Medicare Payment Freeze for Medical Equipment Extended Through 2025 in Non-Rural Areas

The Competitive Bidding Relief Act is a highly technical bill that takes a timeout on certain Medicare payment rule changes for durable medical equipment (DMEPOS)—think wheelchairs, oxygen tanks, and hospital beds. Essentially, it hits the pause button on the government’s ability to change how much it pays suppliers for this equipment in areas that don’t use the competitive bidding system, primarily non-rural parts of the country.

The Pause Button on Payment Rates

This bill mandates that the Secretary of Health and Human Services must keep using an existing transitional payment rule (specifically, 42 CFR 414.210(g)(9)(v)) for DMEPOS in non-rural and non-contiguous areas until December 31, 2025. Simultaneously, it blocks the Secretary from implementing a subsequent, potentially rate-changing regulation (42 CFR 414.210(g)(9)(vi)) until January 1, 2026. If you’re a supplier of medical equipment, this bill means you get stability and predictability in your Medicare reimbursement rates for the next couple of years. For the patient who needs that oxygen machine, this stability helps ensure the equipment keeps flowing without supply disruptions caused by sudden rate cuts.

Bypassing the Bureaucracy

One interesting detail in this short bill is how the changes are implemented. The Secretary is given explicit authority to put these payment delays into effect using “program instructions or other administrative methods.” This means they don’t have to go through the lengthy, public, and comment-heavy formal rulemaking process that usually accompanies changes to federal regulations. While this speeds things up—which is good if stability is the goal—it does mean the public gets less of a look at how these specific administrative decisions are being made. It's a trade-off between speed and transparency.

The Real-World Cost of Stability

While stability is great for suppliers and patients, there’s a flip side. The regulation being blocked until 2026 (42 CFR 414.210(g)(9)(vi)) was likely intended to lower Medicare’s costs, perhaps by adjusting rates downward to be closer to competitive bidding prices or market rates. By delaying this change, the Medicare program—and ultimately the taxpayer—might be paying higher rates for DMEPOS than they otherwise would have for the next two years. For Medicare, this is a delay in potential cost savings. For the companies supplying equipment, it’s a temporary financial reprieve that allows them to continue operating under known conditions, potentially preventing them from dropping out of the Medicare market.