Bidding Calculators Updates Released

CBP Education Collaborative provides context on profit/loss feature; CMS notifies bidders that ratios used to calculate non-lead rates on items that have changed payment class .

Updates have been made regarding the bid calculators on the DMECBPEducation.com site, as well as the lead item pricing calculator on the Competitive Bidding Implementation Contractor (CBIC) site.

The DMECBPEducation site notified its registered users regarding an update to the “what if” tool that is part of calculators.

“The purpose of this message is to provide clarification on the “what if” tool to determine Net Profit/Loss in columns J through M. Specifically, the Net Profit/Loss (Column M) formula built into that tool is based on the calculated single payment (Column E) and not the total payout for capped rental, oxygen, frequently serviced, and other items where payment is based on an ongoing monthly rental,” the update read. “When using the tool to examine their own businesses, users must therefore distinguish between monthly rental rates and total payout when estimating acquisition and indirect costs to determine a potential Net Profit/Loss.”

CMS issued a clarification regarding the lead item pricing calculator on the CBIC site and 14 non-lead item HCPCS codes.

“These HCPCS codes were converted from the inexpensive and routinely purchased (IRP) payment class to the capped rental payment class after 2015,” CMS’s statement read. “In accordance with federal regulations, CMS used the 2015 fee schedule to determine the relative ratios for the non-lead items in each product category. As a result, the relative ratios for the 14 affected HCPCS codes were calculated using the average of the purchase amounts (i.e., NU modifier) in all areas from the 2015 fee schedule since these HCPCS codes were still in the IRP payment class in 2015.”

The codes in question are:

  • Standard Manual Wheelchairs: E0955*, E0985*, E1020*, E1028*, E2228, K0015*, and K0070
  • Standard Power Mobility Devices: E0955*, E0985*, E1020*, E1028*, E2368, E2369, E2370, E2375, and K0015*
  • Support Surfaces (Groups 1 and 2): E0197
  • Walkers: E0140 and E0149

*Included in both the standard manual wheelchairs and standard power mobility devices product categories. 

AAHomecare offered further clarification on CMS’s somewhat opaque statement:

“In the new round, CMS is using pricing ratios from 2015,” a statement from AAHomecare read. “In 2015, 14 items (listed below) were paid as purchase items, but today they are considered capped rental items. CMS’s bidding calculators (and the calculators at DMECBPEducation.com) follow the 2015 rates, which means the 14 identified items are calculated as the purchase price in the calculator, but suppliers will not be paid that rate. Instead, suppliers will need to calculate on their own what they will be receiving on the first month’s rent, which means they need to divide the calculated amount by 10.”

About the Author

David Kopf is the Executive Editor of HME Business and DME Pharmacy magazine. Follow him on Twitter at @postacutenews.

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