VGM--Fundraising event for Rep.Bruce Braley, D-Iowa, chair of the House Small Business Subcommittee on Contracting and Technology and an advocate of HME, today at VGM’s offices in Waterloo; campaign to support Monty Lankford, Republican candidate for the Fourth Congressional District in Tennessee, who owns TLC Medical Oxygen and Hospital Equipment in Franklin, Tenn. Information: VGM, www.vgm.com.

AAHomecare Drafts Proposal to Root Out Fraud and Abuse
ARLINGTON, Va.--In a proactive move to provide CMS and federal legislators alike with concrete strategies for stemming fraud and abuse in the home medical equipment industry, the American Association for Homecare is crafting a plan that could be presented by the end of the year.

Among its possible components are increased scrutiny of new HME providers, real–time claims analysis, accreditation and unannounced site visits.

“We are still in the formative stages of this proposal, and we are working with our members to collect best practices,” Walt Gorski, vice president of government affairs for AAHomecare, said last week. “HME providers, we believe, are the most effective at determining these policies, since they are on the ground and know what works, what is a hassle factor and what doesn’t work.”

Already, AAHomecare has, in the last year, offered input on two separate anti-fraud efforts, including the proposed implementation of a surety bond requirement for providers and the draft of the Seniors and Taxpayers Obligation Protection Act of 2008 (S. 3164), or STOP Act. The latter requires the Secretary of Health and Human Services to change the identifier used to identify Medicare beneficiaries under the program.

The need for the industry to step forward with an anti-fraud plan has, however, become increasingly obvious in the face of derogatory reports that are appearing with alarming frequency in mainstream media such as the Wall Street Journal and the New York Times, Gorski and others said.

“The industry cannot leave its future in the hands of others,” said Gorski. “Recent reports highlighting improper behavior on the DMEPOS benefit validate much of what the HME community has been saying for a very long time: CMS has not adequately policed the program and kept criminals from getting supplier numbers.

“Under no circumstance should Medicare provide a supplier number to a broom closet that includes a bucket of sand and a wrench,” he stated, referring to a government sweep that found hundreds of alleged providers in South Florida and elsewhere had given fraudulent addresses to Medicare. (See HomeCare Monday, July 9, 2007.)

Industry stakeholders roundly applauded the idea of the proposal, which will seek to stop fraud at the front end of the payment process rather than relying on the current “pay-and-chase” system, AAHomecare officials said.

“It’s the realization that, as an industry, we have to be proactive rather than reactive,” said John Gallagher, vice president of government relations for Waterloo, Iowa-based VGM Group. “The drumbeat [of legislators] is that ‘you in the industry have to come up with concrete steps to fight fraud in the industry. If you don’t, we’re going to do it for you, and you don’t want that.’”

The proposal is something that “we could take to the Hill, but immediately, we could take it to CMS,” said Cara Bachenheimer, senior vice president of government relations for Invacare, Elyria, Ohio.

If the industry is to gain more credibility in Washington, “we have to somehow stem this tide of fraud and abuse that is happening,” Bachenheimer noted. “We need to take a slightly different tack in Washington. We can’t be up there blaming CMS. That doesn’t gain us any traction with the policymakers. The industry needs to elevate itself, take a more responsible role in addressing the problem.”

Coming up with anti-fraud measures that are both internal--that is, coming from within the industry--and external, such as actions CMS should take, will help, she believes.

“It’s good these discussions are going on, a good time to have them,” said Seth Johnson, vice president for government affairs for Pride Mobility Products, Exeter, Pa. It is unlikely that there will be any further legislation pertinent to HME this year, he said, but the industry must be braced for a new Congress, a new administration and new CMS leaders who will come on board next year.

“We need to bring the industry together, get what the framework would look like and, once there is agreement on the principles or provisions, then begin selling that in discussions [with legislators and regulators] to advance that proposal, “ he said.

Johnson also believes the plan will allow the HME industry to have a say in its fate. “They really do want to focus on addressing this [fraud-and-abuse] problem,” he said about the nation’s lawmakers. “We really have an obligation as an industry to provide them with what we’d like to see, and if we don’t do that, they are going to do something on their own. It’s better to be very intimately involved in the process.”

While specifics of the plan have not yet been decided, there are some general concepts that will likely make the final proposal. It is, for example, probable that several points will target “the most vulnerable area of the DMEPOS benefit, which is predominately new suppliers,” Gorski said. “In essence, how do you better validate that a supplier seeking a supplier number is a real provider?”

