IIB 

114TH CONGRESS 

1ST SESSION H. R. 284 

IN THE SENATE OF THE UNITED STATES 

MARCH 17, 2015 

Received; read twice and referred to the Committee on Finance 

AN ACT 

To amend title XVIII of the Social Security Act to require 

State licensure and bid surety bonds for entities submitting bids under the Medicare durable medical equipment, 

prosthetics, orthotics, and supplies (DMEPOS) competitive acquisition program, and for other purposes. 

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1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Medicare DMEPOS 

5 Competitive Bidding Improvement Act of 2015’’. 

6 SEC. 2. REQUIRING BID SURETY BONDS AND STATE LICEN7 SURE FOR ENTITIES SUBMITTING BIDS 

8 UNDER THE MEDICARE DMEPOS COMPETI9 TIVE ACQUISITION PROGRAM. 

10 (a) BID SURETY BONDS.—Section 1847(a)(1) of the 

11 Social Security Act (42 U.S.C. 1395w–3(a)(1)) is amend12 ed by adding at the end the following new subparagraphs: 

13 ‘‘(G) REQUIRING BID BONDS FOR BIDDING

14 ENTITIES.—With respect to rounds of competi15 tions beginning under this subsection for con16 tracts beginning not earlier than January 1, 

17 2017, and not later than January 1, 2019, an 

18 entity may not submit a bid for a competitive 

19 acquisition area unless, as of the deadline for 

20 bid submission, the entity has obtained (and 

21 provided the Secretary with proof of having ob22 tained) a bid surety bond (in this paragraph re23 ferred to as a ‘bid bond’) in a form specified by 

24 the Secretary consistent with subparagraph (H) 

25 and in an amount that is not less than $50,000 

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1 and not more than $100,000 for each competi2 tive acquisition area in which the entity submits 

3 the bid. 

4 ‘‘(H) TREATMENT OF BID BONDS SUB5 MITTED.— 

6 ‘‘(i) FOR BIDDERS THAT SUBMIT BIDS

7 AT OR BELOW THE MEDIAN AND ARE OF8 FERED BUT DO NOT ACCEPT THE CON9 TRACT.—In the case of a bidding entity 

10 that is offered a contract for any product 

11 category for a competitive acquisition area, 

12 if— 

13 ‘‘(I) the entity’s composite bid 

14 for such product category and area 

15 was at or below the median composite 

16 bid rate for all bidding entities in17 cluded in the calculation of the single 

18 payment amounts for such product 

19 category and area; and 

20 ‘‘(II) the entity does not accept 

21 the contract offered for such product 

22 category and area, 

23 the bid bond submitted by such entity for 

24 such area shall be forfeited by the entity 

25 and the Secretary shall collect on it. 

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1 ‘‘(ii) TREATMENT OF OTHER BID2 DERS.—In the case of a bidding entity for 

3 any product category for a competitive ac4 quisition area, if the entity does not meet 

5 the bid forfeiture conditions in subclauses 

6 (I) and (II) of clause (i) for any product 

7 category for such area, the bid bond sub8 mitted by such entity for such area shall 

9 be returned within 90 days of the public 

10 announcement of the contract suppliers for 

11 such area.’’. 

12 (b) STATE LICENSURE.— 

13 (1) IN GENERAL.—Section 1847(b)(2)(A) of the 

14 Social Security Act (42 U.S.C. 1395w–3(b)(2)(A)) is 

15 amended by adding at the end the following new 

16 clause: 

17 ‘‘(v) The entity meets applicable State 

18 licensure requirements.’’. 

19 (2) CONSTRUCTION.—Nothing in the amend20 ment made by paragraph (1) shall be construed as 

21 affecting the authority of the Secretary of Health 

22 and Human Services to require State licensure of an 

23 entity under the Medicare competitive acquisition 

24 program under section 1847 of the Social Security 

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1 Act (42 U.S.C. 1395w–3) before the date of the en2 actment of this Act. 

3 (c) GAO REPORT ON BID BOND IMPACT ON SMALL

4 SUPPLIERS.— 

5 (1) STUDY.—The Comptroller General of the 

6 United States shall conduct a study that evaluates 

7 the effect of the bid surety bond requirement under 

8 the amendment made by subsection (a) on the par9 ticipation of small suppliers in the Medicare 

10 DMEPOS competitive acquisition program under 

11 section 1847 of the Social Security Act (42 U.S.C. 

12 1395w–3). 

13 (2) REPORT.—Not later than 6 months after 

14 the date contracts are first awarded subject to such 

15 bid surety bond requirement, the Comptroller Gen16 eral shall submit to Congress a report on the study 

17 conducted under paragraph (1). Such report shall 

18 include recommendations for changes in such re19 quirement in order to ensure robust participation by 

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1 legitimate small suppliers in the Medicare DMEPOS 

2 competition acquisition program. 

Passed the House of Representatives March 16, 

2015. 

Attest: KAREN L. HAAS, 

Clerk. 

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