Shields Up!

Policy experts on CMS’s newly proactive strategy against fraud.

June 9, 2026 | Laurie Watanabe

Combating Medicare fraud is hardly a new topic to the durable and home medical equipment industry (DME/HME). What does change from administration to administration is how the Centers for Medicare & Medicaid Services (CMS) chooses to fight fraud.
The most recent CMS initiative is known as Comprehensive Regulations to Uncover Suspicious Healthcare (CRUSH), announced in February as a request for information (RFI).

The American Association for Homecare (AAHomecare) responded in March with 22 recommendations, ranging from strengthening enrollment requirements for new DME suppliers, to improving quality-of-site visits and the subject-matter expertise of site inspectors, enforcing company Medicare fee-for-service revocations across all government healthcare programs, and using CMS’s targeted probe and educate (TPE) audits for all new supplier locations.

“First of all, this is the first time that they’ve really focused an effort this much on waste and abuse, and we take our hats off to the administration and to the CMS administrator [Mehmet Oz, M.D.] for the effort,” said Tom Ryan, president/CEO of AAHomecare. “I think when you hear Dr. Oz speak of this effort, it’s mostly about the criminal component, the criminal rings and foreign entities that are doing this fraud. And unfortunately, the DMEPOS [durable medical equipment, prosthetics, orthotics and supplies] industry gets a bad reputation and is caught up among the criminals.”

Ryan praised the “specific effort” from CMS and said about an April meeting with Oz and his team, “We told them that we want to partner. We want to be a good steward of the dollars, and we think that the industry can help in these fraud efforts. How do we work together? We had some good initial conversation around that and basically our recommendations of what Kim [Brummett, AAHomecare’s senior vice president of regulatory affairs] put together in the comments.”

“I think it’s different this time just because there’s a focused effort on it, and it feels to be more focused on the criminal activities,” Brummett said. “Anytime an industry gets caught up in audits and these types of issues, [CMS has] historically ramped up audits, and that’s what they’ve done to legitimate suppliers. And I think for the first time, we really see CMS focusing on ‘OK, it’s not legitimate suppliers. So, how do we handle the fraud and not destroy the industry, so to speak?’”

CQRC also seeks CMS partnership

The Council for Quality Respiratory Care (CQRC), whose chair of the board is Rotech Healthcare CEO Robin Menchen, sent its own recommendations in response to the CRUSH RFI, including using technology-based systems and standardized data elements to prevent fraud and abuse of supplemental oxygen, reinstating comprehensive supplier financial documentation qualification requirements to keep fraudsters out of Medicare’s revived competitive bidding program, holding DMEPOS suppliers accountable for their competitive bidding submissions, and creating stronger patient protections, including up-to-date information from CMS to beneficiaries regarding cost-sharing responsibilities.

“We actually appreciate the administration’s effort to eliminate fraud in the Medicare program, and we’re ready to partner with Dr. Oz and CMS on this initiative,” Menchen said.

And while Menchen is an industry veteran well versed in previous fraud-fighting campaigns, “What does feel a little different for me is that it always felt like in the past, they’ve tried to fight fraud and abuse on the back end,” she said. “What I mean by that is after claims have been submitted and care has been given to the patient. I really think that for the first time, they’re trying to fight it on the front end through use of AI [artificial intelligence] technology to look at the history of claims that have been submitted by a particular provider.”

Vetting suppliers from the beginning, Menchen said, could include investigating “whether or not they’re going to meet more stringent financial requirements up front” versus suppliers being able to get their provider numbers and then quickly starting to submit claims. Menchen noted that suggestion “I think is especially important for the competitive bidding program.”

“We’ve been trying for at least the last 10 years,” added CQRC Executive Director Kathy Lester, “to get CMS to focus on ‘How do you prevent the initial denial of claims by making sure the information that is needed to determine medical necessity is collected and obtained with an emphasis on the physician or the practitioner who is prescribing the device? This is our electronic template that’s part of our legislation. So we’re cautiously optimistic that this opportunity with CRUSH really aligned with our longtime commitment of trying to address fraud.”

Distinguishing dolphins from sharks

Noel Neil, JM, CDME, chief compliance officer for ACU-Serve, described CMS’s latest campaign as a “renewed effort” in the perpetual goal of ridding the industry of fraud.

“They’re obviously utilizing some of the same tools, but they’re probably optimizing them,” he explained. “And I think there’s a slightly different mantra with this broad CRUSH initiative. This new effort seems to be focused on stopping the payments as the errors are identified or the risk areas are identified, as opposed to the pay-and-chase method, where oftentimes it seems like the government identifies risk areas, but they continue to allow it to occur just to implicate and prosecute the individual.

“This new effort seems to be more targeted on ‘If we see something, we’re going to shut it off while we investigate, so that there’s no pay-and-chase,’ and they don’t pay the funds out in the first place.”

Another difference: technology.

“I think that’s one of the things that is different here,” Neil said. “Obviously in the era that we’re in currently, AI is talked about in almost every conversation. So that is something this new effort has to its advantage. And it seems like CMS is opening up the pathway for the sharing of data to allow for more collaborative efforts. So they’re not siloed in approach anymore. It does seem as if this effort is a little bit more targeted, a little bit more intentional and seems to be a little bit more focused than we’ve seen in the past.”

And Neil agreed that CRUSH seems focused on players who enter the industry specifically to defraud Medicare.

