Medicare revises coverage for controversial devices

Friday, January 9, 2015

WASHINGTON – Providers of vacuum erection devices (VEDs) were dealt a one-two blow last month.

Medicare will no longer pay for the devices (L7900) under Medicare Part B, unless the beneficiary also needs related prescription drugs under Medicare Part D effective July 1, 2015. The provision was included in the A.B.L.E. Act, which President Obama signed into law Dec. 19.

“There is more than 25 years of research, thousands of patients, and hundreds of doctors to show the medical benefit of VEDs,” said Cara Slovacek, contract manager/corporate compliance for Dodge City, Kan.-based Pos-T-Vac, which makes and sells the devices. “We provide quality products to patients who need them.”

Most recently, VEDs came under scrutiny in a report by the Office of Inspector General that found nearly $175 million was paid out for the devices between 2006 and 2011.

If Medicare thinks it’s spending too much on VEDs, it should look at reducing reimbursement, not cutting it altogether, says Ed Stewart, CEO of Pos-T-Vac, who suggested just that back in 1999 when the devices were under review by the Senate.

“They didn’t take our advice or suggestions,” he said.

Also in December, Medicare lowered the coding requirements that manufacturers of the devices must meet. Previously, only four companies, including Pos-T-Vac, met the requirements. Lowering that bar could open the door to lower-quality products, says Slovacek.

“They say they want high-quality products but then they lower the standards,” she said. “They didn’t drop it a little; they bottomed it out. You could practically get a novelty toy approved.”

As with a lot of other durable medical equipment, the devices suffer from a negative perception that they’re unnecessary or shouldn’t be paid for by Medicare, says consultant Wayne van Halem.

“There’s been a lot of negative views of this particular product and whether or not it should be a covered item,” said van Halem, president of the van Halem Group. “The providers that supply it have seen a significant amount of issues with audits and everything else.”

But with the baby boomer population seeking treatment, demand for the devices will only grow, says Stewart. One saving grace: They’ll pay out of pocket.

“We’ve been selling a non-prescription line for years,” he said. “(Medicare) is just trying to push the responsibility for paying for this back on the user, which seems unfair.”