Inspector General: Fraud Vacating DME
Testimony to Senate Finance Committee says DME/HME's anti-fraud measures are pushing fraudsters into other areas.
- By David Kopf
- Apr 26, 2012
Efforts to push fraud out of the durable medical equipment sector have been successful, according to testimony made by HHS Inspector General Daniel Levinson to Senate Finance Committee this week.
Echoing Levinson's comments was Wifredo Ferrer, from the U.S. Attorney’s office in Southern Florida, who added that criminal activity in Medicare has transitioned “from the DMEs to HIV infusion therapy to home health and now, community mental health,” according to a report from the American Association for Homecare.
Levinson labeled DME fraud a “lazy man’s fraud,” explaining that it was once easier to set up a fake storefront and bill Medicare for items that were never provided. Now that there are more effective policies in place, Levinson said the OIG has seen fraud shift from DME to more sophisticated schemes in areas that involve home health and community mental health clinics.
As patients to receive more care in their homes rather than in more costly institutions such as hospitals, witnesses told the Finance Committee that more anti-fraud focus should be placed on home health and other Part B services.
Case in point was the September's crackdown on an alleged $300 million home health fraud involving providers in eight cities. At the center of the fraud, ABC Home Health Care, had paid indigent people $1,500 a month to file false claims for phony home health services, and paid physicians to document treatments such as insulin injections and physical therapy.
According to Levinson, once people intent on defrauding the system realize that the government has put policies in place to root out fraud in one health care sector, the fraudsters shift their schemes to another. While these schemes vary in different regions, the OIG pointed out that these schemes have moved away from the DME arena.
To combat these new (and existing) areas of fraud, Peter Budetti, director of CMS’ Center for Program Integrity, outlined two newly introduced predictive analytics systems that the agency is implementing to identify aberrant billing patterns and use automated screening procedures for enrollments and revalidations. Onetime CMS executive associate to the administrator Kathleen King, now part of the GAO's healthcare team, said prepayment medical review was critical in ensuring that claims are paid correctly the first time in addition to other initiatives.
That said, CMS could have a way to go, according to some of the committee members. A report from Government Executive stated that Sen. Orrin Hatch (R-Utah) graded CMS’s implementation of new anti-fraud measures as “incomplete” and said “though CMS has made some strides in its fight against fraud, [its grade] is not one to be proud of.” Hatch said CMS still had to implement a temporary moratorium on enrolling new Medicare providers and suppliers; had not yet required a surety bond for home health agencies; had not set dollar-amount ceilings on claims; and had not denied billing privileges to providers that were deemed not in good standing.
AAHomecare noted that much of the the success Levinson touted stemmed from the association's 13-point legislative action plan for fighting fraud that it proposed to Congress in 2009.
David Kopf is the Editor of HME Business.