Quarter-Billion Taxpayer Dollars Spent on Penis Pumps

Quarter-Billion Taxpayer Dollars Spent on Penis Pumps
December 6, 2011

Benjamin Domenech

Benjamin Domenech (bdomenech@heartland.org) is a senior fellow at The Heartland Institute. Domenech... (read full bio)
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According to data collected by the Centers for Medicare and Medicaid Services (CMS), Medicare has spent more than $240 million of taxpayer money on penis pumps for elderly men over the past decade, and will surpass a quarter of a billion dollars this year for costs since 2001.

The cost to taxpayers for the pumps more than quadrupled during that period, from a low of $11 million in 2001 to a high of more than $47 million in 2010. And these represent only the costs for external devices, technically classified as “Male Vacuum Erection Systems,” not implantable devices or oral drugs such as Viagra.

Easy to Qualify

In order to obtain a pump, according to CMS’s Local Coverage Determination (LCD) revised in October this year, the “patient’s medical record must contain sufficient documentation of the patient’s medical condition to substantiate the necessity for the type and quantity of items ordered,” noting erectile dysfunction (ED) can “commonly occur in men in the Medicare age group.”

The National Institutes of Health previously estimated between 15 percent and 25 percent of 65-year-old men experience ED on a long-term basis, which the LCD notes may be caused by “diabetes, other endocrine abnormalities, vascular abnormalities, trauma, neurogenic, psychogenic, side effects of many medications, and other causes.” The Cleveland Clinic also points to “psychological factors, such as stress, depression, and performance anxiety” as possible causes.

If a medical exam and history shows a senior on Medicare meets the relevant threshold—a diagnosis of ED—he becomes eligible for a wide range of options under the Medicare Prosthetic benefit. Treatment Options covered by Medicare include “oral medications, pharmacological injections, intra-urethral suppositories, vacuum erection devices, and implantable penile pumps.”

But are these devices really “medically necessary”? Health Care News contacted CMS to ask whether they have audited the medical files to determine medical necessity. CMS has not provided a response at the time of publication.

Rising Incidence of Fraud

One area of concern for CMS is the rise in fraud in relation to the pump devices. Earlier this year an Illinois man pled guilty to collecting more than $2 million from Medicare in a fraudulent operation where he repackaged $26 items from adult websites and sold them to seniors as medical devices, charging Medicare $284 apiece.

Device fraud has become an increasingly common way for criminals bilk the taxpayers. Durable medical equipment (DME) is widely perceived as a “high risk” area for fraud, according to a spokesman for the HHS Office of the Inspector General.  And a report released last month by CMS found the error and improper payment rate for DME was above 60 percent, whereas no other area even entered double digits.

Questionable Medical Need

Given the questionable medical need for this technology’s utilization and the significant percentage of improper DME payments, John Nothdurft, director of government relations for The Heartland Institute, questions whether it is prudent for Medicare to continue to pay for penis pumps. 

“At a time when the federal government borrows 43 cents of every dollar it spends, do we really need to be spending money on this? I doubt you need a ‘Super Committee’ to realize that this is the epitome of wasteful spending,” Nothdurft said.

In prior reports of Medicare’s trustees, the program’s actuary projected Medicare has $36.8 trillion in unfunded liabilities. And according to their 2011 report, Medicare spending is expected to grow from 3.6 percent of U.S. gross domestic product (GDP) in 2010 to roughly 10.7 percent of GDP in 2085.

Benjamin Domenech

Benjamin Domenech (bdomenech@heartland.org) is a senior fellow at The Heartland Institute. Domenech... (read full bio)
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