Most Medicare Claims for Replacement Positive Airway Pressure Device Supplies Did Not Comply With Medicare Requirements

Most Medicare claims that durable medical equipment suppliers submitted for replacement positive airway pressure (PAP) device supplies did not comply with Medicare requirements. Of the 110 claims in our sample that Medicare paid in 2014 and 2015, 24 complied with Medicare requirements; however, 86 claims with payments totaling $13,414 did not. On the basis of our sample results, we estimated that Medicare made overpayments of almost $631.3 million for replacement PAP device supply claims that did not meet Medicare requirements.

These overpayments occurred because CMS oversight of replacement PAP device supplies was not sufficient to ensure that suppliers complied with Medicare requirements or to prevent payment of claims that did not meet those requirements. Without periodic reviews of claims for replacement supplies, Medicare contractors were unable to identify suppliers that consistently billed claims that did not meet Medicare requirements or to take remedial action.

We recommended that CMS recover the portion of the overpayments of $13,414 associated with the 86 sample claims that are within the 4-year reopening period. We also made several recommendations for CMS to work more closely with the four Medicare contractors, which could have saved Medicare an estimated $631.3 million over a 2-year period.

In written comments on our draft report, CMS concurred with our recommendations and described the actions it planned to take to address them.