WASHINGTON--Most states in a 15-state study conducted by HHS' Office of Inspector General do not routinely verify whether providers are meeting DME enrollment standards, the agency said in its semi-annual report to Congress.

The report, which covers Oct. 1, 2006, to March 31, 2007, also noted that fewer than half the states in the study require Medicaid providers to enroll in the Medicare program, which would require them to adhere to Medicare standards.

The issue was only one of several industry-related items in the report, which also recapped the OIG's recommendation for a 13-month oxygen cap (see HomeCare Monday, Sept. 18, 2006), along with the results of 1,581 unannounced site visits in south Florida released previously.

The agency said that in the first half of fiscal year 2007, it had recovered $2.9 billion in audit and investigative receivables.

The OIG reported exclusions of 1,278 individuals and entities for fraud and abuse; 209 criminal actions against individuals or entities engaging in crimes against departmental programs; and 123 civil actions, including False Claims Act and unjust enrichment suits filed in federal district court and Civil Monetary Penalties law settlements.

The 76-page report also included notice of an agreement with Lincare to pay the government $1.2 million to resolve allegations that, between January 1998 and December 2000, its Idaho facilities submitted false claims to Medicare, Medicaid and the Veterans Affairs programs. According to investigators, Lincare allegedly submitted claims for home oxygen using falsified certificates of medical necessity and without performing a required 30-day review.

In its 15-state standards compliance study, the OIG said that all of the states, which were not named, employed numerous provider standards to safeguard their Medicaid DME programs. Those safeguards included licensure, posting a sign with hours of operation and obtaining surety bonds. However, the OIG said, the majority of the states were not ensuring that those standards were being upheld. According to the report, seven of the 15 states did not even conduct routine site visits at initial enrollment.

In addition, the OIG said only six of the states either routinely re-enrolled providers or had recent re-enrollment initiatives to ensure providers met the standards.

During its unannounced south Florida visits, the OIG found that 45 percent of the companies did not comply with at least one of the five standards under review, and 31 percent didn't have a facility at the address they had provided to Medicare (see HomeCare Monday, April 2).

Based on those findings, in March the OIG recommended that CMS conduct more unannounced site visits and out-of-cycle inspections; perform more rigorous background checks of applicants; increase the prepayment review of DMEPOS claims; and deactivate the Medicare billing numbers of suppliers that have been inactive for a 90-day period.

In its current report, the OIG said CMS agreed to "take more aggressive actions in identifying suppliers who are no longer in business or do not meet basic supplier standards."

But during its annual Washington Legislative Conference, held June 5-7, the American Association for Homecare offered another suggestion to acting CMS Deputy Administrator Herb Kuhn.

AAHomecare President and CEO Tyler Wilson recommended that new Medicare providers should receive only a temporary supplier number for the first six months of operation, that they be placed on "100 percent prepayment review" and that the National Supplier Clearinghouse conduct an initial site visit within a year.

Kuhn said he would discuss the suggestion with CMS' program integrity office.