Home Medical Equipment Sector Continues to Promote Tough Anti-Fraud Measures
PHILADELPHIA, June 17, 2011 /PRNewswire-USNewswire/ -- America's providers of durable or home medical equipment and services have long advocated for tough anti-fraud measures, and this sector hopes that federal regulators and Congress will continue to focus their efforts on effective, targeted measures aimed at stopping criminals intent on stealing taxpayer dollars.
The American Association for Homecare, which represents providers of home medical equipment and services, is attending today's Philadelphia Health Care Fraud Prevention Summit which is sponsored by the U.S. Department of Health and Human Services (HHS) and the U.S. Department of Justice.
In a statement today, the Association made the following points:
"The American Association for Homecare and its members have always had zero tolerance for fraud and will continue to work with federal officials to prevent fraud. In 2009, the American Association for Homecare proposed to Congress an aggressive 13-point Medicare Anti-Fraud Legislative Action Plan that includes tougher penalties for fraud, more site visits, and real-time claims audits to prevent fraud at the front-end of the process rather than relying on the ineffective pay-and-chase system. (See the full list of recommendations below.)
The majority of the Association's recommendations have been adopted by Congress and the Centers for Medicare and Medicaid Services (CMS). However, we encourage Congress to adopt all of our proposals to ensure a comprehensive approach that directly shuts down avenues for Medicare fraud.
A number of important new anti-fraud measures are now in place, which were long overdue. But Congress, CMS, and the HHS Office of Inspector General (OIG) should not impose unreasonable burdens on the existing, accredited home medical equipment providers.
"Crooks, cheats, and con artists have no place in Medicare or healthcare in general," said John Shirvinsky, executive director of the Pennsylvania Association of Medical Suppliers. "Unfortunately the CMS enforcement model has spent more time on punishing legitimate home medical equipment providers than eliminating the opportunity for bad actors to get into the Medicare system."
It's important to point out that providers of home medical equipment must now be accredited by a deemed accrediting organization and they must also post a surety bond. These two requirements took effect in October 2009, and fraud associated with the home medical equipment sector has likely declined since then. We encourage federal officials to assess and report the rate of fraud since these requirements took effect.
Spending in the home medical equipment sector represents less than 1.5 percent of total Medicare spending, and the HME proportion as well as the dollar amount in Medicare are falling. By any measure, any fraud or waste associated with home medical equipment sector can only represent a tiny fraction of total fraud, waste, or abuse in Medicare.
The American Association for Homecare understands that lawmakers and regulators face the difficult challenge of reining in growing health care costs – and federal spending overall – which is why it is critical to note that home-based care is the most cost-effective setting for post-acute care.
Congress must consider the aging U.S. population, the rising incidence of diabetes, COPD, and other chronic conditions, the high cost of treatment in hospitals and nursing facilities, and Americans' clear preference for remaining safe and independent at home as they age. All of these factors argue for a stronger approach to providing homecare, not an erosion of the system.
Getting the Facts Straight
Discussions about Medicare fraud in the home medical equipment sector are often colored by distortions, half-truths, and incomplete information. It's important to remember several key points:
CMS and Its Private Contractors Have Failed in their Oversight of Supplier Enrollment
CMS and its contractors have failed in their oversight responsibility. It is CMS' responsibility to determine whether a homecare provider should be granted Medicare billing privileges. CMS is required to conduct a site visit for any new provider and upon renewal of the supplier number every three years. If CMS were doing its job effectively, criminal enterprises that bilk millions of Medicare dollars would never receive supplier numbers. Congress has also addressed this vulnerability by requiring mandatory accreditation and quality standards for all home medical equipment providers. This should serve as a double check on CMS and raise the bar of entry to protect the Medicare program.
Improper Payments Should Not Be Confused with Fraud
There have been a number of audit samples of specific HME items such as oxygen therapy, power wheelchairs and continuous positive airway pressure (CPAP) devices that indicate a high improper payment rate. As the OIG correctly points out, the increase in the Medicare error rate in the home medical equipment sector is "not necessarily due to more fraud in the program. In fact, the error rate is not a measure of fraud." Homecare providers and the Medicare beneficiaries they serve require clear, reasonable, consistent, and unambiguous guidance that does not change from auditor to auditor.
Competitive Bidding Is a Price-Setting Mechanism, Not an Anti-Fraud Device
The Medicare bidding system is a payment mechanism—not an anti-fraud tool. When the bidding program was mandated by law, Congress adopted a number of separate mechanisms to address fraud and abuse through the establishment of quality standards and mandatory accreditation. CMS also has taken additional steps recently to prevent fraud. Starting in October of 2009, all home medical equipment providers in Medicare were required to be accredited by a deemed accrediting agency and they must also purchase a surety bond.
Internet Pricing Is the Wrong Benchmark for Reimbursement Rates
Several studies conducted by federal agencies such as the Government Accountability Office (GAO) and the HHS Office of Inspector General (OIG) highlighted the disparity between Internet prices and Medicare payments for home medical equipment. This is not an accurate comparison. First, these studies clearly cite that their analyses did NOT look at service-related costs in the provision of home medical equipment. The studies also ignore overhead, staffing costs, mandatory accreditation, 24-7 emergency care, adherence to quality standards, and FDA's home use requirements. There has been only one comprehensive study that has evaluated both service and equipment costs. This study found that in the oxygen arena, equipment costs account for just 28 percent of the total cost of providing oxygen therapy to Medicare patients at home. The remaining 72 percent of the costs relate to services and general and administrative costs.
