HHS-OIG Data Snapshot 
 
Medicare Market Shares of Diabetes Test Strips  
 
From April Through June 2019
 
   
OEI-04-19-00481
   
January 2020 
 
 
 
Why OIG Did This Review  
 
In 2011, the Centers for Medicare & Medicaid Services (CMS) implemented a Competitive Bidding Program (CBP) for 
 
mail-order diabetes test strips (DTS) in limited areas, and in July 2013, CMS expanded the program nationally to 
 
include a national mail-order program (the National Mail-Order Program).1,2  The Medicare Improvements for 
 
Patients and Providers Act of 2008 (MIPPA) currently prohibits CMS from awarding a CBP contract to a DTS supplier if 
 
the suppliers bid does not cover at least 50 percent, by volume, of the DTS types provided to Medicare 
 
beneficiaries.3  (This is known as the 50-percent rule.)  This rule is intended to ensure that Medicare beneficiaries have 
 
access to top-selling DTS via the National Mail-Order Program.  MIPPA requires the Office of Inspector General (OIG) 
 
to determine the Medicare market shares for DTS before each round of bidding.  The Bipartisan Budget Act of 2018 
amende d the 50-percent rule by requiring that, for bids to furnish DTS on or after January 1, 2019, CMS must use 
multiple  sources of data (from the mail-order and non-mail-order Medicare markets).4  OIGs analysis assists CMS in 
determi ning whether bidding suppliers meet this 50-percent rule.  Since 2010, OIG has released nine reports 
evaluati ng the Medicare market shares for mail-order and non-mail-order DTS.5 
   
Results  
 
 
 
DTS was more commonly provided via non-mail  Exhibit 1:  Non-mail-order claims composed 
 
order than mail order to Medicare beneficiaries for  85 percent of the total Medicare market for DTS 
the 3-m onth period of April through June 2019.  during the time period we reviewed. 
     
Medicar e was the primary payer for 1,402,636 claims for   
DTS provided via non-mail order and 256,373 claims for  
15%
DTS provided via mail order during the time period we 
Mail Order
reviewed.   
 
CMS will determine how to combine OIGs data from 
the separate Medicare markets for mail-order DTS and 
non-mail-order DTS, in addition to other market-based 
data sources that may be used, when assessing if 
suppliers bids to participate in the National Mail-Order  85%
Program meet the 50-percent rule.  Therefore, we  Non-Mail Order
present our data as separate markets in this report. 
 
Exhibit 1 shows the percentages of total Medicare 
claims for DTS provided via mail order and non-mail  Source:  OIG analysis of Medicare claims containing Healthcare Common 
Procedure Coding System (HCPCS) code A4253.  Mail-order claims contain 
order.   
the KL modifier, while non-mail-order claims do not contain the KL modifier.   
 
 
 
D ata Snapshot can be found at oig.hhs.gov/oei/reports/oei-04-19-00481.asp                1 
 
  Results  
  
The suppliers in our sample provided 25 types of  Table 1:  The top 10 non-mail-order strip types 
 
DTS to  Medicare beneficiaries via non-mail order.   
Model  Market Share 
     OneTouch Ultra  26.33% 
Our sample of claims includes 25 types of DTS 
  CONTOUR NEXT  13.14% 
provided to Medicare beneficiaries via non-mail order 
  FreeStyle Lite  10.90% 
from Ap ril through June 2019.  The top 10 types of  TRUEmetrix  10.84% 
strips accounted for 93 percent of the market.   OneTouch Verio  9.82% 
 
  ACCU-CHEK Aviva Plus  9.37% 
 
Table 1 lists the top 10 types of non-mail-order DTS  CONTOUR  6.57% 
   
associated with Medicare claims for the time period we  ACCU-CHEK Smartview  2.23% 
reviewed.  See Appendix A for the full listing of market  TRUEtrack  1.91% 
shares for DTS in the non-mail-order market.  Prodigy  1.79% 
         Total  92.90% 
Source:  OIG analysis of Medicare claims containing HCPCS code A4253, 
 
but without the KL modifier.   
   
