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I need to call a patient's family and tell them that I either have to pick up the hospital bed they are renting from me, or they have to sign a document that states they are willing to pay privately.

I provided them a bed and the claim for that bed was randomly picked by the Medicare contractor Noridian to be audited. An audit of a claim should not scare anyone—you would expect that they look at the documentation and see if the patient needs the equipment. Well it does not work that way.

Medicare first goes through every piece of paper looking for a mistake. When there is a mistake, it is an all-or-nothing mistake. It finds any type of mistake and the DME company gets its money taken back. It could be something like a doctor signing an order, but not dating his signature. Not fixable, not payable. Noridian states a 91% denial rate for three quarters in 2013.

DME companies are not dumb. We have had to figure out what words Medicare needs to see to cover equipment and make sure the doctors say something along those lines. You see, we have clients who need equipment and the doctors want to know what has to be done to accomplish that. Medicare will not make sure the doctors are educated; we are forced to.

Most DME companies are not crooked. I am definitely not a crooked person and Sandcreek Medical is not a crooked company. We fight every claim we are denied and we win most times. In fact, most of the DME companies have started fighting every claim and that has created a new problem. The final level of appeal, alone, is out 27 months to 12 years, depending on who you ask. Either way, you cannot afford to work your way through the appeals process anymore.

This particular claim is for a bed needed to take a patient home from the nursing home. The patient's daughter asked us about procuring a bed and we explained we needed chart notes from the doctor stating the need. She said that her mom had seen the doctor, so that part should be taken care of.

I explained that very few doctors will document the need for medical equipment without some one pushing them on how much documentation there needs to be. As usual, when we received the documentation from the doctor, there was no talk of needing a hospital bed, let alone the required phrases Medicare wants to see in the notes, i.e. “frequent changes of body position” “alleviate pain” and “immediate change of body position”

So this family had to take their mom back to the doctor for a visit that would document the need for the bed. I provided them a sheet that explains the basic rules of Medicare and that there needs to be talk of the reasons she needs the bed. Well this doctor did a fair job. I would have liked a little more detail, but I did not get it. I believe in my heart that she needed and still needs the bed. Then I did what every DME company in America does: hope that this claim will not be chosen for an audit.

Here is the real problem. Medicare has changed the rules of the game. According to its own statements, the agency cannot use clinical inference to say, “Oh yeah, this client really does need a hospital bed.” Instead, it has to go to the Local Coverage Determination or LCD for the rules and it sticks to the letter of the rule. Hence, a hospital bed will not be covered if a doctor did not have a statement like this: “This patient needs positioning in ways not feasible in an ordinary bed. This patient needs frequent changes in body position in order to alleviate pain.” If those words were not in the chart notes, then Medicare was going to deny the claim. In the real world, that means one of three things: 1) The DME company is going to loose money, 2.) the patient is not going to get the equipment they need, or 3.) the patient will have to pay privately. With the tighter profit margins and amount of time and money it takes to fight claims, many times we are forced to tell the patients they have to pay.

Back to changing the rules of the game. I believe that Medicare started to see the words it wanted to see in the chart notes. It saw the word “frequent” and it saw the word “alleviate.” It should be happy, but instead of quoting the LCD verbatim, we have a new weapon called the PIM 5.7. Now Medicare is going to focus on the statement, “For any DMEPOS item to be covered by Medicare, the patient’s medical record must contain sufficient documentation of the patient’s medical condition to substantiate the necessity for the type and quantity of items ordered and for the frequency of use or replacement (if applicable).” What is sufficient enough and when is it inapplicable—that is up to Medicare and its auditors.

Medicare still wants to know that it is frequent, but how frequent. It wants to know not only that it will alleviate pain, but also what are the levels of pain, and the frequency of that pain, or how the bed is likely to alleviate that pain. It wants to know if the patient has had experience with this equipment before. It wants to know if the patient has had any therapeutic interventions. Most importantly, it wants it detailed and it does not want any vague answers.

Unfortunately, in our business we deal with real people in their worst part of life. Some times a hospital bed is needed for someone who is dying and the doctor does not really know that the hospital bed will alleviate his or her pain. The doctor knows that the patient is in pain, and the patient needs a hospital bed to be able to be at home with family. The doctor is sometimes just hoping that the bed will alleviate pain. Sometimes morphine will not alleviate the patient’s pain.

