[Federal Register Volume 68, Number 42 (Tuesday, March 4, 2003)]
[Notices]
[Pages 10254-10256]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-5004]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Office of Inspector General


Publication of OIG Special Fraud Alert on Telemarketing by 
Durable Medical Equipment Suppliers

AGENCY: Office of Inspector General (OIG), HHS.

ACTION: Notice.

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SUMMARY: This Federal Register notice sets forth the recently issued 
OIG Special Fraud Alert addressing telemarketing by durable medical 
equipment (DME) suppliers. For the most part, OIG Special Fraud Alerts 
address national trends in health care

[[Page 10255]]

fraud, including potential violations of the anti-kickback statute for 
federal health care programs. This Special Fraud Alert specially 
highlights the statutory provision prohibiting DME suppliers from 
making unsolicited telephone calls to Medicare beneficiaries regarding 
the furnishing of a covered item.

FOR FURTHER INFORMATION CONTACT: Joel Schaer, Office of Counsel to the 
Inspector General, (202) 619-0089.

SUPPLEMENTARY INFORMATION:

I. Background

    The Office of Inspector General (OIG) was established at the 
Department of Health and Human Services by Congress in 1976 to identify 
and eliminate fraud, waste, and abuse in the department's programs and 
to promote efficiency and economy in departmental operations. The OIG 
carries out this mission through a nationwide program of audits, 
investigations, and inspections. To reduce fraud and abuse in the 
federal health care programs, including Medicare and Medicaid, the OIG 
actively investigates fraudulent schemes that are used to obtain money 
from these programs and, when appropriate, issues Special Fraud Alerts 
that identify practices in the health care industry that are 
particularly vulnerable to abuse.
    The OIG issues Special Fraud Alerts based on information it obtains 
concerning particular fraudulent or abusive practices within the health 
care industry. Special Fraud Alerts are intended for widespread 
dissemination to the health care provider community, as well as those 
charged with administering the Medicare and Medicaid programs. To date, 
the OIG has published in the Federal Register the texts of 11 
previously-issued Special Fraud Alerts.\1\
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    \1\ All OIG Special Fraud Alerts are available on the Internet 
at the OIG Web site at http://oig.hhs.gov/fraud/fraudalerts.html#1.
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    This Special Fraud Alert focuses on section 1834(a)(17) of the 
Social Security Act, which prohibits suppliers of DME, except under 
limited circumstances, from making unsolicited telephone calls to 
Medicare beneficiaries regarding the furnishing of a covered item, and 
possible telemarketing practices by DME suppliers through the use of 
independent marketing firms.

II. Special Fraud Alert: Telemarketing by Durable Medical Equipment 
Suppliers (January 2003)

    Section 1834(a)(17) of the Social Security Act prohibits suppliers 
of durable medical equipment (DME) from making unsolicited telephone 
calls to Medicare beneficiaries regarding the furnishing of a covered 
item, except in three specific situations: (i) the beneficiary has 
given written permission to the supplier to make contact by telephone; 
(ii) the contact is regarding a covered item the supplier has already 
furnished the beneficiary; or (iii) the supplier has furnished at least 
one covered item to the beneficiary during the preceding fifteen 
months. Section 1834(a)(17)(B) also specifically prohibits payment to a 
supplier who knowingly submits a claim generated pursuant to a 
prohibited telephone solicitation. Accordingly, such claims for payment 
are false and violators are potentially subject to criminal, civil, and 
administrative penalties, including exclusion from federal health care 
programs.
    Notwithstanding the clear statutory prohibition, the Office of 
Inspector General has received credible information that some DME 
suppliers continue to use independent marketing firms to make 
unsolicited telephone calls to Medicare beneficiaries to market DME. 
Suppliers cannot do indirectly that which they are prohibited from 
doing directly. Except in the three specific circumstances described in 
the statute, section 1834(a)(17) prohibits unsolicited telemarketing by 
a DME supplier to Medicare beneficiaries, whether contact with a 
beneficiary is made by the supplier directly or by another party on the 
DME supplier's behalf. Moreover, a DME supplier is responsible for 
verifying that marketing activities performed by third parties with 
whom the supplier contracts or otherwise does business do not involve 
prohibited activity and that information purchased from such third 
parties was neither obtained, nor derived, from prohibited activity. If 
a claim for payment is submitted for items or services generated by a 
prohibited solicitation, both the DME supplier and the telemarketer are 
potentially liable for criminal, civil, and administrative penalties 
for causing the filing of a false claim.

What to do if you Have Information About Fraud and Abuse Against 
Medicare or Medicaid Programs

    If you have information about DME suppliers or telemarketers 
engaging in any of the activities described above, contact any of the 
regional offices of the Office of Inspector General, U.S. Department of 
Health and Human Services, at the following locations:

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        Regional offices                             States served                             Telephone
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Boston..........................  MA, VT, NH, ME, RI, CT                              617-565-2664.
New York........................  NY, NJ, PR, VI                                      212-264-1691.
Philadelphia....................  PA, MD, DE, WV, VA, DC                              215-861-4576.
Atlanta.........................  GA, KY, NC, SC, FL, TN, AL                          404-562-7603.
Chicago.........................  IL, MN, WI, MI, IN, OH                              312-353-2740.
Dallas..........................  TX, NM, OK, AR, LA, MS                              214-767-8406.
Kansas City.....................  CO, UT, WY, MT, ND, SD, NE, KS, MO, IA              816 426-4000.
Los Angeles.....................  AZ, NV, So. CA, HI,                                 714-246-8302.
San Francisco...................  No. CA, AK, OR, ID, WA, AK                          415-437-7961.
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    Dated: February 3, 2003.
Janet Rehnquist,
Inspector General.
[FR Doc. 03-5004 Filed 3-3-03; 8:45 am]
BILLING CODE 4150-01-P