CMS tighten reins on medical gear suppliers

The U.S. Centers for Medicare & Medicaid Services (CMS)last week announced it is requiring certain durable medical equipment suppliers to post a surety bond, adding that it has revoked the billing privileges of more than 1,100 medical equipment suppliers in Florida and California and suspended payments to home health agencies in the Miami-Dade County section of Florida.
“We know the majority of medical-equipment suppliers and health care providers want to improve the health of Medicare beneficiaries, but we also know there are those who look for any opportunity to take advantage of beneficiaries and Medicare,” said CMS Acting Administrator Kerry Weems in a news release.
“The steps we are taking today provide us with additional oversight of the suppliers who furnish medical equipment to Medicare beneficiaries and those who provide home health services in South Florida,” he added.
The surety bond requirement, which was issued as a regulation under the Balanced Budget Act of 1997, will make certain suppliers of durable medical equipment, prosthetics, orthotics and supplies post a $50,000 surety bond.
Existing suppliers must comply with this requirement by Oct. 2, while newly enrolling suppliers must meet this requirement by May 4. CMS said the rule is due in part to “the large number of improper and potentially fraudulent payments to medical equipment suppliers for furnishing medical equipment and devices to people with Medicare.”
The 2007 Medicare error rate report, CMS noted, found approximately $1 billion in improper payments for medical equipment and supplies.
Most medical-equipment suppliers will have to obtain a bond, CMS said, but some will be exempt, including certain physicians and non-physician practitioners, physical and occupational therapists, state-licensed orthotic and prosthetic personnel, and government-owned suppliers.
Suppliers who have had certain adverse legal actions imposed against them in the past may also be required to post a higher bond amount, CMS said.
All newly enrolling suppliers that meet the requirements of the rule will be required to have a surety bond before they can enroll in the Medicare program. More information about the new regulation can be found at www.cms.hhs.gov/MedicareProviderSupEnroll.