Below is Medicare's answers to why this patient does not meet the medical criteria for the bed. As you read these statements, remember that the doctor is required to document this in his normal chart notes. Even if he wanted to write a letter or a 500-word essay stating why this client needs a hospital bed, the letter or essay would not be considered part of the medical record. The documentation must be in the doctor’s normal chart notes. This particular doctor has a unique way of doing his chart notes. He has forms where he will X out words and circle others. He will write little statements to the side and makes notes that tell him how the patient is doing. These same chart notes have been used for years and used to document conditions that are more complex than a hospital bed referral. I do not believe that his chart notes could ever get a hospital bed covered and that is sad.

As you read the statements from Medicare, pay close attention to this: “Verbiage such as pain is vague, subjective, and insufficient. Clear objective documentation and quantifying information is lacking.  This type of verbiage does not provide a clear picture of the beneficiary's pain.” Then keep in mind that Medicare does not have objective rules on what frequent is. It cannot tell you what level of pain is acceptable. It cannot tell you what functional limitation it is looking for, or what therapeutic intervention is acceptable. It will not tell you exactly why the documentation does not support that the beneficiary requires frequent changes of body positioning and it will not say exactly what part of pages 5-8 are illegible, just that they are partially illegible.

What Medicare is really saying is, do as we say, not as we do. It is saying that we must provide clear, objective data, written in the doctor’s normal chart notes, and only the agency can be subjective on the reasons it denies the equipment. It says that verbiage such as pain is vague, subjective and insufficient—the doctor used the words severe pain. Maybe that was one of the illegible words; I do not know because Medicare does not have to be clear, objective, or quantified.

Noridian Medicare Denial Documentation

Medical records submitted to not support the beneficiary has a medical condition which requires positioning of the body in ways not feasible with an ordinary bed, the beneficiary requires position of the body in ways not feasible in an ordinary bed in order to alleviate pain, the beneficiary requires the head of the bed to be elevated more than 30 degrees most of the time due to congestive heart failure, chronic obstructive pulmonary disease, or problems with aspiration or the beneficiary requires traction equipment.

The documentation does not support the beneficiary requires frequent changes in body position and or has an immediate need for change in body position and or has an immediate need for change in body position.

When a hospital bed is needed for positioning, the medical documentation should describe the severity and frequency of the symptoms of the medical condition that necessitates a hospital bed for positioning.

The information should include the beneficiary's diagnosis and other pertinent information including, but not limited to, duration of the beneficiaries condition, clinical course, (worsening or improvement), prognosis, nature and extent of functional limitations, other therapeutic interventions and results, past experience with related items, etc.

Verbiage such as pain is vague, subjective, and insufficient. Clear objective documentation and quantifying information is lacking.  This type of verbiage does not provide a clear picture of the beneficiary's pain.

Medical documentation should describe the severity and frequency of the symptoms of the medical condition that necessitates a hospital bed for positioning and how it will alleviate pain.

A semi-electric hospital bed is covered if the beneficiary meets one of the criteria for a fixed and requires frequent changes in body position and/or has an immediate need for a change in body position.

ABN dated 11/14/2014 invalid as incomplete section C.

Pgs. 5-8 partially illegible.

Deny E0260

I now have to do the part of the job I do not like. I am going to have to call the family and give them a choice between paying privately for the bed, or having me pick the bed up. I no longer can fight a bed like this through the appeals process. Money is too tight and the time it takes is too long. You see, you would think that the requirement of an Administrative Law Judge hearing your case in 60 days would happen within 60 days. Somehow that has turned into a minimum of 27 months and a letter asking us to be patient, but that is a different issue.

I now have to do the part of the business that I do not like and I have to call this patient and say that the bed is not covered. I am also going to say that until patients start contacting their elected officials, these are only going to be seen as numbers and not as someone's mother.

Gary Rench is the owner and manager of Sandcreek Medical in Sandpoint, Idaho, a small DME and respiratory company started in 1989. He can be reached at

by: Guest Blogger - Thursday, November 20, 2014

We all know that Black Friday and Cyber Monday are nearly upon us, however we are in a very unique industry in that most people will not be purchasing medical supplies for gifts. So the question becomes, how can we use these manufactured holidays to sell more cash and retail items. 

Below I have listed a few ways in which you can use creative marketing and advertising to reach more customers and attract potential new ones.

Play into consumers’ state of minds

Gift cards: Your customers will already be in the “shopping state of mind” so to speak, so play into this by offering them gift cards to stores where they may already be planning to make purchases. For example, you could have a promotion that says “Spend $75 or more today on Incontinence items and receive a $5 gift card to Target.” It’s not a lot, and I know some of you may be saying “My margins on cash already thin, I can’t afford to give away $2 dollars let alone $5!” I would agree with you on that, however by offering a discount around the “shopping state of mind” season, you will evoke a great brand building interaction with your customer.

