State Leaders Join AAHomecare in Endorsing the AIR Act, H.R. 5083

AAHomecare is leading the charge to build support for the new audit reform legislation by publicly asking all HME state associations for their formal endorsement of H.R. 5083. HME state associations represent a valuable grassroots network on the front lines of fighting for HME providers and no legislative effort is complete without their full support. Thank you to all of the organizations who are telling Congress to fix Medicare audits! Read the letter and see the full list of supporters below.

Dear Representatives Ellmers and Barrow:

We would like to thank you for introducing H.R. 5083, the Medicare DMEPOS Audit Improvement and Reform Act (AIR Act). We are pleased to support this important legislation, which will make the Medicare audit process more effective and efficient for durable medical equipment, orthotics, prosthetics, and supplies (DMEPOS) Medicare claims.

On December 24, 2013 the Administrative Law Judge (ALJ)—the final level of appeal for Medicare claims—stopped taking new appeals, including those from the DMEPOS sector. Currently, there are approximately 600,000 appeals before the ALJ, of which a quarter are from DMEOS suppliers who have waited more than two years to get to the ALJ. These suppliers face an onslaught of audits from the Medicare Administrative Contractors MACs), Supplemental Medicare Review Contractors (SMRC), Recovery Audit Contractors (RAC) and the Comprehensive Error Rate Testing Contractor (CERT).

The complication presented by the audit alphabet and delay in final appeals hinders the supplier’s ability to service their patients. DMEPOS suppliers typically serve patients, often with rental items and on-going supplies and medications for a significant portion of the patient’s life; in fact, many patients are served until they pass away. When auditing claims for ongoing rental items and sales, the MAC selects one claim for an item, normally the initial claim, and if the contractor denies, then all subsequent claims get denied as well. Although many denials get overturned in the appeal process up to the ALJ, waiting two years for payment impacts the ability of a supplier to service a beneficiary. Many companies scale back services, or close leaving beneficiaries to go through the process of finding a new supplier and obtaining required medical documentation to get their needed supplies, medications and durable medical equipment.

Your legislation (H.R. 5083) will increase transparency, education and outreach, and reward suppliers that have low error rates on audited claims. The AIR Act, which applies to all MACs, RACs, and all other contractors performing audits on DMEPOS, addresses those three points: it requires the reporting of error rates on audited claims after adjustment for those audited claims that have been overturned on appeal; requires thorough education and outreach; removes for one year all suppliers who have an error rate on audited claims of 15 percent or less (restricting them to one random claim audit per year); reinstates clinical inference, and limits look-back periods while fixing timely filing constraints on appeals.

We look forward to working with you, Congress, and the Administration to make the Medicare audit process more efficient to protect beneficiaries’ access to the equipment and supplies they need.

Sincerely,

American Association for Homecare (AAHomecare)
National Coalition for Assistive and Rehab Technology (NCART)
American Podiatric Medical Association (APMA)
National Home Infusion Association (NHIA)
National Association for Medical Direction of Respiratory Care (NAMDRC)
The VGM Group
North Carolina Association of Medical Equipment Services (NCAMES)
Association for Home and Hospice Care of North Carolina
Georgia Association of Medical Equipment Suppliers (GAMES)
Alabama Durable Medical Equipment Association (ADMEA)
Arizona Medical Equipment Suppliers Association (AZMESA)
Association for Tennessee Home Oxygen & Medical Equipment Services (ATHOMES)
Big Sky Association of Medical Equipment Services
California Association of Medical Product Suppliers (CAMPS)
Colorado Association for Medical Equipment Services (CAMES)
Florida Alliance of Home Care Services (FAHCS)
Florida Association of Medical Equipment Suppliers (FAMES)
Great Lakes Home Medical Services Association
Healthcare Association of Hawaii
Home Medical Equipment and Services Association of New England (HOMES)
Jersey Association of Medical Equipment Suppliers (JAMES)
Kentucky Medical Equipment Suppliers Association (KMESA)
Michigan Association for Home Care
Midwest Association for Medical Equipment Services (MAMES)
New York Medical Equipment Providers Association (NYMEP)
Nevada Association of Medical Products Suppliers (NAMPS)
Ohio Association of Medical Equipment Services (OAMES)
Pennsylvania Association of Medical Suppliers (PAMS)
South Carolina Medical Equipment Services Association (SCMESA)
Virginia Association for Durable Medical Equipment Companies (VADMEC)
Wisconsin Association of Medical Equipment Services (WAMES)
West Virginia Medical Equipment Suppliers Association (WVMESA)

If your association would like to join the letter, please email Ashley Jackson, ashleyj@aahomecare.org, as soon as possible.

