CERT Report Uncovers CMS Problems; OIG Studies RAC Results

WASHINGTON — New medical record review methodologies, not fraud, helped pump up the DME MAC error rate to 51.9 percent in 2009, CMS said in a recent Comprehensive Error Rate Testing report.

Overall, the national error rate for Medicare-fee-for-service claims ballooned more than 100 percent, from 3.6 percent in FY 2008 to 7.8 percent in FY 2009. That equates to $23 billion in overpayments, CMS said, and $1.1 billion in underpayments, with durable medical equipment being by far the most error-plagued of the claims.

In a rare admission, CMS, in its "Improper Medicare Fee-for-Service Payments Report." said the DME MAC error rate  "is not a measure of fraud."

Indeed, the agency said, "It should be noted that due to changes in the review methodology, the 2009 error rates are not comparable to previous years' error rates since we cannot quantify the impact these changes had on the measurement process."

CMS officials said plainly that "stricter adherence to policies disproportionately affected DME claims."

"More DME claims were determined to be paid in error because of the more strict enforcement of documentation requirements rather than allowing for clinical review judgment. In the past, reviewers applied clinical review judgment to claims to fill in gaps of knowledge where documentation was missing," CMS said in the report. "Once CMS clarified that clinical review judgment may not override documentation requirements, more errors were found on DME items."

Last year, CMS began requiring enhanced documentation for HME claims. Providers have argued the documentation requirements are especially burdensome because they must obtain much of that information from physicians and other referral sources and it is often not forthcoming.

CMS acknowledged the difficulty in its report.

"It is often more difficult for DME contractors to obtain the proper documentation because they (contractors) requested documentation from the supplier who billed for the item, not the medical professional who ordered the item," CMS said. "The supplier is then responsible for submitting documentation to CMS that they have collected from the ordering provider. The involvement of multiple parties can cause a delay in documentation receipt and incomplete documentation."

The report prompted the Midwest Association of Medical Equipment Services and other HME organizations to encourage their members to send letters to their referring physicians, explaining the need for increased documentation.

The letter, drafted by the DME Task Force, reads in part: