MED Group President Bill Elliott said the Lubbock, Texas-based organization has already begun a search to fill its government affairs job. "It's an important part of what we do for our members and for the industry," he said.

Florida Medicaid Probes Oxygen Providers
MIAMI--Florida’s Agency for Health Care Administration said last week it is zeroing in on home oxygen providers suspected of defrauding the Medicaid program.

”Investigators have found that Medicaid paid for equipment that is missing, unused or was never received by the patient,” an AHCA press release announced. As well, some beneficiaries may have received kickbacks from providers, officials said.

Holly Benson, secretary of AHCA, told reporters at a press conference on Thursday that a team of state investigators conducted site visits at 12 providers and visited more than 120 beneficiaries who had received oxygen concentrators in Miami-Dade County. Now they will evaluate the results to figure out whether the discrepancies are the result of billing errors, abuse of the system or Medicaid fraud.

AHCA focused on oxygen providers because concentrators were Florida’s top durable medical equipment expenditure. The Miami-Dade County area was targeted because of its high reimbursement levels for oxygen concentrators, Benson said. Last year, Medicaid reimbursements for concentrators tallied more than $1.4 million in the county, about 17 percent of the statewide total of $8.5 million.

In all, Medicaid spent $90 million in 2008 on HME for 150,000 beneficiaries, according to ACHA.

“As the cost of health care continues to rise, it is important that we ensure the integrity of the Medicaid program stays intact,” Benson said. The goal of the investigation, she continued, is to ensure that appropriate services are being delivered and billed correctly, as well as to determine that beneficiaries have been trained how to use their equipment.

The Miami-Dade investigation follows another earlier this month that focused on the Tallahassee area and Escambia County.

“Escambia County was targeted for the current investigation because it ranks seventh in the state in billing for oxygen concentrators, even though its Medicaid population represents only a small percentage of total recipients,” according to an AHCA release.

Last Monday, Florida Gov. Charlie Crist signed a bill declaring Miami-Dade a crisis area for health care fraud and tightening regulations on home health agencies, HME providers and health care clinics.

In May, the federal government announced a new Health Care Fraud Prevention and Enforcement Action Team that will increase anti-fraud enforcement efforts in Miami and Los Angeles.

Identity Theft Scam Snags Medicare Docs
BALTIMORE--According to a Thursday alert, CMS has become aware of a scam in which perpetrators are sending faxes to physician offices posing as the Medicare carrier or Medicare Administrative Contractor (MAC).

The fax instructs physician staff to respond to a questionnaire to provide an account information update within 48 hours in order to prevent a gap in Medicare payments. The fax may have the CMS logo and/or the contractor logo to enhance the appearance of authenticity, the scam alert said.

A Friday update from NHIC, the A/B MAC for Part B, said once obtained, the personal information is being used to complete fraudulent Medicare provider applications for new practice locations. Once the new provider number is established, the scammers quickly submit a large volume of claims to the Medicare carrier for payment.

In one instance, NHIC said, "a provider received a fax on what appeared to be the carrier's letterhead. The fax was labeled 'CMS File Update' and asked for a series of documents, including copies of the physician's medical license and driver's license. The physician faxed the requested information to a toll-free '877' number. The unknown party then submitted a Medicare provider application (CMS 855) under the provider's name and set up a 'fake' office in another city. The real physician discovered the fraud when a third-party insurer contacted him for a refund on a patient that was not his."

According to the CMS notice, all Medicare fee-for-service providers should be wary of this type of request. "If you receive a request for information in the manner described above," CMS said, "please check with your contractor before submitting any information. Medicare providers should only send information to a Medicare contractor using the address found in the download section of the CMS.gov Web site at www.cms.hhs.gov/MLNGenInfo/ or www.cms.hhs.gov/MedicareProviderSupEnroll."

Apria Begins Billing Office Consolidation
LAKE FOREST, Calif.--As part of a consolidation of its billing offices announced earlier this year, Apria Healthcare will move at least 200 employees into a new facility in Overland Park, Kan., by the end of the summer.

The 101,000-sq. ft. office location, part of Sprint Nextel’s $1 billion headquarters campus, will expand to between 450 and 550 employees in three to four years, according to Apria Executive Vice President Lisa Getson.

The current billing and collection jobs will be moved from “other relatively large respiratory/HME billing centers” in Washington, Oregon, Hawaii, Illinois, Ohio, Florida and Connecticut, Getson said. Those facilities will gradually consolidate into the Overland Park center and two others in Jackson, Tenn., and Tempe, Ariz.