“I think the intent of the CRUSH fraud initiative is really to target the folks that are intentionally trying to defraud the government and taxpayers,” he said. “The sort of career criminals that are jumping from one area to another, jumping from one company to another and exploiting the vulnerabilities of the system. I think that’s the intent of the policy.

“I think in reality, the execution does sometimes implicate providers that do not fall within that category because there may be aberrancies in the data or other risk factors that are somewhat indicative of a bad actor that might trigger the government to take another look at a legitimate supplier.”

And those legitimate suppliers do need to be protected, Neil added.

“I’ve always analogized it in this way: The issue we have currently is we have sharks and dolphins that are coexisting in a particular area, and the goal of is to get rid of the sharks. The approach seems to be to cast a net, and often times what ends up happening is that net will catch dolphins.”

The goal, then, would be to develop an effective method for CMS to identify and release those dolphins from nets that were cast.

“The unfortunate thing that we do see, though, is more often than not, the process of identifying the shark from the dolphin takes an extremely long time,” Neil said. “And in doing so, the dolphins die because they cannot survive the sustained vetting process. So one of the things that I would love to see is the expedited screening process to be able to determine the shark from the dolphin.”

Neil said ordinary supplier activities such as growing and expanding into other DME categories could cause a false alarm with CMS.

“I’ve seen legitimate suppliers who’ve been in business for a while switch product categories,” he said. “So they increase billing and that [causes] triggers, and oftentimes those reviews take a long time and can lead to payment suspension. If you don’t have any money coming from the government when it’s your major payer, it’s difficult to withstand the fight because defending audits is expensive. And therefore providers oftentimes don’t have a choice if they don’t have reserve [funds] or the ability to leverage credit to be able to sustain the fight.”

Sadly, sometimes the end result can be the supplier closing up “when they were not doing anything fraudulent,” Neil said. “They were just trying to grow their business, diversifying their product offerings, and that could potentially raise a flag for the government.”

Actions to turn the tide

Given the current regulatory environment, what can providers do to distinguish themselves from fraudsters?

“Really the best way for suppliers to be able to distinguish themselves as a dolphin and not a shark is by the quality of their documentation, and to maintain compliance not just as a checkbox but as a culture within their organization,” Neil said. “The risk now is not just ensuring that your documentation is compliant and making sure that medical necessity documented. That’s one risk. The other risk that is at this point overtaking the other risk is compliance with the supplier quality standards. Complying with supplier standards is as vitally important as making sure that the medical records meet medical necessities.”

Neil said he’s seeing suppliers losing their ability to bill Medicare because they fall short of maintaining their supplier standards.

“If you don’t have the ability to bill the government, you won’t be paid,” he pointed out. “Even if your documentation is great, you still won’t be paid because you don’t have the ability to bill. So it’s a two-pronged approach. One, you have to ensure you’re compliant and you have a good compliance program. You’re monitoring all of the requirements, making sure that you meet the quality standards, supplier standards, and all of the other Medicare standards. And then second to that is ensuring that you have a proper intake process for your documentation procurement. Whether you use AI or humans or a hybrid of the two, you just have to have a very robust intake process to make sure the requirements are met before the items are dispensed or delivered.”

On the oxygen front, Menchen urged suppliers to support the Supplemental Oxygen Access and Reform Act (SOAR).
“It is a bipartisan effort,” she said of the act that is part of the fight against fraud. “We feel it’s critical to adopt this oxygen template, and we already have patient advocates. We have physician groups, the RT [respiratory therapist] community, and the supplier community. We really need all DME suppliers, regardless of size.

“It’s kind of hard, I understand, for some of the small suppliers because this is going to involve electronic transmission. But really embracing that technology, because for us to get to this next level in our industry, we really need this.”

Lester said the technology included in the SOAR Act has been embraced by end-user organizations such as the American Lung Association “and a lot of patient groups that specialize in rare diseases. This has been something that really could jump start the CRUSH initiative.”

Monitoring new providers, Brummett said, could also fight fraud. “CGS, the jurisdiction B and C [DME MAC] contractor, is focusing their TPE prepaid audits on new suppliers. That’s a step in the right direction.”

When applying those TPE audits, CGS Administrators hasn’t yet, however, differentiated between brand-new suppliers and established suppliers who have opened new locations.

“One of the things that we heard from Dr. Oz this past week is that he realized the limitations of the oversight that CMS has,” Ryan said. “CMS is not an oversight segment of the administration. Their job is to take care of patients and pay claims.”

Ryan added that in the past, CMS officials have expressed that they wished they had the anti-fraud tools available to the private sector.

“When you have these changes of ownership or these electronic funds transfer activities happening, you need somebody that can follow those dollars that are coming into an entity in the U.S. that quickly transfers to China or to Russia,” he said. “I think CMS has realized this, and they want to work with the Treasury Department, who has those tools. So I think understanding the limitations of what they could do and then bringing in a force like the Treasury Department, who is used to tracking down these fund transfers that go to foreign entities, is a good combination.”

Speaking about AAHomecare members, Brummett said, “I think our members really try to do the right thing. They’re taking care of patients. They’re vital members of their community and their healthcare systems. And most do self audits and respond to TPE audits or RAC [Recovery Audit Contractor] audits. So, I don’t think there’s anything they really need to do to change. I think what needs to change is really how they look at the claims hitting the system.

“I think we just need to continue to push, and I think we need to find a way to deal with the tarnished name that we have because of these criminals. I think that’s something that we as an industry need to do a better job at, to validate that hey, we are the good guys. We are taking care of our patients.”