 
 
 
The suppliers in our sample provided 21 types of   Table 2:  The top 10* mail-order strip types 
DTS to Medicare beneficiaries via mail order.   
Model  Market Share** 
   Prodigy  38.04% 
Our sample of claims includes 21 types of DTS  TRUEmetrix  17.31% 
provided to Medicare beneficiaries via mail order  Embrace  15.87% 
from April through June 2019.  The top 10 types of  CareSens N  9.35% 
strips accounted for 99 percent of the market.   Advocate Redi-Code+  6.09% 
  On Call Express  4.23% 
Table 2 lists the top 10 types of mail-order DTS  EASYMax  3.64% 
Fora V10/V12  1.44% 
associated with Medicare claims for the time period 
Unistrip1  1.18% 
we reviewed.  See Appendix B for the full listing of 
Embrace Talk*  0.68% 
market shares for DTS in the mail-order market.  
GlucoCard Expression*  0.68% 
 
       Total  98.48% 
 
Source:  OIG analysis of Medicare claims containing HCPCS code A4253 
and the KL modifier.   
* This list contains 11 types, because the last 2 strip typesEmbrace Talk 
and GlucoCard Expressiontied for the 10th highest market share.  
** The market shares in this column do not sum to the total because of 
rounding. 
 
 
Data Snapshot:  Medicare Market Shares of Diabetes Test Strips From April Through June 2019                        2
                2 
  The suppliers in our samples provided eight  Table 3:  The eight strip types in both markets 
 
types of DTS to Medicare beneficiaries both via   
Model  Non-Mail Order  Mail Order 
 
non-mail order and mail order.   CONTOUR NEXT  13.14%  0.34% 
   
FreeStyle Lite  10.90%  0.08% 
Of the 3 8 unique types of DTS across our samples,  TRUEmetrix  10.84%  17.31% 
8 types  of DTS were provided in both samples.  Two  CONTOUR  6.57%  0.08% 
of these  8 strip typesProdigy and TRUEmetrixare  Prodigy  1.79%  38.04% 
included  in the top 10 for both markets.  EASYMax  0.89%  3.64% 
  Embrace  0.38%  15.87% 
 
Table 3 lists these eight strip types and their  GlucoCard Expression  0.32%  0.68% 
 
Source:  OIG analysis of Medicare claims containing HCPCS code A4253.  
respective market shares.   
   
 
   
 
Additi onal Context   
 
DMEPOS Competitive Bidding Program.  The Medicare Prescription Drug, Improvement, and Modernization 
 
Act of 2003 requires CMS to phase inthrough several rounds of biddinga CBP for selected durable medical 
 
equipment, prosthetics, orthotics, and supplies (DMEPOS) items.6  The statute allows for the phase-in of items and 
 
services under the program, beginning with the highest-cost and highest-volume items and services or those with 
the larg est savings potential.7,8  CMS evaluates suppliers bids based on the suppliers eligibility, financial stability, 
and bid  prices.  Generally, CMS awards contracts to the suppliers that offer lower bid prices and meet applicable 
quality a nd financial standards.  The payment amounts resulting from winning bids replace the Medicare 
fee-sche dule amounts for the selected items.9  Generally, contract awards and payment amounts expire every 
3 years,  and suppliers must recompete to remain contract suppliers. 
   
MIPPA added further conditions to the competition for DTS.  MIPPA required that in rounds subsequent to the 
 
first round, a supplier must demonstrate that its bid covers at least 50 percent, by volume, of the DTS types 
 
provided to Medicare beneficiaries.  (This is known as the 50-percent rule.)  The Bipartisan Budget Act of 2018 
 
amended the 50-percent rule by requiring that, for bids to furnish DTS on or after January 1, 2019, CMS must use 
 
multiple sources of data (from the mail-order and non-mail-order Medicare markets) to determine the volume for 
 
such types of products.10  Therefore, in future rounds of competitive bidding, CMS will use these multiple sources 
 
of data to determine if suppliers bids for the National Mail-Order Program meet the 50-percent rule.   
 