The answer, he said, could lie in real-time data, unannounced site visits and audits for an initial amount of time to ensure that the entity is serving Medicare beneficiaries and providing services for which they are billing

“That is an initial first step that we think is necessary toward improving the image of the HME community,” Gorski said.

Accreditation is another fraud-and-abuse-fighter, he said, because it helps monitor the monitors. “The National Supplier Clearinghouse is supposed to do a site visit for each new provider and upon re-enrollment every three years, but it appears that is not taking place,” Gorski said. “Accreditation is a way to double-check that CMS is policing its [monitors].”

Gallagher said some stakeholders, himself included, champion establishing an HME licensure board so the industry can police itself much the way physicians and pharmacists do.

”Right now, policing is not being done. If you know of fraud in your area, you turn it in and nothing happens. The industry has been screaming for years, ‘What are you doing, CMS’? and years and millions of dollars later, CMS wakes up and says, ‘Oh, you fraudulent providers.’ Let’s wrestle that away from them and let us be like the docs and pharmacists and police our own.”

There has also been talk of establishing escalating penalties with a “third-time-you’re-out” rule for providers who skirt the rules, and surety bonds for new suppliers.

“But we have to come to a consensus,” said Gallagher, who would like to fast-track the process so the industry can start selling the plan to legislators and regulators.

“Most likely the legislation will be in draft form this year for introduction in a new Congress next year,” said Gorski, who added that he welcomes any ideas on rooting out fraud and abuse. He can be contacted at waltg@aahomecare.org.

PAP LCD: Comparison of Latest Revisions, Initial Provisions
MURRYSVILLE, Pa.--While the DME MACs' re-issued PAP local coverage determination still prohibits HME providers' involvement in home sleep testing, the new LCD has been characterized by some in the industry as a "kinder" version of the sleep policy. (See HomeCare Monday, Sept. 22.)

Courtesy of Philips Respironics, following is a comparison of revisions in the new PAP LCD to provisions in the initial LCD, which was issued, then pulled back, in July.

Revised LCD:
Initial exam - May include sleep history, Epworth and physical exam but not every exam required to have each
Original LCD:
Initial exam – Sleep history, Epworth and physical exam REQUIRED

Revised LCD:
Type IV device – Monitors and records a minimum of three channels that allow direct calculation of an AHI or RDI as defined in policy
Original LCD:
Type IV device – Monitors and records a minimum of three (3) channels that must include respiratory effort, airflow and oxygen saturation

Revised LCD:
WatchPAT not specifically mentioned in policy
Original LCD:
WatchPAT specificially identified in policy

Revised LCD:
As of Nov. 1, 2008, patients must receive HST instruction by the entity providing the device and not a DME supplier; either face-to-face or via video or telephone with 24-hour troubleshooting availability
Original LCD:
HST patient instruction must be provided face-to-face by the testing entity and not a DME supplier

Revised LCD:
For PAP devices with initial dates of service on or after Nov. 1, 2008, all HSTs must be interpreted by a physician who holds either:
1. Current certification in Sleep Medicine by the American Board of Sleep Medicine (ABSM); or,
2. Current subspecialty certification in Sleep Medicine by a member board of the American Board of Medical Specialties (ABMS); or,
3. Completed residency or fellowship training by an ABMS member board and has completed all the requirements for subspecialty certification in sleep medicine except the examination itself and only until the time of reporting of the first examination for which the physician is eligible; or,
4. Active staff membership of a sleep center or laboratory accredited by the American Academy of Sleep Medicine (AASM) or The Joint Commission (formerly the Joint Commission on Accreditation of Healthcare Organizations – JCAHO).
For PAP devices with initial dates of service on or after Jan. 1, 2010, physicians interpreting facility-based polysomnograms (Type I) must meet one of the requirements listed above (1-4) for credentialing.
Original LCD:
All sleep tests must be interpreted by:
1. A diplomat of the American Board of Sleep Medicine (ABSM); or,
2. Diplomat in Sleep Medicine by a member board of the American Board of Medical Specialties (ABMS); or,
3. An active staff member of a sleep center or laboratory accredited by the American Academy of Sleep Medicine (AASM) or The Joint Commission (formerly the Joint Commission on Accreditation of Healthcare Organizations – JCAHO).

Revised LCD:
DME supplier involvement - SAME as initial PAP LCD
Original LCD:
DME supplier involvement - No aspect of an HST, including but not limited to delivery and/or pickup of the device, may be performed by a DME supplier. This prohibition does not extend to the results of studies conducted by hospitals certified to do such tests.

