ZPIC: The newest acronym to put fear in the eyes of HME providers

AUSTIN, Texas - Industry stakeholders report an uptick in the number and intensity of audits as Medicare transitions from Program Safeguard Contractors (PSCs) to Zoned Program Integrity Contractors (ZPICs).

In zone 4, which comprises Texas, Colorado, New Mexico and Oklahoma, stakeholders report dozens of HME providers being audited for anywhere from a few claims to more than 500.

"We heard from one provider who had something like 120 claims audited each week for four weeks in a row, said Sean Schwinghammer, acting executive director of the Texas Alliance of Home Care Services (TAHCS). "They're taking this to an extreme level."

ZPICs are also up and running in zone 7, which comprises Florida, Puerto Rico and the Virgin Islands; and, most recently, zone 5, which comprises 10 states in the Southeast. There are a total of seven zones.

The audits in zone 4 are already taking their toll on HME providers, especially smaller providers, stakeholders say.

"It's a 90-day process at least," said Barry Johnson, president of TAHCS and president of Texas Medical Supply in Duncanville, Texas. "That whole time your payments are slowed, which hurts your cash flow. In this economy and with all of the other audits, it's a killer."

Additionally, the contractors conducting the ZPIC audits are using statistical samples and extrapolating their results, meaning a $12,000 overpayment can turn into a $1.3 million recoupment, stakeholders say.

Though the ZPIC audits arent anything new—they just replace the PSC audits—stakeholders aren't surprised they're taking on a whole new meaning.

"The government has increased its budget considerably for reducing improper payments, so they're looking at more expansive audits, said Wayne van Halem, president of The van Halem Group, a consulting firm that specializes in audits and appeals. "This is just the tip of the iceberg."

The best thing for providers to do, stakeholders say: Review and re-review policies, and partner with physicians to get appropriate documentation.

"There's no point in getting hysterical about it," said Liz Moran, executive director of the Medical Equipment Suppliers Association (MESA), which represents providers in Texas, Arkansas, Louisiana, New Mexico and Oklahoma. "Providers need to dot their Is and cross their Ts."

Provider Michelle Boyett sure hopes that's the case.

"We want to stay below that hard deck on this one," said Boyett, vice president of MESA and manager of Weaver Home Medical in Tyler, Texas. "It's an interesting way to level the playing field out there."