A review was made of the procurement practices of 37 hospitals in 6 cities to determine: (1) the prices paid for selected routine hospital items; and (2) whether there are significant variations in prices paid for the same or similar hospital items within the same geographical area.
Recommendations for Executive Action
|Department of Health and Human Services||1. The Secretary of HEW should direct the Administrator of the Health Care Financing Administration (HCFA) to instruct Medicare intermediaries to: (1) gather and compile price information in various areas on the five items GAO identified that appeared to offer the greatest potential for cost savings; and (2) communicate such information to the hospitals they service.|
|Department of Health and Human Services||2. The Secretary of HEW should direct the Administrator of HCFA to instruct intermediaries to periodically monitor their hospitals' purchases of the items identified and report back to HCFA in order to: (1) assess the extent that this activity may result in cost savings; and (2) determine whether it should be expanded to include other hospital supply items.|