Mark Huffman | ConsumerAffairs.com |
New law designed to reduce fraud by equipment salesmen
The TV commercial for a chain of motorized wheelchair stores features a geriatric spokesmodel who exclaims, "I didn't pay a penny for my Scooter, Medicare paid it all!"
If that was ever the case, things may be changing. A new law ends the first month purchase option for Medicare patients, as well as expansion of the competitive bidding process to provide equipment to Medicare recipients.
Companies that make and market these high-tech chairs to Medicare patients see the change as a threat. Jay Broadbent, CEO of Salt Lake City-based Alpine Home Medical, noted that these changes are coming at a time when power mobility providers are already experiencing increasing government audits, delays in reimbursement payments, and reimbursement cuts of more than 35 percent over the last five years.
Provider push-back
"Providers are at the point where we can't endure any more financial pressure and continue to offer quality products and services to Medicare beneficiaries," said Broadbent. "There has to be a realization in Washington that the fallout from the competitive bidding fiasco and elimination of the first-month purchase option is going to have a major impact on Medicare beneficiaries. There simply are not going to be enough providers left standing to supply them with mobility equipment."
By eliminating the option for the first-month purchase, the government plans to pay providers rental payments over the first 13 months that a patient has the equipment. But with credit tight in the sluggish economy, many providers say they can't obtain the lines of credits and loans they need to afford the upfront cost of purchasing power wheelchairs from manufacturers.
The new law is scheduled to take effect on January 1, but providers are asking Congress to delay implementation for one year so they can have time to adjust their business models to account for the cash flow problems created by the new policy. Currently, Medicare will pay 80 percent of the Medicare-approved amount for a qualifying wheelchair, assuming you have met your Part B deductible and your doctor tells Medicare the wheel chair is medically necessary.
Fraud
The new law comes at a time when Medicare has been cracking down on fraud related to the purchase of power wheelchairs, which can cost thousands of dollars.
Last month the Justice Department announced the guilty pleas of three people in connection with a Medicare fraud scheme operated out of a Houston-area durable medical equipment (DME) company.
In their pleas, the defendants admitted that they were paid kickbacks in exchange for referring Medicare beneficiaries to the DME company, Luant & Odera Inc. Luant & Odera submitted false and fraudulent claims to Medicare for medically unnecessary DME, including power wheelchairs, wheelchair accessories, and motorized scooters.
On its website, Medicare explains its concern with fraud, noting that most doctors, health care providers, suppliers, and private companies who work with Medicare are honest, but a few aren't.
"For example, some suppliers of medical equipment try to cheat the Medicare Program by offering power wheelchairs and scooters to people who don't qualify for these items under Medicare," the agency says. "Medicare is trying harder than ever to find and prevent fraud and abuse by working more closely with health care providers, strengthening oversight, and launching a national program to review claims."
Medicare offers the following red flags when dealing with equipment suppliers:
# Suppliers offer you a free wheelchair or scooter
#Suppliers offer to waive your copayment
#Someone bills Medicare for equipment you never got
#Someone bills Medicare for home medical equipment after it has been returned
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