Payment Rates Do Not Promote Fraud
Criminals out to defraud the Medicare program are intent on stealing. They do not provide equipment and services and they do not follow Medicare regulations. But the OIG claims that because home medical equipment reimbursement rates in Medicare are often higher than prices on the Internet, this difference inherently leads to greater fraud and abuse. OIG cites no facts, research, or any evidence to support that claim. Criminals intent on defrauding Medicare are not real equipment providers, and they have no intention of providing the items and services to beneficiaries – regardless of the payment rate.
There Is Not an Excessive Number of HME Providers
Federal officials frequently point to the need to reduce the number of suppliers that participate with the Medicare program. What is overlooked is that there are only approximately 15,000 home medical equipment providers nationwide—or about one for every 2,500 Medicare beneficiaries. The vast majority of entities that have supplier numbers are large pharmacy chains, physical therapists, physicians, ophthalmologists, prosthetists, neurosurgeons, dentists, and other providers.
Home Medical Equipment Rates Have But Cut Deeply and Repeatedly
In urging competitive bidding, some at CMS and in Congress have argued that the durable medical equipment fee schedule is a relic that hasn't been changed since the mid 1980s. This is not true. Starting with health care reform last year and going back over the past 12 years, there is a long list of deep reimbursement cuts and rate freezes that have been imposed on home medical equipment.
Home Medical Equipment Receives Disproportionate Attention
The media has widely reported examples of home medical equipment fraud committed by suppliers who billed for services they never actually provided. The Association supports the government's efforts to stop providers from engaging in these flagrant violations of law. The Association will continue to work with Congress and regulators to stamp out fraud in the homecare sector. But if the size of overall Medicare fraud truly is in the neighborhood of $60 billion annually, federal officials must highlight and pursue the far greater fraud losses in other areas of Medicare since spending in the home medical equipment sector represents less than 1.5 percent of total Medicare spending.
The vast majority of homecare providers make every effort to comply with very complex Medicare rules and regulations. And unlike other providers, we are dependent not only on compliance with detailed supplier requirements but also on the accurate documentation of physicians. Yet, simply highlighting the homecare sector as an example overlooks the high quality of care that home medical equipment providers and disparages the reputation of those who furnish the most cost effective care in our health care system
American Association for Homecare's 13-Point Anti-fraud Legislative Action Plan
The anti-fraud plan proposed by the American Association for Homecare in 2009 includes the following specific recommendations:
Mandate Site Inspections for All New Home Medical Equipment Providers
A July 2008 GAO report underscored the need for CMS to ensure that its contractors are conducting effective site inspections for all new applicants for a Medicare supplier number.
Require Site Inspections for All HME Provider Renewals
All renewal applications should require an in-person visit by the National Supplier Clearinghouse (NSC), the contractor that CMS uses to ensure integrity in the Medicare program.
Improve Validation of New Homecare Providers
Additional validation of new providers should be included in a comprehensive and effective application process for obtaining a Medicare supplier number.
Require Two Additional Random, Unannounced Site Visits for All New Providers
Two unannounced site visits should be conducted by NSC during the first year of operation for new HME providers.
Require a Six-Month Trial Period for New Providers
The NSC should issue a provisional, non-permanent supplier number to new suppliers for a six-month trial period. After six months of demonstrated compliance, the provider would receive a "regular" supplier number.
Establish an Anti-Fraud Office at Medicare
CMS should establish an office with the sole mandate of coordinating detection and deterrence of fraud and improper payments across the Medicare and Medicaid programs.
Ensure Proper Federal Funding for Fraud Prevention
Increase federal funding to ensure that NSC completes site inspection and other anti-fraud measures.
Require Post-Payment Audit Reviews for All New Providers
Medicare's program safeguards contractors should conduct post-payment sample reviews for six months worth of claims submitted to Medicare by new providers.
Conduct Real-Time Claims Analysis and a Refocus on Audit Resources
Medicare must analyze billings of new and existing providers in real time to identify aberrant billing patterns more quickly.
Ensure All Providers Are Qualified to Offer the Services They Bill
A cross-check system within Medicare databases should ensure that homecare providers are qualified and accredited for the specific equipment and services for which they are billing.
Establish Due Process Procedures for Suppliers
CMS should develop written due process procedures for the Medicare supplier number process, including issuance, denial and revocation of the Medicare supplier number. The procedures must include, for example, an administrative appeals process and timelines.
Increase Penalties and Fines for Fraud
Congress should establish more severe penalties for instances of buying or stealing beneficiaries' Medicare numbers or physicians' provider numbers that may be used to defraud the government.
Establish More Rigorous Quality Standards
Ensure that all accrediting bodies are applying the same set of rigorous standards and degree of inspection to their clients.
More about the Association's anti-fraud action efforts can be viewed at www.aahomecare.org/stopfraud.
The American Association for Homecare represents durable medical equipment providers, manufacturers, and others in the homecare community who serve the medical needs of millions of Americans who require oxygen equipment and therapy, wheelchairs and assistive technologies, medical supplies, inhalation drug therapy, and other medical equipment and services in their homes. Members operate more than 3,000 homecare locations in all 50 states. Visit www.aahomecare.org/athome.
The Pennsylvania Association of Medical Suppliers (PAMS) is the oldest state association of its kind in the country, dedicated to providers of home medical equipment (HME) and suppliers and the patients they service since 1972. PAMS is a unified voice for providers of durable medical equipment and supplies; respiratory equipment, supplies, and therapy; rehab technology and services; as well as, infusion therapy. Through a myriad of services, benefits, and resources, PAMS' members stay in touch with the most up-to-date changes and problems affecting the HME community, network with their peers and experts within the industry, and help affect change and solve problems on both a state and national level. http://www.pamsonline.org/
SOURCE American Association for Homecare
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