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Medicare Payments Compared to the Prices Available to Consumers and Suppliers for Continuous Glucose Monitors and Sensors

Announced on  | Last Modified on  | Project Number: OEI-04-23-00430
Status
Completed
Agency
Centers for Medicare and Medicaid Services

OBJECTIVE

We will compare Medicare payments to suppliers' acquisition costs and prices otherwise available to consumers for selected continuous glucose monitors (CGMs) and their sensors to determine if there are potential cost savings for Medicare and enrollees. In 2022, Medicare Part B allowed more than $1.1 billion in payments for CGMs and sensors. If we find that Medicare payments for CGMs greatly exceed their acquisition costs, then CMS has authority to adjust payment rates for CGMs and sensors through two methods: CMS can adjust the fee schedule prices using its inherent reasonableness authority, or it can introduce an item into the Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Competitive Bidding Program.

TIMELINE

  • November 15, 2023
    Announced
  • November 20, 2025
    Complete

    Medicare Payments Compared to the Prices Available to Consumers and Suppliers for Continuous Glucose Monitors and Sensors has been marked as complete. This evaluation resulted in 2 recommendations.

REPORT PUBLISHED

Medicare Payments for Continuous Glucose Monitors and Supplies Exceeded Supplier Costs and Retail Market Prices, Indicating Medicare Can Save At Least Tens of Millions of Dollars in One Year (OEI-04-23-00430)

Comparing Medicare payments to CGM suppliers’ acquisitions costs; their total estimated costs; and, for supplies, retail prices, indicates that there are potential cost savings for Medicare and enrollees.

From July 2022 to June 2023, Medicare payments for CGMs and supplies exceeded suppliers’ acquisition costs and suppliers’ estimated total costs. Medicare payments for CGMs and supplies exceeded suppliers’ acquisition costs by $377 million (or 69 percent) in a year, and their total estimated costs by $70 million (or 8 percent) in one year.

CGM supplies—the most common CGM-related Medicare billing—represent the largest potential number of dollars saved. Medicare payments exceeded suppliers’ acquisition costs by $359 million and their total estimated costs by $61 million. Medicare payments for CGM supplies also exceeded retail market prices by $290 million in one year.

Suppliers received $7 million in potential overpayments based on improper coding of CGMs and supplies. Suppliers billed Medicare for CGMs and supplies that have higher payment rates but provided CGMs and supplies that should have had lower payment rates.

26-E-04-005.01 to CMS - Open Unimplemented
Update expected on 05/19/2026
CMS should pursue reductions to Medicare's payment rates for CGMs and supplies.

26-E-04-005.02 to CMS - Open Unimplemented
Update expected on 05/19/2026
CMS should take action to prevent overpayments caused by suppliers' improper use of billing codes for CGMs and supplies to achieve potentially millions of dollars of cost savings for Medicare and enrollees.

View in Recommendation Tracker
Work Plan Type
Office of Evaluation and Inspections
HHS Agencies
Centers for Medicare and Medicaid Services
Issue Areas
Medical Supplies and Equipment
Target Groups
-
Financial Groups
Medicare B