Offer something free

Shipping: If you have an online store, free shipping is the No. 1 discount by far. Try to offer free shipping site wide for Cyber Monday. Research your competition and ask yourself, “How can I do this better? What can I do that is more compelling and unique?” 

Email Blast

Leverage the hype: Use Black Friday and Cyber Monday as an excuse to reach out to your customer base. As we talked about previously, everyone is already in the shopping state of mind, and from my experience customers are more open and receptive to advertising based around these days for our industry.

Get personal: The holiday season is the perfect time to get personal with your customers. Try working in “from the desk of” email blasts. These are emails that come from C-level executives and usually have a small blurb about the holiday season and how important the customers are to the business (which they really are). 

In the fast moving age we live in, it can be difficult to keep up with the large companies and brands that have huge advertising budgets and planning. However we have the unique opportunity to really shine in our industry as our customers trust us with the most important gift of all, health. Use this time of the year to let your true colors shine as a provider, vendor, or manufacturer.  Tell your story, tell customers why it’s important that their health and well-being matters. I’ve always liked the saying I learned when I first started in this industry: “Our patients never take vacations from getting sick, and we never take vacations from providing them the products and services that allow them to live the best possible life” 

Justin Racine serves as Marketing & eCommerce Manager for Geriatric Medical in Woburn, Massachusetts. Geriatric Medical is a medical supply distributor that stocks thousands of name brand and generic products at the lowest possible price. As Marketing & eCommerce manager, Justin is in charge of overseeing all marketing and eCommerce efforts for both Geriatric Medical and its customers.

Van Miller
CEO and founder, The VGM Group

Editor’s note: The following is a letter to the editor from Van Miller that appeared in the Waterloo Cedar Falls Courier in July. The letter is in response to another reader’s letter decrying fraud and abuse in the Medicare program—a letter that ended with, “Here’s to audits, let there be more.”

It’s absolutely amazing how some people look at statistics and make an overall generalization. Bob Black’s June 25 letter to the editor expressed an opinion without apparently knowing much about the underlying subject matter. I would like to correct the misunderstanding and set the record straight.

Providers of home medical equipment for Medicare/Medicaid patients are under siege through the use of “audits.” Black refers to an FBI estimate on Medicare/Medicaid “fraud,” which is a term they frequently use loosely to also include “improper payments.” This includes situations where a patient and his/her doctor order equipment for use in the home, that equipment is delivered and used by the patient, and then years later (after an “audit”) the government finds there is insufficient documentation in the file to support that ordered equipment under Medicare’s then-current interpretations of what is required. In the case of home medical equipment companies, which, percent-wise, are less than 3% of total Medicare expenditures, here is the real story about the misuse of post-payment audits.

Companies that do the audits are private independent contractors that are paid hundreds of millions of dollars or a contingency. To show the government a return on its investment, they often find minor technical errors or omissions in documentation (most often the doctor’s records) and do not take into account the medical need for the services provided.

These contractors have little oversight as evidenced in this 2011 report by the Office of Inspector General. Because the vast majority of these audit “recoveries” are based on physicians not crossing the Ts or dotting the Is in their records, the preliminary audit findings are eventually overturned through the appeal process. The administrative law judge that finally gets to hear the facts finds the patient did need the equipment, his/her doctor did order the equipment and the provider did deliver the equipment. However, at this time, the appeal process can take up to three years or more. In the meantime, these audit contractors are paid a percentage of claims “found” to be “improper.” It is essentially a “gotcha” game played years later with someone else’s records being found inadequate by someone who is paid to do so.

Meanwhile, many of the providers, especially smaller providers, are being put out of business because they can’t sustain their business. Imagine if you were told years after the fact that your employer was taking back the pay they gave you because they found that someone above you in the company didn’t fill out your paperwork correctly that month. Imagine the hours and hours of work that must go in to defending these post-pay audits years later, while you are otherwise struggling to take care of current patients.

There are lower levels of administrative appeal, but these are almost knee-jerk denials by Medicare staff that have no incentive to spend time on old problems. On the rare occasion they do, 70% of the audit denials are easily overturned. Medicare has recently adopted a policy of not paying the auditing companies until the first two appeal steps are completed. This doesn’t help much because most of the time those first two appeals processes are not substantive (for example, they might stamp a thousand claims “reviewed” in one morning). Again, most will be overturned when actually reviewed by an administrative law judge, thus the auditing companies are being paid a percentage of those denials.

If space permitted, I could also explain how home medical equipment suppliers save Medicare/Medicaid hundreds of millions of dollars a year by allowing patients to be treated outside of hospitals and nursing homes.

