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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of Medicare Payments to iCare Medical Supply for Home Blood-Glucose Test Strip and Lancet Supplies," (A-09-05-00063)

January 23, 2008

PDF File Complete Text of Report is available in PDF format (629 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


iCare Medical Supply, Inc. (iCare), did not claim reimbursement for test strips and lancets in accordance with Medicare requirements.  Medical reviewers found that none of iCare’s claims for the 100 sampled beneficiaries met Medicare requirements and that each service line item on each claim had one or more errors.  These errors occurred because iCare did not have adequate controls to ensure that test strips and lancets billed to Medicare were medically necessary and documented in accordance with Medicare requirements.  As a result, iCare received $73,040 in unallowable Medicare payments for the 100 sampled beneficiaries.  Projecting these results to the population, we estimated that at least $8,233,476 of the $8,664,874 paid to iCare for test strips and lancets provided in calendar years 2002 and 2003 was unallowable for Medicare reimbursement.

We recommended that iCare refund $8,233,476 to the Medicare program and work with the Centers for Medicare & Medicaid Services to determine the allowability of test strips and lancets billed after calendar year 2003.  In its comments on our draft report, iCare did not address our recommendations.