Department of Health and Human Services 
OFFICE OF 
INSPECTOR GENERAL 
Durable Medical Equipment 
Ordered with Surrogate Physician 
Identification Numbers 
JANET REHNQUIST 
INSPECTOR GENERAL 
SEPTEMBER 2002 
OEI-03-01-00270  O I G
FFICE OF  NSPECTOR  ENERAL

http://www.oig.hhs.gov/ 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as amended, 
is to protect the integrity of the Department of Health and Human Services (HHS) programs, as well as 
the health and welfare of beneficiaries served by those programs.  This statutory mission is carried out 
through a nationwide network of audits, investigations, and inspections conducted by the following 
operating components: 
Office of Audit Services 
The OIG's Office of Audit Services (OAS) provides all auditing services for HHS, either by conducting 
audits with its own audit resources or by overseeing audit work done by others.  Audits examine the 
performance of HHS programs and/or its grantees and contractors in carrying out their respective 
responsibilities and are intended to provide independent assessments of HHS programs and operations in 
order to reduce waste, abuse, and mismanagement and to promote economy and efficiency throughout the 
Department. 
Office of Evaluation and Inspections 
The OIG's Office of Evaluation and Inspections (OEI) conducts short-term management and program 
evaluations (called inspections) that focus on issues of concern to the Department, the Congress, and the 
public.  The findings and recommendations contained in the inspections reports generate rapid, accurate, 
and up-to-date information on the efficiency, vulnerability, and effectiveness of departmental programs. 
Office of Investigations 
The OIG's Office of Investigations (OI) conducts criminal, civil, and administrative investigations of 
allegations of wrongdoing in HHS programs or to HHS beneficiaries and of unjust enrichment by 
providers.  The investigative efforts of OI lead to criminal convictions, administrative sanctions, or civil 
monetary penalties.  The OI also oversees State Medicaid fraud control units which investigate and 
prosecute fraud and patient abuse in the Medicaid program. 
Office of Counsel to the Inspector General 
The Office of Counsel to the Inspector General (OCIG) provides general legal services to OIG, rendering 
advice and opinions on HHS programs and operations and providing all legal support in OIGs internal 
operations.  The OCIG imposes program exclusions and civil monetary penalties on health care providers 
and litigates those actions within the Department.  The OCIG also represents OIG in the global settlement 
of cases arising under the Civil False Claims Act, develops and monitors corporate integrity agreements, 
develops model compliance plans, renders advisory opinions on OIG sanctions to the health care 
community, and issues fraud alerts and other industry guidance.  E X E C U T I V E  S U M M A R Y  
PURPOSE 
To examine supplier billing and documentation practices for durable medical equipment, 
prosthetics, orthotics, and supplies (hereinafter, referred to as medical equipment) ordered with 
surrogate unique physician identification numbers. 
BACKGROUND 
Title XVIII of the Social Security Act prescribes coverage requirements under Part B of the 
Medicare program.  Part B covers physician and outpatient hospital services along with a 
variety of other services, including the rental or purchase of medically necessary medical 
equipment.  Medical equipment includes a wide range of items prescribed by a physician for 
use at home, such as hospital beds, wheelchairs, oxygen devices, surgical dressings, splints, and 
casts. 
Medicare beneficiaries covered under Part B are eligible to receive medical equipment ordered 
by a physician or non-physician provider and furnished by a supplier who has been issued a 
billing number by Medicare. If the ordering physician has not been assigned a unique physician 
identification number (UPIN), the supplier must use a temporary or surrogate UPIN when 
submitting claims. 
We selected a sample of 250 medical equipment claims from the Centers for Medicare & 
Medicaid Services National Claims History File for 1999 for our review. The sample 
consisted of claims for medical equipment ordered by physicians with surrogate UPINs.  We 
contacted the suppliers who submitted the claims and requested documentation to support each 
sample service. We also asked for pertinent physician information, including the State in which 
the prescribing physician is licensed, medical specialty, and permanent UPIN, if known. 
FINDINGS 
Sixty-one percent of services reviewed should have been ordered using a 
permanent UPIN rather than a surrogate 