So, Mr. Black, I would appreciate it if you’d call me so I can further explain why this audit process is not just “annoying and a pest,” but rather how it’s putting honest and efficient small businesses out of business and helping to drive healthcare costs higher and higher.

Van Miller is CEO and founder of The VGM Group.

Jamie Loper
co-founder, DMEevalumate

As Elmer Fudd would say “Be vewwy, vewwy quiet...I'm hunting wabbits!” The Centers for Medicare and Medicaid Services (CMS) may not be hunting rabbits, but they’re hunting the very elusive greenbacks.

On September 1, 2012, CMS implemented the prior authorization (PA) for power mobility devices (PMDs) demonstration in seven states: Cal., Fla., Ill., Mich., N.C., N.Y. and Texas. CMS claims that spending per month on power mobility devices in the seven demo states has decreased since September 2012, as has spending per month on power mobility devices in the non-demo states. Looking at the statistics provided by CMS, it appears that roughly half (50% to 52%)of requests during the first year of the demonstration were non-affirmed, with the basis for the denials that the beneficiaries do not qualify for the benefit based on the documentation submitted. On April 4, 2014, CMS requested approval to expand the PA Demonstration for PMDs to 12 additional states. Are you ready MD, N.J., Pa., Ind., Ky., Ohio, Ga., Tenn., La., Mo., Wash. and Ariz.?

In a stealthy scouting move during 2012, CMS also signed a five-year contract with Strategic Health Solutions, LLC, a supplemental medical review contractor (SMRC), to perform reviews aimed at lowering improper payment by determining whether Medicare claims were billed in compliance with coverage, coding, payment and billing practices. In a move that should be lauded by the DME industry, Strategic is paid by CMS based on a flat fee arrangement; that is, unlike the Recovery Audit Contractors (RACs), SMRC is not paid a contingency fee for alleged overpayments. SMRC work is also not intended to overlap with that of RACs, but as seen below, their work has inevitably overlapped, causing inefficiencies.

CMS directed one of SMRC’s initial focuses to be post-payment medical review of PMD claims from those states not included in the demonstration project. These post payment reviews were to determine whether the claims submitted were billed in compliance with the PMD policies. The post-payment reviews were not to be limited to K0823; CMS directed SMRC to include all power mobility devices, including complex rehab. The project consisted of a random sampling of 1,200 claims—300 claims per the four DME MAC jurisdictions. SMRC was supposed to conduct their post payment review on claims that had not been audited by another contractor, yet 369 of the 1,200 claims (31%) had previously been reviewed by another Medicare contractor. The 831 remaining claims from this initial sampling with dates of service July 1, 2011—December 31, 2012, revealed an overall total error rate of 60%.

CMS posted an update to its website on February 18, 2014, explaining the wind-down of current outstanding claim reviews to finish out the current recovery auditor’scontracts.The rational for this wind-down was time needed to prepare for the next round of RACs. It is important to note that on March 7, 2014, CMS posted an update reminding providers the Recovery Audit Programs would continue to conduct automated reviews through June 1, 2014. Two RACs have filed “pre-award” protests with the Government Accountability Office (GAO), regarding some of the changes planned by CMS for the next round of five-year RAC contracts. CGI Federal and HMS Holdings (which owns HealthDataInsights) object to CMS’s changes to the next RAC installment. CMS said it would, among other things, revise the number of medical records that RACs can request from providers, reducing them for providers with low claim denial rates, and not pay RAC contingency fees for overpayments until it was clear they would survive the second level of appeal.

If a RAC comes hunting at your company, could you withstand a 60% denial rate? Your company should take advantage of this wind-down time to gear up. CMS is attempting to make its hunting trips as profitable as possible, therefore high-risk providers will be targeted. In other words, failing an audit increases the chances of another audit in the near future. In order to pass audits it is important to ensure that all face-to-face documentation is compliant before delivering the equipment. Encouraging your referral sources to use an algorithmic face-to-face program ensures that medical necessity policies are followed and equipment that is vended will pass muster.

Be prepared for hunting season; don’t get caught out in the open like a sitting duck! Adjust billing practices today and make sure you are in compliance with CMS policies. Look to those who have positive experiences with the PA demo. Perform self-audits on paperwork before the equipment is dispensed. Always have two or even three different people review paperwork. Use checklists. Eliminate the unfavorable odds. If the hunting is good at your company a RAC will return looking for more wabbits.


The DME/HME industry for the past 30 or more years has been cyclic. There have been changes, but most providers have experienced very good years.

