Industry attorneys: CMS proposal goes too far

Sunday, March 25, 2007

WASHINGTON - In a little-noticed proposed rule published in the Federal Register earlier this month, CMS announced plans to revoke supplier numbers for "abuse of billing privileges." The problem: The agency fails to define what constitutes abuse, say industry attorneys.

"It's really wide open," said Asela Cuervo, a Washington, D.C.-based healthcare attorney. "There are no standards or parameters for how they plan to measure 'abuse.' Is it measured against your total volume of claims or 10 claims or one claim?"

The rule is tucked into a larger proposed rule that would establish an appeals process for providers whose application for enrollment or renewal has been denied. Industry stakeholders can submit comments on the rule until May 1, 2007.

CMS proposes to revoke supplier numbers when "a provider submits a claim or claims for services that could not have been furnished to a beneficiary." For example: a provider bills for services that are undeliverable because the beneficiary is deceased.

Revocation wouldn't be the only punishment, however. In a move Cuervo described as "serious," CMS also proposes that providers with revoked supplier numbers be banned from re-enrolling in the Medicare program for three years.

CMS stated: "By having a regulatory provision that would keep such entities out of the program for three years, we believe we would be establishing a credible deterrent to these substandard billing practices where providers would know that there are real consequences to their actions."

Industry attorneys don't necessarily buy the need for such severity.

"It's not beyond my realm of reality to imagine providers drop shipping items to a beneficiary whose family hasn't notified them the beneficiary has died," said Elizabeth Hogue, a Burtonsville, Md.-based healthcare attorney. "It's not unrealistic at all."