OIG’s 2007 Work Plan Includes Focus on DME

WASHINGTON–In a 94-page document issued last week, the HHS
Office of Inspector General outlined its work plan for 2007 and
said it will look into a number of aspects of Medicare and Medicaid
programs related to DME.

The OIG said the wok plan projects best identify
“vulnerabilities” in the HHS programs. After its investigations,
the OIG will make recommendations for improvements.

The OIG said it will examine the following areas this year:

–DME payments for beneficiaries receiving home health services:
The OIG will review medical records for DME items and supplies
furnished to beneficiaries receiving HHA services to determine
whether the items and supplies were reasonable and necessary for
the beneficiaries’ conditions.

–Medicare payments for therapeutic footwear: The OIG will
determine whether therapeutic footwear furnished by individual
suppliers was reasonable and necessary for the beneficiaries to
whom it was provided. Medicare payments for therapeutic footwear
totaled more than $130 million in 2003. A previous OIG report
indicated that a significant percentage of payments made for
therapeutic footwear did not have adequate documentation to support
the beneficiaries’ medical need for the footwear.

–Medicare payments for DME Claims with ZX, KX, and KS
modifiers: The OIG will determine whether DME suppliers that filed
claims with ZX, KX, and KS modifiers appropriately billed Medicare.
Under the Medicare program, a DME supplier may use these modifiers
to indicate that it has the appropriate documentation on file; upon
request, the supplier will provide the documentation to support its
claim for payment. Reviews by several CMS DME regional carriers of
suppliers who had used the ZX, KX, and KS modifiers found that
suppliers had little or no documentation to support their claims.
This suggests that many of the claims submitted may have been
invalid and should not have been paid by Medicare.

–Medical necessity of DME: The OIG will determine the
appropriateness of Medicare payments for certain DME items, such as
power wheelchairs, wound care equipment, and supplies or orthotics.
It will assess whether the suppliers’ documentation supports the
claim, whether the item was medically necessary and/or whether the
beneficiary actually received the item.

–Medicare pricing of equipment and supplies: The OIG will
compare Medicare payment rates for certain medical equipment and
supplies with the rates of other federal and state health care
programs, as well as with wholesale and retail prices. Its review
will cover such items as wheelchairs, parenteral nutrition, wound
care equipment and supplies, and oxygen equipment and supplies.

–Billing for DME in hurricane-affected areas: The OIG will
examine payments for DME supplies and equipment in the areas
affected by the recent hurricanes. According to DMERC officials,
suppliers in the hurricane-affected areas were not to bill for
equipment until they could make contact with the beneficiary to be
sure the equipment was still medically necessary and that the
beneficiary had the equipment in use.

To review the OIG’s full work plan, click here.