But the times are now rapidly changing. CMS and Medicare have been running out of funds. They are looking for every way possible to delay reimbursements. They move forward without any thoughts of how these delays will affect the beneficiaries and providers.

AAHomecare is leading the battle, together with the state DME associations, against these onerous and oppressive changes.

The industry has twice failed to get legislations out of committee that would change this. We cannot allow this to happen once again.  The “market pricing program,” H.R.1717, is still waiting for more congressmen to get on board—or it will fade away! There is so much at stake for every DME/HME dealer.

AAHomecare and the state DME associations will get better results if they obtain much more support. Every DME/HME dealer must become a dues-paying member or face the possibility of having to close their doors. It is that desperate. The cost of membership in both these organizations is so minimal (and written off as a business expense), that I do not comprehend the hesitation.

Dealers must get off their soft chairs and immediately contact both AAHomecare and their state associations. Join now to stay in business. Work with them to protect your company and livelihood. Attend the meetings, go to Medtrade and insure you’re staying solvent. By doing this—joining—you will continue to support your families and those of your employees, and most important, all your customers, your senior citizens and bed ridden.

Take a giant step forward by being a joiner!

If you remember The Roy Rogers Show, you might remember Roy's sidekick, Pat, driving the old Jeep nicknamed Nellie Belle. On occasion, Nellie Belle would get out of control and Pat would yell, “Whoa Nellie Belle." (It was shortened by most people to just plain "Whoa Nellie.") Today, we have a different vehicle out of control: Medicare. Someone needs to holler "Whoa Nellie!” and put a stop to this runaway, out of control renegade before someone gets hurt.

Home medical equipment (HME) providers, hospitals, physicians, and home health and hospice agencies have been assaulted by an unprecedented numbers of audits. The latest numbers show that in the first quarter of fiscal year 2013, the recovery audit contractors (RACs) collected $744.8 million in overpayments. And while providers in all four regions were hit hard, those hit the hardest were in Region C, which had to pay back $244 million in the first quarter of 2013. This is only expected to grow. As reported in Decision Health Daily's recent Red Alert, CMS is paying bounties to a new private corporation. A fifth RAC will have jurisdiction nationwide over just HME and home health and hospice. This expands on the four existing RACs, which have limited jurisdiction by state.

On Feb. 12, the Office of Medicare Hearings and Appeals (OMHA) hosted a very informative and eye opening Medicare Appellant Forum. The purpose was to provide updates to appellants on the status of OMHA operations and relay information on a number of OMHA initiatives designed to mitigate a growing backlog in the processing of Medicare appeals at the administrative law judge (ALJ) level.

These numbers, released by OMHA, will make you yell "Whoa Nellie” over and over! When a request for a hearing is made, requests are mailed to OHMA and processed manually. The average response time to acknowledge that the OMHA request for a hearing was received is 18 to 22 weeks, or almost 6 months. There are 65 judges hearing cases, Chief ALJ Nancy Griswold reported. Judges are hearing, on average, 4.9 cases per day. It would take 65 judges 3,061 days to rule on one week's worth of cases.

Other stats shared at the forum:

  • OHMA receives 15,000 cases per week
  • OMHA has 375,000 cases assigned to be heard
  • There are 480,000 cases waiting to be assigned to a judge.
  • There are 220,000 cases waiting to be added to the OMHA system, manually.
  • It’s 28 months until a case is assigned to a judge
  • 177,283 cases have been assigned through July 15, 2014
  • Once a case is assigned to a judge, the average days to a decision is 329.8 days—and that's after it gets assigned

During the forum, a panel of judges took questions from attendees. Many of the attendees offered the opinion that the tremendous backlog of cases is due to the massive amount of denials at the lower level of appeals and asked what could be done to provide relief.

Griswold expressed several times that OHMA is looking at a "holistic" approach to the challenge that OHMA faces. OHMA is seeking to digitize claims so that they can be processed electronically, said Bruce Golden, director of information management. Golden spoke about OHMA's IT efforts to help process claims. A program called ESCAPE (yeah, right) should be ready to launch by 2016 (Don't hold your breath).

I wish Pat from The Roy Rogers Show was around today to yell, "Whoa Nellie!" so that someone would listen and stop this madness. Those were the good ole days, but the good ole days are gone and Roy is not around to help. It is up to suppliers to yell out, loud and clear!

Jonathan Temple owns OxyMed in Birmingham, Ala.

Don Clayback
executive director of NCART

There’s a great deal of activity regarding healthcare policy changes with the goal of providing quality care and services in the most cost-effective manner. But to be successful, the process must include input from all parties so that changes are made in a fully informed manner and result in the most effective and positive outcomes.

