Congress Cracks Down on Fraud

The durable medical equipment sector has zero tolerance for illegal activity. This is why the American Association for Homecare (AAHomecare) proposed an aggressive, comprehensive 13-point anti-fraud plan to Congress.

Much of that plan has been adopted by Medicare or incorporated into legislation, so it’s no coincidence that, as the Department of Health and Human Services Office of Inspector General testified before Congress, criminals have shifted away from the DME sector.

Some elements of AAHomecare’s plan that have been adopted include:

New provider requirements

• Mandated Site Inspections: Section 6401 of the Patient Protection and Affordable Care Act (ACA), CMS requires that the National Supplier Clearinghouse conduct a site visit for all newly enrolling HME providers.
• Improved Validation: Section 6401 also sets up three risk categories for providers. Newly enrolling HME providers are in the “high risk” category, which requires that they undergo additional screening, including fingerprinting and background checks.
• Required Six-Month Trial Period: H.R. 4872, the reconciliation bill passed along with the ACA, contains a requirement in Section 1305 for a 90-day period of enhanced oversight for initial claims of HME providers. It requires a 90-day period to withhold payment and conduct enhanced oversight in cases where the HHS secretary identifies a significant risk of fraud.
• Required Post-Payment Audit Reviews: The DME Medicare Administrative Contractors now conduct post-payment audit reviews.

Prevention and enforcement

• Proper Federal Funding: Anti-fraud efforts by Medicare and the Department of Justice have dramatically expanded and accelerated. Congress has granted increased funding for CMS program integrity activities many times throughout the past three years.
• Anti-Fraud Office: In 2010, CMS created a new Center for Program Integrity, which serves as the focal point for fraud and abuse activities for national and state-level Medicare, Medicaid and CHIP.
• Real-Time Claims Analysis: The Small Business Jobs Act of 2010, H.R. 5297, required CMS to implement a predictive modeling system similar to those used by credit card companies to track unusual billing patterns for Medicare claims. The system went live on June 30, 2011, for all Medicare Part A and Part B claims.
• Increased Penalties and Fines: Sections 6402 and 6408 of the ACA include additional penalties for fraud.

Although DME represents just 1.4 percent of total Medicare spending and is growing less than 1 percent annually, according to CMS’ own data, AAHomecare continues to urge Congress and CMS to take effective steps to root out waste, fraud and abuse in Medicare and preserve patient access to cost-effective care, equipment and services.

To that end, AAHomecare has endorsed H.R. 3399, the Medicare and Medicaid Fighting Fraud and Abuse to Save Taxpayers’ Dollars Act (FAST Act), which would establish a workable prior-authorization program for power wheelchairs.

The association has also developed a Code of Business Ethics. Members and nonmembers are encouraged to formally adopt the code to demonstrate their commitment to the highest standards of honest and transparent business practices. With the code, companies affirm that they will comply with applicable federal, state and local laws and regulations, and they pledge to encourage conduct that builds trust between DME providers, patients, referral sources and payers in both the private and public sector.

To find a complete copy of the Code of Business Ethics, related documentation and information about how to sign on, visit www.aahomecare.org/codeofethics.