In all, 13 billing centers will be affected over the next 12 months, closing by mid-2010.

Separately, Getson said, two large Medicare respiratory/HME billing centers will consolidate into a single location in Canonsburg, Pa., on the same timeline.

“Unfortunately, Medicare cuts are translating directly into staff reductions in these states,” said Getson, adding that “Apria is doing everything it can to minimize the impact on employees.” The company announced the closings internally in mid-April and is offering career counseling and relocation assistance if affected employees want to move to one of the three consolidated centers or to other jobs within the Apria network.

Apria already has 250 employees in Overland Park area offices, including respiratory/HME branches, a home infusion therapy pharmacy and an inhalation therapy/diabetic supply pharmacy.

Citing home oxygen cuts of 27 percent this year due to the 36-month cap and the 9.5 percent DME reimbursement reduction, Getson said “the company must continue to find ways to lower costs to become even more efficient in order to position itself to navigate the cuts in the short term and continue to serve patients over the long term.”

HME Company Newswire
Cape's Sheehan Meets Sebelius; Home Care Medical Turns 35
SANDWICH, Mass.--Cape Medical Supply CEO Gary Sheehan got the word out about home care to HHS Secretary Kathleen Sebelius and Massachusetts Gov. Deval Patrick at a June 5 forum on health care reform. The invitation-only event was held at Boston's Tufts New England Medical Center.

“I was fortunate to have Gov. Patrick call on me for a question, and Secretary Sebelius gave a thoughtful answer about the role she saw home care playing," said Sheehan, who delivered a statement to Sebelius along with supporting materials on the value home care brings to the health care continuum. "One of my central points centered on the Hippocratic Oath, which states ‘above all else, do no harm.’ The government must be careful in the rush to complete the reform process that they do not dismantle or destroy key programs providing long-term value to patients and the system.”

Home Care Medical Turns 35
NEW BERLIN, Wis.--Home Care Medical, founded by father and son David and Richard Rolfs in 1974, is celebrating its 35th anniversary. The company, which started with two employees and 1,100 customers in the Milwaukee area, had grown to serving most of southeastern Wisconsin by 1983. That same year, the HME helped found the Wisconsin Association of Medical Equipment Services (WAMES). Now, with nearly 39,000 square feet of space at its corporate headquarters plus an 8,000-sq. ft. retail store open six days a week, Home Care Medical "will continue to expand to meet the needs of our customers," said President John Teevan, who took the reins in 1990.

Kelly's Expands
DAVENPORT, Iowa--Kelly’s Medical Equipment & Supply has moved to new digs in an effort to grow its retail business. Owner Bill Kellenberger told the Quad Cities Business News that due to Medicare cuts, "we needed more walk-ins." The company now occupies 7,500 square feet of a former Kunkels Sport Center building. Kelly's also has stores in Moline, Geneseo, Kewanee and Galesburg, Ill., and Clinton, Iowa.

Pediatric Asthma Program Singled Out
ST. PAUL, Minn.--Pediatric Home Service has earned The Joint Commission’s certificate of distinction in disease-specific care for its pediatric asthma program, the only U.S. program independent of a hospital or health care organization with the certification. For a look at PHS, see "Safe at Home," HomeCare, October 2008.

In Brief
AARP Backs Transitional Care Benefit; CNN Investigates NCB
On Wednesday, AARP threw its weight behnd the bipartisan "Medicare Transitional Care Act," introduced by Sens. Jeanne Shaheen, D-N.H., and Susan Collins, R-Maine. The legislation would create a new Medicare benefit to coordinate care during a person's transition from a hospital to their home or other care settings. Such a benefit could could help save some of the estimated $17 billion Medicare spends each year on preventable hospital readmissions, AARP said.

"It's unacceptable that 20 percent of people in Medicare who visit the hospital will return within a month, often because they aren't getting the follow-up care they need,” said AARP Executive Vice President Nancy LeaMond. "We're sending home too many people with a handful of prescriptions and no support. Something as simple as help to set up a medication schedule could be the difference between getting healthy or winding up back in a hospital bed.”

Reps. Earl Blumenauer, D-Ore., and Charles Boustany, R-La., have introduced a companion bill in the House.

Earlier this month, AARP endorsed the "Empowered at Home Act," which would provide incentives for states to expand access to home and community-based services. (See AARP Endorses 'Empowered at Home Act,' June 8.)