That’s not happening when it comes to Medicare’s coverage of complex rehab technology (CRT).

Medicare policy changes impacting CRT during the past year fall under negative reform. It’s reform that makes it harder for beneficiaries with significant disabilities to get the specialized equipment and services they need. It’s reform that will actually increase healthcare costs. And to compound the problems, Medicaid programs and private insurance plans may follow Medicare’s lead.

CMS has an obligation to administer the Medicare program in a responsible manner, which includes properly evaluating and implementing changes. This obligation necessitates incorporating input from knowledgeable stakeholders who can speak to how a change may increase healthcare costs, decrease quality of care, or have a detrimental impact on clinical and functional outcomes. CMS is consistently ignoring this critical requirement.

The most recent and egregious example is the disregard of public comments on a final rule issued Nov. 22, 2013, that included a reclassification of certain mobility and seating codes from the “routinely purchased” payment category to the “capped rental” payment category.

CMS chose to ignore more than 170 letters and issued its final rule with virtually no changes. Many letters were from well-recognized national consumer and clinical associations. Commenters noted a major problem with a classification relying solely on Medicare claims data from 1986. Common sense indicates the methodology needs to be updated and additional criteria added. Letters also pointed out Congress set a precedent in 2010 that CRT items should be classified as routinely purchased given their specialized and individually configured nature.

These and many other constructive comments and recommendations were completely ignored or discounted by CMS. If the rule is left unchanged, it will have significant negative impacts to Medicare beneficiaries with disabilities. Thankfully, interested congressional offices have agreed to look into this.

Sadly, there are many other recent examples where the disregard of constructive stakeholder comments produced bad policy and will hurt access: the new requirement that beneficiaries must go through the time and expense of a doctor’s examination before they can get their wheelchair brake fixed or their seat belt replaced; the drastic reductions in access to wheelchair repairs due to a competitive bidding program that took bids from companies offering unrealistically low prices without requiring them to actually do repairs at the new rates; and the various changes to how modified and custom manual wheelchairs are coded and reimbursed. 

Genuine collaboration can work if given a chance, as seen in CMS’s prior authorization demonstration project for certain power mobility devices. Upon initial announcement of this three-year demonstration, stakeholders endorsed the concept but pointed out significant problems with certain operational details. To the credit of CMS, it delayed the original start date, and took the time to hear and incorporate comments on how best to roll out a program that would increase safeguards, but not negatively impact beneficiaries. Why can’t this inclusive process, one that protected both the Medicare program and its beneficiaries, be replicated for other Medicare changes?

On a positive note, CRT issues and concerns have gotten the attention of Congress through federal legislation to create a separate benefit category for CRT (H.R. 942 and S. 948). Once this bill is passed, it will provide a foundation for improved safeguards, policies, and recognition on a federal and state level.

There needs to be a change in mind-set and process at CMS. Knowledgeable national consumer, clinician, and industry associations remain committed to working with CMS to promote the provision of quality CRT and support services in the most cost-effective manner. But they need to be genuinely included. That’s what will produce the best decisions for both the Medicare program and its beneficiaries.

Don Clayback is executive director of NCART. Reach him at

Jerry Hall
owner, Hall-Moore Medical Supplies

On Nov. 5, the North Florida Coalition of Home Medical Equipment providers coordinated a meeting between several of the largest hospital systems in North Florida, along with some nursing facilities and the local offices of Sens. Bill Nelson and Marco Rubio, and Rep. Ander Crenshaw. Our coalition has been very active in communicating the competitive bidding issues with our lawmakers; however, we felt it was time that they heard from the case managers and nurses themselves (the horse’s mouth).

The floor was opened to the referrals to talk about the problems they were having with the program. Among their answers:

o      Delayed discharges
o      Readmits because patients were not receiving needed equipment (pointing out that Part A spending increases)
o      Hospital referrals are having to wait seven to 10 days for orders to be filled
o      Skilled nursing facilities (SNFs) are having to wait two to three weeks for their orders to be filled
o      Hospitals and SNFs are being told to do all of their own pre-certifications, including labeling all HCPCs.
o      Referrals have made complaints directly to the CBIC; however, they see no consequences for the winning providers and access has not improved. Winning providers are telling referrals they have to be more patient. Winning providers are telling referrals that equipment is on back order.
o      Referrals are being told that deliveries are limited to the hours of 8 a.m. to 5 p.m.
o      Referrals are being told that deliveries are limited to zip code areas (excluding some zip codes that are clearly part of the contract they won).
o      Referrals are being told that deliveries are limited to weekdays only.
o      Referrals are being told by the winning provider that a part of the order can be filled, but not the entire order.
o      Referrals are having to obtain multiple companies for one patient’s needs.
o      Patients and/or their families are blaming the hospital case managers when equipment hasn’t been delivered after discharge. One winning provider is telling patients that the hospital isn’t sending the orders and that is why there is a delay in getting the equipment.

