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Penis pumps are major drain on Medicare

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A report released by the Office of the Inspector General (OIG) for U.S. Department of Health and Human Services has revealed that the government has been spending too much on penis pumps. From 2006 to 2011, Medicare paid $172 million for around 473,620 of such devices. This translates to an average cost of $360 compared to options that can go as low as $164.

While penis pumps could have helped patients with erectile dysfunction but the spending proved way overboard compared to what patients could have paid for the vacuum erection systems (VES) at retail stores.

"During a previous Office of Inspector General review of one of the Nation's major suppliers of male vacuum erection systems (VES), we noted that Medicare payments for VES were significantly greater than the prices available to non-Medicare payers," the report of the OIG stated.

"From calendar years (CYs) 2006 to 2011, Medicare paid 473,620 VES claims totaling approximately $172.4 million. Over the same 6-year period, the yearly claimed amount for VES nearly doubled from $20.6 million in CY 2006 to $38.6 million in CY 2011," the report pointed out. "Over the same period, the number of Medicare paid claims for VES also nearly doubled, from 61,589 in CY 2006 to 103,448 in CY 2011. The average Medicare payment for VES over this period was $360.93. The average beneficiary copay amount was $90.23."

Upon investigation, the OIG found out that the spending of Medicare is "grossly excessive" compared to non-Medicare payers. It found out that Medicare paid twice as much compared to people who get penis pumps online. It also concluded that the government could have saved $14.4 million for each year the review covered or about $86.4 million. If recommendations will be followed, the government can save $18 million and Medicare beneficiaries save $4.5 million in purchasing VES.

The OIG suggested that the Centers for Medicare and Medicaid Systems (CMS) do two things. It hopes that the CMS "use its authority under the inherent reasonableness regulations to determine whether the payments for VES are grossly excessive and, if so, establish a special payment limit," and "seek legislative authority to include VES in the Competitive Bidding Program and then implement a National Mail-Order Competitive Bidding Program for VES."

According to the Administration of Aging, there were 39.6 million people in the United States who were 65 years or older in 2009. This number of this population is expected to balloon to 72.1 million by 2030. Will expenditure on penis pumps deny a good chunk of these old people treatment for life-threatening health problems in the future? Unless, the CMS can negotiate for better prices or have a good bidding process the answer might be a resounding "yes."

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