Competitive Bidding Calculator Questions Answered

WASHINGTON, D.C. (September 10, 2019)—The DME CBP Collaboration has sent the following update to users who have registered with the dmecbpeducation.com resource related to the site’s bidding calculators:

The DME CBP Collaboration thanks you for engaging in Competitive Bidding Program education. 

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.

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.

Of course, bidders are responsible for their bids and should consult their own finance teams and counsel for legal advice. It is particularly important to remember that each bidder is responsible for its own bid, and must not collaborate with competitors. 

For official Round 2021 information please visit CBIC’s website. If you have additional questions please don’t hesitate to reach out to [email protected] or call the CBIC’s customer service at (877) 577-5331 between 9 a.m. and 9 p.m. ET.

CMS Provides Clarification on Lead Item Pricing Calculator

The Centers for Medicare & Medicaid Services (CMS) put out an announcement Sept. 6 related to Round 2021 clarifying the fact that the ratios used to calculate the non-lead rates on items that have changed from purchase price to capped rental prices. CMS is also reminding suppliers that they need to calculate the rental rate on their own for the identified 14 items.

In the new round, CMS is using pricing ratios from 2015. 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.

For example, E0140 under the Walkers calculator has the NU modifier, meaning it is the purchase price. If you enter the bid of $100 for the lead item, you get $310.13 for E0140 NU. Suppliers will then need to calculate the first month’s rental rate on their own to get the E0140 RR rate which is $31.01 (=$310.13/10).

• Codes related to announcement:
• 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.

CMS Adds New Bidding FAQs

CMS has added four new questions and answers to their Frequently Asked Questions section of the CBIC website. The four questions cover no-longer-used codes, criteria for indirect costs, criteria for appropriate gross margins, and justifying bids below acquisition costs. These new questions can all be found under the “Bidding FAQs” category here.

Bidding closes September 18, 2019.