Mobility provider takes CMS to court

Friday, December 31, 2004

BALTIMORE - In a rare legal move, a small power chair provider here has filed a suit in federal court seeking thousand’s of dollars that it claims CMS had no right to recoup following a post-payment audit.

MacKenzie Medical Supply filed its suit in federal district court in Baltimore Aug. 27, claiming Medicare had no right to request information beyond the CMN to document medical necessity. CMS had until Dec. 13 to answer the provider’s complaint. The company’s lawyers then expect it to take about a year to resolve the dispute in court.

CMS audited 29 of the provider’s claims filed in 1998-99 and extrapolated them to a universe of claims covering an entire year, resulting in a $500,000 overpayment assessment. Disputes over Medicare audits seldom end up in federal court because the formal appeals process takes so long and is so expensive that the provider either goes broke or settles.The MacKenzie dispute follows last summer’s successful case involving Maximum Comfort, a California provider, and presents a similar argument. While district court rulings pertain only to the district where they occurred, they do provide guidance and help bolster the cases of providers in other parts of the country.