Revised LCD:
Coverage beyond first three months – For PAP devices with initial date of service 11/1/08 or after: face-to-face exam between the 31st and 91st day and objective measure of compliance
Original LCD:
Coverage beyond first three months – face-to-face exam between the 61st and 90th day and objective measure of compliance

Revised LCD:
Compliance definition – Same as initial PAP LCD
Original LCD:
Compliance is defined as PAP usage of 4 hours per night for 70% of the nights in a consecutive 30-day period during the first 90 days of therapy

Revised LCD:
Documentation of adherence to PAP therapy shall be accomplished through direct download or visual inspection of usage data with documentation provided in a written report format to be reviewed by the treating physician and included in the beneficiary’s medical record. This information does not have to be submitted with the claim but must be available upon request.
Original LCD:
Documentation of adherence to PAP therapy shall be accomplished through direct download. This information does not have to be submitted with the claim but must be available upon request

Revised LCD:
Beneficiaries who fail the initial 12 week trial are eligible to requalify for a PAP device but must have both:
1. Face-to-face clinical re-evaluation by the treating physician to determine the etiology of the failure to respond to PAP therapy; and,
2. Repeat sleep test in a facility-based setting (Type 1 study)
Original LCD:
Not addressed

Revised LCD:
If the physician re-evaluation does not occur until after the 91st day but the evaluation demonstrates that the patient is benefiting from PAP therapy as defined in criteria 1 and 2 above, continued coverage of the PAP device will commence with the date of that re-evaluation
Original LCD:
Not addressed

Revised LCD:
If a CPAP device is tried and found ineffective during the initial 3 month home trial, substitution of a RAD (E0470) does not change the length of the trial unless there is less than 30 days remaining in the trial period. If more than 30 days remain in the trial period, the clinical re-evaluation would still occur between the 31st and 91st day following the initiation of CPAP. If less than 30 days remain in the trial period, the clinical re-evaluation must occur before the 120th day following the initiation of CPAP
Original LCD:
If a CPAP device is tried and found ineffective during the initial 3 month home trial, substitution of a RAD (E0470) does not change the length of the trial

Revised LCD:
If a CPAP device was used for more that 3 months and the patient was switched to a RAD, then the clinical re-evaluation would occur between the 31st and 91st day following the initiation of the RAD. There would also need to be documentation of adherence to therapy during the 3 month trial with the RAD
Original LCD:
If a CPAP device was used for more that 3 months and the patient was switched to a RAD, then the clinical re-evaluation would occur between the 60th and 91st day following the initiation of the RAD. There would also need to be documentation of adherence to therapy during the 3 month trial with the RAD

Revised LCD:
327.23 OSA is the only acceptable qualifying diagnosis code
Original LCD:
327.23 OSA is the only acceptable qualifying diagnosis code

Revised LCD:
If the supplier chooses to hold claims for the fourth and succeeding month pending receipt of information from the treating physician but learns that the beneficiary did not receive a clinical re-evaluation between the 31st and 91st day but rather was re-evaluated at a later date and had documented improvement in OSA symptoms and is adhering to PAP therapy, those claims may then be submitted with the KX modifier but only for dates of service following the date of the clinical re-evaluation
Original LCD:
Not addressed

For FAQs on the new LCD and a link to the complete PAP policy on the Jurisdiction C DME MAC (Cigna) Web site, click here.

In Brief
No NPI, No CEDI; Medi-Cal Providers Finally to Get Paid
Effective Wednesday, Oct. 1, the Common Electronic Data Interchange edit B108 will be changed from a warning to a rejection, according to a notice from NGS, the CEDI contractor. At that time, claims that do not have an NPI matched to the Trading Partner (Submitter) ID will be rejected by CEDI and will not be forwarded to the DME MACs. For more information, check the CEDI Web site at www.ngscedi.com. Another NGS reminder for all Part A, Part B and DME MAC electronic submitters, software vendors, billing services and clearinghouses, said as of Monday, Oct. 6, Medicare will reject all incoming electronic claims that contain any legacy provider identifiers other than the NPI, EIN/Federal Tax ID or SSN.

