Higley Offers More Recompete Advice: Do I start Bidding From the Current Round 2 Rates (Single Payment Amounts)?

Posted on in HME Government Issues

By Mark Higley, VGM Regulatory Important Information for All DMEPOS Suppliers Eligible to Bid in the Round 2 Recompete On Dec. 12, the Competitive Bid Implementation Contractor (CBIC) posted on the official DMEPOS competitive bid acquisition program website the Round 2 and National Mail-Order Recompete “Bid Preparation The Bid Preparation Worksheets include information about items in each product category for each Round 2 Recompete and the national mail-order recompete competitive bidding area. The worksheets are designed to help you determine your estimated capacity and bid amount for each item in a product category. You should review these worksheets carefully when developing your bid(s). The purpose of this correspondence is to remind DMEPOS suppliers considering a bid in the Round 2 Recompete to note the following:

The Bid Limit column shows the current Medicare fee schedule amount for the item. Bids must be at or below the fee schedule amount.

As you are likely aware, Medicare Part B pays for DMEPOS items based on the Medicare Physician Fee Schedule. CMS updates the DMEPOS fee schedules on an annual basis in accordance with statute and regulations. For CY 2015, the update factor of 1.5 percent is applied to the applicable CY 2014 DMEPOS fee schedule amounts. In accordance with the statutory Sections 1834(a)(14) and 1886(b)(3)(B)(xi)(II) of the Act, the DMEPOS fee schedule amounts are to be updated for 2015 by the percentage increase in the consumer price index for all urban consumers (or “CPI-U”) for the 12-month period ending with June of 2014, adjusted by the change in the economy-wide productivity equal to the 10-year moving average of changes in annual economy-wide private non-farm business Multi-Factor Productivity (MFP). The MFP adjustment is 0.6 percent and the CPI-U percentage increase is 2.1 percent. Thus, the 2.1 percentage increase in the CPI-U is reduced by the 0.6 percentage increase in the MFP resulting in a net increase of 1.5 percent for the update factor. What this means to you: For DMEPOS suppliers submitting a bid for the Round 2 and National Mail-Order Recompete, bids must be at or below the current fee schedule amount. For example, the current “bid limit” (2015 fee schedule) for one month’s rental of Payment Class A – Stationary Oxygen Equipment & Oxygen Contents (Stationary & Portable) is $180.92 in the Akron, OH competitive bidding area. Round 2 Recompete Bid Limit for Payment Class A Oxygen (e.g., E1390): It is NOT the current “single payment amount” in effect from the previous “Round 2” competition. Again, by way of example, the Akron, OH single payment amount is currently set at $85.76. The Akron, OH CBA has been included for example purposes. The “bid limit” for all CBAs reverts to the 2015 fee schedule, and not the current single payment amount in effect in a specific area. Why I am forwarding this information: In Round 2, some DMEPOS suppliers believed their bid must be at or below the current “single payment amount” of the previous round (the Round 1 rebid). This is, as noted above, incorrect. DMEPOS suppliers must bid at or below the 2015 fee schedule (“the bid limit”). The CBIC Bid Worksheets may be accessed here. To access my previous FAQ post, click here. “Why does it appear that the Round 2 single payment amounts for power wheelchairs are higher than the “bid limit” of Round 2 Recompete. For more of this type of assistance and more, make sure to sign up for the Round 2 Recompete Bid Worksheet Demonstration on Feb. 26. at 1 p.m. CST.