In response to inquiries from HomeCare magazine, the Centers for Medicare & Medicaid Services (CMS) acknowledged that home medical equipment (HME) claims have declined in the durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) Round 1 biddings areas, as reported in a recent study by economist Peter Cramton, PhD. Cramton, a University of Maryland, College Park, economics professor whose research interest is auction theory and practice, is a critic of competitive bidding.
CMS confirmed that claims had declined since competitive bidding was implemented in January 2011, but disagreed with Cramton’s methodology and conclusions. CMS also said the declines are being driven by better controls for fraud and waste, and there is no evidence that beneficiaries are losing services.
Cramton said neither explanation makes sense, as fraud of such a high magnitude is highly unlikely because CMS had previously implemented layers of audits and oversight in Round 1 areas. He added that while his study was preliminary and there could minor variations in how far rates of claim submissions are dropping, he used Medicare’s own data.