CNN Investigates NCB
AAHomecare reported Wednesday that CNN is working on an investigative piece on HME spending and national competitive bidding. "AAHomecare has opened its doors to CNN and has methodically shared reams of information with the producers" and "is working to ensure accurate reporting and fair treatment by CNN," the association said. Stay tuned.

MACs Summarize LCD Revisions
Last week the DME MACs sent a summary outlining changes to local coverage determinations and policy articles on oxygen and therapeutic shoes. Read the notice on the Jurisdiction C Web site.

Heartland Attendees Welcomed in Waterloo
After regional flooding caused an evacuation of VGM’s Heartland Conference last year, more than 800 HME providers, manufacturers and others gathered earlier this month in Waterloo, Iowa, the member services group’s hometown, for the eighth annual event. Held at the Five Sullivan Brothers Convention Center June 8-11, the conference featured 109 educational sessions across eight tracks: executive, operations, products and technology, regulatory issues, rehab, reimbursement, respiratory and sales and marketing. In the exhibit hall, 73 vendors showed off their latest products and services.

Attendees were able to earn up to 23 continuing education units from eight accrediting bodies: NRRTS, RESNA, AARC, University of Pittsburgh, IACET, ABC, BOC and the Iowa Board of Nursing. They also got a welcome dose of VGM’s famous Midwest hospitality at a hog roast, gala party and bowling tournament.

VGM officials called the event particularly timely this year with health care reform “a front-burner issue.”

In other VGM news, the group has revised the schedule for its competitive bidding seminar dates to align with CMS’ new timeline for the rebid of Round One. Beginning next month and running through early September, the seminars will be held in all nine bid areas. For dates, cities and information, visit www.vgmncbservices.com.

Invacare Scores Again
Following its ranking among the Fortune 1000 earlier this month, Invacare, Elyria, Ohio. moved up on IndustryWeek Magazine’s U.S. 500, a list of the largest publicly held manufacturing companies headquartered in the United States. The company is ranked 393, up from its 2008 ranking of 407. “When I led the leveraged buyout of Invacare in 1979, Invacare had three small Ohio manufacturing facilities. Over the past 30 years, Invacare has grown to 14 manufacturing locations in North America and 16 additional manufacturing facilities throughout the world,” said Chairman and CEO Mal Mixon.

NCAMES Director Named Outstanding
Beth Bowen, executive director of the North Carolina Association for Medical Equipment Services (NCAMES), has been named Outstanding CEO for 2008-2009 by the Association Executives of North Carolina. The award reflects outstanding leadership and achievement in association management.

Watching Those Middle-of-the-Night Soccer Games? Blame the Economy
A survey conducted in five countries around the globe found 40 percent of those questioned blame the state of the world economy as the reason for their lack of sleep. The Royal Philips Electronics survey showed the majority of respondents (61 percent) said their work was impacted negatively by lack of sleep, at an average of 6.2 days a year. Additional survey findings showed:

• The average manager is sleeping 19 percent less than the recommended eight hours a night.
• Americans are more likely than other nationalities to lose sleep through workplace stress, with 30 percent citing it as the reason they wake up during the night.
• The average amount of time it takes Americans to fall asleep--26 minutes--is more than that of any other country surveyed.
• American men lead the world in snoring, with 29 percent snoring every night.

The study surveyed 2,500 managers equally split across the UK, Germany, United States, Japan and The Netherlands.

CHAD Revamps Web Site
CHAD Therapeutics has unveiled a new Web site that, according to a company release, makes it easier to get information on products as well as to place an order and track shipments. "Faced with the myriad of issues challenging their businesses, we wanted to make it easier for our customers to do business with us," said Heather Anusbigian, marketing administrator. In 2008, Naples, Fla.-based Inovo acquired CHAD's oxygen conserving assets and retains the right to market and sell under that name.

In My View
Thoughts from the PAOC
By Rob Brant, owner of City Medical Services, North Miami Beach, Fla., and president of the Accredited Medical Equipment Providers of America

Editor’s Note: Among other arguments against competitive bidding, provider Rob Brant believes one of its goals has already been achieved: The number of oxygen providers has dropped significantly since last year, even though the bidding roll-out was delayed after an implementation of only two weeks. “In April 2008, there were 501 oxygen providers listed in the Miami MSA,” he reported. “Today, medicare.gov states that there are only 388 oxygen providers listed in the Miami MSA, a reduction of 113 providers.”

