Via justice.gov – One of the largest health care fraud schemes investigated by the FBI and the U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG) and prosecuted by the Department of Justice resulted in charges against 24 defendants, including the CEOs, COOs and others associated with five telemedicine companies, the owners of dozens of durable medical equipment (DME) companies and three licensed medical professionals, for their alleged participation in health care fraud schemes involving more than $1.2 billion in loss, as well as the execution of over 80 search warrants in 17 federal districts. In addition, the Center for Medicare Services, Center for Program Integrity (CMS/CPI) announced today that it took adverse administrative action against 130 DME companies that had submitted over $1.7 billion in claims and were paid over $900 million. Read on…
With the 2021 competitive bidding round on the horizon for durable medical equipment (DME) providers, both those that are established as well as those fairly new to the industry must take note of the potential pitfalls that may be encountered when competing to become a Medicare contract supplier.
The durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) competitive bidding program was first established by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. Under this program, DMEPOS suppliers submit bids (i.e. applications) and compete to furnish specific items in competitive bidding areas commonly referred to as CBAs. Additionally, suppliers are not just bidding for the rights to a particular CBA but also for a single payment amount that will replace the current Medicare fee schedule payment. The payment will be determined by using the bids submitted. As of December 31, 2018, all contacts have expired. As a result, there is currently a temporary gap period. The upcoming bidding process is loaded with requirements. Therefore, compliance with each requirement is crucial. Here are a few pitfalls to watch out for:
Attorney Michael Silverman will present this live lunch n’ learn webinar for those considering starting a DME business startup or wanting to reconsider some of the legal issues involved in the DME business. He will review the laws, options and risks, and share information regarding state licensure requirements, product offerings and enrolling in Medicare as a Part B supplier.
Regulatory compliance is a mandatory investment for any healthcare business owner looking to stay out of serious and personal legal peril, let alone one hoping to keep their company viable.
Yet there is seemingly an onslaught of providers that blatantly run afoul of many of these regulations, knowingly or not, or those that believe they may have found a loophole.
Concerning the latter, there is an important mantra that such DME and pharmacy providers should remember and live by: “[W]hat a provider cannot do directly, it cannot do indirectly through an intermediary.”
Marketing for DME – What exactly am I talking about?
DME providers enrolled with CMS (should) know they cannot solicit or ‘cold call’ Medicare Part B beneficiaries, per the Federal Anti-Solicitation Statute, and that they cannot offer anything of value to a potential patient that could induce them to utilize them as a provider, in accordance with the Beneficiary Inducement Statute.
Many DME suppliers purchase leads from marketing companies. The patients who respond to the marketing advertisements are generally not interested in travelling to their doctor’s office to obtain an order for braces, for example. This type of arrangement is seen often enough and so starts a potentially problematic arrangement with the DME company paying the marketing company. The marketing company may then use some of these dollars to pay a telehealth company. The telehealth company may then pay a telehealth physician for “telemedicine visit” with the patient. Ultimately, the telehealth/telemedicine physician issues and order for the braces or other supplies.The DME brace supplier then gets paid by Medicare Part C, or other healthcare plan for providing the supply to the patient.
The problem with this arrangement is that the sole source of the telehealth doctor’s reimbursement for the visit comes indirectly from the DME company. Essentially, the DME supplier is paying the ordering physician through the marketing company for the visit with the patient. This creates a prohibited kickback arrangement because the supplier is essentially paying the Teledoctor for the referral for braces. The telehealth company is acting as a virtual unregulated physician practice. Providers engaged in this type of practice are not in compliance with either Federal or Florida law.
Providers need to comply with all the Medicare ‘red tape’ but need not let fear of non-compliance inhibit their practice from offering Durable Medical Equipment Prosthetics & Orthotics Supplies (“DMEPOS”) to Medicare beneficiaries.
Here’s an overview of the steps providers need to take to enroll as a supplier of DMEPOS with Medicare to be eligible for Part B coverage and reimbursement:
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