INDIANAPOLIS, July 1 (UPI) -- According to a recently released report by the Department of Veterans Affairs Task Force on Procurement Reform, Medicare is being "taken to the cleaners," in the words of the newspaper USA Today, for supplies ranging from wheelchairs to cleaning solution.
And that's just the tip of the iceberg. What are our elected representatives doing about it? Well, in the most basic sense, it depends who you ask.
If you ask Sen. Tom Harkin, D-Iowa, it is time to address the most basic issue -- purchasing.
"There's absolutely no reason why Medicare can't engage in competitive bidding. I'm going to turn up the heat on this," said Harkin.
Along the same lines, Rep. Bill Smith, R-Calif., is considering legislation this year that would allow Medicare to engage in competitive bidding for supplies.
Sen. Edward Kennedy, D-Mass., said on the Senate floor, "Reducing administrative costs (of the American health care system) to the level of other industries would save enough to finance universal health care several times over."
However, at the same time that Republicans and Democrats are beginning to work together to adopt best practices in purchasing, another government investigation is saying something different and may be heading in the opposite direction.
The Senate subcommittee on antitrust, competition, and consumer rights, chaired by Sen. Hebert Kohl, D-Wis., recently held a hearing on hospital group purchasing organizations. More commonly referred to as GPOs, these organizations are used by 98 percent of hospitals across the country to keep procurement costs down and enhance quality. For example, while the Veterans Administration employs 6,000 people to manage $5 billion in annual purchasing, Novation, one of the top health care GPOs, has 375 people dealing with $19 billion worth of goods.
But Kohl's committee isn't investigating how to broaden the usage of GPOs. Instead they are talking about why GPOs should be more closely regulated by the federal government. After all, since the feds are doing such a fine job overseeing Medicare purchasing, why not extend Uncle Sam's purview to the private sector too!
In the words of that famous American political pundit Madonna -- NOT!
"Not" is also appropriate to the coverage of this disturbing new report on Medicare cost discrepancies by America's newspaper of record, the New York Times -- as in, they did not report it. At all.
Instead, the Times is currently running a multi-part series that is critical of GPOs. A senior Senate staffer working for Kohl admitted that the impetus for holding hearings in the first place was due in large measure to phone calls from the New York Times. If the New York Times doesn't print it, can it really be that important?
We should hope that, despite the absence of reporting by the New York Times, our elected representatives will focus not on the sum of all fears, as reported by the New York Times, but on the fearful sums being wasted because the government isn't applying the best practices of the private sector.
(Peter J. Pitts is a senior fellow at the Institute for Strategic Communications and an adjunct professor at the School for Public and Environmental Affairs at Indiana University.)
