Medicare DMEPOS Audit Improvement and Reform (AIR) Act of 2014

Medicare DMEPOS Audit Improvement and Reform (AIR) Act of 2014 - Amends title XVIII (Medicare) of the Social Security Act (SSA) to establish a Medicare Administrative Contractor Payment Outreach and Education Program for DMEPOS (durable medical equipment, prosthetics, orthotics, and supplies) suppliers.

Requires each Medicare administrative contractor responsible for DMEPOS payments, in order to reduce improper payments to DMEPOS suppliers under Medicare part B (Supplementary Medical Insurance), to provide suppliers, physicians and practitioners who prescribe DMEPOS, and discharge planners and case managers who coordinate DMEPOS for individuals in the contractor's area with error rate reduction training as well as:

• a list of suppliers' most frequent payment errors and the most expensive payment errors over the last quarter,
• specific instructions regarding how to correct or avoid such errors in the future as well as to prevent future issues related to new audits, and
• a notice of all new topics that have been approved by the Secretary of Health and Human Services (HHS) for audits.

Sets forth the structure for audits of DMEPOS suppliers, requiring a contractor to give priority to activities under the DMEPOS payment outreach and education program that will reduce improper Medicare payments based on technical errors, medical necessity, and fraud.

Requires annual reports to Congress on the use of recovery audit contractors under the Medicare Integrity Program to include certain information on the results of audit appeals related to DMEPOS.

Requires the Secretary to: (1) increase the maximum record requests made by Medicare DMEPOS contractors in auditing claims of suppliers with a relatively high audited claims error rate for DMEPOS payments, and (2) decrease the maximum record requests for suppliers with a relatively low error rate.

Directs the Secretary to limit the audit documentation review period for Medicare administrative contractors to three years.