Be Careful What You Bid … You Might Just Win

BELLEVILLE, Ill. — Have you got your pencils ready, or
maybe your aspirins?

With only a month left before CMS’ Oct. 21 target opening for
the Round 1 rebid, The Roho Group‘s Tom Borcherding, executive vice
president, and Dave McCausland, senior vice president, have put
together an article on bidding smart.

“Isn’t it in your best interests to utilize a bid strategy that
will preserve patient access to the goods and services they need
while maintaining reasonable levels of reimbursement? Does it make
sense to bid lower than is necessary for specific HCPCS codes when
it is almost a certainty that such a strategy would have no bearing
on the outcome of whether or not you receive a bid award?” the duo
questioned.

Before providers rush to bid, they said, it is “critical” to
understand three key dynamics: bid weighting, bid rate calculations
and bid winners. Here’s their explanation:

1) Bid Weighting. Only a handful of HCPCS
codes per product category will determine bidding awards. The
large majority of HCPCS codes within a given product category have
almost no bearing on the bid determination and therefore can be bid
at or near the maximum bid limit without jeopardizing your chances
of winning the bid award.

2) Bid Rate Calculations. The strategy used
by bid award winners has a direct relationship to the final
determination of fee schedules for each HCPCS code within a given
product category. It is important to understand how winning
bids impact the calculation of fee schedules, with far-reaching
consequences that extend much beyond just the scope of pricing and
access within the specific CBA.

3) Bid Winners. You do not need to have one
of the lowest bids to win a bid award. Your goal should be to
bid as high as possible while still qualifying as a bid winner.
This is obviously a critical bidding strategy that you and you
alone can make for your respective bid, but a review of original
Round 1 bid awards and resulting fee schedules would indicate that
many providers discounted much more deeply than was necessary to
win a bid award (and likely bid lower than they could really
afford).

Remember, the Roho execs cautioned: “Be careful what you bid,
you just may get it.”

For the entire article courtesy The Roho Group’s Borcherding and
McCausland, click here.