Study details increased Part A costs due to bid program

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Tuesday, July 31, 2018

WATERLOO, Iowa – The VGM Group has added a study that shows the cost shift that is happening as a result of reduced access to DME for Medicare beneficiaries to its lobbying toolbox.

The VGM-sponsored study by Leitten Consulting shows that:

  • Fall-related injuries due to failure to provide needed mobility equipment results in a cost shift of between $4,705 and $5,029;
  • COPD-related exacerbations due to failure to provide supplemental oxygen therapy results in a cost shift of about $14,350; and
  • OSA-related complications due to failure to provide CPAP therapy results in cost shift of $1,631.


“When this happens, Medicare incurs substantial increased Part A costs to treat medical complications caused by not having the needed DME,” Brian Leitten writes in the study.

This most recent study builds on another study by Leitten Consulting released last year that shows, for every dollar spent on DME, Medicare could save anywhere from $11 to $29 in payments for direct treatment.

VGM says the most recent study will be an important tool in its continued discussions with elected officials about the negative impact of Medicare’s competitive bidding program.

“(The study) provides a clear picture of the negative impact caused by both the delay and lack of access to proper equipment due to CMS’s competitive bidding program,” said John Gallagher, vice president of government relations. “The dramatic reduction in DMEPOS providers, coupled with cost shifted from prevention to treatment, are, in fact, coming at a significant larger cost to Medicare.”