The nation’s lawmakers are at an impasse over the fiscal debt crisis, yet the majority of the House, 145 Republicans and 82 Democrats, are demanding a second delay in the implementation of a durable medical equipment Medicare cost-reduction initiative, scheduled to take effect July 1.
Excessive reimbursements for durable medical equipment, prosthetics, orthotics and supplies, or DMEPOS for short, have plagued Medicare for years. Now on the eve of meaningful spending cuts members of the House want a pass.
Medicare routinely pays more than double the current retail rate for DMEPOS equipment. Congress created the current DMEPOS reimbursement schedule in 1989, and then left it virtually unchanged, despite intervening cost reductions for dozens of the most costly product categories. Between 2000 and 2010, Medicare spent an estimated $69.4 billion on inflated DMEPOS reimbursement rates. DMEPOS fraud is rampant.
The straight-forward Medicare remedy is to force suppliers to compete on price. Numerous pilot programs have proven that competitive bidding will save taxpayers hundreds of millions of dollars each year with no harm to patient care. As authorized under the Affordable Care Act, competitive bidding in the DMEPOS marketplace is scheduled to begin July 1. The projected savings for taxpayers and Medicare beneficiaries over the next 10 years is $42.8 billion.
Apparently the hypocrisy in American politics has no bounds. The irony of the House-led stall is that the Democratic opposition voted on President Obama’s health care law and the GOP opponents are fighting against a free-market alternative.
Meanwhile, a Chicago hospital is accused of cutting throats for $160,000 from Medicare.
Based in part on surreptitious tape recordings, an FBI affidavit lays out allegations that a Sacred Heart pulmonologist kept patients too sedated to breathe on their own, then ordered unneeded tracheotomies for them — enabling the for-profit hospital to reap revenue of as much as $160,000 per case.
Sacred Heart hospital patients are not the only ones feeling the deep cuts. According to the Washington Post, on Friday a federal advisory panel said that Congress should move to cut payments to hospitals for services that can be provided in doctors’ offices at much lower costs.
The Medicare Payment Advisory Commission said the current payment disparities had created incentives for hospitals to buy physician practices, driving up costs for the Medicare program and for beneficiaries. Hospital buyouts of doctors, turning independent practitioners into hospital employees, have also led to higher spending by private insurers and higher co-payments for their policyholders, the commission said.