As Goes Florida

Every year, the Office of Inspector General releases its Work Plan for the upcoming fiscal year, identifying areas of concern it intends to investigate for possible enforcement activity or regulatory reform.

The OIG mentions several times in the 2008 Work Plan its recent investigation of South Florida DME suppliers to ferret out sham businesses that failed to comply with the supplier standards and, for the most part, did not really exist except for fraudulent purposes.

The OIG touted its investigation as a huge success, noting: “In a recent review of DME suppliers in three South Florida counties, we found that 31 percent of suppliers did not meet selected Medicare supplier standards requiring suppliers to maintain a physical facility and to be open and staffed during reasonable business hours.”

The OIG’s comments reveal important indicators of upcoming activity. For example, the OIG intends to continue its focus on South Florida suppliers to “determine whether DME claims paid under Medicare to suppliers in South Florida were allowable.” The Work Plan does not state that the OIG will review claims submitted only by that 31 percent of suppliers who were found to violate the supplier standards. Rather, it indicates that South Florida suppliers in general will have their claims scrutinized.

As a practical matter, this means that “perfection” in claims submission may well be the de facto standard for South Florida home care companies for a while. I expect this will also include a review of supporting medical documentation, such as items for power mobility devices. Smart Florida suppliers should take care to ensure that their claims are as pristine and free from omissions and errors as is possible.

If the DME MACs’ behavior during the 2007 investigation is predictive of the claims review project in 2008, suppliers who wish to challenge alleged overpayments or deficient claims, etc., may find little willingness by CMS or the MAC to compromise, or even to be reasonable in negotiation. Rather, suppliers may find that an appeals process is their only outlet for fair treatment.

Further, if 2007 activities are predictive of 2008, the hearing officers may very well be under very narrow parameters in their discretion at the hearing. They may be pressured to find against the supplier in the event of any uncorrected imperfections. Again, hyper-vigilance is key.

This de facto requirement of near perfection is important for all suppliers, not just those in South Florida. The 2008 Work Plan states the OIG “will apply lessons learned through our work related to fraudulent DME suppliers in South Florida to other areas of the nation.” This means that the OIG, as well as CMS and its contractors, may focus attention on other areas of the country. Surprise visits will be made. Compliance with supplier standards will be evaluated.

Even though the Florida investigation focused on suppliers’ physical presence, compliance with signage, posted hours, etc., scrutiny will likely focus on all of the supplier standards and not merely those having to do with physical attributes of the storefront.

Any imperfections will likely lead to challenge, and, frequently, efforts to revoke the supplier number. Hearings will be delayed so that most of the time, adversely affected suppliers will have their numbers revoked long before their hearing appeal is concluded. Further, these suppliers will likely have their claims reviewed, both for medical necessity issues and more generally.

What locations may be subject to this broadened scrutiny? I do not know for certain. Do I think that these broadened investigations are fair to good suppliers who make mistakes? No, I do not. Do I believe that the government cares about my opinion? No, I do not.

It therefore behooves all suppliers to be particularly careful over the next year with regard to supplier standard compliance, especially those standards involving their physical facilities. They should also pay extra close attention to the accuracy of claims submissions.

Neil Caesar is president of the Health Law Center (Neil B. Caesar Law Associates, PA), a national health law practice in Greenville, S.C. He also is a principal with Caesar Cohen Ltd., which offers compliance training, outsourcing and consulting and the author of the Home Care Compliance Answer Book. He can be reached by e-mail at [email protected] or by telephone at 864/676-9075.