For 61 percent of services, ordering physicians had permanent UPINs at the time the service 
was provided. Physicians for more than one-third of these services had individual UPINs for at 
least 5 years prior to the dates on the claims. Physicians for 17 percent of these services had 
individual UPINs at least 10 years before the dates of service. 
i 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  Supporting documentation was missing or incomplete for 45 percent of services 
ordered using a surrogate UPIN 
Nearly half of services ordered with a surrogate UPIN (45 percent) had either:  (1) no written 
order or certificate of medical necessity (CMN) to support the service, or (2) a written order or 
CMN with one or more items missing.  Medicare paid an estimated $61 million for these 
services in 1999. 
Seventeen percent of services ordered using a surrogate UPIN had no supporting 
documentation.  For 28 percent of services ordered with a surrogate UPIN, at least one piece 
of required information was missing from the documentation.  The elements most often missing 
from the CMN were the beneficiary height (18 percent) and weight (17 percent). 
Documentation for 5 percent of services did not include the physicians UPIN, and 
documentation for 4 percent of services did not include the supplier billing number.  The 
elements missing from physician orders were the physicians name or signature, description of 
the item being ordered, or the date of the order. 
Documentation for 9 percent of services was dated months after the service date 
Supporting documentation for 9 percent of services was dated more than 31 days after the 
service date provided on the Medicare claim.  Seventy-one percent of these services had 
CMNs as supporting documentation and 29 percent had physician orders. Medicare paid an 
estimated $15 million for these services in 1999. For 6 percent of services, documentation was 
dated 4 or more months after the date of service. For 1 percent of services, documentation 
was dated in excess of 1 year after the date of service on the claim. 
CONCLUSION AND RECOMMENDATIONS 
We believe the use of surrogate UPINs on Medicare claims poses a vulnerability to the 
Medicare program. We found a substantial number of documentation problems in the 
supporting evidence submitted by suppliers for claims processed with surrogate UPINs. Our 
review found that 17 percent of services had no supporting documentation, and another 28 
percent had at least one piece of required information missing from the documentation. We 
have referred all of the services with missing or incomplete documentation to CMS for 
appropriate action. In 1999, we estimate Medicare paid  $61 million for services ordered 
with a surrogate UPIN that had missing or incomplete supporting documentation. 
The findings detailed in this report also revealed misuse of surrogate UPINs on Medicare 
claims. We found that surrogate UPINs were incorrectly used for many services since the 
ordering physician had already been issued a permanent UPIN. We believe this is a 
ii 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  significant problem given that the use of a surrogate UPIN on medical equipment claims allows 
them to be processed automatically whether the equipment has been ordered by a physician or 
not. If the inappropriate use of surrogate UPINs by suppliers goes unchecked, the Medicare 
program becomes vulnerable to fraudulent billings and inappropriate payments. Therefore, we 
recommend that CMS: 
<	 Perform targeted reviews of claims for medical equipment ordered with surrogate 
UPINs. 
<	 Continue to educate suppliers and physicians that accurate UPINs must be used on 
claims, and surrogate UPINs should not be used if the ordering physician has a 
permanent UPIN.  For example, an article could be included in carrier bulletins 
reminding suppliers of proper documentation practices. 
Agency Comments 
The CMS concurred with our recommendations and indicated that the agency will take the 
necessary steps to increase the monitoring of UPINs and to educate suppliers and providers 
that accurate UPINs are required on submitted claims. The CMS also stated that Medicare 
must set priorities for validating the UPIN information.  As a result, CMS will be implementing 
several initiatives to improve the accuracy of UPIN reporting.  Such initiatives include 
instructing DMERCs to decrease the use of surrogate UPINs through education and training, 
expanding Medicare Carrier Manual UPIN monitoring instructions to include DMERCs, and 
increasing central office/regional office monitoring of DMERCs UPIN activities. Appendix B 
contains the full text of CMS comments. 
iii 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  T A B L E  O F  C O N T E N T S  
PAGE

