The American Association for Homecare (AAHomecare) recommended a number of ways that the Centers for Medicare & Medicaid Services (CMS) could confront Medicare fraud and abuse — without inadvertently hurting “the thousands of legitimate, law-abiding” durable medical equipment (DME) suppliers “who serve the most vulnerable patient populations.”
The association’s comments were in response to a request for information (RFI) for CMS’s Comprehensive Regulations to Uncover Suspicious Healthcare (CRUSH) initiative.
AAHomecare CEO/President Tom Ryan addressed his March 30 comments on behalf of the industry to CMS Administrator Mehmet Oz, M.D.
The comments urged CMS to avoid hurting legitimate suppliers and the patients they support by adopting “a more nuanced and strategic approach that targets at-risk and bad actors while minimizing the administrative burden on ethical suppliers.”
In all, AAHomecare made 22 suggestions:
— Strengthen enrollment requirements for new DME suppliers. AAHomecare recommended a “robust identify verification and authentication process” to prevent fraudulent entities from entering or re-entering the system by using new company names.
“This could be an internal CMS verification process, such as reviewing a cross-section of internal government data that would identify fraudulent players from the broader healthcare sector and other industries, creating a check for new companies entering and fraudulent entities from reentering,” AAHomecare said. “The enrollment process for all new companies should be subject to a multi-layered verification process to ensure they are entering the Medicare market in good faith.”
AAHomecare also suggested creating a system that would apply administrative scrutiny “only towards unknown or high-risk entities rather than suppliers with a proven compliant history.”
— Better quality-of-site visits. Site inspectors are not always experienced or knowledgeable, “and some interactions fall short of professional standards,” AAHomecare said. “Site visits carry significant weight for suppliers. An unfavorable finding can result in revocation of their supplier number, which prevents the business from billing and jeopardizes their ability to continue to service patients. This is especially heightened for suppliers operating with small margins; even a short-term disruption can have a disproportionate consequence on their business viability.”
Because of the severe consequences when supplier locations are revoked, inspectors should be “well informed and committed to providing professional services. AAHomecare recommends that CMS review the number of deactivations and revocations due to unfavorable site inspections that are subsequently reinstated to identify systemic issues surrounding site inspections. AAHomecare also recommends that CMS ensure that individuals employed to conduct site inspections are qualified and properly trained. The quality of site inspections is a critical component of program integrity, and it is only as good as the inspectors with whom CMS contracts.”
— Enforce revocations across government programs. “If a company’s Medicare Fee-for-Service (FFS) status is revoked, that revocation should be applied across all government health care programs, including Medicare Advantage (MA) and state Medicaid programs,” AAHomecare said — but only after revocation has reached its final stage and all appeal rights have been exhausted. “Establishing cross-program revocation is essential because fraudulent entities often exploit the current lack of communication and consistency between the programs.”
— Monitor new suppliers’ electronic funds transfer (EFT). “Anytime an EFT is set up or changed, CMS should verify whether there has been a corresponding change in ownership or other activity that warrants a review,” AAHomecare said. “When there are large deposits or transfers, the transactions should be monitored, like the banking industry monitors large deposits or transfers.”
Doing this would better position CMS to notice possibly fraudulent activity in its early stages.
— Use TPE for all new supplier locations. CMS’s targeted probe and educate (TPE) audits should be the rule for all new supplier locations because the audits “are designed to be educational,” AAHomecare said. “Requiring new supplier locations to go through the TPE process will be an opportunity to detect whether the supplier is knowledgeable about the coverage and billing criteria for the product categories they provide.”
— Urge adoption of electronic orders (e-Orders). e-Orders improve integration between DME “orders and patient medical records, communication between suppliers and providers, and will create a digital audit trail that can be accessed by auditing contractors, making it easier to identify issues when no order exists,” AAHomecare pointed out. “Establishing a fully digital trail today will strengthen transparency and prepare the industry for the integration of any advanced technologies in the future.”
— Use technology to review claims in real time. Noting that technology “must be part of the solution in fighting fraud and abuse,” AAHomecare said current advances “can enable CMS to review claims as they are submitted.” Automated claims reviews could help detect fraud much more quickly than current means.
— Install a CMS tech liaison. AAHomecare noted the need for DME billing/ordering companies to be able to notify CMS when they observe suspicious behavior. “With more suppliers opting to digitize their orders, the platforms have a front-row seat on various company activities,” the association said. “A specific liaison position should be created at CMS to coordinate with technology platforms. The liaison should be knowledgeable and should not be a front-line customer service representative.”
— Improve oversight of Medicare Advantage (MA) plans. The inconsistencies among the hundreds of MA plans — which “often impose requirements that go beyond traditional Medicare requirements” — cause confusion and undermine “efforts to combat fraud due to the lack of clarity,” AAHomecare said. “When MA plans follow uniform Medicare rules, CMS and MA plans can more easily detect aberrant billing patterns, ensure consistent enforcement actions, and prevent bad actors from exploiting differences across payers to avoid oversight.”
