Screening and Disclosure
The Patient Protection and Affordable Care Act was signed into law on March 23, 2010. The health reform law has a number of provisions that directly affect DME suppliers, including screening and disclosure requirements.
Screening: Section 6401 of the act states that suppliers enrolling or re-enrolling in Medicare, Medicaid or CHIP will be subject to screening measures. The Secretary of the Department of Health and Human Services is required to establish procedures for screening suppliers, and to determine the level of screening according to the risk of fraud, waste and abuse with respect to each category of supplier.
All suppliers will be subject to licensure checks and, if the Secretary so determines, additional screening measures such as criminal background checks, fingerprinting, database checks, and unscheduled and unannounced site visits. An application fee of $500 will be imposed to cover the costs of screening; this fee will be adjusted for inflation. (A recent CMS notice sets the fee at $505 beginning March 25.)
To paraphrase the words of an OIG attorney, the government is moving away from “pay and chase” to “guarding the henhouse.” In the early days of the industry — in the “pay and chase” days — it was easy for a company to obtain a Medicare Part B supplier number. The screening process was rudimentary. A dishonest company could easily obtain a supplier number, improperly bill Medicare, and then shut down and escape just ahead of the posse.
Over the past five years, it has become more difficult for a company to obtain a supplier number. Accreditation and surety bond requirements by themselves have weeded out many of the dishonest players.
Section 6401 of PPACA assists the government in achieving its goal of moving away from “pay and chase” to “guarding the henhouse.” Now, a company must jump through multiple hoops before it is awarded a supplier number: It has to purchase a surety bond; it has to become accredited; and its principals are subject to a background check (including a criminal background check and fingerprinting).