Expect Audits After the Emergency Ends

The Centers for Medicare & Medicaid Services (CMS) has issued temporary regulatory waivers and new rules during the COVID-19 public health emergency to allow certain health care providers flexibility in providing care during the pandemic. Some of these initiatives directly impact the home medical equipment/durable medical equipment (HME/DME) industry. Providers of HME and DME, however, should be prepared for post-COVID-19 audits. Here are some areas of concern to be aware of.

1. Stark Law Waivers

The federal physician self-referral law (i.e., the Stark Law) prohibits a doctor from making referrals for certain health care services payable by Medicare if they or an immediate family member has a financial relationship with the entity performing the service. There are statutory and regulatory exceptions, but in general, a physician cannot refer a patient to any entity with which they have financial relationship.

On March 30, 2020, CMS issued blanket waivers of certain provisions of the Stark Law. These waivers apply to financial relationships and referrals related to the pandemic. The remuneration and referrals described in the blanket waivers must be solely related to “COVID-19 purposes,” as defined in the waiver document; under the waivers, CMS will permit certain referrals and the submission of related claims that would otherwise violate the Stark Law.

For example, some of the restrictions regarding when a physician group practice can furnish medically necessary designated health services (DHS) in a patient’s home have been loosened. According to CMS, any physician in the group may order medically necessary DHS that are then furnished by one of the group’s technicians or nurses in the patient’s home contemporaneously with a physician service that is furnished via telehealth by the physician who ordered the DHS.

Areas of Audit Concern

Anticipated areas of audit concern regarding the Stark Law Waivers include:

• Whether remuneration and referrals are solely related to “COVID-19 purposes;”
• Whether a physician group meets the definition of “group practice;”
• Whether the DHS are medically necessary;
• Whether the health services provided are considered DHS; and
• What is considered the patient’s home.

2. Unusable DMEPOS

In cases where durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) are lost, destroyed, irreparably damaged or otherwise rendered unusable, DME Medicare Administrative Contractors have the flexibility to waive replacement requirements under Medicare such that the face-to-face requirement, a new physician’s order and new medical necessity documentation are not required.

Areas of Audit Concern

Suppliers must include a narrative description on the claim explaining the reason the equipment must be replaced and must maintain documentation indicating that the DMEPOS was lost, destroyed, irreparably damaged or otherwise rendered unusable or unavailable as a result of the COVID-19 emergency.

3. Prior Authorization

CMS is pausing the national Medicare prior authorization program for certain DMEPOS items.

Areas of Audit Concern

When it comes to prior authorization, make sure that the supplied DMEPOS items were part of the DMEPOS Medicare Prior Authorization program for which prior authorization was paused by CMS before forgoing prior authorization.

4. DMEPOS Accreditation

CMS is not requiring accreditation for newly enrolled DMEPOS suppliers and is extending any expiring supplier accreditation for a 90-day time period.

Areas of Audit Concern

Suppliers should make certain the expiring supplier accreditation falls within the 90-day extension time period.

5. Signature Requirements

CMS is waiving signature and proof of delivery requirements for Part B drugs and durable medical equipment when a signature cannot be obtained because of the inability to collect signatures.

Area of Audit Concern

Suppliers should document in the medical record the appropriate date of delivery and that a signature was not able to be obtained because of COVID-19.

6. Signature on Orders

DMEPOS items, except for power mobility devices, can be provided via a verbal order.

Areas of Audit Concern

Areas of audit concern regarding signature on orders include:

• A signature is required prior to submitting claims for payment but the order can be signed electronically.
• Power mobility devices require a signed, written order prior to delivery. A signature is required prior to submitting claims for payment but the order can be signed electronically.

7. DMEPOS Payment Increases

As required by section 3712(a) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, CMS will adjust the fee schedule amounts for items and services furnished in rural and non-contiguous non-competitive bidding areas within the United States based on a 50/50 blend of adjusted and unadjusted rates for the remainder of 2020 and through the remainder of the public health emergency, which could mean that this fee schedule adjustment methodology continues into 2021 if the public health emergency is still in effect after Dec. 31, 2020.

Also, as required by section 3712(b) of the CARES Act, CMS will provide higher payments for certain DMEPOS items and services furnished in non-rural, non-competitive bidding areas within the contiguous U.S. with dates of service on or after March 6, 2020. That change will
extend through the remainder of the public health emergency.

Areas of Audit Concern

Auditors will be checking the following regarding DMEPOS payment increases:

• Whether the items and services were furnished in rural and non-contiguous non-competitive bidding areas within the U.S. (for section 3712(a) relief);
• Whether the items and services were furnished in non-rural, non-competitive bidding areas within the contiguous U.S. with dates of service on or after March 6, 2020 and through the remainder of the public health emergency.

HME suppliers have received several benefits due to the public health emergency, but anticipating what comes next will help limit the pain and expense of audits.