After attending a June 4 meeting of the Program Advisory and Oversight Committee, held to discuss the rebid of Round One, Brant sent along these thoughts.

“Medicare told me they resolved the problems from last year's competitive bidding program, but if you hear differently at the PAOC meeting, I want to know about it.”

That's what Congresswoman Ginny Brown-Waite, R-Fla., who serves on the Health Subcommittee of the House Ways and Means Committee, told me during a meeting in her Washington office.

Unfortunately for her constituents in the Round One Orlando MSA, little has changed. The competitive bidding program in DMEPOS is still a bid without financial accountability that will allow unqualified companies to low-ball bid to achieve their goal: not the ability to continue serving patients but to sell their company after winning the bid.

Lowest Bidder Selling Out to the Highest Bidder
A key fundamental flaw, which still exists, is that bid winners can still sell their companies and transfer their bid contract to the new owners. This resulted in companies that had no intention and ability to provide products and services to patients offering unrealistic low bids with the intent of selling a worthless business for something.

In the Polk County demonstration project a large national company bought a bid winner, and the concept snowballed from there. Last year, bid winners received calls from desperate bid losers asking to buy their companies. When common sense revealed that a bid-winning business could not survive with an average 26 percent cut in reimbursement, bid winners began calling existing companies announcing that their businesses were now for sale.

When the topic came up at the PAOC meeting, CMS officials explained that Medicare providers will always have the right to sell their companies. One of the first suggestions from the public comments was by a provider in a Round One MSA. She suggested that if the program continues, bid winners should not be allowed to transfer their contract to the new owners. I applaud this idea and feel it would help keep bids at an attempted honest level.

No History of Providing Products and Services
This was a topic that nearly the entire PAOC committee questioned: “How can a company that has never provided products and services before be allowed to win a bid?” PAOC members commented that “you don't want on-the-job training when it comes to products that provide life support.”

The most basic argument floating around the table was that these companies would place unrealistic low bids in order to win without knowing the requirements of providing expensive services. When asked for an explanation of why this still exists, a CMS representative answered, “It will increase competition.”

During the public comment period, I used my time to talk about how the new CPAP requirements would affect the uninformed bidder. I explained that a company that does not currently provide CPAP would most likely choose to bid based on the least expensive CPAP machine available.

CMS' new policy, which began in November, requires a premium CPAP device with download capability, multiple visits to the patient's house to assure compliance and additional time spent downloading reports and communicating with the doctor to make sure that the patient is using the device according to the new requirements.

Obviously a company that has never provided CPAP before will bid at a much lower rate based on a single delivery of the least expensive CPAP compared to the actual provision of premium products and necessary services.

Licensure
One of the only significant changes [in the bidding process] is that CMS will now disqualify companies that do not have state oxygen and home medical equipment licenses in place before they bid. Unfortunately, only a few states require licensure, and it was not made clear whether the license would be sent with hard copy documents or if CMS would check each applicant against state records.

Last year, nine of the 44 oxygen bid winners in Florida's Miami and Orlando MSAs did not have medical oxygen retailer licenses from the Florida Department of Health. Additionally, CPAP and enteral feed bid winners from California, Ohio, New York and other states failed to obtain a home medical equipment license from Florida's Agency for Health Care Administration. The previous Round One bid required providers to be licensed.

When CMS was made aware of the unlicensed bid winners, those companies were not disqualified. When asked, CMS stated that those companies would have to wait until they obtained the proper licenses before they could participate as bid winners, but they were merely following state laws.

Transparency
Other issues were brought up about needing only one year of financial records compared to three, and new subcontracting rules that require subcontractors to be accredited. But providers located hundreds of miles outside an MSA could still win a bid without having any subcontract agreements in place proving they could service an area.

The underlying problem is that the members of the PAOC and attendees still do not know how CMS evaluates a company's ability to cover an area, how capacity is calculated and what constitutes a valid bid that a business could live with without declaring bankruptcy. When asked at the meeting, CMS answered that [last year] they did question a bid that they thought was too low, but the bidder provided an invoice to prove the company could purchase a product at that price. The question about providing the product to the patient, training the patient, billing Medicare and providing maintenance and service was never discussed.

The PAOC did a commendable job in trying to make the competitive bidding program work, but by the end of the day, the only thing that was clear is that the outcome from this version may be another rebid of Round One in 2011.

Rob Brant can be reached at rob@amepa.us.

To revisit this news any time during the week, go to www.homecaremonday.com.

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