EXECUTIVE SUMMARY ...................................................... i

INTRODUCTION  ............................................................1

FINDINGS 
Services Should Have Been Ordered Using a Permanent UPIN  ......................6

Services with Missing or Incomplete Documentation ...............................7

Documentation Dated Later than Service Date  ...................................8

CONCLUSION  ..............................................................9

RECOMMENDATIONS .......................................................9

APPENDICES

A. Estimates and Confidence Intervals ........................................11

B. Comments from the Centers for Medicare & Medicaid Services  .................. 15

ACKNOWLEDGMENTS ..................................................... 16

iv 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  I N T R O D U C T I O N  
PURPOSE 
To examine supplier billing and documentation practices for durable medical equipment, 
prosthetics, orthotics, and supplies (hereinafter, referred to as medical equipment) ordered with 
surrogate unique physician identification numbers. 
BACKGROUND 
Title XVIII of the Social Security Act prescribes coverage requirements under Part B of the 
Medicare program.  Part B covers physician and outpatient hospital services along with a 
variety of other services, including the rental or purchase of medically necessary medical 
equipment.  Medical equipment includes a wide range of items prescribed by a  physician for 
use at home, such as hospital beds, wheelchairs, oxygen devices, surgical dressings, splints, and 
casts. 
The Centers for Medicare & Medicaid Services (CMS), which administer the Medicare 
program, contract with four durable medical equipment regional carriers (DMERCs) to process 
and pay claims for medical equipment. Medicare beneficiaries covered under Part B are 
eligible to receive needed medical equipment ordered by a physician or  non-physician 
provider and furnished by a supplier who has been issued a billing number by Medicare. 
Suppliers submit claims for reimbursement to the DMERCs in either paper or electronic format. 
In 1999, the DMERCs paid more than $6.2 billion for medical equipment claims. These 
payments include the 20 percent coinsurance amount for which Medicare beneficiaries are 
responsible. 
UPIN Requirements 
The unique physician identification number (UPIN) is a six-character identifier assigned to 
physicians, non-physician practitioners, and medical groups that provide services or order 
medical equipment for Medicare beneficiaries. In this report, we use the term physician to 
describe both physicians and other medical providers who are assigned UPINs. 
To receive a UPIN, each physician must send an application to the carrier serving his or her 
jurisdiction. The carrier reviews the application, validates the credentials of the applicant, and 
ensures that the physician is eligible for Medicare payment.  Assigned UPINs are maintained in 
a national Registry of Medicare Physician Identification and Eligibility Records, also known as 
the UPIN Registry. Each physician should receive only one individual UPIN. 
1 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  Medicare requires medical equipment suppliers to provide the name and UPIN of the physician 
ordering the equipment on the claim form. Without this information, the claim should be denied. 
The DMERCs use the UPIN in a variety of analyses, such as medical review and program 
integrity activities. 
The Health Insurance Portability and Accountability Act of 1996 (the Act) mandated the 
establishment of a new provider identifier, known as the National Provider Identifier (NPI). 
According to the Act, the NPI will eventually replace the UPIN. 
Surrogate UPINs 
If the ordering physician has not been assigned a UPIN, the supplier must use a substitute 
UPIN, known as a surrogate UPIN, when submitting claims. According to Medicare 
guidelines, surrogate UPINs are temporary and may be used until an individual UPIN has been 
assigned. The DMERCs are required to monitor claims with surrogate UPINs. The CMS has 
established specific surrogate UPINs and guidelines for their use.  These include: 
PHS000	 To be used by physicians serving in the Public Health Service, including the 
Indian Health Service. 
VAD000	 To be used by physicians employed by the Department of Veterans Affairs or 
serving on active duty in the U.S. military. 
RES000  To be used by physicians meeting the description of intern, resident or fellow. 
OTH000	 To be used when the ordering physician has not yet been assigned a UPIN, and 
does not qualify for other surrogates listed above. 
Claim Documentation Requirements 
Suppliers submit medical equipment claims to the DMERCs for review and payment. In 
order for a claim to be paid by Medicare, the supplier must have a written order from a 
physician to justify the medical need for the equipment.  The order must include 1) the 
beneficiarys name, 2) the ordering physicians signature, 3) a description of the item ordered, 
and 4) the date of the order. 
Selected items of medical equipment require a Certificate of Medical Necessity (CMN) to 
justify Medicare coverage. For these items, the CMN may serve as the physicians written 
