HHS OIG issues FY 2013 Work Plan

WASHINGTON, D.C., Oct. 3, 2012—As reported by The American Health Lawyers Association—and edited by Neil Caesar of The Health Law Center to target DMEPOS suppliers—the following provides a brief summary of the Office of the Inspector General’s (OIG) new regulation, accreditation and payment-related activities for FY 2013.

Medicare Reviews

For FY 2013, OIG has added several new reviews of Medicare payments and services. Activities include:

• Examining the requirements and processes employed by accreditation organizations in reviewing and granting accreditation to durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) suppliers. DMEPOS suppliers must meet each of Medicare’s quality standards to become accredited and must comply with Medicare’s quality standards to maintain billing privileges.
• Analyzing possible wasteful spending for vacuum erection systems by comparing the current Medicare fee schedule amount with amounts charged by non-Medicare payors, such as private insurance and the U.S. Department of Veterans Affairs (VA).
• Identifying potential savings for supplies used with continuous positive airway pressure (CPAP) machines. For this review, OIG will compare Medicare’s existing supply replacement schedules for CPAP supplies with schedules used under Medicaid, VA and Federal Employee Health Benefits programs.
• Analyzing possible Medicare savings for Part B-covered drugs infused through medical equipment by comparing the provider’s acquisition cost for the infused drugs, which are paid based on average wholesale price (AWP), with payments for such drugs had they been based on average sale price. OIG previously found that the AWPs for Part B-covered drugs often greatly exceeded the drugs’ actual costs.

Medicaid Reviews

OIG’s Medicaid-related reviews in FY 2013 continue to focus on, among other issues, prescription drugs. Of note is the planned examination of potential Medicaid savings related to home blood-glucose test strips that could arise through alternative payment methods such as rebates, competitive bidding, or other means. OIG previously found that state Medicaid programs were able to reduce net payments for blood-glucose test strips through negotiated rebates with manufacturers, while CMS reduced Part B rates in selected areas through competitive bidding.

ACA Reviews

OIG’s review of the ongoing implementation of the ACA spans several new focus areas, and they include:

• Analyzing whether Medicare can achieve savings through rental of certain power mobility devices (PMD) rather than a lump-sum purchase. The ACA eliminated the option of a lump-sum purchase for certain PMDs.

• Determining how often on-site visits (which are now required for moderate- and high-risk providers and suppliers as a result of the ACA) occur as part of the Medicare enrollment or reenrollment process.

OIG’s Outlook 2013 webcast will occur on October 24. A copy of OIG’s FY 2013 Work Plan is available through OIG’s website.