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GAO Investigation Unearths Flaws in CMS Audit Program; Confirms Complaints of Rampant, Out of Control Medicare Audits

“The GAO report confirms what the industry has been saying for years: the CMS auditing system is poorly managed, is forcing good providers out of business and needs to be significantly revised,”
Thomas Ryan, president of AAHomecare

A Government Accountability Office (GAO) investigation recently found that the Centers for Medicare & Medicaid Services (CMS) provides insufficient oversight to contractors auditing Medicare reimbursement claims. These inappropriate, multiple audits are crippling the operations of many home medical equipment providers.

The American Association for Homecare (AAHomecare) said the GAO report, which was released earlier this month, underscores the repeated complaints from providers that the rampant out-of- control CMS audit system is placing unfair burdens on their businesses.

“The GAO report confirms what the industry has been saying for years: the CMS auditing system is poorly managed, is forcing good providers out of business and needs to be significantly revised,” said Thomas Ryan, president of AAHomecare. “Hopefully, the GAO report helps create the changes needed to ensure that HME providers can stay in business and supply Medicare beneficiaries with the quality services and products that they deserve.”

Ryan noted that Congress is already working on a legislative fix to the audit system.  The recently introduced Audit Improvement and Reform Act (AIR Act), H.R. 5083, will increase transparency, education and outreach, and reward suppliers that have low error rates on audited claims. The AIR Act would apply to all contractors performing audits on durable medical equipment, prosthetics, orthotics, and supplies.

The extent of the audit problem was revealed last December when Administrative Law Judges suspended action on new audit appeals because of the backlog of cases. There are now more than 600,000 cases awaiting appeals. Previous to the suspension, providers repaid the government or didn’t get paid during the appeals process. But most appeals were ultimately won by providers and they received the money owed for providing home medical equipment to Medicare patients.

But closing down the appeals process left providers with no recourse and has forced many to shut their businesses or no longer service Medicare patients.

Another factor for providers is the amount of time and resources needed to comply with the army of auditors that CMS has unleashed without proper management.  CMS has hired a variety of contractors that conduct audits of providers – Durable Medical Equipment Medicare Administrative Contractors (DME MACs), Zone Program Integrity Contractors (ZPICs), Recovery Audit Contractors (RACs) and the Comprehensive Error Rate Testing Contractor (CERTs). And what GAO determined is that these entities are not coordinated and are wasting government resources by auditing the same claims, while needlessly burdening the providers.

“This audit process – from paying contractors a ‘bounty’ to open audits to shutting down appeals for providers – has done a major disservice to providers and to the Medicare beneficiaries who they serve,” said Ryan. “The GAO report is a major rebuke of CMS’ ability to adequately manage an audit system and provides further evidence that this is bad public policy must be fixed.”

Specifically, the GAO report found that:

  • A Recovery Audit Data Warehouse was created to track audits and prevent duplications. But GAO found that the database was not designed to provide information on all possible duplications, and that its data was not reliable because the contracts didn’t include the necessary information.
  • Contractors had a low compliance rate on requirements that they communicate to providers their rights during an audit.  This affected the ability of providers to exercise their rights.
  • A lack coordination and oversight by CMS regarding the activities of their audit contractors.
  • CMS has not established clear guidance prohibiting contractors from reviewing the same claims.

The flaws cited in the GAO report got the attention of many on Capitol Hill.

“The provider community has raised numerous concerns about the consistency and accuracy of the audit process over the past few years and this report is the first effort to determine what steps could be taken to improve the process,” said Rep. Diana Louise DeGette (D-CO). “The information in this report can now be used by Congress and CMS to help make improvements and ensure more consistent oversight of both the contractors and audit process.”

Ryan cautioned that the audit legislation won’t solve all the problems, but will help.

To learn more, visit www.FixMedicareAudits.org and follow @AAHomecare on Twitter.


New Legislation Introduced to Fix Medicare Audits, Bring Back Clinical Inference

The American Association for Homecare (AAHomecare) is proud to announce the introduction of a new piece of legislation to fix the broken Medicare audit system. The Audit Improvement and Reform Act (AIR Act), H.R. 5083, sponsored by Reps. Renee Ellmers (R-N.C.) and John Barrow (D-Ga.), will increase transparency, education and outreach, and reward suppliers that have low error rates on audited claims. The AIR Act would apply to all MACs, RACs, and all other contractors performing audits on durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) providers. Visit www.FixMedicareAudits.org to download a copy of the legislation, issue brief and learn how you can support the legislation.

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