Savannah, GA (WorkersCompensation.com) – It seems durable medical equipment (DME) and telemedicine have been under the federal radar as another telemedicine operator has been charged with healthcare fraud. Savannah businesswoman Charlene Frame operated two telemedicine network companies, Royal Physician Network, LLC in Atlanta, and Envision It Perfect, LLC in Stockbridge. Frame has been charged with conspiring to pay medical providers in exchange for physician’s orders for DME that allowed the claims to be billed to Medicare and other carriers. The total on the alleged ill-gotten payments exceeds $60 million. The case is the result of a much larger case that was part of “Operation Brace Yourself” and “Operation Double Helix,” netting over $470 million in which eight physicians, two nurse practitioners, two operators of different telemedicine companies, two brokers of patient data, and owners of several DME companies were charged.
According to a 2019 United States Government Accountability Office (GAO) report, in 2018 there were $2.6 billion in improper payments paid on DME claims by Medicare. Two billion of that total was due to improper documentation for the DME claims. Improper documentation included lack of documentation supporting medical necessity, missing proof of delivery, and missing physicians’ orders. Total improper payments made for all other reasons was .6 billion. The total improper payments for labs, home health, hospice, and DME was $31.6 billion.
From the same GAO report, the Centers for Medicare and Medicaid Services (CMS) indicated that medical reviews did not provide large enough information to provide substantial specific results. The example given was a 2017 audit of 31,000 claims of which only 918, or 2 percent, were found to be improper. Additionally, audits for more than half the states produced only 10 or fewer claims that were identified as being paid improperly. CMS estimated the federal spending for Medicaid medical review audit costs at around $8 million per year prior to any state spending.
In an April report from the Department Of Health And Human Services, 96 percent of South Carolina’s Medicaid telemedicine payments were for claims that were improperly documented. Of 100 claims audited, only 3 were found payable. Of those claims, 95 did not have the start and end time documented. The remaining two claims were actually office visits instead of virtual visits. The OIG speculated that the cause of such a high error rate of improper claims was due to lack of training. The total financial impact of the improper payments is estimated to be $2.1 million.