order. The certificates are divided into four parts: Section A, which may be completed by the 
supplier, contains information on the beneficiary, supplier, and the beneficiarys physician. 
Section B, which must be completed by the patients physician 
2 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  or the physicians employee, requires medical information and/or the results of clinical testing. 
Section C provides supplier information regarding a description of the item(s) being provided, 
the suppliers charge for the item(s), and the Medicare allowance for the item(s). Section D 
contains the physician signature and date along with the physicians attestation that the 
information provided is true and accurate. 
Suppliers must retain in their files the physician order as well as the CMN, if required, along 
with any other medical necessity information submitted by the ordering physician or required by 
the DMERCs. Medicare also requires suppliers to maintain a detailed record of all items 
furnished to the beneficiary, including brand names of items supplied, model numbers, and dates 
of delivery. The DMERCs are required to periodically audit supporting documentation in 
suppliers files. 
Related Work by the Office of Inspector General 
In a related study entitled, Medical Equipment and Supply Claims with Invalid or Inactive 
Physician Numbers, (OEI-03-01-00110), we found that Medicare paid $32 million for 
medical equipment claims with invalid UPINs in 1999. Additionally, we found Medicare paid 
$59 million for medical equipment claims billed with UPINs that were inactive on the dates of 
service. 
In an earlier report, Accuracy of Unique Physician Identification Number Data, 
(OEI-07-98-00410), information in the UPIN Registry was found to be inaccurate. For 
example, there was a lack of recent claims activity for almost 25 percent of the active UPINs. 
In addition, the study found evidence of erroneous State license number information. 
METHODOLOGY 
Sample Design 
We created a file consisting of all paid medical equipment claims from the National Claims 
History file for the year 1999.  This file contained $6.2 billion in allowances for medical 
equipment. From this file, we extracted all services for equipment ordered with surrogate 
UPINs and removed claims submitted by beneficiaries. The resulting file contained $147 
million in allowances for services ordered with surrogate UPINs. 
From the universe of medical equipment services ordered with surrogate UPINs in 1999, we 
removed all services with allowed amounts of $10 or less. Total Medicare allowances for the 
remaining services was $146 million. We then divided these services into two strata. The first 
stratum contained services for suppliers that met two criteria:  1) at least 25 percent of their 
allowed dollars were ordered with a surrogate UPIN, and 2) they received Medicare payments 
3 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  for at least 50 services ordered with a surrogate UPIN. The second stratum contained services 
for suppliers that did not meet the two criteria. The first stratum contained 137,342 services 
and the second stratum contained 1,165,145 services. We selected a random sample of 125 
services from each stratum, for a total sample size of 250 services. 
Data Collection 
Carrier requests.  We contacted each DMERC and requested copies of the sample claims. 
We received copies of claims for 246 of the 250 sample services. 
Supplier requests. Using address information obtained from the National Supplier 
Clearinghouse, we sent letters to suppliers requesting documentation to support each sample 
service.  We also requested pertinent physician information, including the State in which the 
prescribing physician is licensed, the medical specialty of the physician, and the physicians 
individual UPIN, if known. 
We received responses for 227 of the 250 sample services. Of the 227 responses, 198 
contained supporting documentation and 29 had no supporting documentation. We made three 
attempts to contact suppliers for the requested information. If the suppliers did not respond to 
the three requests, we concluded that, for the purposes of this inspection, they did not have 
documentation to support the sample services.  We did not receive responses for 14 services 
following three requests. We could not locate the suppliers for the 9 remaining services. We 
did not include these 9 services in our analysis. 
Data Analysis 
Documentation from suppliers.  We reviewed documentation from suppliers to identify 
ordering physicians.  We also compared physician information on the claim form with the 
documentation submitted by suppliers. For medical equipment requiring a CMN, we reviewed 
the CMN as the supporting documentation. For all other medical equipment, we reviewed the 
physicians order. We analyzed the documentation to determine if the CMNs and orders were 
completed according to DMERC requirements. 
We determined the type and number of required items that were not completed by physicians 
or suppliers in each document. We did not review documentation to determine if the 
beneficiary met medical necessity requirements. 
