Healthcare Business News

CMS holds off on two anti-fraud projects

By Rich Daly
Posted: December 30, 2011 - 5:30 pm ET

The CMS delayed two anti-fraud demonstration projects that drew heavy provider opposition after they were announced in November.

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The delay in implementing anti-fraud programs for power wheelchairs and an expansion of Recovery Audit Contractor authority stemmed from the large number of comments and suggestions the agency received regarding two of the programs, the CMS said in a notice on its website.

The first pilot would require prior authorization for scooters and power wheelchairs prescribed for Medicare beneficiaries living in any of the seven states with the highest concentration of fraud or billing errors: California, Illinois, Michigan, New York, North Carolina, Florida and Texas. The preauthorization process was devised to ensure that medical conditions warrant the medical equipment, according to the CMS.

The second delayed project would have allowed RACs to review claims before they are paid, focusing on the types of claims historically associated with high rates of improper payments in seven states (Florida, California, Michigan, Texas, New York, Louisiana and Illinois) and claims with high volumes for short inpatient hospital stays in four states (Pennsylvania, Ohio, North Carolina and Missouri). CMS officials claimed the RAC expansion would lower Medicare's error rate by preventing improper payments, rather than the traditional “pay and chase” methods of looking for improper payments after they occur.

The agency plans to provide at least 30 days' notice before the delayed demonstration projects begin.

A third demonstration program announced at the same time will begin, as planned, on Jan. 1. It will allow hospitals to re-bill for 90% of the Part B payment they would have received for claims that a Medicare contractor denied for care billed as short inpatient stays.

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