 
DTS pro vided via non-mail order are not included in the CBP.  However, effective for dates of service on or after 
July 1, 2013, Medicare adjusts the fee-schedule amounts for non-mail-order DTS so that they are equal to the 
single payment amounts that the National Mail-Order Program establishes for mail-order DTS.11  During the last 
round of competitive bidding, this rate was $8.32 per 50-count box.12 
 
Current Status of the DMEPOS Competitive Bidding Program.  All CBP contracts expired on December 31, 
2018.  In October 2018, CMS issued guidance stating there would be a temporary gap in the CBP beginning 
January 1, 2019.13  As a result, beginning January 1, 2019, and until new CBP contracts are awarded, beneficiaries 
may receive DTS from any Medicare-enrolled DMEPOS supplier.14  During the temporary gap in the CBP, Medicare 
will pay for mail-order DTS at the single payment amount that was in effect for the last day of the National 
Mail-Order Program contract period (i.e., December 31, 2018), adjusted for inflation.15    
 
On March 7, 2019, CMS announced plans to initiate a new round of competitive bidding that will take effect on 
January 1, 2021; however, the National Mail-Order Program for DTS will not be included in this round.16  CMS has 
not yet announced when the National Mail-Order Program for DTS will resume being included in the CBP.   
 
Data Snapshot:  Medicare Market Shares of Diabetes Test Strips From April Through June 2019                        3
                 2 
     
Appendix A:  Model, Manufacturer, and Market Share Estimates for Non-Mail-Order 
DTS for April Through June 2019 
Model  Manufacturer  Market Share*  95-Percent Confidence Interval 
OneTouch Ultra  LifeScan, Inc.  26.33%  21.91%30.76% 
CONTOUR NEXT  PHC Holdings Corporation  13.14%  10.04%17.01% 
FreeStyle Lite   Abbott Diabetes Care, Inc.  10.90%  8.28%14.23% 
TRUEmetrix  Trividia Health, Inc.  10.84%  8.42%13.85% 
OneTouch Verio   LifeScan, Inc.  9.82%  7.27%13.14% 
ACCU-CHEK Aviva Plus  Roche  9.37%  6.77%12.84% 
CONTOUR   PHC Holdings Corporation  6.57%  4.19%10.15% 
ACCU-CHEK Smartview   Roche  2.23%  1.04%4.74% 
TRUEtrack   Trividia Health, Inc.  1.91%  1.00%3.62% 
Prodigy   Prodigy Diabetes Care  1.79%  0.99%3.19% 
ACCU-CHEK Guide   Roche  1.28%  0.48%3.32% 
ACCU-CHEK Compact Plus   Roche  1.04%  0.38%2.79% 
WaveSense Presto  AgaMatrix  1.02%  0.38%2.69% 
EASYMax   Oak Tree International Holdings, Inc.  0.89%  0.26%2.98% 
EasyTouch   MHC Medical Products  0.64%  0.26%1.53% 
Embrace  Omnis Health  0.38%  0.14%1.08% 
FreeStyle   Abbott Diabetes Care, Inc.  0.38%  0.14%1.08% 
FreeStyle InsuLinx   Abbott Diabetes Care, Inc.  0.38%  0.09%1.64% 
GlucoCard Expression   ARKRAY  0.32%  0.10%1.03% 
FreeStyle Precision NEO   Abbott Diabetes Care, Inc.  0.19%  0.04%0.83% 
Fora V30 G30 Premium V10  ForaCare, Inc.  0.13%  0.02%0.91% 
GlucoCard Vital  ARKRAY  0.13%  0.02%0.91% 
EvenCare G2   Medline  0.13%  0.02%0.91% 
GlucoCard Shine  ARKRAY  0.13%  0.02%0.91% 
Precision Xtra   Abbott Diabetes Care, Inc.  0.06%  0.01%0.45% 
Source:  OIG analysis of supplier documentation and Medicare claims containing HCPCS code A4253, but without the KL modifier, for the 3-month period 
of April through June 2019. 
* The market shares in this column do not sum to 100 percent because of rounding. 
 
