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| The Medicare Golden Goose |
When your call to action is "Get This Free",
people respond. People like things that
are free, that is why Free is the #1 marketing term.
When that call to action is supported with just under $200 million a year in continuous bombardment television advertising (and radio, direct mail), it makes people want to get the free stuff.
Lately, you may have seen non-stop ads from a company called SafeLink which is giving away free phones and minutes to those on food stamps and Medicaid. The free phones and minutes are funded by The Universal Administrative Company (USAC) which takes money we pay to phone companies in our bills and they fund the free phones with it (and other programs). When you peel back the layers you discover that USAC is the administrator and the fund manager referred to as USF of Universal Service Fund. Digging even deeper, you find this leads back to Washington and the FCC which actually has oversight for USAC. SafeLink is a company taking advantage of this government program that we are all paying for and creating the expectation for a free cell phone and minutes.
Lately, you may have seen non-stop ads from a company called SafeLink which is giving away free phones and minutes to those on food stamps and Medicaid. The free phones and minutes are funded by The Universal Administrative Company (USAC) which takes money we pay to phone companies in our bills and they fund the free phones with it (and other programs). When you peel back the layers you discover that USAC is the administrator and the fund manager referred to as USF of Universal Service Fund. Digging even deeper, you find this leads back to Washington and the FCC which actually has oversight for USAC. SafeLink is a company taking advantage of this government program that we are all paying for and creating the expectation for a free cell phone and minutes.
It used to be that 'we the people' (Medicare) told citizens that we will pay for these medical products and supplies if you really need them... not if you just want them. Profit seeking individuals figured out an
angle and began creating companies to take advantage of the Medicare giveaway
program. They discovered they could offer consumers free
scooters, free diabetic supplies and now, even free mobile phones with bundled minutes
to boot, process a bit of paperwork and generate nice profit margins. Since the government back this, payment was
virtually 100% certain -- and fast.
Recently, the government (Medicare) changed the rules. These companies now have to
bid for 'we the people's business'. Soon, we'll only allow only one provider of scooters in the Milwaukee area (as an example) - the one who will provide them at the lowest cost. What a novel concept. Furthermore, isn't guaranteeing
payment of $X per scooter. They also aren't paying for the scooters at time of delivery. They've moved to the installment plan - 13 'easy' monthly payments to the providers. In essence Medicare is now 'renting' the scooters, not selling
them. This is a simplistic presentation
of what's been changing and will continue to be implemented. Companies devised
tactics to game the system like directing patients to doctors who were more likely to approve a
scooter as compared to their own doctor. They even went so far as to go
to the doctor's appointment with them to intimidate the doctor.
Dr. Jerome Epplin of Litchfield, Ill., who testified before the Senate, estimates that only about one out of every 10 patients who ask him for a scooter actually needs one. But he said that sales representatives from some scooter companies put pressure on him by accompanying patients to his office. The effect is coercive, he says.
Dr. Jerome Epplin of Litchfield, Ill., who testified before the Senate, estimates that only about one out of every 10 patients who ask him for a scooter actually needs one. But he said that sales representatives from some scooter companies put pressure on him by accompanying patients to his office. The effect is coercive, he says.
Members of Congress say the ads lead to hundreds of millions
of dollars in unnecessary spending by Medicare, which is only supposed to pay
for scooters when seniors are unable to use a cane, walker or regular
wheelchair. Government inspectors say up to 80 percent of the scooters and
power wheelchairs Medicare buys go to people who don’t meet the requirements.
And doctors say more than money is at stake: Seniors who use scooters
unnecessarily can become sedentary, which can exacerbate obesity and other disorders.
“Patients have been brainwashed by The Scooter Store,” says
Dr. Barbara Messinger-Rapport, director of geriatric medicine at the Cleveland
Clinic. “What they’re implying is that you can use these scooters to leave the
house, to socialize, to get to bingo.”
The Scooter Store was caught over billing the Federal Government
by over $100 million and said they would only send back $19 million -- over a
number of years. Who's running things
here?
We believe 'we the people' need to invest significant funds to root out
deception, fraud and stealing from 'we the people's Medicare funds. The days of making a fortune off the backs of
'we the people' are hopefully coming to an end to some degree. And lets get smarter -- people should return the scooter when they no longer need it (or pass away). Otherwise their grand children may be using it as a $2,500 toy.
Following are a few examples.
- The Scooter Store. The Federal Government is forcing these
companies like The Scooter Store to compete in a sealed bid process rather than just giving them $X
for each scooter delivered. One of our
employees father who was 99 1/2 got a free $7,000 scooter. He passed away shortly thereafter and there
was no expectation that the chair be returned for reuse by someone else in
need. Most are simply 'delivered', not sold, because the Federal government is
paying the majority -- so who wouldn't want one for free? The Federal Government raided The Scooter
Store in February, but no one is talking.
They don't usually raid a facility unless they suspect fraud. It is likely that all the employees will lose
their jobs and The Scooter Store will be no more. Sun Capital Partners, which is a major investor in The Scooter Store has made no statement nor do they even mention it on their website. They also are hiding under their desks.
In 2005 the U.S. Justice Department sued The Scooter Store, alleging that its advertising enticed seniors to obtain power scooters paid for by Medicare, and then sold patients more expensive scooters that they did not want or need. The Scooter Store settled that case in 2007 for $4 million. In 2011, government auditors estimated that The Scooter Store received between $47 million and $88 million in improper payments for scooters.
- Hoveround hasn't gotten the message. The headline on their website still says "Get a Hoveround' for little to no cost. They are hiding under their desks and simply not returning any calls from the media. This is one of the key issues -- advertising which has created false expectations that everyone should have a free chair, free supplies, now a free mobile phone (along with free minutes). Society pays for this and there is little accountability.
- Liberty Medical - "If your diabetic and on Medicare", your supplies may be covered said Wilford Brimley. Not anymore. Liberty (formerly owned by Medco Health Solutions) got out of the business and laid off 450 people recently. According to sources, new government documentation forced them to sell. Another company, Arriva is positioning themselves to be a large player in the market. They purchased Direct Diabetic Source and AmMed Direct in 2012. We'll see.
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