— Expanding prior authorization (PA) use. AAHomecare noted the “remarkable success with PA in reducing improper payments,” and added, “We believe there are opportunities to expand the program to other product categories. PA requires suppliers to submit medical records and orders for review before services are rendered. The upfront review can streamline the service for patients and suppliers; however, it is important for CMS to consider which [DME] product categories are appropriate to be added and be sensitive to the timeframe for the authorizations to be completed.”
— Increased surety bond amount won’t help. CMS’s suggestion of increasing the surety bond amount to $50,000 per location “will not be perceived as a barrier to fraudulent actors and instead would disproportionately impact legitimate suppliers,” AAHomecare said.
— More accurately report actual losses due to fraud. AAHomecare agreed that DME fraud is “a genuine issue that needs to be addressed,” but suggested that legitimate suppliers are hurt when fraud reports aren’t entirely transparent. For example, while CMS has repeatedly mentioned $2 billion in intermittent catheter fraud in recent years, “Less attention has been given to the fact that CMS was able to prevent over 99% of the fraudulent claims from being paid. The distinction is crucial and warrants emphasis.”
— Maintain one-year claims filing deadline. While CMS has mentioned shortening the current one-year Medicare claims filing window for DME to 90 to 180 days, AAHomecare said retaining the current timing “is consistent with all other Medicare health care programs,” and noted situations in which longer claims timelines are needed, such as when a rental claim has been defined and is being appealed.
— Medicare participation status doesn’t predict fraud. CMS’s current consideration of non-participating DME suppliers who bill MA plans as “a major fraud risk” isn’t correct, AAHomecare said, noting that those suppliers are enrolled in Medicare and are accredited nonetheless. “Participation status is primarily about payment terms,” AAHomecare said, explaining that non-participating suppliers “decide on a claim-by-claim basis whether to accept the Medicare rate.”
— Expand rules about soliciting beneficiaries to cover email, text and social media. Current CMS restrictions apply only to phone calls. An expansion, however, should not limit supplier marketing “that is directed at a specific individual provided that it follows current requirements for contacting a beneficiary.”
— Improve oversight, training for 1-800-MEDICARE agents. As these agents hear directly from beneficiaries, “they are uniquely positioned to hear of emerging issues firsthand,” AAHomecare said. But agents don’t always respond adequately to what beneficiaries report. “Often, we have seen that when a beneficiary contacts 1-800-Medicare over an explanation of benefits that shows Medicare paid for something they did not receive, the agent responds that they have heard the same issue from many others. These types of responses continue to perpetuate a sense of distrust in beneficiaries that is inappropriate. “
— Shorten the reporting timeline for sellers of HME supplier businesses. The current 30-day reporting window “may allow for a vulnerability that can be exploited by fraudulent entities,” AAHomecare said in recommending a seller notify the provider enrollment contractor within five business days of the transaction. “This earlier reporting would allow CMS to monitor billing activity of the location while anticipating a notification from the buyer within the existing timeframe of 30 days.”
— Improve Provider Enrollment, Chain, and Ownership System (PECOS). “CMS has been working for many years on creating a PECOS 2.0 with enhanced features to allow suppliers and providers to electronically notify CMS of changes, additions, licensure updates, etc., in real time,” AAHomecare said. “However, it is the industry’s understanding that PECOS 2.0 has been discontinued at this time. AAHomecare strongly recommends that CMS invest in PECOS to ensure that ALL transactions, updates, deletions and changes can be accommodated electronically. CMS must get to the point where there are no paper submissions of enrollment forms.”
— Require reporting of lead generation companies. AAHomecare recommended that suppliers be required to disclose lead generation companies they work with “similar to the way suppliers report third-party billing companies” because some lead generation companies “have been associated with program integrity concerns.”
— Require Healthcare Fraud Prevention Partnership (HFPP) for all government health care insurers. “HFPP brings together public and private insurers, anti-fraud associations, federal agencies, and others to share insights and data to prevent fraud across the health care system,” AAHomecare said. “A program like HFPP is essential because fraudulent entities often shift between health care programs and services, and by fostering collaboration, all stakeholders would be able to proactively identify and prevent emerging threats before they escalate.”
— Improve audit contractors oversight. AAHomecare noted “inconsistencies and challenges with audit contractors for all government health plans,” including traditional Medicare and Medicaid programs, managed care organizations (MCOs) and MA plans. “To improve program integrity while minimizing burden on legitimate suppliers, all audit contractors should be required to apply coverage and documentation policies consistently and conduct their audits within their scope of work.”
— Improve oversight, reporting of third-party administrators (TPAs) in MAs, MCOs. “TPAs that administer benefits on behalf of MA and MCO plans often introduce additional administrative layers that obscure transparency,” AAHomecare said. “This lack of visibility, combined with complex billing systems and inconsistent policy requirements, makes it more difficult to identify irregularities, inflates administrative costs, and creates opportunities for fraudulent activity to go undetected.”
“Our comments were informed by member experiences and ongoing discussions with CMS on fraud and abuse within the DMEPOS sector,” the association said in the announcement of its comments. “We appreciate the valuable insights shared by members, which helped shape a thoughtful and practical response to CMS.”
