Penis pumps cost Medicare $172 million over 6 years

The Medicare system was paying as much as double the retail rates for non-Medicare buyers.
Posted By Ananth Baliga   |   Jan. 14, 2014 at 4:00 PM
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The Inspector General of the Health and Human Services department has found that the Medicare program spent $172.4 million on vacuum erection systems, commonly called penis pumps, between 2006 and 2011, paying a higher price than that paid by non-Medicare payers.

The report found that the Medicare program paid nearly 474,000 claims for penis pumps totaling about $172.4million, with the yearly payment nearly doubling from $20.6 million in 2006 to $38.6 million in 2011.

"Medicare payment amounts for VES remain grossly excessive compared with the amounts that non-Medicare payers pay. Medicare currently pays suppliers more than twice as much for VES as the Department of Veterans Affairs and consumers over the Internet pay for these types of devices."

The report goes on to say that if Medicare had adjusted prices to those paid by non-Medicare payers, then the government could have saved $14.4 million for each of the six years, and Medicare beneficiaries would have saved $3.6 million.

The report was unable to calculate the cost advantage if competitive bidding was introduced for acquiring these pumps, but said that the Centers for Medicare & Medicaid Services has been able to lower the cost of certain types of durable medical equipment by 45 percent, and lowered cost by 72 percent for mail-order diabetic testing supplies.

[Office of Inspector General]

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