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Medicare Testing Medical Supply Program To Reduce Costs and Number of Suppliers - 9 Cities to Participate

Posted Jul 04 2010 3:57pm

The pilot program begins January 1st and the number of suppliers will be reduced by companies submitting bids to be approved suppliers.  The entire question here that concerns many is that will enough suppliers be contracted to meet the needs of consumers and providers.  They anticipate a 32 percent savings with the algorithms set up to project analysis in the cities.

The article states that the number of approved providers in Texas could go down as much as 80 percent, which is a big number and again access to life saving image equipment will be needed.  Perhaps with this effort we could also see some acquisitions and mergers in this area too?   I can understand needing to save money but again there’s much more money to be saved from the billing side of healthcare with way too many billing and auditing companies out there who make billions with transaction fees.  Their existence to many is hidden and thus we keep coming back to the areas that most can see and in essence the quality of care seems to dwindle with this effort. 

Again, saving costs and providing good care is important but in no way do we need all of the analytics and software gluts out there who take their fee from every claim processed and sometimes you have as many as 2 or 3 taking a cut from one medical claim, this is over done and a huge part of healthcare expense could be saved here along with cutting fraud. 

Between omitting duplication and unnecessary transaction fees and services along with better fraud detection, more money would be saved than in any other cost saving areas. 

It’s just too bad that we don’t have leaders smart enough to see the underside here and that the focus stays on what is visible.  It is what is invisible in healthcare that yields big profits.  We could easily get by with about 25% of the analytical and billing services that make billions today.

Perhaps when this program gets going they could also eliminate duplicate or non essential transaction fees too. 

Tech denial and the value and non value of Health IT issues continues to rule.  BD 

Dallas-area residents who use Medicare to pay for their medical supplies may soon get a break on the prices, but they may have fewer suppliers to choose from.

Medicare is overhauling how it pays for products such as oxygen concentrators, hospital beds and diabetes testing supplies by making suppliers compete to offer the best price. Dallas is one of nine cities where Medicare is testing the program.

The federal government expects to save more than $17 billion over 10 years. On average, costs for medical equipment and supplies will be 32 percent cheaper.

Suppliers that wish to participate in the program submitted bids last year. CMS plans to announce the contract suppliers in September, once all contracts have been finalized.

The bidding program could trim the number of medical supplies providers in Texas by 80 percent, from 1,500 to 300, Schwinghammer said. Fewer providers might mean less access to life-saving medical supplies, he said.

During the icy weather in January, home health care service providers carrying oxygen and other supplies were critical to local emergency response efforts, Schwinghammer said. North Texas has 200 oxygen providers; the bidding program could cut that number to 40, he said.

The first round of the program starts Jan. 1 for Medicare users in Dallas; Charlotte, N.C.; Cincinnati ; Cleveland; Kansas City ; Miami; Orlando, Fla.; Pittsburgh ; and Riverside, Calif.

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