New Rule Issued to Fight Medicare Fraud

In an effort to fight one of the most prevalent sources of Medicare fraud, a new federal rule will require prior authorization before Medicare will pay for certain durable medical equipment, prosthetics, orthotics, and supplies (commonly referred to as DME or DMEPOS).  The Centers for Medicare & Medicaid Service (CMS) announced the issuance of the new rule today.

As the CMS press release notes, “The Department of Health and Human Services’ Office of the Inspector General and the U.S. Government Accountability Office have published multiple reports indicating questionable billing practices by suppliers, inappropriate Medicare payments, and questionable utilization of DMEPOS items.”  An example of a recent prosecution for DME fraud brought by my former colleagues at the U.S. Attorney’s Office in Los Angeles can be found here.  Other examples of DME fraud cases can be found here, here, and here.  They’re not hard because the schemes have been so prevalent.

Healthcare professionals who prescribe DMEs will have to stay up-to-date on the Required Prior Authorization List which will list DMEPOS items that will require prior authorization.  That list will be published at a later date and will be based off “The Master List” of 135 DMEPOS items identified as being frequently subject to fraudulent schemes.

All 121 pages of the rule – which will go into effect March 1, 2016 – can be found here.