 
Data Snapshot:  Medicare Market Shares of Diabetes Test Strips From April Through June 2019                            4 
 
 
   
Appendix B:  Model, Manufacturer, and Market Share Estimates for Mail-Order DTS 
   
for April Through June 2019 
Model  Manufacturer  Market Share*  95-Percent Confidence Interval 
Prodigy  Prodigy Diabetes Care  38.04%  33.58%42.51% 
TRUEmetrix  Trividia Health, Inc.  17.31%  14.09%21.08% 
Embrace  Omnis Health  15.87%  12.63%19.76% 
CareSens N  i-Sens, Inc.  9.35%  6.98%12.42% 
Advocate Redi-Code+  BroadMaster Bio-Tech Corp.  6.09%  4.28%8.61% 
On Call Express  ACON Laboratories  4.23%  2.69%6.61% 
EASYMax  Oak Tree International Holdings, Inc.   3.64%  2.36%5.57% 
Fora V10/V12  ForaCare, Inc.  1.44%  0.66%3.09% 
Unistrip1  Unistrip Technologies, LLC  1.18%  0.49%2.84% 
Embrace Talk  Omnis Health  0.68%  0.27%1.69% 
GlucoCard Expression  ARKRAY  0.68%  0.25%1.79% 
Easy Talk  Home Aide Diagnostics  0.42%  0.12%1.54% 
CONTOUR NEXT  PHC Holdings Corporation  0.34%  0.13%0.90% 
Fora G20  ForaCare, Inc.  0.17%  0.02%1.20% 
OneTouch Verio  LifeScan, Inc.  0.08%  0.01%0.60% 
NovaMax  Nova Biomedical  0.08%  0.01%0.60% 
CONTOUR  PHC Holdings Corporation  0.08%  0.01%0.60% 
Rightest GS 300  Bionime Corporation  0.08%  0.01%0.60% 
Embrace Evo  Omnis Health  0.08%  0.01%0.60% 
FreeStyle Lite  Abbott Diabetes Care, Inc.  0.08%  0.01%0.60% 
OneTouch Ultra   LifeScan, Inc.  0.04%  0.01%0.30% 
Source:  OIG analysis of supplier documentation and Medicare claims containing HCPCS code A4253 and the KL modifier for the 3-month period of April 
through June 2019.  
* The market shares in this column do not sum to 100 percent because of rounding. 
 
