Sound the Alarm

The Centers for Medicare and Medicaid Services’ “Operation Wheeler Dealer” hit the trade press and even the mainstream press in early September.

If there is any good news hidden in this massive motorized wheelchair scandal, it is that this represents a needed wake-up call for both the home medical equipment industry and the federal government.

Both parties need to do a better job to ensure that scam artists cannot so easily rip off the Medicare rogram and pollute our industry.

While we can and should fault the regulators who failed to notice the dramatic increase in new supplier numbers coming out of Harris County, Texas, and the unbelievable rise in claims for motorized wheelchairs coming out of the same area in a year, that is not enough.

As an industry and as honest competitive businesses, we have a responsibility to make sure these types of dishonest people cannot even begin to submit a Medicare claim for payment.

The Plan

So what exactly is CMS’ “Operation Wheeler Dealer”? It is a 10-point plan designed to eradicate fraud and abuse from the home and durable medical equipment industry.

The government’s stated purpose is to eliminate the bad actors, while not harming the many good home care providers that routinely provide medically necessary motorized wheelchairs, along with other DME items, to Medicare beneficiaries pursuant to a physician prescription.

As CMS Administrator Tom Scully stated during his announcement of “Operation Wheeler Dealer” on Sept. 9, “While many of these wheelchairs are provided by ethical suppliers and go to beneficiaries in need, we know that a great number of unscrupulous suppliers are promising free wheelchairs to beneficiaries who don’t need them. We are taking immediate action to stop these scams.” And we should applaud each and every initiative that actually will help stop the scams.

The Numbers

According to CMS, total Medicare payments for motorized wheelchairs increased from $289 million in 1999 to $538 million in 2001, with payments of over $845 million in 2002 and a projected $1.2 billion for 2003.

In addition, the number of Medicare beneficiaries with at least one claim for a motorized wheelchair rose from just over 55,000 in 1999 to almost 159,000 in 2002, an increase of 189 percent, while the overall Medicare population rose only 1 percent per year during that same time period.

The Steps

To address the fraud and abuse, CMS announced that it would take the following 10 steps:

1. A CMS task force will personally review each claim for a motorized wheelchair that comes from Harris County, Texas.
2. CMS will educate beneficiaries and physicians, particularly those in Houston and Harris County, Texas, about the Medicare coverage requirements for motorized wheelchairs.
3. CMS will conduct mandatory Medicare coverage and medical review training for all suppliers in Harris County, Texas.
4. Once CMS’ guidelines for the application of “inherent reasonableness” are final (which likely will occur late this year), CMS will analyze motorized wheelchairs for possible payment reductions using the IR authority.
5. CMS will revise, through a national regulation, the coverage policies for motorized wheelchairs and power-operated vehicles. Specifically, CMS will lift the coverage restriction that only certain physician specialties can prescribe POVs. And, CMS will require a beneficiary to see a physician before the physician can prescribe a motorized wheelchair.
6. CMS will revise the durable medical equipment regional carriers’ medical policies for motorized wheelchairs to ensure the DMERCs in all four regions have identical coverage polices.
7. CMS will revise the medical review guidelines to ensure that all four DMERCs have consistent application of medical review during the audit process.
8. The agency will intensely scrutinize all new Medicare supplier number applications. The National Supplier Clearinghouse is unlikely to assign any new supplier numbers until early 2004.
9. CMS will issue new regulations that will provide the government with greater screening ability of new supplier number applicants.
10. CMS, the DMERCs and law enforcement authorities will collaborate to process fraud cases and ensure more aggressive application of sanctions, and civil or criminal prosecutions. CMS will also implement payment suspensions.

The Action

We should applaud any steps that CMS takes that will result in increased scrutiny of Medicare supplier number applications. How did those Harris County scam artists pass the NSC’s site inspection?

We also should applaud any steps that result in greater clarity of the Medicare coverage requirements for motorized wheelchairs and that unbundle the K0011 code into multiple codes that better distinguish the type of motorized wheelchair a beneficiary receives.

Further, the government absolutely needs to track claims submission spikes from a particular area more aggressively, particularly when the supplier-number applications from the same area surge correspondingly.

At the same time, we as an industry and as individual businesses must continue to be vigilant and provide the government with any and all evidence of suspect activity in our own geographic areas.

A specialist in health care legislation, regulations and government relations, Cara C. Bachenheimer is an attorney with the law firm of Epstein, Becker & Green in Washington, D.C. Bachenheimer previously worked at the American Association for Homecare and the Health Industry Distributors Association. Beginning Oct. 20, she will join Invacare as vice president of government relations. You can reach Bachenheimer by phone at 202/861-1825 or by e-mail at [email protected].