House Report Focuses on Medicare, Medicaid Fraud

WASHINGTON—Federal and especially state agencies should strengthen oversight of high-risk health care providers to prevent Medicare and Medicaid fraud, concludes a new majority staff report by the House Committee on Energy and Commerce. The report, “The Real Costs of Fraud,” outlines 13 invetigative findings and 37 recommendations to strengthen program integrity and said it uncovered disparities in the oversight and enforcement of the state Medicaid program and found that states also play a significant role in monitoring Medicare services.

“As a result of insufficient or ineffective program integrity efforts, states are struggling to get fraud under control,” the report’s executive summary reads. “Some states are failing to adequately screen Medicaid providers before they enrll and during revalidation, not utilizing audits to their full extent to monitor ongoing fraud, and failing to leverage investigative authorities at their disposal to stop fraud.”

During the investigation, the committee sent 12 letters, held three Oversight and Investigations hearings and reviewed more than 100,000 pages of documents.

“Every dollar stolen from Medicare and Medicaid is a dollar taken from the seniors, children, pregnant women and Americans with disabilities these programs were created to serve,” said Rep. Brett Guthrie, the committee’s chairman. “That’s why Chairman Joyce and our Committee have made rooting out fraud a top priority. Our findings expose the worst actors, but the accompanying recommendations also lay out commonsense steps to help CMS and the states stop fraud before it happens. We will keep fighting to hold criminals accountable, protect patients, and safeguard taxpayer dollars.”

The Council for Quality Respiratory Care (CQRC), a coalition of six home oxygen therapy provider and manufacturing companies, commended the report, saying it emphasizes the need for innovative tools and technology-based solutions to improve fraud detection and mitigation.

“According to the committee’s recommendations, traditional ‘pay and chase’ approaches used to identify and address Medicare and Medicaid fraud must be replaced with preventive fraud detection methods that identify improper payments, rather than relying on post-loss recovery efforts. Millions of taxpayer dollars are lost each year to improper payments, including 74.2% due to insufficient documentation,” the group said in a statement.

CQRC said the proposed Supplemental Oxygen Access Reform (SOAR) Act (H.R. 2902/S. 1406) would help prevent fraudulent or abusive claims by providing the Centers for Medicare & Medicaid Services (CMS) and its contractors with the information needed to establish medical necessity before a claim is paid. It requires CMS to ue an electronic template that would improve clarity and accuracy in the Medicare review process, reducing improper payments linked to the current order process and contractors’ reliance on physician chart notes, thereby preventing fraud before it occurs, the organization said, urging the committee to pass the bill.

Some of the homecare-related recommendations listed in the report are:

• CMS should implement HHS-OIG’s recommendation to require, or seek statutory authority to require, all Medicare Advantage DME suppliers be enrolled in Medicare.
• Medicare Advantage organizations should strengthen oversight of out-of-network DME suppliers so that it aligns with the rigor used for in-network supplier screening.
• CMS should continue targeted oversight of hospice providers—applying tools such as Provisional Periods of Enhanced Oversight and enrollment moratoria—to protect the integrity of hospice services and patients against fraud.
• States should systematically monitor hospice licensure and require that licensure reviews are successfully completed, ensuring that hospice facilities comply with state standards before enrolling in Medicare.
• States should invest in AI tools to streamline fraud detection in provider enrollment, revalidation, and pre- and post-payment claims processing.
• States should strengthen payment integrity by verifying provider enrollment, exclusion status and claims information prior to payment and by improving
  oversight of high-risk services and providers.