Durable Medical Equipment Medicare Administrative Contractor

DME MAC Recompete (Round 2)

In 2006, the Centers for Medicare and Medicaid Services (CMS) awarded the first MAC contracts to administer Medicare claims for DME benefits in Jurisdictions A, B and D.  Under the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) the Secretary of Health and Human Services must re-compete its Medicare Administrative Contractors contracts every five (5) years.  Therefore, on Thursday, December 30, 2009, CMS issued a solicitation for the first Round 2 MAC contracts for DME Jurisdictions A and B.  Currently, National Heritage Insurance Company (NHIC) is serving as the DME MAC in Jurisdiction A, and National Government Services (formerly doing business as AdminaStar Federal Inc.) is serving as the DME MAC in Jurisdiction B. 

On September 2, 2010, CMS announced that National Government Services (NGS) has been awarded the Round 2 contract for DME Jurisdiction B.  As NGS is the incumbent contractor for Jurisdiction B, CMS anticipates that implementation of the new contract will go smoothly with no disruptions in service for Medicare beneficiaries and DME suppliers.

On February 16, 2011, CMS announced that Noridian Administrative Services (NAS) has been awarded the Round 2 contract for DME Jurisdiction D.  As NAS is the incumbent contractor for Jurisdiction D, CMS anticipates that implementation of the new contract will go smoothly, with few (if any) disruptions in service for Medicare beneficiaries and DME suppliers.

On March 31, 2011, CMS announced that NHIC Corp. (NHIC) was awarded a new contract to process and pay Medicare claims for durable medical equipment (DME), prosthetics, orthotics, and medical supplies within DME MAC Jurisdiction A.  However, on April 19, 2011, two companies filed protests regarding the contract award with the Government Accountability Office (GAO).  On May 27, 2011, both protestors advised the government that they would withdraw their respective protests.  CMS will now move forward to implement the new DME MAC Jurisdiction A contract.  During the implementation period, suppliers of DME to Medicare beneficiaries in the northeastern US will continue to receive Medicare claims processing and payment services from NHIC under an existing contract with CMS.

On November 30, 2010, CMS issued a solicitation for DME MAC Jurisdiction C.  Currently, CIGNA Government Services is serving as the DME MAC.  CMS anticipates awarding this contract in August 2011.

A link to the solicitations can be found below.  

DME MAC Contract Awards (Round 1)

The first awards of the full and open MAC competitions were for the Durable Medical Equipment (DME) claims workloads.  CMS decided to start the Medicare Contracting Reform initiative with the DME MAC contracts because the workload of the four DMERCs was stable and the risk of any significant program disruption to the provider and beneficiary communities would be minimal.

On January 6, 2006, CMS announced that it had awarded the contracts for the four specialty MACs that will handle administration of Medicare claims for DME.  All four DME MACs are operational.

Jurisdiction A

The Jurisdiction A DME MAC contract was awarded to National Heritage Insurance Company (NHIC).  NHIC immediately began transition activity and became fully operational as the DME MAC on July 1, 2006.  The states included in DME MAC Jurisdiction A are: Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont. 

Jurisdiction B

The Jurisdiction B DME MAC contract was awarded to AdminaStar Federal Inc. (AdminaStar) which immediately began transition activity and became fully operational as the DME MAC on July 1, 2006.  The states included in DME MAC Jurisdiction B are: Illinois, Indiana, Kentucky, Michigan, Minnesota, Ohio and Wisconsin. 

AdminaStar temporarily served as the DME MAC for Virginia and West Virginia because of delays in awarding the contract for Jurisdiction C.  Once the Jurisdiction C DME MAC contract was awarded and implemented, those two states were moved to Jurisdiction C. 

Jurisdiction C

The states included in Jurisdiction C are:  Alabama, Arkansas, Colorado, Florida, Georgia, Louisiana, Mississippi, New Mexico, North Carolina, Oklahoma, Puerto Rico, South Carolina, Tennessee, Texas, U.S. Virgin Islands, Virginia, and West Virginia.

The Jurisdiction C DME MAC contract was awarded to Palmetto GBA, LLC (Palmetto), on January 6, 2006, but a protest against the award was filed January 24, 2006, with the Government Accountability Office (GAO) by CIGNA Government Services, LLC (CGS).  As a result, a stay on performance of work was triggered until a decision could be rendered.

On May 4, 2006, CMS received notification from GAO of its decision concerning the bid protest.  GAO's decision sustained CGS's protest of the award made by CMS and recommended corrective steps.  In response to the recommendations of GAO, CMS reopened discussions with the offerors within the competitive range on May 10th and requested that the offerors submit final proposal revisions. CMS evaluated the final proposal revisions consistent with the provisions of the solicitation for the Jurisdiction C DME MAC contract.  As a result, on September 28,2006, CMS awarded the DME MAC contract for Jurisdiction C to CGS.

On October 6, 2006, Palmetto filed a protest with GAO of the award to CGS.  The protest triggered an automatic stay on performance of work under the Jurisdiction C contract until a decision could be rendered on the protest.  On January 16, 2007 CMS received notification that GAO denied Palmetto's protest of the award to CGS.  As a result, CMS authorized CGS to resume work under Jurisdiction C.  As of June 1, 2007, CGS had assumed full responsibility for administering the DME work for Jurisdiction C.

Jurisdiction D

The Jurisdiction D DME MAC contract was awarded to Noridian Administrative Services (NAS).  The states included in DME MAC Jurisdiction D are: Alaska, American Samoa, Arizona, California, Guam, Hawaii, Idaho, Iowa, Kansas, Missouri, Montana, Nebraska, Nevada, North Dakota, Northern Mariana Islands, Oregon, South Dakota, Utah, Washington, and Wyoming. 

On January 24, 2006 CGS filed a protest of this award made to NAS and an automatic stay on performance of work was triggered until a decision on the protest could be rendered.  On May 4, 2006, CMS received notification that GAO denied CGS's protest of the award to NAS.  As a result of this decision, CMS authorized NAS to resume work under Jurisdiction D as of May 8, 2006.  As of September 30, 2006, NAS had assumed full responsibility for administering the DME work for Jurisdiction D.

The solicitation for DME MAC contracts also included four options for which offerors were able to submit proposals:  the Medicare Electronic Data Interchange System (MEDIS), the Data Center, the National Supplier Clearinghouse (NSC) and Data Analysis and Coding (DAC) (similar to the current SADMERC).  Those options were originally awarded on January 6, 2006, to Palmetto.  But, because of the protests of the Jurisdiction C DME MAC award and the fact that Jurisdictions A, B, and D have already become operational using non-standard front end systems and individual data centers, CMS decided to drop the MEDIS and the Data Center from award consideration.  Decisions with respect to the NSC and DAC are pending.  In the interim, Palmetto GBA will be providing those services through their contracts for the NSC and SADMERC.

Fact sheets and Qs & As related to the implementation for Jurisdictions A and B, and D can be found below.  To view the DME MAC jurisdictions, see Specialty MAC Jurisdictions.