Sen. Grassley Calls for Review of Medicare Durable Medical Equipment Payment Errors

Sen. Chuck Grassley (R-Iowa) on Tuesday sent a letter to acting CMS Administrator Kerry Weems demanding a "full accounting" of how the agency underestimated the extent of improper Medicare payments for durable medical equipment, the Miami Herald reports (Weaver, Miami Herald, 8/27). HHS Inspector General Daniel Levinson on Monday released a federal audit that found that Medicare officials underestimated the amount of incorrect payments for DME in 2006 and that the miscalculation was caused by the agency's failure to have auditors follow CMS' policy for checking claims. CMS had estimated a payment error rate of 7.5%, or about $700 million, in improper payments. The HHS audit found an "error rate" of nearly 29% for a sample of DME claims. The report cited 20 payment errors identified by the Medicare audit and 73 errors the contractor had not identified (Kaiser Daily Health Policy Report, 8/26).

Grassley wrote that the report highlights flaws in Medicare's auditing system and raises questions about the program's efforts to identify and reduce waste. Grassley in the letter called on the HHS inspector general to conduct a follow-up review of Medicare's 2007 payment error rate because of irregularities in the 2006 audit. He also requested that the inspector general identify which Medicare officials told outside auditors to "deviate" from federal policy in the 2006 audit. Grassley wrote, "This is unconscionable and an affront to every American taxpayer who is footing the bill, especially because we are not talking about millions of dollars," adding, "Instead, we are talking billions of dollars lost to fraud, waste and/or abuse in 2006" (Miami Herald, 8/27).