AMARILLO, TX – The Office of Inspector General (OIG) conducted an audit that covered Medicare Part B paid claims for 37,013 beneficiaries. For these beneficiaries, DME suppliers submitted charges for 244,667 claim lines, totaling $40.1 million, for Power Mobility Device (PMD) repairs.
The audit aimed to determine whether suppliers complied with Medicare requirements when billing for PMD repairs. The OIG found that not all suppliers complied with Medicare requirements when billing for PMD repairs.
Specifically, the OIG found that (i) supplier documentation did not adequately support the charges for PMD repairs, (ii) labor time associated with the PMD repairs was not documented, and (iii) PMD repair charges were not reasonable and necessary.
DME suppliers are required to maintain and repair rented PMDs, at no charge, to Medicare or to beneficiaries. The repairs are covered when they are necessary to make the PMD serviceable. Medicare will pay for the labor associated with the repairs and for necessary replacement parts. Labor is billed in 15-minute increments. Suppliers are required to ensure that the charges for PMD repairs are reasonable and necessary.
Medicare pays reasonable and necessary charges for the maintenance and service of beneficiary- owned equipment. If the expense of a PMD repair exceeds the estimated expense of purchasing or renting another PMD for the remaining period of medical need, Medicare will not pay the excess amount.
CMS standards state that (i) either the treating practitioner or the supplier must document that a PMD repair was reasonable and necessary and (ii) the supplier must maintain detailed records describing the need for and the nature of the repairs. DME MACs must ensure that suppliers’ records include the nature of the repair required and the work that is performed to restore the PMD to its functionality to meet the medical need of the beneficiary. Suppliers must also have documentation from the beneficiary’s physician indicating that the PMD being repaired continues to be reasonable and necessary.
Overall, the audit showed that multiple PMD repairs may not have been reasonable and necessary because the suppliers submitted repair charges for power wheelchairs that were within their 5-year Reasonable Useful Lifetime (“RUL”). The accumulated cost of the repairs exceeded 100 percent of the cost of replacing the power wheelchair. There were also PMD repairs in which the suppliers had submitted charges for replacing parts that had previously been replaced within the previous 12 months. According to the audit, these charges suggest that the power wheelchairs were not in adequate condition to have lasted the entire 5-year RUL.
According to the audit, there were instances where suppliers did not (i) provide documentation for the time billed for repairs of the PMDs nor (ii) kept detailed records. Suppliers must have documentation to support the amount of time spent on each PMD repair billed to Medicare.
In the case of repairs to a beneficiary-owned item, if Medicare paid for the base item initially, the medical necessity for the base item was established. When it comes to repair reimbursement, the supplier must maintain detailed records describing the need for and nature of the repairs, including a detailed explanation justifying the (i) replacement of any component and (ii) labor time to restore the item to its functionality. According to the audit, the documentation is considered timely when it is on record in the preceding 12 months unless otherwise specified.
Audit reports conducted by the OIG are important to pay attention to because they can often influence the policy process. Suppliers of PMDs that also provide repairs should examine their policies and ensure their documentation of repairs complies with Medicare requirements.
Jeffrey S. Baird, JD, is Chairman of the Health Care Group at Brown & Fortunato, PC, a law firm with a national health care practice based in Texas. He represents pharmacies, infusion companies, HME companies, manufacturers, and other health care providers throughout the United States. Baird is Board Certified in Health Law by the Texas Board of Legal Specialization and can be reached at (806) 345-6320 or [email protected].
Jacque S. Steelman, JD is a member of the Health Care Group at Brown & Fortunato, PC, a law firm with a national health care practice based in Texas. She represents pharmacies, infusion companies, HME companies, manufacturers, and other healthcare providers throughout the United States. Steelman can be reached at (806) 345-6316 or [email protected].
