We have recently observed an increase in action against Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) suppliers under the Medicare program pursuant to 42 CFR § 424.535(a)(8)(ii) for abuse of billing privileges. These suppliers have submitted otherwise valid claims for DMEPOS they furnished to Medicare beneficiaries during a period in which their required surety bond had — inadvertently, and unbeknownst to the supplier — lapsed. After a year or more, the supplier received a notice of termination as a DMEPOS supplier in the Medicare program. Critically, these terminations for alleged “abuse of billing privileges” may carry a ten-year re-enrollment bar to the Medicare program, the maximum bar for first-time offenders.
Medicare regulations require a surety to provide CMS with thirty days’ notice of a bond cancellation; however, this regulation is silent with respect to the surety’s obligation to provide written notice to the supplier. As a result, suppliers can easily and unknowingly submit DMEPOS claims that are technically not eligible for reimbursement due to the lapse of the surety bond. These claims can later serve as the basis for revocation of the supplier’s billing privileges. The maximum penalties described above can be triggered by just three claims with errors.
DMEPOS suppliers must ensure their compliance with the twenty-two supplier standards required by Medicare, as well as all other applicable conditions of coverage and payment rules. Even an inadvertent lapse in the required surety bond can lead to the revocation of the supplier’s billing privileges and a recoupment of reimbursements paid by Medicare to the supplier during the lapsed period.
Our team of attorneys has extensive experience in pursuing administrative appeals on behalf of DMEPOS suppliers whose Medicare billing privileges have been revoked. For more information, contact Frier Levitt to speak with an attorney.