The meeting went very well and the case managers from the hospitals and rehab facilities were very blunt in talking about access issues under this flawed program. The case managers explained to the lawmakers that before this program started on July 1st, they could get medical equipment for their patients within hours any time of the day or night. Now all of that has changed.

Due to the problems that are occurring in the Jacksonville competitive bidding area (CBA), case managers were not surprised to see studies showing that 80% of the winning winners in the CBA were out-of-area providers who were not servicing the area prior to July 1st, and that approximately 75% of the winning providers for walkers and hospital beds were still not capable of servicing the area three months into the program. One hospital stated that they contacted every winning provider for the Jacksonville CBA and found that most were not capable of servicing the area. The lawmakers found this very disturbing.

I then showed everyone a copy of the response letter I received from the deputy director at CMS concerning my testimony about competitive bidding to the Small Business Administration. In the letter, the deputy director states in paragraph five that CMS conducts an evaluation of expansion plans to verify the supplier’s ability to provide items and services in the CBA on day one of the contract period. The letter also states that one important contract term and beneficiary protection is the requirement that contract suppliers must service the entire CBA. These statements by the deputy director obviously contradict what is actually happening with in the program.

At the end of the meeting, we asked that the Senate offices introduce a companion bill to H.R.1717, which would replace the competitive bidding program with a market-pricing program (MPP). We also asked that a hearing be conducted that includes testimony from case managers, nurses and other healthcare professionals on the program and how it is affecting patient care. The case managers at our meeting today had stacks of email complaints that they will also be forwarding to the offices, which debunks the claim by CMS that there are only 33 complaints nationally.

Jamie Loper
co-founder of

True or false: A pad prescription (order to dispense), blood gas study, ABG or oxygen saturation and a completed CMS 484 form is in compliance with CMS’s Oxygen Coverage Criteria Policy?

True or false: CMS delayed the face-to-face rule until sometime in 2014 so we do not have to worry about it this year?

True or false: You really want to argue with a Qualified Independent Contractor (QIC) in three years about the effective date of the face-to-face rule?

If you answered true to one or more of the above questions, you are following the shortcut to the emerald city of CMS recoupment, not the yellow brick road to favorable audits.

The new face-to-face rule of Section 6407 of the Affordable Care Act (affecting more than 100 items of durable medical equipment) still went into effect July 1, 2013. The only exception is delayed implementation of the enforcement of the face-to-face rule until “sometime in 2014.” An auditor several years from now could reasonably expect full compliance with the face-to-face requirements in your files from July 1, 2013, forward.

The harsh truth for respiratory providers is that they are now experiencing what power mobility providers have seen for the past eight years; physicians are more hesitant to complete a detailed face-to-face evaluation to justify the need for oxygen therapy. Why? Because it requires more of their time; physicians can no longer simply write a script for oxygen.

Oxygen face-to-face documentation must contain 38 key components to justify medical necessity and an auditor will be on the lookout for any that are missing. The supporting documentation cannot be addressed in a question-and-answer format. The physician must make entries in a detailed narrative as to the medical need. The DME MAC website now has a checklist for physicians to refer to when documenting the patient visit.

On the road to a favorable oxygen audit, the face-to-face evaluation must document a respiratory-related condition that benefits from oxygen therapy. Documentation that the patient was seen prior to the initiation of the home oxygen must also be included, as well as a list of alternative treatments tried and proven ineffective. DME provider records must contain a copy of the qualifying blood gas study, ABG or oxygen saturation, as well as all testing methods that were met, according to the policy (LCD) L11457. For initial oxygen claims, the date of the initial test results in section B 1.a, 1.b, 1.c on the CMS 484 form must be before the initial start date of service in Section A. In Section C, the equipment they are providing must be detailed, including HCPCS, manufacturer make and model, and billed and allowed amounts. Finally, the delivery invoice must match the HCPCS for the dates of service submitted for reimbursement.

On the road to a favorable PAP audit, five things must be documented: 1) The patient was seen prior to the ordering of the polysomnogram (sleep study); 2) The sleep study meets the coverage criteria detailed in the national LCD L11528; 3) The face-to-face documents the assessment of obstructive sleep apnea (OSA), current symptoms of OSA and why the patient would benefit from PAP therapy; 4) For continuation of PAP device coverage beyond the first three months (31st to 90th day), the treating physician must conduct a new face-to-face to document the patients tolerance, compliance and benefits from the use of the device, as well as which symptoms of OSA have improved with the use of PAP therapy; and 5) Evidence of training proper patient use of PAP device, along with the delivery ticket.

