Monday, April 30, 2007

Q: Can a DME supplier provide oxygen for free to patients while they wait to qualify for Medicare coverage? What about oximetry testing?
A. On Nov. 8, 2006, an OIG advisory opinion addressed both practices. In both instances, the necessary equipment is delivered to the patient's home and set up, free of charge. The DME suppliers requesting the opinion stated that they did not actively market these free services, but they did answer inquiries. The OIG reasoned that such free services would constitute remuneration--giving something of value--to beneficiaries who receive them. The free testing was considered remuneration, despite having no value for the purpose of qualifying for Medicare coverage. Medicare rules prevent oximetry tests administered by DME suppliers from qualifying patients for Medicare coverage of oxygen. The OIG was concerned that the delivery of the testing service would lead beneficiaries to believe they were receiving a valuable service. The OIG also reasoned that the arrangements provide the supplier with the opportunity to initiate a relationship with the beneficiary that would influence the beneficiary to select the supplier for future purchases. Finally, the OIG inferred from the arrangements that the supplier knows or should know that the arrangements would likely generate federally-payable business for the suppliers. For these reasons, the OIG concluded that both arrangements would likely implicate the Civil Monetary Penalties statute and the Medicare/Medicaid anti-kickback statute. In light of the opinion, DME suppliers should refrain from providing free home oxygen and free oximetry testing to patients whose Medicare coverage for oxygen is pending. If oxygen is provided under such circumstances, the patient must be made responsible for the cost of the service. hme
Phuong Nguyen is a healthcare attorney with Brown & Fortunato, in Amarillo, Texas. Reach him at (806) 345-6308 or