UPIN database. We examined the UPIN database to determine if the ordering physicians 
identified on claims or by suppliers had been assigned individual UPINs.  If the physician had 
been assigned a permanent UPIN, we compared the date the UPIN was assigned to the 
physician with the date of service on the sample claim. 
Computation of estimated allowances. To compute Medicare payments for undocumented 
services and services with incomplete documentation, we totaled the 
4 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  allowed amounts for these services and weighted the estimate to reflect our stratified sample 
design.  The allowed amounts include the 20 percent coinsurance amount for which Medicare 
beneficiaries are responsible. 
Point estimates and confidence intervals for all statistics presented in the findings of this report 
are provided in Appendix A. 
____________ 
This inspection was conducted in accordance with the Quality Standards for Inspections 
issued by the Presidents Council on Integrity and Efficiency. 
5 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  F I N D I N G S  
The use of surrogate UPINs on claims for medical equipment services is a vulnerability to the 
Medicare program. From a universe of services totaling $146 million in 1999, we reviewed a 
statistically valid sample of 250 Medicare claims for medical equipment ordered with surrogate 
UPINs and found that suppliers could not provide adequate documentation for approximately 
45 percent of the services.  Specifically, our review found that 17 percent of services had no 
supporting documentation, and another 28 percent had at least one piece of required 
information missing from the documentation. Nationally, we estimate that $61 million was paid 
for services not adequately documented in 1999. We also found that surrogate UPINs were 
incorrectly used for many services since the ordering physician had already been issued a 
permanent UPIN.  We are recommending that CMS:  (1) perform targeted reviews of claims 
for medical equipment ordered with surrogate UPINs, and (2) continue to educate suppliers 
and ordering physicians that accurate UPINs must be used on claims and that surrogate UPINs 
should not be used if the ordering physician already has a permanent UPIN. 
Sixty-one percent of services reviewed should have been 
ordered using a permanent UPIN rather than a surrogate 
For 61 percent of services, ordering physicians had permanent UPINs at the time the service 
was provided. Physicians for more than one-third of these services had individual UPINs for at 
least 5 years prior to the dates on the claims. Physicians for 17 percent of these services had 
individual UPINs at least 10 years before the dates of service. 
The use of an ordering UPIN on claims for medical equipment can provide certain protections 
to the Medicare program and its beneficiaries. The provision of a permanent UPIN on the 
claim is important because it allows Medicare to identify the physician who  actually ordered 
the equipment for a beneficiary.  The use of ordering UPINs on claims also ensures that 
Medicare beneficiaries are receiving equipment ordered only by qualified physicians.  In 
addition, by summarizing claims data by UPINs, CMS can identify aberrant ordering or billing 
patterns for medical equipment. When surrogates are used instead of permanent UPINs on 
claims for medical equipment, these protections are no longer in place. 
According to Medicare guidelines, if the ordering physician has not been assigned a UPIN, only 
then can one of the surrogates be used. However, such usage is temporary and the surrogate 
should only be used until an individual UPIN is assigned.  In a bulletin to suppliers, one 
DMERC stated: If a physician currently has a UPIN, you must use that number.  Suppliers 
are not taking appropriate steps, as recommended by the DMERCs, to ensure that a 
physicians individual UPIN is used on claims when he or she has one.  Such steps include 
obtaining a UPIN directory from the Government Printing Office, checking Internet websites 
containing listings of permanent UPINs by State, and 
6 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  contacting the ordering physician directly. One DMERC stated in a bulletin to suppliers that 
All suppliers should review their claim submission processes to ensure that they submit all 
claims with correct UPINs. 
Supporting documentation was missing or incomplete for 
45 percent of services ordered using a surrogate UPIN 
Nearly half of services ordered with a surrogate UPIN (45 percent) had either:  (1) no written 
order or CMN to support the service, or (2) a written order or CMN with one or more items 
missing.  Depending on the type of equipment provided, suppliers are required to have either a 
completed CMN or a physician order on file to support the Medicare claim. In 1999, we 
estimate Medicare paid $61 million for services ordered with a surrogate UPIN that had 
missing or incomplete supporting documentation. 
Seventeen percent of services ordered using a surrogate UPIN had no supporting 
documentation 
Suppliers did not submit supporting documentation for 17 percent of services ordered using a 
surrogate UPIN.  For 3 percent of services, suppliers did not submit documentation after three 
