$919 back braces typ­ify Medi­care over­spend­ing

Medi­care of­fi­cial says com­pet­i­tive bid­ding plan could cut down on costs.

Austin American-Statesman - - THE SECOND FRONT - By Ri­cardo Alonso-zaldivar

WASHINGTON — In­ter­net sale price for a stan­dard back brace: $99.99.

What Medi­care pays for the item: $900-plus.

A fed­eral report re­leased Wed­nes­day of­fers a look at how waste­ful spend­ing drives up health care costs as in­ves­ti­ga­tors found that Medi­care paid $919 on av­er­age for back braces that cost sup­pli­ers an av­er­age of $191 each.

“The pro­gram and its ben­e­fi­cia­ries could have paid mil­lions of dol­lars less if the Medi­care re­im­burse­ment amount … more closely re­sem­bled the cost to sup­pli­ers,” ac­cord­ing to the report from the in­spec­tor gen­eral of the De­part­ment of Health and Hu­man Ser­vices.

In a writ­ten re­sponse, Medi­care’s ad­min­is­tra­tor, Mar­i­lyn Taven­ner, said Medi­care will con­sider in­clud­ing back braces in a com­pet­i­tive bid­ding plan for med­i­cal equip­ment. The bid­ding ex­per­i­ment, ex­pand­ing across the coun­try, has been shown to save tax­pay­ers money.

Bud­get talks be­tween Pres­i­dent Barack Obama and House Speaker John Boehner, R-Ohio, may lead to more com­pet­i­tive bid­ding, a shift that some Democrats are urg­ing and in­dus­try is fight­ing.

It’s es­ti­mated the health care sys­tem squan­ders $750 bil­lion a year, about 30 cents of ev­ery med­i­cal dol­lar, through un­needed care, waste­ful spend­ing and fraud. Part of the prob­lem is prices can vary widely de­pend­ing on who’s paying the bill. Prices that government pro­grams pay can be way off the mark.

Medi­care spends more than $10 bil­lion a year pro­vid­ing ben­e­fi­cia­ries with med­i­cal equip­ment, from power wheel­chairs to blood sugar mon­i­tors. It’s an area that has been rife with fraud. Un­scrupu­lous sup­pli­ers sell ben­e­fi­cia­ries items they may not need and bill the cost to Medi­care.

The $96 mil­lion that Medi­care spent on back braces in 2011 was a small sliver of its to­tal spend­ing, but that amount had more than dou­bled in just three years, up from $36 mil­lion in 2008, the report said. In­ves­ti­ga­tors de­cided to take a closer look, be­fore the line item for back braces could reach the $200 mil­lion or $300 mil­lion mark.

The in­spec­tor gen­eral’s of­fice fo­cused on a type of back brace that is fairly stan­dard. Dozens of med­i­cal de­vice man­u­fac­tur­ers pro­duce such braces for thou­sands of sup­pli­ers around the coun­try.

The brace is worn around the mid­sec­tion of the body, and usu­ally features rigid pan­els on the front and back, along with straps for ad­just­ment. It’s pre­scribed to help back-pain suf­fer­ers main­tain proper body align­ment. Medi­care paid for more than 121,000 of the braces in 2011, com­pared with fewer than 49,000 in 2008.

In­ves­ti­ga­tors pulled a random sam­ple of claims from more than 300 sup­pli­ers and took a deep dive into the pa­per­work. They found the price Medi­care was will­ing to pay was more than four times what the braces cost sup­pli­ers. The av­er­age dif­fer­ence: $728 per brace. The high costs were shared by ben­e­fi­cia­ries, who are re­spon­si­ble for a 20 per­cent co­pay­ment.

The re­im­burse­ment amount set by Medi­care goes be­yond just equip­ment cost, also in­clud­ing fit­ting and ed­u­ca­tion for the pa­tient. So the in­spec­tor gen­eral’s of­fice took a look to see if that might ex­plain the high cost to the pro­gram.

But in­ves­ti­ga­tors found that for one-third of claims, sup­pli­ers did not report any fit­ting and ad­just­ment help. Sup­port ser­vices var­ied for the re­main­ing two-thirds of cases. Some sup­pli­ers re­ported tak­ing hip and waist mea­sure­ments. Oth­ers said they ad­justed the braces in some fash­ion. Nearly half the claims in­volved ser­vices from med­i­cal pro­fes- sion­als such as doc­tors, chi­ro­prac­tors and phys­i­cal ther­a­pists.

“For the vast ma­jor­ity of claims, sup­pli­ers did not pro­vide any ad­di­tional ser­vices … other than gen­eral in­struc­tions,” the report said.

A re­porter’s quick In­ter­net search sug­gested there’s a thriv­ing busi­ness in back braces. One med­i­cal sup­plier in the Mid­west aimed its pitch di­rectly at doc­tors.

“Your peers are us­ing back braces to help gen­er­ate ad­di­tional rev­enue for their of­fice,” the pro­mo­tional ma­te­rial said. It ex­plained how doc­tors can make an added $350 to $650 for each Medi­care pa­tient who qual­i­fies for a brace.

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