The federal government has announced additional steps to limit the risk of fraud in the durable medical equipment contracting process.
Late last week, the Centers for Medicare & Medicaid Services announced it was extending the deadline for equipment suppliers to submit bids to the program until September 25. The original deadline on the bids had been July 13, but now the agency is requiring suppliers interested in bidding to resubmit bids.
Additionally, CMS is requiring suppliers to be accredited, or awaiting accreditation, before receiving a contract. The deadline for receiving accreditation has been extended two months, to October 31. The agency is accepting bids in 10 separate areas.
The Department of Health and Human Services also is taking steps to reduce instances of fraud in the system by requiring all suppliers of durable medical equipment, prosthetics, orthotics and supplies to give CMS a surety bond of $65,000. The required amount is an increase of $15,000, or 30 percent, from the previous surety bond requirement, as stipulated in the Balanced Budget Act of 1997.
The new rule is intended to ensure that Medicare can recover erroneous payments as a result of fraudulent or abusive supplier billing practices, said Herb Kuhn, acting CMS deputy administrator.
"A surety bond will not only limit Medicare's risk to fraudulent billing, but will also help to ensure that only legitimate DMEPOS suppliers are enrolled in the program," Kuhn said.
The registration requirements and increases in bond requirements represent another effort by the federal healthcare organizations to watch Medicare spending and quickly identify shoddy services or Medicare fraud. Earlier this year, HHS and the Department of Justice announced that they were establishing a multi-agency task force that aims to combat fraud from real-time analysis of Medicare billing.
HHS also said it's accepting comments on the future of the surety bond, specifically whether it can request a higher bond from higher-risk DMEPOS suppliers, or whether physicians, non-physician practitioners, pharmacists and large publicly traded companies should be exempted from the bond requirement.