written requests. For 14 percent of services, suppliers did respond but indicated that no 
documentation was available. Medicare paid an estimated $17 million in 1999 for claims with 
missing documentation. 
Documentation for 28 percent of services was incomplete 
For 28 percent of services ordered with a surrogate UPIN, at least one piece of required 
information was missing from the CMNs or orders. The DMERCs require that all elements 
contained on supporting documentation be completed. In 1999, Medicare paid an estimated 
$44 million for services with incomplete documentation. 
Certificates of medical necessity for 25 percent of services ordered with surrogate UPINs were 
missing one or more pieces of information. Missing elements affected all sections of required 
information, including patient information, supplier information, physician information, and 
information related to the medical equipment ordered. For 9 percent of services, CMNs were 
missing three or more elements.  The number of items missing on incomplete CMNs ranged 
from 1 to 14. 
There were a number of required elements missing from CMNs and physician orders. The 
elements most often missing from CMNs were the beneficiary height (18 percent) and weight 
(17 percent).  For certain items of medical equipment, such as wheelchairs,  height and weight 
are elements that need to be reviewed to ensure that beneficiaries are receiving the appropriate 
equipment.  Documentation for 5 percent of services did not include the physicians UPIN, and 
7 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  documentation for 4 percent of services did not include the supplier billing number.  The 
elements missing from physician orders were the physicians name or signature, description of 
the item being ordered, or the date of the order. 
Documentation for 9 percent of services was dated months 
after the service date 
Supporting documentation for 9 percent of services was dated more than 31 days after the 
service date provided on the Medicare claim.  Seventy-one percent of these services had 
CMNs as supporting documentation and 29 percent had physician orders. Medicare paid an 
estimated $15 million for these services in 1999.  Some of these services also had items missing 
from the documentation. For 6 percent of services, documentation was dated 4 or more 
months after the date of service. For 1 percent of services, documentation was dated in excess 
of 1 year after the date of service on the claim. 
8 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  C O N C L U S I O N  
We believe the use of surrogate UPINs on Medicare claims poses a vulnerability to the 
Medicare program. We found a substantial number of documentation problems in the 
supporting evidence submitted by suppliers for claims processed with surrogate UPINs. Our 
review found that 17 percent of services had no supporting documentation, and another 28 
percent had at least one piece of required information missing from the documentation. We 
have referred all of the services with missing or incomplete documentation to CMS for 
appropriate action. In 1999, we estimate Medicare paid  $61 million for services ordered 
with a surrogate UPIN that had missing or incomplete supporting documentation. 
The findings detailed in this report also revealed misuse of surrogate UPINs on Medicare 
claims. We found that surrogate UPINs were incorrectly used for many services since the 
ordering physician had already been issued a permanent UPIN. We believe this is a significant 
problem given that the use of a surrogate UPIN on medical equipment claims allows them to be 
processed automatically whether the equipment has been ordered by a physician or not.  If the 
inappropriate use of surrogate UPINs by suppliers goes unchecked, the Medicare program 
becomes vulnerable to fraudulent billings and inappropriate payments. 
R E C O M M E N D A T I O N S  
We recommend that CMS: 
<	 Perform targeted reviews of claims for medical equipment ordered with surrogate 
UPINs. 
<	 Continue to educate suppliers and physicians that accurate UPINs must be used on 
claims, and surrogate UPINs should not be used if the ordering physician has a 
permanent UPIN.  For example, an article could be included in carrier bulletins 
reminding suppliers of proper documentation practices. 
Agency Comments 
The CMS concurred with our recommendations and indicated that the agency will take the 
necessary steps to increase the monitoring of UPINs and to educate suppliers and providers 
that accurate UPINs are required on submitted claims. They also stated that Medicare must set 
priorities for validating UPIN information. As a result, CMS will be implementing several 
initiatives, which include instructing DMERCs to decrease the use of surrogate UPINs through 
education and training, expanding Medicare Carrier Manual 
9 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  UPIN monitoring instructions to include DMERCs, and increasing central office/regional office 
monitoring of DMERCs UPIN activities. Appendix B contains the full text of CMS 
comments. 
10 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  APPENDIX  A 
Estimates and Confidence Intervals

