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Durable Medical Equipment and Medicare Fraud

A report released by the Department of Health and Human Services and the Office of the Inspector General (OIG) outlines the difficulties that many businesses have in conforming to Medicare billing requirements. Roughly one quarter of durable medical equipment suppliers are accused of Medicare fraud in the first year they supply products covered by Medicare. The accusations typically concern fraudulent billing, meaning billing for services not provided or for services that are not properly covered by Medicare.

The durable medical equipment industry has been the target of extensive scrutiny from federal investigators. Makers of wheelchairs, prosthetic limbs and other medical equipment were reimbursed for nearly $9 billion in 2010. Many of the companies seeking reimbursement had no prior experience with Medicare billing. Whether through unfamiliarity or intentional acts, many of these businesses found themselves facing punishment for their billing practices. Some had their billing rights revoked, while others were required to submit to prepayment claims review.

Medicare fraud has been a hot-bottom issue under this administration. Unprecedented effort has been directed toward catching and prosecuting medical providers and health care businesses suspected of fraud. The OIG has concluded that further review and analysis is necessary in the durable medical equipment field to combat Medicare fraud. This could come in the form of a more intensive screening process, or it could come in the form of increased criminal prosecution of businesses suspected of fraudulent activity.

For now, new entrants and existing businesses in the durable medical equipment field should expect to have a harder time obtaining Medicare reimbursement. Those who have billed Medicare improperly can expect to face an enforcement action that could expose them to significant financial and criminal penalties.

Source: MedPage Today, "Medicare Punished One in Four DME Suppliers," by Emily P. Walker, 29 December 2011

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