Feds Crack Down on Power Wheelchair Fraud

Washington and Baltimore

On Sept. 9, the Centers for Medicare and Medicaid Services took drastic action to clean up billing fraud in the durable medical equipment industry. At the same time, the Department of Health and Human Services Office of Inspector General (OIG) said it is investigating the proliferation of DME fraud cases.

Responding to a surge in Medicare claims for power wheelchairs — and in the wake of a massive alleged fraud scheme in Houston revolving around the expensive equipment — CMS issued a 10-point initiative dubbed “Operation Wheeler Dealer” aimed at curbing fraud and abuse of the Medicare power wheelchair benefit. The federal campaign includes aggressive scrutiny of all new supplier-number applications and collaboration between CMS, DMERCs and law enforcement agencies to process fraud cases.

CMS will revise coverage policy for motorized wheelchairs to require — for the first time — that physicians see patients before prescribing a power wheelchair. The agency will also develop inherent reasonableness review guidelines, with motorized wheelchairs to be the first item analyzed for potential adjustments.

“Spending on power wheelchairs has increased nearly 450 percent over the last four years, an unprecedented growth in this benefit,” said CMS Administrator Tom Scully. “While many of these wheelchairs are provided by ethical suppliers and go to beneficiaries in need, we know that a great number of unscrupulous suppliers are promising free wheelchairs to beneficiaries who don't need them. We are taking immediate action to stop these scams.”

According to CMS, Medicare costs for motorized wheelchairs are expected to reach $1.2 billion this year, growing from $289 million in 1999. In contrast, overall Medicare benefit payments rose only 11 percent during that same period. The number of Medicare beneficiaries with at least one claim for a motorized wheelchair rose from 55,000 in 1999 to almost 159,000 in 2002. The overall Medicare population rose only 1 percent per year during that same time frame.

CMS said its action will allow Medicare “to support honest providers and target those who are exploiting the program.” Acting Principal Deputy Inspector General Dara Corrigan warned that wayward suppliers are in for severe punishment. “The perpetrators of these fraudulent schemes face serious consequences, including fines, jail time and exclusion from doing business with Medicare and other federal health programs,” Corrigan said.