An editorial in this journal previously reported sales of blood glucose meters and test strips composed at least two-thirds of the diabetes technology market, and consequently expressed concern over the potential impact of the Medicare Competitive Bid program.1 Considering the relatively high use of strips by US Medicare beneficiaries, and given multiple Medicare reimbursement changes were implemented in 2013, presented here are 5 years of Medicare test strip utilization. No hypothesis is provided; however, this information may assist with future forecasting.
Background
In 2009, Fee-for-Service Medicare beneficiaries received in excess of 2 billion blood glucose test strips (Table 1). In the same year, the Advanced Medical Technology Association (AdvaMed) reported approximately 6.2 billon diabetes patient self-tests were performed,2 suggesting that Medicare beneficiaries accounted for roughly a 30% share of the test strip market volume. In addition, 62% of test strips were provided to beneficiaries via mail from durable medical equipment (DME) distributors, while 38% of strips were obtained from retail locations.3
Table 1.
Medicare Allowed Blood Glucose Test Strip Claims 2008-2012.
| Year | Allowed number of test strip units (1 unit = 50 strips)6 | Volume % change versus prior year | Number of beneficiaries for allowed claims6 | Allowed charges (amount paid to distributor including 20% patient copay) ($)6 |
|---|---|---|---|---|
| 2012 | 37 408 435 | 7 | 3 950 279 | 1 304 067 096 |
| 2011 | 34 958 964 | −14 | 4 016 296 | 1 191 672 169 |
| 2010 | 40 827 576 | 1 | 3 995 347 | 1 394 657 438 |
| 2009 | 40 401 652 | 3 | 3 930 644 | 1 383 283 479 |
| 2008 | 39 214 036 | 25 | Not available | 1 408 091 978 |
In the 2008 to 2013 timeframe, the Centers for Medicare and Medicaid Services (CMS) intensified efforts to minimize waste, curb fraudulent claims, and reduce reimbursement rates:
Federal government initiatives to stem illegal claims and document compliance deficiencies by test strip suppliers included increased audits and significant penalties.
In 2009, Medicare implemented a 9.5% reduction in the reimbursement amount paid to mail DME providers for test strip claims.
2011 marked the start of a 2-year Medicare mail-order Diabetes Supply Competitive Bidding program. CMS implemented Round 1 of the program in 9 competitive bid areas (CBAs) encompassing approximately 9% of the population.4 In these CBAs, CMS contracted with selected mail-order DME distributors at reduced reimbursement rates. Beneficiaries with traditional Medicare who obtained mail-order supplies in these 9 CBAs were required to use a contracted supplier.
In early 2012, to support future expansion of the Competitive Bidding program, CMS solicited bids as part of a National Mail-Order Competition for Diabetic Supplies.
Effective July 1, 2013, diabetes test strip reimbursement was reduced by an average of 70% to $10.41 per 50 strips for mail-order and retail distributors of strips to Medicare Fee-for-Service beneficiaries. Simultaneously, 18 DME distributors became exclusive national bid contractors for diabetes test supplies provided via mail.5
Historic Utilization
After anomalous double-digit growth in 2008, lower volume growth followed despite a relatively constant number of beneficiaries (Table 1).
Footnotes
Abbreviations: AdvaMed, Advanced Medical Technology Association; CBA, competitive bid area; CMS, Centers for Medicare and Medicaid Services; DME, durable medical equipment.
Declaration of Conflicting Interests: The author(s) declared the following potential conflicts of interest with respect to the research, authorship, and/or publication of this article: Jennifer Hahamian is a diabetes industry consultant and has advised various diabetes device companies in the areas of marketing and business development.
Funding: The author(s) received no financial support for the research, authorship, and/or publication of this article.
References
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