Based on prepayment audits for the first and second quarters of 2013, results in all four jurisdictions for oxygen remain on average 60% unfavorable. PAP therapy results for initial claims are on average 64% unfavorable and documentation missing in the 31-90 timeframe is at a steady average of 75% unfavorable. The Office of Inspector General (OIG) reported Top 20 Service Types with the Highest Improper Payments for 2011. Oxygen supplies and equipment was No. 1 at more than $1.2 billion. PAP supplies and equipment came in at No. 5 in excess of $414 million. As Denise Fletcher Lard stated in the October issue of HME News, “CMS leaves plenty of clues providers can use to anticipate future audits.” Could we have laid a smoother road for CMS to follow?

There are things you should do right now to merge onto the yellow brick road to favorable audits.  Indeed, CMS has coined this time period as “additional time to establish operational protocols necessary for compliance.” Take this additional time to do things such as educate stakeholders; refine, streamline and integrate your internal processes and checklists; and research and investigate web-based documentation solutions that remove the guesswork out of DME documentation.

The choice is yours: Slip on your ruby slippers and start down the yellow brick road to favorable audits today, or wish you had done so a year from now.

Jamie Loper is the co-founder of

by: Michael Reinemer - Friday, June 21, 2013

The home medical equipment sector needs to be part of the accelerating national conversation about healthcare costs, outcomes and value. While HME has to stay engaged in immense challenges like the Medicare bidding program, the ongoing “auditgeddon” and regulatory hurdles, it ignores the larger value debates at its peril. 

Since the HME sector has the resources, intellectual and otherwise, to walk and chew gum at the same time, I don’t know what’s holding up progress on this big-picture front. HME’s sister sector, the home health agencies, has seen huge problems in terms of Medicare regulations and reimbursement in recent years. That sector mobilized big resources and ideas to address issues such as fraud prevention and also the cost effectiveness of home care in the healthcare continuum.

In the meantime, the long-suffering HME sector remains mired in its crises du jour.

You could see a glimpse of the bigger picture and perhaps the future of health care at the fourth annual Health Datapalooza conference held in Washington, D.C., in June. It was a big, sprawling event attended by health economists, industry leaders, data geeks, journalists, and government officials, including HHS Secretary Kathleen Sebelius.

More and more data is becoming available to analyze. The White House Office of Science and Technology Policy brags that over the past four years, HHS has “liberated over 400 datasets, participated in a countless number of codeathons, and has seen and helped developers build hundreds of apps, services and products using health data.” It’s about time. Imagine a world where HME News didn’t have to use the Freedom of Information Act to wrench reimbursement data out of CMS.

Close scrutiny of outcomes, cost control measures and value will drive much of the real health policy debate among Washington’s wonking class. Consumers, stakeholders and the industry are pressing for more data, more transparency from all sources, plus the analysis that will help draw better insights, practices and policies from the data.

While the HME sector made good connections with many economists in the course of critiquing Medicare’s bidding system and seeking budget estimates (or “scores”) for legislative proposals, it should be doing the same for questions like health and financial outcomes of home care.

Health economists and advocates could help to quantitatively frame issues like the role of HME in preventing ER visits and hospitalizations, and shortening hospital lengths of stay. When the HHS Office of Inspector General opines that Medicare overpays for a specific HME item or category, where is the data and analysis to assess the validity of that indictment? 

The dollars that Medicare spends to reimburse HME providers who deliver and set up canes and walkers for beneficiaries seems like a bargain when you consider that they help prevent devastating falls, which lead to long hospital stays or death. Where is the data analysis to put that item into context? Or similar analysis for oxygen therapy, nebulized drugs, hospital beds, wheelchairs, support surfaces, or diabetic supplies?

The HME sector is losing the value debate. Even though it does not deserve it, HME remains a “target rich” environment that gets a disproportionate amount of negative attention from the Inspector General, the Department of Justice, congressional investigators and too many journalists who cut and paste self-serving government press releases into their news stories.

There are no silver bullets. However, like AAHomecare got out in front of the fraud and abuse debate with specific, aggressive proposals to stop fraud, the HME sector needs an equally aggressive commitment to look at data and put HME into context that will help policy makers and the public better understand the value of home care.

Michael Reinemer is a Washington-based communications consultant. Visit