicaid members they serve. Provider Bulletin PB18-15

On March 16, 2018, DSS met with MEDS providers to discuss impact of the federal changes and requested voluntary cost based information from MEDS providers to assist in determining appropriate levels of MEDS reimbursement while ensuring compliance with the federal changes that are necessary to obtain federal matching funds for durable medical services provided through Connecticut's Medicaid program.

On March 21, 2018 DSS issued a revision to the previously announced reimbursement change to DME and other MEDS items. The revision will reprice codes subject to the federal limit on April 1, 2018 and implement additional reimbursement changes effective July 1, 2018. Summary of Revisions

On May 1, 2018 the Home Medical Equipment and Services Association of New England (HOMES) sent the following fee schedule proposal to the Department.
The proposal was prepared or accomplished by the Home Medical Equipment and Services Association of New England. The opinions expressed in the proposal are that of the Home Medical Equipment and Services Association of New England and do not reflect the view of the Department of Social Services, the Division of Health Services, or the State of Connecticut. Assumptions made in the proposal are not reflective of the position of any entity other than that of the Home Medical Equipment and Services Association of New England.

On June 15, 2018 the Department issued a response letter to HOMES regarding their May 1, 2018 proposal.


DME and MEDS Cost Based Information

The Department will not accept information that cannot be verified.

Examples of cost based information may be invoices, supplier charges, shipping costs, cost reports, revenue reports, audited financials, financial statements, staffing cost. Do not send documents that contain client sensitive information, including information protected by the Health Insurance Portability and Accountability Act (HIPAA). If you send documents with client data, please redact this information from the documents or please send through a secure portal in compliance with HIPAA.

Important Note: It is each individual's responsibility to determine which information and documents that individual is permitted to disclose to DSS. In addition, the state Freedom of Information Act, Conn. Gen. Stat. 1-200 et seq. ("FOIA") requires DSS to disclose documents in its possession upon request, which means that anything you send to DSS may need to be publicly disclosed. Although there are exemptions in the FOIA, they are permissive and not required. If an individual choosing to send information to DSS in response to this voluntary request believes that all or part of certain information or documents is exempt from disclosure under the FOIA, that individual must clearly mark such information or documents as CONFIDENTIAL and may be required to provide additional explanation or information to DSS. DSS will decide whether such information or documents are exempt from disclosure under the FOIA.

Please send documentation and questions to:

Department of Social Services
Reimbursement and Certificate of Need, 9th Floor
DME Reimbursement
55 Farmington Avenue
Hartford, CT 06105

Fax: 860-424-4812

Email: con-ratesetting.dss@ct.gov

Additional Information:

State Medicaid Directors Letter SMD#18-001

Medicare Competitive Bidding Program

CT Medicaid Bulletins can be downloaded from the CMAP website