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     Methodology 
 
Data Collection  
   
Using CMSs National Claims History file, we identified the population of Medicare Part B paid claims for DTS that 
had dates of service beginning between April 1, 2019, and June 30, 2019.  There were 1,402,636 non-mail-order 
claims and 256,373 mail-order claims for which Medicare was the primary payer during this period.  From these 
populations, we selected a simple random sample of 600 non-mail-order claims and 600 mail-order claims. 
To identify the beneficiaries associated with the claims in our samples, we matched the beneficiary numbers from 
the claims with beneficiary numbers in the CMS Beneficiary Enrollment Database.  We sent documentation 
requests to the 594 non-mail-order suppliers and the 18 mail-order suppliers associated with the claims in our 
samples.  In some cases, we were able to aggregate individual non-mail-order suppliers under a large retailer 
chain (e.g., CVS Health).  In these cases, we sent documentation requests to the large retailer for a response on 
behalf of all suppliers that had been aggregated under it.  For each claim, we asked the large retailer or individual 
supplier to (1) indicate the type (model and manufacturer) of DTS that it provided to the Medicare beneficiary we 
identified and (2) submit relevant documentation (such as packing slips or box labels) for the strips.  We received 
responses from all 594 non-mail-order suppliers documenting 600 claims in our sample, a 100-percent response 
rate.  We received responses from 17 mail-order suppliers documenting 599 claims in our sample, a 99-percent 
response rate.   
Data Analysis  
We reviewed claims data, supplier responses, and supplier documentation to determine the quantity and type of 
mail-order or non-mail-order DTS associated with each claim in our sample.  Each claim in our non-mail-order 
sample covered between 1 and 15 boxes.  Data for the 600 non-mail-order claims provided information for a total 
of 1,578 boxes of strips.  Each claim in our mail-order sample covered between 1 and 18 boxes.  Data for the 
599 mail-order claims provided information for a total of 2,364 boxes of strips.   
We categorized the DTS types by model and manufacturer in both our non-mail-order and mail-order samples.  
We determined the market share estimates for each DTS model type (strip type) that each of our samples 
captured.  We calculated each strip types share of its respective Medicare market by determining the total 
number of 50-count boxes of each strip type provided to beneficiaries in our sample and dividing that number 
by the total number of boxes across all strip types in each sample.17  To estimate the Medicare market share of 
each type of DTS provided via non-mail order and mail order, we projected our sample data to each of the 
populations of DTS during the timeframe we reviewed.   
For the non-mail-order claims in our sample, we identified 1 type of DTS that was sold exclusively by a single 
retailer.  This 1 type of DTS accounted for 5 claims and 10 boxes in our non-mail-order sample.  We removed 
these claims from our sample to assist CMS in meeting the Bipartisan Budget Act of 2018s requirement for CMS 
to use multiple sources of data, including market-based data measuring sales of DTS products that are not sold 
exclusively by a single retailer.18  This reduced our non-mail-order sample of claims from 600 to 595, with a 
corresponding total of 1,568 boxes.   
Lastly, we reviewed the market share lists for both the non-mail-order market and the mail-order market to 
determine which strip types were provided via both methods. 
Data Snapshot:  Medicare Market Shares of Diabetes Test Strips From April Through June 2019                                            6
 
                 
 
   ELinmdintaottieosn s 
Suppliers have 1 year to submit claims to CMS.  Our study did not include any Medicare claims submitted after 
August 1, 2019, the date we collected our claims data for non-mail-order DTS and mail-order DTS.  Therefore, our 
sample may not include all types of non-mail-order and mail-order DTS reimbursed by Medicare during our 
timeframe.  Additionally, the market share analysis reflects only the suppliers that responded to our 
documentation request.  
   
Standards 
We conducted this study in accordance with the Quality Standards for Inspection and Evaluation issued by the 
Council of the Inspectors General on Integrity and Efficiency. 
  
Acknowledgments  
 
 
Lauren Buss served as the team leader for this study.  Other Office of Evaluation and Inspections staff from the 
 
Atlanta regional office who conducted the study include Taylor Eastman, Margaret Naughton, and 
 
Brianna Weldon.  Office of Evaluation and Inspections staff who provided support include Kevin Farber, 
 
Christine Moritz, and Michael Novello.   
 
 This report was prepared under the direction of Dwayne Grant, Regional Inspector General for Evaluation and 
 Inspections in the Atlanta regional office; Evan Godfrey, Deputy Regional Inspector General; and Jaime Stewart, 
 Assistant Regional Inspector General.  
 
To obtain additional information concerning this report or to obtain copies, contact the Office of Public Affairs at 
 
Public.Affairs@oig.hhs.gov.    
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Data Snapshot:  Medicare Market Shares of Diabetes Test Strips From April Through June 2019  7
 
   
   
