Home Health and Medical Equipment Use Could Indicate Fraud and Abuse says Study

Health care usage by Medicare fee for service beneficiaries reveals that durable medical equipment and home health care are disproportionately responsible and could be an indication of fraud and abuse according to a new report funded by the Commonwealth Fund.

Beneficiaries used an average of $12,847 per year (in 2006 dollars) in standardized medical costs covered by Medicare. Hospital care constituted 40 percent of this total; other Part A services, including skilled nursing facilities and home health or hospice, represented an additional 17 percent.

“[Durable medical equipment and home health] may be particularly susceptible to fraud and abuse because physicians are unaccountable for utilization after the prescription is made,” said the report. “These service categories have figured prominently in two well-publicized Meccas of high spending: Miami, Florida, for its durable medical equipment usage, and McAllen, Texas, for its home health usage.”

According to the authors, the variation of use is large enough to warrant further study and possibly policy interventions.

“Both may be susceptible to fraud and abuse, in part, because physicians are not held accountable for utilization after the prescription is made. Patient cost-sharing could reduce inefficiencies in certain services, like home health. For others—including specialist visits and imaging—pay-for-performance, prospective payment systems, and valuebased insurance designs may promote greater efficiency.”

View the study here.

Written by John Yedinak

John Yedinak

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