Home Health & Hospice Week

Move is latest in fraud crackdown.

The feds have cast a wider net in their new war on fraud and abuse among HME suppliers--and you'll need to stay informed to stay untangled.

On Aug. 1, the Centers for Medicare & Medicaid Services published in the Federal Register a proposed rule requiring all suppliers of home medical equipment to furnish Medicare with a surety bond.

Rationale: The agency's goal is to ensure that Medicare can easily recover up to $65,000 in payments made in error to fraudulent suppliers of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS), CMS said in a press release.

The proposed requirement would make it easier for Medicare to recover funds when necessary, while making it tougher for fraudulent suppliers to enroll in Medicare in the first place, says Herb Kuhn, CMS' acting deputy administrator, in the release.

Take action: Suppliers and other stakeholders can comment on the proposed rule. Specifically, CMS invites comment on the idea of requiring some suppliers to secure surety bonds in amounts exceeding the basic $65,000 requirement.

Suppliers whose owners, authorized officials, or delegated officials had their billing privileges revoked within the last 10 years would be subject to double or triple the $65,000 surety amount, for example.

Possible exemptions: The agency is also seeking input on when to exempt physicians and non-physician practitioners from the surety bond requirement. CMS also proposes exempting pharmacists and large publicly-traded HME suppliers. Rural DMEPOS suppliers may also be exempt.

The proposed rule, which implements section 4312 of the Balanced Budget Act of 1997, is the latest step in the feds' crackdown on Medicare fraud among DMEPOS suppliers. Earlier in July, the Department of Health & Human Services launched two demonstration projects aimed at weeding out bad apple DMEPOS suppliers in south Florida and southern California (see Eli's HCW, Vol. XVI, No. 24).

This is also CMS' second go-round on the surety bond issue. The agency tried to institute a surety bond requirement for suppliers in the late 1990s, but scrapped it after numerous false starts and provider protests.

Deadline: Submit your comments on the proposed rule by Oct. 1.

Resource: To read the proposed rule, go to www.gpoaccess.gov/fr/browse.html; select "Back Issues" and "Wednesday, Aug. 1, 2007."