Medicare's Reimbursement Policies for Durable Medical Equipment Should Be Modified and Made More Consistent
Highlights
Because of complaints from suppliers of durable medical equipment to Medicare beneficiaries in some southeastern states that they were not being treated fairly by the Health Care Financing Administration's (HCFA) Atlanta regional office and Medicare carriers in that region, GAO was asked to look into selected Medicare reimbursement practices in Georgia, Alabama, Florida, and South Carolina in comparison with other states. Specifically, GAO was asked to determine: (1) whether standard hospital beds and wheelchairs are widely and consistently available to beneficiaries at the 25th percentile of charges; (2) whether suppliers in the HCFA Atlanta region were subject to different and more restrictive coverage and reimbursement criteria than were being applied to suppliers in other areas; and (3) the appropriateness of other payment practices and policies followed by carriers in the Atlanta region.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Health and Human Services | The Secretary of the Department of Health and Human Services (HHS) should direct the Administrator of HCFA to discontinue applying the 25th percentile on purchases because: (1) there are not enough data to compute it; (2) equipment is not widely and consistently available at the computed price; and (3) the limits tend to defeat the purpose of Public Law 95-142 which would require purchase if less costly than rental. |
The agency does not intend to act on this recommendation but believes that other changes it is making to its policies will somewhat alleviate the problems identified by GAO.
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| Department of Health and Human Services | The Secretary of HHS should direct the Administrator of HCFA to require carriers to compute data on assignments for items subject to the lowest charge levels to monitor the availability of such items. |
Although HHS acknowledges that the recommendation has merit, it believes that its implementation would be too costly.
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| Department of Health and Human Services | The Secretary of HHS should direct the Administrator of HCFA, to inform beneficiaries, or their doctors, of where items can be acquired at or below the allowed amount or suppliers that usually accept assignment. |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
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| Department of Health and Human Services | The Secretary of HHS should direct the Administrator of HCFA to ensure that the Medicare policies, practices, and coverage and utilization screens required by HCFA are consistently applied in all regions. |
The agency only took action to correct the specific inequities GAO identified in one of the areas of the country.
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| Department of Health and Human Services | The Secretary of HHS should direct the Administrator of HCFA to determine, to the extent practicable, the cost effectiveness of coverage and utilization screens before or during their implementation. |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
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