No oxygen license? Then don't bill Medicare

Sunday, August 10, 2008

WASHINGTON - CMS has begun cracking down on HME providers who don't have the necessary state licenses to supply oxygen.

"I would say that the takeaway is hooray," said Bently Goodwin, CEO of RemitData, a company that helps HME providers reduce claims denials. "Medicare is weeding out people who they shouldn't have been paying, which is good for the legitimate players in the industry."

Currently, 38 states require licensure and/or certification to provide oxygen and/or oxygen related equipment.

Earlier this year, a Medicare analysis showed that 10% of claims for oxygen were submitted by unlicensed providers, said Dr. Robert Hoover, the medical director for Jurisdiction C. As a result, CMS asked the National Supplier Clearinghouse, which grants Medicare billing privileges, to begin asking about oxygen licensure on the NSC application. On April 1, the DME Medicare Administrative Contractors began editing claims to make sure oxygen providers in those 38 states met all necessary requirements.

Roughly 15% to 20% of monthly Medicare oxygen claims are denied for a variety of reasons, according to industry billing consultants. The 10% claims denial rate due to a lack of licensure seems a little high, but it is not a "get out of town" number, said Bruce Brothis, president of Allegient Billing & Consulting.

"If it was 30% or 40%, you'd say something is up with this edit," he said.