The “Small Provider” Strategy: Forming a Network to Survive the Bid

Answer Summary:

Small DME providers (under $3.5M revenue) often lack the capacity to bid on large, multi-state “Remote Item Delivery” (RID) contracts. The solution in 2026 is to form a Network (formerly called a Consortium). By aggregating market share with other small providers, the Network can bid as a single entity with combined capacity. However, strict “Primary Supplier” liability rules mean you must choose your partners carefully and sign the Legal Network Agreement before registering in Connexion.

Introduction:

“I’m too small to bid.”

If you are thinking this, you are effectively planning to exit the Medicare market.

But there is a survival mechanism built into the regulations: The Network.

CMS allows small suppliers to band together to form a legal bidding entity.

• The Math: Supplier A (20% share) + Supplier B (20% share) + Supplier C (20% share) = A Network with 60% capacity.
  Suddenly, three small companies become one “Virtual Giant” capable of winning a regional contract.

The “Primary Supplier” Rule

A Network isn’t a handshake club. It is a rigorous legal structure with a hierarchy.

• The Role: You must designate a Primary Supplier.
• The Power: The Primary Supplier registers the network in Connexion, submits the bid price, and receives the contract.
• The Liability: The Primary Supplier is legally responsible for the actions of all members. If “Supplier C” commits fraud or fails to deliver a wheelchair, the “Primary Supplier” gets the audit.
• The Strategy: Only partner with companies whose compliance you trust with your life. Do not join a network via a Facebook group or a cold call.

The “Small Supplier” Definition

Who can join?

• The Cap: To join a network, you must meet the definition of a “Small Supplier” (typically <$3.5M in gross revenue).
• The Trap: If one member of your network is a large national chain, the entire network is disqualified. You cannot mix “David” and “Goliath.”

The Execution Steps

1. Draft the Agreement: You must have a signed Legal Network Agreement detailing revenue sharing, liability, and dispute resolution.
2. Register: The Primary Supplier logs into Connexion and selects “Form a Network.”
3. Invite: The Primary inputs the PTANs of the member companies.
4. Accept: Each member AO must log in and “Accept” the invitation electronically.

WWS Value Proposition:

We Structure the Network

Forming a network is complex. Wonder Worth Solutions acts as the “Network Architect.” We provide the templates for the Network Agreement, help you vet potential partners for compliance risks, and manage the complex registration of multiple PTANs under one bid ID.