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Durable Medical Equipment Community Supports Tough Anti-Fraud Measures, Corrects Persistent Myths
Date:9/22/2010

medical equipment represents a tiny fraction of total fraud in Medicare.  

A number of important new anti-fraud measures are now in place, which were long overdue. But Congress, CMS, and the Office of Inspector General should not promote or impose unreasonable burdens on the existing, accredited home medical equipment providers.  

Correcting the Record: Myths Associated with Fraud Debate

During discussions on the issue of fraud in the home medical equipment sector, policymakers frequently commingle issues that distort and misrepresent the homecare community.

Competitive Bidding Is a Payment Mechanism, Not an Anti-Fraud Measure

Competitive bidding is simply a payment mechanism—not an anti-fraud tool.  When competitive bidding was enacted in 2003, Congress adopted a number of separate measures to address fraud and abuse through the establishment of quality standards and mandatory accreditation.  CMS also has taken additional steps recently to prevent fraud through the implementation of surety bonds and more stringent supplier standards.  Medicare has also issued enhanced provider enrollment rules and more stringent supplier standards.

Internet Pricing Is Not an Accurate Benchmark for Medicare Payment Levels

Several studies conducted by federal agencies such as the GAO and the OIG highlight the disparity between Internet prices and Medicare payments.  This is not an accurate comparison.  First, these studies clearly cite that the analyses did not look at service-related costs in the provision of home medical equipment.  The studies also overlook overhead, staffing costs and mandatory accreditation, 24/7 emergency care, adherence to quality standards, and FDA's home use requirements.  There has been only one comprehensive study that has evaluated both service and equipment costs.  This study found that in the oxygen arena, equipment costs
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SOURCE American Association for Homecare
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