OIG: Some providers fall short of Medicare regs

Sunday, March 9, 2008

WASHINGTON - The Office of Inspector General (OIG) released a report last week that states many HME providers in the Los Angeles area are not complying with certain Medicare standards.

The OIG inspected 905 providers to see how they complied with four "easily observed rules": maintain a physical facility; be accessible during reasonable business hours; have a visible sign; and post hours of operation.

The office found that 115 (13%) of the 905 providers did not maintain a physical facility or were not open during unannounced site visits. Another 79 providers (9%) were open but did not meet at least one of the two additional requirements. Additionally, 124 providers (14%) met the four requirements, but "their claims had in common an atypical characteristic."

The OIG made the following recommendations to CMS:

* Conduct more unannounced site visits.
* Perform more rigorous background checks of applicants and existing high-risk providers.
* Assess the fraud risk of providers and focus monitoring and enforcement on high-risk providers.
* Increase prepayment review of claims, especially those from new and high-risk providers.
* Require providers in areas vulnerable to fraud and abuse to reenroll with the NSC more frequently than every three years.
* Strengthen the Medicare supplier standards by establishing a minimum of hours of operation and minimum inventory requirements for product and service types.
* Require providers pay a Medicare enrollment application fee to cover the costs of inspections and criminal background checks.
* Require providers to pay an additional Medicare enrollment fee if, during a site visit, their facility is closed or inaccessible, necessitating another site visit.
* Seek legislative authority to impose temporary moratoriums on provider enrollment in high-fraud areas.

CMS responded that it believes it has addressed the majority of the recommendations. It stated that it would consider increasing prepayment review of claims and that it is in the process of conducting "targeted background checks" on providers. The agency may consider establishing more frequent reenrollment requirements for providers. Additionally, it's seeking public comment on a proposed rule that would establish a minimum number of hours of operation.