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CMS In Brief

Medicare updates: “Inherent reasonableness,” DRGs and more.

CMS will hold a public meeting July 23 to discuss the prospect of employing its rarely used “inherent reasonableness” policy to adjust payments for non-mail-order diabetic testing supplies. The agency is considering the approach as an alternative to phasing retail supplies into the durable medical equipment competitive bidding program, which already incorporates mail-order diabetes products. (See Also see "Access To Diabetic Test Strips Jeopardized In CMS Competitive Bidding Areas" - Medtech Insight, 11 April, 2011..) The inherent reasonableness policy was established in a 2005 regulation to allow CMS to adjust payments for products that they deem are reimbursed excessively higher or lower than appropriate. Medicare over-spending on diabetes supplies has attracted recent scrutiny. (See [A#01120625003].)

“Before making a determination that a payment amount is not inherently reasonable, we consult with representatives of the supplier industry...

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