Rate Calculation

There are many factors which go into calculating rates for claims, and it is not as straight forward as it seems it should be. To get to the point we're able to calculate a rate, we need to have a bunch of data fall in place correctly. If the data doesn't line up properly, you will get a pend reason explaining what is wrong.

There are a few different types of rate calculations we support in GoSimple:

1. Fixed Rate - Numeric
2. Fixed Rate - Percent
3. Fixed Price - Numeric

One of the three (Fixed Rate - Numeric) requires no extra work to get a usable rate, as it's input by the user in a usable format. The other two (Fixed Rate - Percent, Fixed Price - Numeric) require extra work to create a usable rate. These two need an accurate price to correctly calculate a rate.

In the TELUS TPM, we currently support multiple systems of pricing. These pricing systems can be used in different combinations, and configured to act like a stack when looking for pricing. The order which each system is looked in, and what is enabled is configurable per-client. What that means, when looking for a price, we will look in system “1” first, and if a price is found use that, if not, we will look into system “2”, and continue until a price is found (or we run out of systems to look in).

To find the correct price, we have a few data points we will check for in each system.

• Company - Either the claimant or the line distributor.
• Product - The product on the claim line we're calculating a rate for.
• Date - The resolve date on the claim line we're calculating a rate for.
• Cost Basis Type - The Cost Basis Type of the contract this claim is linked to.

The Product, Date, and Cost Basis Type are all simple and easy to understand what will be used. The company has some rules as to when the line distributor or the claimant will be used.

We will use the line distributor only if these conditions are met:

• The claimant is not company type LOCATION.
• The claimant is not a redistributor.
• There is a line distributor.

In all other cases, we will use the claimant.

With that data, we can look into the stack and get the price which correlates to those data points, pulling the first one that matches. We will take into account any price modifiers at this point, and apply them to the price returned which will potentially make it different than what we store as the price.

Once we have a accurate price, we are able to calculate a usable rate.

• (Fixed Rate - Numeric) = rate
• (price * Fixed Rate - Percent) = rate
• (price - Fixed Price - Numeric) = rate

When the claimant type is a LOCATION we have to look to your Price Tiers (from your Client Settings) to determine which price we should use to calculate a rate because customers with a company type of LOCATION would not be purchasing direct from the MFG.

Two methods of pricing provide options for us to calculate a rate for a Location. Default Price and Price List.

Default Price is part of the product file. The value provides us with one price for the product applied to both cost basis types (FOB and Delivered). There is no date range for this value.

Price List is a separate data feed. The value provides us with one price per product, per cost basis type (FOB or Delivered) and there is a time frame associated to the price. Using List Price allows the MFG to not only change the price over time, but to track when the prices changed.

Typically MFGs will provide either Default or Price List. Whichever appears first in the Price Tiers is the price we would use to calculate any direct rates back to the Location (Operator) where the contract is set up as a Fixed Price or a Fixed Rate Percentage.