Medicare Payments for Durable Medical Equipment Are Higher Than Necessary
HRD-82-61
Published: Jul 23, 1982. Publicly Released: Jul 23, 1982.
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Highlights
GAO reported on the probable fiscal impact of the failure of the Department of Health and Human Services (HHS) to implement a law aimed at reducing the cost to the Medicare program and its beneficiaries for the prolonged rentals of durable medical equipment.
Recommendations
Recommendations for Executive Action
Agency Affected | Recommendation | Status |
---|---|---|
Department of Health and Human Services | 1. The Secretary of HHS should direct the Administrator of the Health Care Financing Administration (HCFA) to immediately notify the Medicare carriers to: (1) stop reimbursements for new rentals of items costing $60 or less; and (2) make analyses where possible of medical necessity forms to determine whether reimbursement on a rental or lump-sum purchase basis would be more economical and pay benefits on the most economical basis. |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
Department of Health and Human Services | 2. The Secretary of HHS should direct the Administrator of HCFA to increase the $60 limit used for requiring purchase to $100 and periodically adjust the limit for inflation. |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
Department of Health and Human Services | 3. The Secretary of HHS should direct the Administrator of HCFA to require carriers to improve their monitoring and retention of the medical necessity forms. Carriers must have the forms completely filled out by physicians in order to make effective rent or purchase decisions. |
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
Department of Health and Human Services | 4. The Secretary of HHS should modify the regulations to recognize that lease-purchase arrangements will generally be more costly than lump-sum purchase and, thus, would have limited applicability to certain high-cost items where the expected period of need is uncertain or where beneficiaries cannot afford the co-insurance associated with lump-sum purchases. |
GAO issued a follow-on report on July 30, 1985, HRD-85-35. The recommendations in the follow-on report are applicable to HHS.
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Department of Health and Human Services | 5. The Secretary of HHS should direct the Administrator of HCFA to provide beneficiaries with written material explaining the regulations on lease-purchase arrangements. |
GAO issued a follow-on report on July 30, 1985, HRD-85-35. The recommendations in the follow-on report are applicable to HHS.
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Topics
Cost controlHealth care servicesMedicareLeasesMedical equipmentRental equipmentBeneficiariesOxygenDurable medical equipmentDeductibles and Coinsurance