Government Moves from Pay-and-Chase to Guarding the Henhouse

BALTIMORE — On Friday, new screening
requirements for Medicare DME enrollees took effect, along with
new application fees.

According to attorney Jeff Baird, chairman of the health care
group at Brown & Fortunato, Amarillo, Texas, the new
requirements are part of the government’s move away from
“pay-and-chase” to “guarding the henhouse” when it comes to
fighting fraud.

“In the early days of the industry, it was easy for a company to
obtain a Medicare Part B supplier number.” Baird said. “The
screening process was rudimentary.”

A sham company could “easily” get a billing number, submit
fraudulent claims and then “shut down and escape just ahead of the
posse,” Baird said. But with the government’s growing focus on
fraud, now a company “must jump through multiple hoops before it is
awarded a supplier number.”

Two of those hoops include purchasing a surety bond and becoming
accredited, which by themselves have weeded out a lot of the
crooks, Baird pointed out. As of March 25, newly enrolling DME
company principals will also be subject to a criminal background
check and fingerprinting at a future date.

Baird said HME providers are also experiencing unannounced site
visits from a variety of sources, including the National Supplier
Clearinghouse, the Office of Inspector General, state Medicaid,
accrediting organizations and Medicare contractors.

“If a DME supplier is conducting a non-compliant, or perhaps a
fraudulent, operation, there is a reasonable chance that the
non-compliance/fraud will be discovered when a person walks
unannounced onto the supplier’s premises, eyeballs the operation
and asks for evidence that the supplier standards are being
followed,” Baird said.

In addition to expecting an NSC site visit when it’s time for
reenrollment, he added, HME companies should expect unannounced
site visits on a periodic basis. Last year, CMS issued final rules
enhancing Medicare supplier standards for DME companies, including
more stringent operations and facilities requirements.

For more from Baird on new screening and disclosure requirements
under health reform, see “Screening and
Disclosure,” his “Law School” column in the March issue of
HomeCare.