Last week California Gov. Arnold Schwarzenegger signed a tardy budget that has kept Medi-Cal providers in the state unpaid for months. (See HomeCare Monday, Aug. 4.) According to an update from the California Association of Medical Product Suppliers, the final budget agreement includes continuation of an across-the-board 10 percent rate reduction for Medi-Cal providers until March 1, 2009, then converts it to a 1 percent reduction with no end date. CAMPS said it has inquired about the timing and order of payments on suspended claims for DME. “There is an effort to expedite payments to clinics and nursing homes, but we don’t know the prioritization process,” CAMPS said.

On Thursday, President Bush signed the ADA Amendments Act, in effect overturning a series of Supreme Court decisions that have limited the scope of the Americans with Disabilities Act, which was passed in 1990. The new law makes it clear that “mitigating measures,” such as medications, medical devices and artificial limbs, should not be considered in determining disability and also directs the courts toward a broader interpretation of disability, increasing the number of activities covered and adding a category of conditions that limit bodily functions. (See HomeCare Monday, Sept. 15.)

According to The Associated Press, almost 8,500 Florida Medicaid beneficiaries living in nursing homes have joined a federal class action lawsuit claiming they are forced to obtain care in nursing homes rather than in the community. The story, published Sept. 21 in the Miami Herald, notes Medicaid beneficiaries who are sick or disabled have little trouble getting admitted to nursing homes, but that receiving services at home is “substantially harder and often involves a long waiting list” even though home care costs less.

At a meeting last Monday at its headquarters in Baltimore, CMS heard from providers and other stakeholders that the transition to DME Medicare Administrative Contractors, or MACs, “has not been as rosy as CMS portrayed it,” the American Association for Homecare described in its weekly newsletter. “Complaints focused on difficulty reaching customer service representatives, claims holds causing disruption in cash flow, and even cases of covering staff paychecks with personal loans because of the disruptions. When asked what providers and others should do when the MAC is not reachable by phone, a CMS staffer suggested sending a written letter to the MAC and said, ‘I don’t know what else I can tell you.’”

CMS plans to host a series of national provider calls to give an overview of ICD-10 and how it differs from ICD-9-CM. The presentations will include the major impacts providers should consider when planning to update any systems with ICD-10 codes to help them think about future reporting, system updates and training, considering that ICD-10 may be implemented in the future, the agency said. Separate conference calls have been scheduled for hospital staff and physicians, but the same information will be presented for other Part A and Part B providers on Nov. 12 from 12:30 to 2:30 p.m. EST. Registration information for the call will be available soon, CMS said.

The Department of Justice and the Medicare Fraud Strike Force have announced the Sept. 18 arrests of 18 Los Angeles-area residents indicted in Medicare fraud cases totaling than $33 million. In eight separate criminal cases against DME company owners, clinic owners and medical professionals, allegations include the fraudulent ordering of power wheelchairs, orthotics, hospital beds, feeding apparatus and supplies. The largest case involves four suspects--the owners of multiple clinics and DME companies in LA and Van Nuys--who allegedly submitted more than $16.3 million in claims for “medically unnecessary” PWCs between April 2007 and June 2008. “With real-time access to Medicare claims data, law enforcement in Los Angeles is developing better tools to enhance our abilities to combat fraud in our community,” U.S. Attorney for the Central District of California Thomas P. O’Brien said in a statement.

Coming Up
On the HME Calendar
The Midwest Association for Medical Equipment Services (MAMES) will hold its Fall Conference in West Des Moines, Iowa, Oct. 2-3, with a pre-conference program on Oct. 1. For information, call 651/351-5395 or visit www.mames.com.

The West Virginia Medical Equipment Suppliers Association (WVMESA) will hold its Annual Fall Conference in Charleston, W.V., Oct. 6. For information, contact Pam Kaehler at 304/285-2700, ext. 18, or kaehlerp@monhealthsys.org.

The National Association for Home Care and Hospice (NAHC) has set its 27th Annual Meeting & Exposition in Ft. Lauderdale, Fla., Oct. 11-15. For information, call 202/547-7424 or visit www.nahc.org.

The National Community Pharmacists Association (NCPA) has scheduled its 110th Annual Convention and Trade Exposition in Tampa, Fla., Oct. 11-15. For information, call 703/683-8200 or visit www.ncpanet.org.

MAMES will hold its South Dakota State Meeting Oct. 15 in Pierre, S.D. For information, call 651/351-5395 or visit www.mames.com.

Medtrade and AAHomecare will present the Continuum of Care and Reimbursement Conferences on Oct. 27 preceding Medtrade's 29th Annual Conference and Expo Oct. 28-30 in Atlanta. For information, visit www.medtrade.com.

Visit this week's sponsor at www.brightree.com/ecosystem