Senate Republicans To Begin Campaign Against Medicare Fraud

(Kaiser Network, 7/28/08)

Senate Republicans have begun "piecing together a crusade" against Medicare fraud in an effort to make the issue an important part of the health care reform debate in the next Congress, CongressDaily reports. Republicans estimate that fraud accounts for 20%, or about $60 billion, of the annual Medicare budget. Sens. Mel Martinez (R-Fla.) and John Cornyn (R-Texas) on Monday plan to lead a Senate Republican Conference meeting to examine proposals to improve detection and prevention of Medicare fraud, as well as promote a "zero fraud tolerance" agenda to increase penalties and devote more resources to prosecution of fraud.

Martinez said, "We hope, as a result of that hearing, there`s going to be a much greater understanding of how big a problem it is." He added that he hopes the campaign against Medicare fraud will become a bipartisan effort. "If we got something good like this done, there will be plenty of credit to go around," Martinez said. According to Ryan Loskarn, a spokesperson for the conference, the campaign against Medicare fraud is part of a larger effort to highlight fiscal responsibility among Republicans. He said, "With this issue, we`re reaching out to people who thought we lost our way on fiscal issues" (Edney, CongressDaily, 7/25).

American Association for Homecare Favors Tougher Approach to Fighting Fraud and Opposes Delay in Medicare Accreditation Deadline for Durable Medical Equipment
(AAHomecare, 7/25/08)

ARLINGTON, VA, July 25, 2008 —- The American Association for Homecare opposes the decision by the agency that oversees Medicare to cancel the accreditation deadline for durable medical equipment providers in the 70 metropolitan areas throughout the U.S. designated for Round Two of the Medicare competitive bidding program.

The Centers for Medicare and Medicaid Services (CMS) announced last week that it was canceling its January 14, 2009 accreditation deadline for durable medical equipment (DME) or home medical equipment providers in the 70 metropolitan areas that were to be included in Round Two of the recently postponed bidding program.

“The home medical industry has advocated accreditation of homecare providers for three decades because accreditation helps ensure quality care for Medicare beneficiaries and can serve as a powerful tool in preventing fraud,” said Tyler J. Wilson, president and CEO of AAHomecare. “We are surprised that CMS would in the first case argue against the reforms and the delay enacted by Congress in the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) by stating that it would delay accreditation – and then cancel the accreditation deadlines it had already set for providers in 70 metropolitan areas. Enactment of MIPPA is no reason to push back accreditation deadlines.”

The new law, MIPPA, mandates a September 30, 2009 deadline for accreditation of all durable medical equipment providers nationwide. CMS had set a January 14, 2009 deadline for Round Two providers. MIPPA also closes a loophole that had allowed non-accredited DME providers to serve Medicare beneficiaries. The American Association for Homecare enthusiastically supported these provisions as well as the important reforms to the competitive bidding system that are designed to improve access to care for seniors and people with disabilities and prevent arbitrary exclusion of qualified, accredited providers from participating in Medicare. The Association has also urged CMS to subject all new medical equipment providers to a rigorous on-site inspection by the government to help prevent fraud. “We do not favor government delays to the accreditation requirement,” said Wilson. “Accreditation for this industry is already 30 years overdue. If the federal government wants to get serious about preventing fraud and preventing theft of taxpayer dollars, it should use tools like accreditation more aggressively and use its ample, existing authority much more effectively.”

“Congress estimates that Medicare loses $70 billion per year to fraud. CMS says $700 million in DME payments are improper, due to billing errors or fraud. So less than one percent of Medicare fraud can be attributed to DME. While our industry has zero tolerance for fraud, the $70 billion number begs the question: Where is the more than $69 billion in non-DME fraud occurring? You have to wonder whether the focus on DME is designed to shift attention away from the failure of CMS to use its existing authority and tools at its disposal to ferret out and stop fraud against Medicare. CMS has just renewed its contract with Palmetto GBA, the private company that serves as the National Supplier Clearinghouse for Medicare. Palmetto serves as the gatekeeper for issuing and renewing DME Medicare billing privileges and is required to establish and maintain programs to prevent and detect fraud. The renewal raises the question, why is a contractor that has failed miserably being rewarded with another contract?” Wilson said.

Background on MIPPA
Earlier this month, the Senate and the House enacted MIPPA by overriding the President’s veto. Provisions of the law include the following:

— “The Medicare Improvements for Patients and Providers Act of 2008” includes improvements to the Medicare competitive bidding program for home medical equipment that will help to ensure that seniors and people with disabilities continue to have access to quality medical equipment and services at home.

— The bill saves Medicare billions of dollars in reduced payments for home medical equipment. While the bill delays the Medicare bidding program, the home medical equipment industry pays for the delay in the form of a 9.5 percent nationwide reimbursement reduction on the bid upon items and services. This reimbursement cut saves taxpayers the billions of dollars that the flawed program would have saved. So taxpayers win through reduced Medicare spending, and beneficiaries win because they will continue to receive quality care from their local providers.

— The bidding system has been fraught with problems that have confused seniors, threatened severe reductions to care, and unfairly disqualified hundreds of accredited homecare providers. In cities where competitive bidding was implemented, the process befuddled hospital discharge personnel to the point where patients were being forced to stay longer in hospitals while frantic efforts were underway to locate the hospital beds, power wheelchairs, home oxygen therapy, and other equipment and services needed for patients to continue their recovery and therapy in their homes.