Home Blog Post


In mid-November, the OIG published a report highlighting improper payments for DMEPOS provided to hospice beneficiaries. Officially titled “Medicare Improperly Paid Suppliers an Estimated $117 Million over 4 Years for Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Provided to Hospice Beneficiaries”, the report indicated that for 121 of 200 sampled DMEPOS items, Medicare improperly paid suppliers for DMEPOS items they provided to hospice beneficiaries. The OIG determined that these payments occurred because: (1) the majority of the suppliers were unaware that they had provided DMEPOS items to hospice beneficiaries, (2) the system edit processes that should have prevented the improper payments were not effective or did not exist, and (3) the suppliers inappropriately used the GW modifier.

In the report, the OIG provided a total of four recommendations to the CMS, of which they concurred with two. These were: (1) improve the prepayment edit process by instructing the durable medical equipment (DME) Medicare contractors to deny DMEPOS claims submitted by suppliers without the GW modifier for DMEPOS items provided to hospice beneficiaries and (2) direct the DME and hospice Medicare contractors, or other contractors as appropriate, to conduct prepayment or postpayment reviews of supplier claims billed with the GW modifier.

CMS audit contractors have kept hospice claims on the forefront since before the pandemic. In fact, the Supplemental Medical Review Contractor (SMRC) has had a multi-phase hospice postpayment audit project in effect for some time, most recently with phases 2 and 3 posted to their website for hospice claims billed to Medicare on dates of service (DOS) from January 1, 2018 through December 31, 2019.

Performant, the National Home Health, Hospice and DMEPOS Recovery Audit Contractor (RAC), added Hospice: Continuous Home Care (CHC) to their approved issues in February 2021. The RAC is conducting complex medical reviews for hospice claims with a “claim paid date” prior to 10/1/2020. More recently, we learned that these audits would be increasing in volume.

Lastly, the Home Health and Hospice MACs reinstated the Targeted Probe and Educate (TPE) program in September of this year. TPE consists of up to three rounds of review with a 20–40 claim sample selected (pre-payment or postpayment) for each round.

Given the newly published OIG Report and CMS’ concurrence with the recommendation to conduct prepayment and postpayment claim reviews, hospice providers should expect additional scrutiny entering 2022.

Want to be ‘audit-ready’? The van Halem Group can help!

Our team of experts have solutions to ensure your claims are audit ready and meet technical and clinical guidelines. We offer assistance with a pre- and postpayment audits and have experience with the SMRC, RAC and MACs. Already received your audit results but disagree with the outcome? Let our audit and appeal consultants assist you with the appeals process.

Contact us today to learn more about our Audit Response services.