How Much Are You Getting Paid For That? Part II

In last month's post, we provided the information needed to access the current durable medical equipment (DME) and / or prosthetics (DMEPOS) fee schedule.  When opening the file for the current fee schedule, the HCPCS codes are listed from top to bottom in column A.  The reimbursement dollar value is listed for each state from left to right in columns H through DI.  Column F lists the ceiling value for each HCPCS code and Column G lists the floor value for each HCPCS code.

Surgical Dressing Values

Some surgical dressing values are determined by competitive bidding, a process that involves suppliers submitting bids to Medicare reflecting what they would charge for DME items. Medicare sets DME prices based on these bids.  When the value of a DME product is not determined based on competitive bidding, these values are determined by each state with the ceiling value serving as the upper limit and floor value serving as the lower limit.

Ceiling / Floor Calculations

The ceiling equals the median of the statewide fee schedule values and the floor equals 85% of the median of the statewide fee schedule values. When this post was written, the competitive bid program had been suspended so the ceiling and floor values served as the range for statewide pricing.

An Example

The HCPCS code for HELIX3-CP® Collagen Powder is A6010.  When looking up A6010 on the DMEPOS Fee Schedule, the first piece of information of interest is the category which is listed as, “SD”.  This stands for "surgical dressing".  In the October, 2019 Fee Schedule, the ceiling value is listed as $35.66 and the floor value is listed as $30.31.  Then each state has a value listed.  These values represent one unit of A6010.  Therefore, when calculating the total expected reimbursement, the number of units dispensed should be multiplied by the value for the state in which the service was provided.

For example, the value listed for Florida is $35.66.  If 25 grams of collagen powder are dispensed in Florida, the value should be calculated as:

25 units x $35.66 = $891.50

Thus, the expected reimbursement for 25 units of HELIX3-CP, dispensed in Florida would be $891.50.

DISCLAIMER: The information provided here is intended to educate health care providers regarding compliance for ICD, CPT, and HCPCS coding. The information provided does not guarantee reimbursement and is accurate to the best of our knowledge at the time of this publication. Coding guidelines can change and we encourage you to stay up to date. The existence of a code does not guarantee payment.

About the Author

Dr. Jeffrey D. Lehrman, DPM, FASPS, MAPWCA, CPC

Dr. Lehrman is in private practice in Fort Collins, CO and operates Lehrman Consulting, LLC. He is a Diplomate of the American Board of Foot and Ankle Surgery, Fellow of the American Society of Podiatric Surgeons, and is recognized as a “Master” by the American Professional Wound Care Association. He is a Fellow of the American Academy of Podiatric Practice Management and an Expert Panelist on Codingline. In his role as a Consultant to the APMA Health Policy and Practice Department, Dr. Lehrman serves as an advisor to the APMA Coding Committee and the APMA MACRA Task Force. Dr. Lehrman sits on the board of directors of both the American Professional Wound Care Association and the American Society of Podiatric Surgeons. He is also on the editorial advisory board of the journal WOUNDS.

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