New demo scrutinizes PMD claims

Friday, November 18, 2011

WASHINGTON – The HME industry was blindsided this week when CMS announced that providers in seven states would need to go through prepay reviews and prior authorizations for power mobility device (PMD) claims. 

"We had no idea this was coming," said Cara Bachenheimer, senior vice president of government relations for Invacare. "We still don't know a lot of the details—we're working to learn as much as we can about it and to understand what's required."

CMS will conduct a three-year demonstration project, beginning Jan. 1., with two phases: a first phase, lasting three to nine months, where all PMD claims will go through prepay review; and a second phase where all PMD claims will go through a prior authorization process.

Industry stakeholders question whether CMS can be ready for a Jan. 1 starting date. 

"I don’t see how they could set this program up in a month and a half," said Walt Gorski, vice president of government affairs for AAHomecare. "Nor do I think they have the ability to audit this many claims."

The demo targets providers in Florida, Texas, California, Michigan, Illinois, New York and North Carolina. Claims in those seven states accounted for 43% of total Medicare expenditures for PMDs in 2010. CMS estimates the demo will affect 325,000 claims.

Industry stakeholders have many questions regarding the announcement, among them: Will the demo include complex rehab? What will the prepay review and prior authorizations processes look like? What will this mean for providers and consumers in those states?

John Letizia, chairman of AAHomecare's Complex Rehab and Mobility Council, is among the stakeholders who believe the demo will result in access issues, especially when you consider it’s on top of other recent changes like the elimination of the first-month purchase option.

"I don't know how any provider, small or large, can do prepay review for all PMDs," Letizia said. "We’ve been trying to still provide quality products and services, but people are just going to say, 'I can't do it anymore.'"

Gorski said AAHomecare plans to meet with CMS in early December to learn more about exactly what the demo entails.



I have tried to open everyone's eyes but as the the usual mentality goes "this can't happen to me". If anyone has read about or been following the current pending litigation in The Third District of Philedelphia but one Federal Judge has basically ruled that medicare can do whatever thet want, whenever they want, however they want to whomever they want. Her ruling did not apply to just the audit debacle being litigated or its contractors. It was a general blatent entire CMS entity. This case is currently in Third Circuit Court of Appeals. It is the "Nichole Medical" case. That is why this case is so important to the entire medical industry. Currently, medicare is running wild and out of control with no accountability to anyone not even legislators. It is my legal team's objective to quash that mentality and have The Third District Court of Appeals hold them accountable for their actions and those actions of their contracors to the Courts if not the legislators!! My "E" address is

This is an industry killer folks. The problem here isn't the audits. It's the interruption of cash flow the audits will create. It's going to take providers 120 days to 2 years to get the power mobility products billed during the 100% prepay period assuming they win the audits and how many businesses do you think can float that sort of cash hit for that length of time? The only companies that will survive are those with a highly diversified product mix that relies on power mobility for less than 25% of their sales or those few companies with a wealthy backer who actually wants to throw more money into this dying industry. Medicare has run out of money and now they are going to stop paying for services by hook or crook. This is California Medicaid all over again on a national level.