Scooter and power wheelchair claims have long been under the tight scrutiny of the DME Regional Carriers (DMERCs) and the Centers for Medicare and Medicaid Services (CMS), and last month’s announcement of the “Operation Wheeler Dealer” crackdown on power mobility product claims has done little to change this.

Such a move by CMS and the Department of Health and Human Services Office of Inspector General (OIG) was not entirely unexpected by those in the industry who had noticed the extraordinary rise in power mobility claims in the past few years. According to CMS’s figures, nationally, total Medicare payments for motorized wheelchairs increased from $289 million in 1999 to $538 million in 2001, with payments of over $845 million in 2002, and a projected $1.2 billion for 2003. In addition, the number of Medicare beneficiaries with at least one claim for a motorized wheelchair rose from just over 55,000 in 1999 to almost 159,000 in 2002, an increase of 189%.

Some of the rise in power mobility claims is probably related to our rapidly aging population. It is no secret that Baby Boomers are now reaching the age where their need for medical equipment and supplies will increase. Furthermore, this segment of the population has become accustomed to the “right here, right now,” instant gratification mind-set and many have the economic wherewithal to demand it.

However, this fact falls terribly short of explaining the entire increase. The balance of this increase must be logically accounted for by the brain trust at CMS or the immediate assumption is that something fraudulent is going on. And when CMS makes this assumption, it tends to step up its number of audits and scrutinize claims more closely.

Are the Bad Apples to Blame?
In CMS’s defense, it may be right. There is fraudulent activity happening in our industry every day and this activity gives everyone a black eye. Unfortunately, a handful of unscrupulous providers are causing negative economic ripples throughout the industry in the form of increasing difficulty getting power mobility claims paid through Medicare.

In 2002, CMS, through the DMERCs, threw the industry a huge bone when it announced that power mobility claims would be paid solely on the merits of the information contained on the CMN. Realizing the size of this bone prior to throwing it, CMS also said that it reserved the right to conduct both pre- and post-payment audits to determine coverage.

Apparently, all the unscrupulous providers heard was that Medicare will pay based only on the CMN and the floodgates opened. Upon closer inspection, through audits, the DMERCs found many claims without adequate (or sometimes no) additional supporting documentation to justify the use of the power wheelchair or scooter.

Consequently, we are now fighting an uphill battle to get these claims paid.

What About Consumer Demand?
The manufacturers, bless their hearts, are creating a greater awareness of power mobility products and their availability in the marketplace by marketing them on television and through targeted print media campaigns. It is not their fault that the demand is increasing. After all, that is what they are in the business to do. The fault lies with those providers who see this as an easy way to make a buck and engage in questionable and, in many cases, fraudulent marketing activities designed to boost demand and inevitably sales.

A common example of this type of fraudulent activity involves 100%-commission salespeople used by an HME company to market directly to potential patients, sometimes even door-to-door at elderly housing developments, assisted living facilities, and group homes.

So, what can the legitimate HME dealer do to minimize the economic risk of providing power mobility products? While there is no simple, foolproof method of avoiding Medicare audits and potential overpayment policies and extrapolation, the aboveboard HME provider should stick to the basic business rule of CYA (Cover Your Assets). Make sure that you have all of the following in the file of every Medicare patient that you have dispensed a power mobility product to:

1. A properly completed assignment of benefits form.

2. A properly completed order from the patient’s ordering physician. Note that this item can sometimes be eliminated, but only if Section C of the certificate of medical necessity (CMN) contains an adequate narrative description or the brand name and model number of the item being dispensed.

3. A properly completed CMN.

4. A copy of the patient’s medical records reflecting the need for the power mobility product provided. The patient’s medical records include the physician’s office records, hospital records, nursing home records, home health agency records, records from other health care professionals (such as physical therapists), and corresponding test reports.

5. Proper proof of delivery of the power chair or scooter.

Additional documents in the patient’s chart could include:

1. If the patient is upgrading or if the supplier is anticipating a medical necessity denial, there should be a properly executed Advance Beneficiary Notice (ABN) form.

2. If the claim is for a K0011 or K0014 power wheelchair with a power tilt or recline and/or a nonjoystick controller, you may also want the resulting letter from an Advance Determination of Medicare Coverage (ADMC) decision proving that the DMERC has made a “prior authorization” decision based on the patient’s condition.

The five required items listed above will almost always be asked for in an audit situation. Failure to produce any of these items could result in the application of an overpayment policy where the money that was previously paid to you on a claim would be demanded along with interest and possible penalties. This overpayment scenario can have even greater economic consequences when the number of claims the auditor rejects out of a small number (often only 30) is extrapolated to cover the HME provider’s entire number of claims. If 10 out of the 30 reviewed are found to not be worthy of payment (33%) and you actually provided 100 of the items identified in the audit during the chosen time period, typically 6 months, you will be required to repay, with interest and penalties, the claims for 33 patients.

Unlike the rest of our country’s judicial system, in an audit situation you are guilty until proven innocent. You will, of course, have the opportunity to prove your case and recover your money, but in the meantime you have had to shell out big bucks, and if you are running a tight economic ship, this could mean serious financial consequences.

If you believe that you can defend this type of audit yourself, more power to you. If you feel you can’t, hire an expert to help you. The money paid to an expert could be dwarfed by extrapolation payments. After all, when it comes to the rise of the machines, the one phrase you do not want the auditor to say to you when leaving is “I’ll be back.”

Bruce Brothis is president and CEO of Centralized Billing & Intake Ltd in Parker, Colo. He has more than 23 years of HME industry experience and is a nationally recognized speaker and consultant. Contact him at (800) 396-9910, ext 13.