Grassley introduces UPN bill to revamp Medicare billing for DME
Grassley introduces UPN bill to revamp Medicare billing for DME
BY MATTHEW HAY
HHBR Washington Correspondent
WASHINGTON Sen. Charles Grassley (R-IA), Chairman of the Senate’s Special Committee on Aging, and the Committee’s ranking Democrat, Sen. John Breaux (D-LA), last week introduced legislation that would require the use of universal product numbers (UPN) for all durable medical equipment (DME) billed to the Medicare program. The bill the Medicare Universal Product Number Act of 1999 is designed to improve the Health Care Financing Admin istration’s (HCFA; Baltimore) ability to accurately track the value of DME paid for by Medicare.
"We have medical suppliers giving patients the cheapest products and getting paid for the most expensive products. The whole system is out of whack," Grassley said in introducing the bill. "Better billing codes would help make sure the taxpayers get what they pay for."
Reps. Louise Slaughter (D-NY) and Amo Houghton (R-NY) have already introduced a similar bill in the House. Slaughter called Medicare’s current system of tracking DME "a little like the game of Clue." Said Slaughter, "We are never quite sure precisely who got what when."
Grassley pointed to last year’s General Accounting Office (GAO; Washington) report which recommended major changes are needed in the way Medicare pays for DME including UPNs. In its May 29 report to Grassley’s Aging Committee, the GAO concluded that under the current reimbursement methodology for DME, HCFA does not know specifically what products it is paying for because the only product identifiers on its claims are billing codes that cover "a broad range of product types, quality, and market prices."
"Since Medicare pays the same fee for all the products billed under the same HCFA Common Procedure Coding System (HCPCS) code," said the GAO, "suppliers have a financial incentive to provide patients the least costly product covered by the code" but "bill Medicare the full fee schedule allowance regardless of the product provided."
In fact, the DME industry strongly supports this legislation and was instrumental in its development. "We’ve been involved in the development of the bill," Erin Bush of the Health Industry Distributors Association (HIDA; Alexandria, VA), told HHBR. "We worked with the GAO on their report and we’re one hundred percent behind this bill."
The industry’s reasons for supporting the bill are twofold, said Bush. First, it would eliminate a lot of the confusion created by HCPCS. "Our members run into this daily when they try to bill medical equipment to Medicare," she said. "They are constantly operating under the threat that if the bill incorrectly they could be charged with a violation of the Small Claims Act which carries up to $10,000 in fines."
In addition, Bush said that UPNs, which are numbers included at the bottom of a bar code, would facilitate the use of bar codes and electronic data interchange (EDI) technology which in turn would greatly improve the movement of product through the distribution chain. According to Bush, this would allow DME suppliers to set up automatic bar scanners at warehouse entries and exits and implement electronic billing, in-time delivery’, and other modernizations.
Grassley introduced similar legislation last year, but that bill was never passed by Congress. The DME industry is optimistic that Grassley’s bill will pass this time around. It might be attached to Medicare reform legislation that might emerge later this year or a fraud and abuse bill that is also considered likely.
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