OIG targets home oxygen reimbursement in recent report
August 30, 1999 3 minutes read
OIG targets home oxygen reimbursement in recent report
By MATTHEW HAY
HHBR Washington Correspondent
WASHINGTON Medicare paid $263 million in 1996 for oxygen equipment covered by inaccurate or incomplete certificates of medical necessity (CMN), according to a Department of Health and Human Services (Washing ton) Office of Inspector General (OIG) report released this month. But perhaps even more damaging were the OIG’s findings that 13% of beneficiaries surveyed never used their portable oxygen systems and that many suppliers were unable to fully document all of the services they reported providing.
The OIG’s report is a potent reminder that home oxygen therapy, which accounted for more than $2 billion in Medicare payments in 1997, is still high on the government’s radar screen. Home oxygen therapy makes up for the largest share of Medicare payments for durable medical equipment (DME). Those payments more than doubled between 1992 and 1996, increasing from about $900 million in 1992 to about $1.9 billion in 1996.
In all, the OIG found that nearly one-quarter of oxygen CMNs were inaccurate or incomplete. However, the Health Care Financing Administration (HCFA; Baltimore) was quick to point out that the $263 million figure does not necessarily represent payments made for medically unnecessary or unreasonable services. The agency noted that the file copy CMNs reviewed by the OIG are mainly used for suppliers’ own records and may not include all of the information submited electronically to the durable medical equipment regional carriers (DMERC).
That does not mean HCFA will not use the OIG’s report as ammunition to zero in on oxygen. In fact, the agency agreed with every one of the OIG’s recommendations, including the use of focused medical review for oxygen equipment claims. "It would not be manageable or cost effective to perform extensive reviews on all oxygen equipment claims," the OIG said. But the inspectors contend that their findings raise issues that can only be addressed through individual case review.
The OIG also recommended that system edits in place at the DMERCs be capable of identifying incomplete CMNs and that payment for oxygen equipment claims be suspended until complete CMNs are submitted. "HCFA should conduct periodic checks to ensure that original CMNs signed by beneficiaries’ physicians and kept on file by oxygen suppliers confirm the electronic versions of CMNs that suppliers submit to Medicare carriers," the OIG said.
The OIG also recommended that HCFA establish specific service standards for home oxygen equipment suppliers as mandated by the Balanced Budget Act of 1997. That recommendation echoes a report issued by the General Accounting Office (Washington) in April of this year that said HCFA should make development of these standards a top priority. In fact, the DME industry largely supports this measure, but holds out little hope the agency will complete this mandate anytime soon.
The OIG also revisited its recommendation included in a January 1999 Fraud Alert that warned physicians about their responsibility in determining beneficiaries’ medical need for and utilization of medical equipment paid for by Medicare. "By signing CMNs, physicians are attesting that information on the entire CMN is true, accurate, and complete to the best of their knowledge," said the OIG. Rightly or wrongly, the DME industry fears these warnings will discourage physicians from ordering certain DME items altogether out of fear of prosecution.
While almost all beneficiaries used their stationary oxygen equipment, 13% of beneficiaries said they never used their portable oxygen systems. According to the OIG, information gathered from suppliers further bolsters this case. Roughly 22% of the suppliers that billed for portable oxygen equipment in 1996 never provided any refills over the next two years. The OIG estimated the cost of those claims at about $24 million. By contrast, less than 1% of liquid portable suppliers did not provide any refills during the same two-year period. When asked to submit documentation supporting oxygen equipment service visits, only 35% of the suppliers were able to fully document these visits.
"That tells me that people are using portable oxygen for equipment failure back-up tanks and trying to get the government to pay for it," remarked one veteran oxygen supplier, who said these items used to have a rational system with a reasonable rate. "The selling point then was that you could fix the upper cost because it was limited to a fixed monthly sum," the supplier said. "That was intended to be part of the rental rate on the concentrator, but today, many suppliers rent non-used portables instead and don’t give patients the other equipment they claim was included in the rent on the concentrator.
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