CRUSH, A DME Moratorium, OIG Audits Resume, and the PEPPER

Picture this: You are driving through an area you don’t know well. It is a cold day. You stop to get gas. You fill the tank, then pull into a parking place to go inside and get a donut and a cup of coffee. You note a few people lingering around the front door, but they look friendly. Because it is cold outside, you leave the car running. You get your donut and coffee, and when you go back outside, your car is gone.

I am sure every one of you knew that was going to happen. And while you know the car thief committed a criminal act, the driver kind of asked for it to happen, right? Now, what does this have to do with Medicare?

Well, the Centers for Medicare & Medicaid Services (CMS) just announced their CRUSH initiative: Comprehensive Regulations to Uncover Suspicious Healthcare. They are asking for suggestions on how to reduce fraud against the Medicare system.

But honestly, as you read the announcements of indictments from the U.S. Department of Justice (DOJ), it just doesn’t seem like it should be all that hard. One Texas doctor, an orthopedic surgeon, was recently indicted for prescribing $145 million worth of prescription creams. The DOJ noted that the insurers were charged $16,000 per tube. No one noticed that? Every insurer just paid the bill?  

So, if CMS and payors want to stop fraud, maybe modernize the payment system to detect aberrant claim patterns. Waiting until claims from a single provider hit $145 million before stepping in makes no sense. They are leaving the keys in the car and asking for people to steal.

The other recent announcement CMS made was that they are putting a moratorium on issuing new licenses for durable medical equipment (DME) suppliers. Personally, I don’t have a problem with that. There are plenty of DME providers, and I rarely hear of a patient having trouble accessing necessary DME when it is medically necessary and meets the coverage requirements. And there seems to be way too much DME fraud. This moratorium is like Honolulu putting a moratorium on new ABC convenience stores opening; I just don’t think any tourist would struggle to find a place to buy a cold drink or box of delicious chocolate-covered macadamia nuts. And if it reduces fraud, I am all for it.

Moving on, the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) has released its first audit of a hospital in over three years, and Sarasota Memorial Hospital was the lucky victim. The audit was for claims in 2020 and 2021, two perfectly ordinary years in healthcare; they were cited for 9 of 65 inpatient admissions not meeting the Two-Midnight Rule. But if you read the response letter from Sarasota, which was excellent, it was not clear that the CMS auditor really understood the Rule, so I really doubt that all of those were improper. Of course, I have no access to the clinical details, but the auditor’s apparent inability to understand the two-midnight benchmark puts the findings in doubt.

In addition, CMS asked the auditor to apply InterQual criteria and report those findings, but noted that it was done for informational purposes. I struggle to find how any hospital would find that useful. CMS even admits that meeting commercial criteria is not required.

Finally, everyone is using artificial intelligence (AI), seemingly for everything. So, for fun, I put the sample Program for Evaluating Payment Patterns Electronic Report (PEPPER) that CMS has posted into an AI system and asked it to analyze it for me. And honestly, its analysis was very superficial and provided no meaningful insights. That’s a relief, that I still have some job security. But more importantly, the AI system repeatedly referenced “the PEPPER report.” I do wonder if it did that simply to mock me.