  4 
   Sources 
 
1 The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), P.L. No. 108-173,  302(b)(1).  CMS 
implemented Round 1 of the CBP in 2008 for 2 weeks until the contacts were terminated by the Medicare Improvements for 
Patients and Providers Act of 2008 (MIPPA), P.L. No. 110-275,  154(a)(1).  As required by MIPPA, CMS conducted the supplier 
competition again in 2009, referring to it as the Round 1 Rebid, which began on January 1, 2011. 
2 MIPPA authorized CMS to phase in a national mail-order program after 2010.  MIPPA, P.L. No. 110-275  154(a)(1)(A)(iii) 
(amending Social Security Act,  1847(a)(1)(B)(i)(III), and 42 U.S.C.  1395w-3(a)(1)(B)(i)(III)). 
3 MIPPA, P. L. No. 110-275  154(d)(3)(B) (adding new paragraph Social Security Act,  1847(b)(10)(A), 42 U.S.C.  
 1395w-3(b)(10)(A)).   
4 Bipartisan Budget Act of 2018, P.L. No. 115-123,  50414(a)(1)(amending Social Security Act,  1847(b)(10)(A), 42 U.S.C. 
 1395w-3(b)(10)(A)). 
5 These nine reports include OEI-04-10-00130, OEI-04-13-00680, OEI-04-13-00681, OEI-04-13-000682, OEI-04-16-00470,  
OEI-04-16-00471, OEI-04-16-00473, OEI-04-18-00440, and OEI-04-18-00441. 
6 MMA, P.L. No. 108-173,  302(b)(1). 
7 Social Security Act,  1847(a)(1)(B)(ii), 42 U.S.C.  1395w-3(a)(1)(B)(ii).  
8 The statute also allows CMS to exempt items and services from the CBP if the application of competitive bidding for these 
items and services is not likely to result in significant savings.  Social Security Act,  1847(a)(3)(B), 42 U.S.C.  1395w-3(a)(3)(B). 
9 In November 2018, CMS revised its CBP rules to change the processes for submitting bids, evaluating bids, and calculating 
single payment amounts.  Specifically, CMS will replace the bidding method that was in effect through 2018in which 
a supplier submits a bid for each item in the product categorywith what is known as lead item pricing.  Under lead item 
pricing, a bidding supplier would submit a bid for one itemknown as the lead itemin the product category.  The 
maximum winning bid for the lead item would be used to establish single payment amounts for both the lead item and all 
other items in the product category. 83 Fed. Reg. 56922 (Nov. 14, 2018).  Accessed at https://www.gpo.gov/fdsys/pkg/FR-
2018-11-14/pdf/2018-24238.pdf on September 19, 2019. 
10 Bipartisan Budget Act of 2018, P.L. No. 115-123,  50414(a)(1)(amending Social Security Act,  1847(b)(10)(A), 42 U.S.C. 
 1395w-3(b)(10)(A)). 
11 American Taxpayer Relief Act of 2012, P.L. No.112-240  636 (added new paragraph to Social Security Act,  1834(a)(1)(H), 
42 U.S.C.  1395m(a)(1)(H)).   
12 CMS, Public Use File V0817.  Accessed at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/DMEPOSFeeSched/DMEPOS-Fee-Schedule-Items/DME16-
C.html?DLPage=1&DLEntries=10&DLSort=2&DLSortDir=descending on November 7, 2019. 
13 CMS, Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Competitive Bidding Program:  Temporary Gap Period, 
October 2018.  Accessed at https://www.cms.gov/Outreach-and-Education/Outreach/Partnerships/Downloads/DMEPOS-
Temporary-Gap-Period-Fact-Sheet.pdf on October 1, 2019. 
14 Ibid. 
15 The single payment amount for mail-order DTS that was in effect on December 31, 2018, will be increased by the projected 
percentage change in the Consumer Price Index For All Urban Consumers for the 12-month period on the date after the 
contract period ended.  42 CFR  414.210(g)(10) (as added by 83 Fed. Reg. 56922, 57071 (Nov. 14, 2018)).  Accessed at 
https://www.gpo.gov/fdsys/pkg/FR-2018-11-14/pdf/2018-24238.pdf  on September 19, 2019. 
16 CMS, DMEPOS Competitive Bidding Round 2021, March 8, 2019.  Accessed at https://www.cms.gov/newsroom/fact-
sheets/dmepos-competitive-bidding-round-2021 on November 4, 2019. 
17 Generally, each box of DTS contains 50 strips.  Some types of DTS are packaged as 51-count boxes instead of 50-count 
boxes, but Medicare pays for these boxes as though they were 50-count boxes.  In our analysis, we counted these boxes of 
DTS as containing 51 strips. 
18 Bipartisan Budget Act of 2018, P.L. No. 115-123,  50414(a)(1) (amending Social Security Act,  1847(b)(10)(A), 42 U.S.C. 
 1395w-3(b)(10)(A)). 
 
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