PAGE 
TABLE 1. 	 Services That Should Have Been Ordered Using a Permanent UPIN

Rather Than a Surrogate UPIN  ........................................12

TABLE 2.  Services with Missing or Incomplete Documentation .........................12

TABLE 3.  Undocumented Services Ordered Using a Surrogate UPIN ....................13

TABLE 4.  Services Supported by Incomplete Documentation ..........................13

TABLE 5.  Items Missing from Documentation ......................................13

TABLE 6.  Services Supported by Incomplete CMNs  ................................14

TABLE 7.  Services with Supporting Documentation Dated After the Date of Service ......... 14

11 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  APPENDIX  A 
Estimates and Confidence Intervals

The tables below contain statistical estimates presented in the Findings section of this report. 
These estimates are weighted based on the stratified random sample design and are reported at 
the 95 percent confidence level. 
Table 1. 
Services That Should Have Been Ordered Using a Permanent UPIN 
Rather Than a Surrogate UPIN 
Point Estimate  95% Confidence Interval 
Percent of Services that Should Have Been Ordered  60.53%  52.89% - 68.17% 
with a Permanent UPIN 
Percent of Services where Ordering Physician had  37.93%  27.99% - 47.87% 
a Permanent UPIN for 5 or More Years 
Percent of Services where Ordering Physician had  16.60%  9.11% - 24.09% 
a Permanent UPIN for 10 or More Years 
Table 2. 
Services with Missing or Incomplete Documentation 
Point Estimate  95% Confidence Interval 
Percent of Services with Missing or  44.96%  37.02% - 52.90% 
Incomplete Documentation 
Total Medicare Allowances in 1999 for Services  $60,678,298  $42,226,787 - $79,129,808 
with Missing or Incomplete Documentation 
12 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  APPENDIX  A 
Table 3. 
Undocumented Services Ordered Using a Surrogate UPIN 
Point Estimate  95% Confidence Interval 
Percent of Services with  16.70%  10.76% - 22.64% 
No Supporting Documentation 
Percent of Services where Suppliers Did Not Submit  3.18%  0.65% - 5.71% 
Documentation After 3 Written Requests 
Percent of Services where Suppliers Responded but  13.53%  7.98% - 19.08% 
Did Not Submit Documentation 
Total Medicare Allowances in 1999 for Services  $16,600,257  $8,565,455 - $24,635,060 
Ordered with a Surrogate UPIN 
Table 4. 
Services Supported by Incomplete Documentation 
Point Estimate  95% Confidence Interval 
Percent of Services Supported by Incomplete  28.26%  21.18% - 35.34% 
Documentation 
Total Medicare Allowances in 1999 for  $44,078,040  $26,457,005 - $61,699,075 
Services Supported by Incomplete Documentation 
Table 5. 
Items Missing from Documentation 
Percent of Services  95% Confidence Interval 
Beneficiarys Height Missing  18.17%  12.00% - 24.34% 
Beneficiarys Weight Missing  17.44%  11.38% - 23.50% 
Physicians UPIN Missing  4.62%  1.70% - 7.54% 
Suppliers Billing Number Missing  3.89%  1.32% - 6.46% 
Description of Item Ordered Missing  3.91%  1.03% - 6.79% 
13 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  APPENDIX  A 
Table 6. 
Services Supported by Incomplete CMNs 
Point Estimate  95% Confidence Interval 
Percent of Services with CMNs Containing  25.35%  18.51% - 32.19% 
1 or More Missing Items 
Percent of Services with CMNs Containing  8.82%  4.59% - 13.05% 
3 or More Missing Items 
Table 7. 
Services with Supporting Documentation 
Dated After the Date of Service 
Point Estimate  95% Confidence Interval 
Percent of Services with Documentation  8.95%  4.36% - 13.54% 
Dated After the Date of Service 
Percent of These Services with a CMN Dated After  71.46%  47.45% - 95.47% 
the Date of Service 
Percent of These Services with an Order Dated After  28.54%  4.53% - 52.55% 
the Date of Service 
Total Medicare Allowances in 1999 for  $15,081,142  $39,000 - $30,123,283 
Services with Documentation Dated 
After the Date of Service 
Percent of Services with Documentation  5.84%  2.10% - 9.58% 
Dated 4 or More Months After the Date of Service 
Percent of Services with Documentation  0.91%  0% - 2.36% 
Dated More Than 12 Months After the Date of 
Service 
14 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  APPENDIX B 
Comments from the

Centers for Medicare & Medicaid Services

15 
Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270  A C K N O W L E D G M E N T S  
This report was prepared under the direction of Robert A. Vito, Regional Inspector General for 
Evaluation and Inspections in Philadelphia and Linda M. Ragone, Deputy Regional Inspector General. 
Other principal Office of Evaluation and Inspections staff who contributed include: 
Robert Katz, Project Leader  Tricia Davis, Program Specialist

Erika Lang, Lead Analyst  Barbara Tedesco, Mathematical Statistician

Lauren McNulty, Program Analyst

Cynthia R. Hansford, Program Assistant

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Medical Equipment Ordered with Surrogate UPINs  OEI-03-01-00270