The Goose That Laid The Golden Medicare Egg is Dead

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.

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.

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.
Lets continue to detect and report fraud and waste.  That will go along way to reducing health care costs.

Call us. We're here to help.

Help support this ad free blog by answering several questions about caregiving here. It will take just two minutes.

About The CareGiver Partnership. The CareGiver Partnership helps caregivers and their loved ones with answers to their caregiving questions, including information about home health care products and supplies, from our Wisconsin-based team of Product Specialists who are all current or former caregivers. The company’s Web site provides the largest online library of resources on subjects most important to caregivers — from arthritis to assisted living, and Parkinson’s to prostate cancer — as well as access to more than 3,000 home care products for incontinence, skin care, mobility, home safety and daily living aids. The CareGiver Partnership was founded in 2004 by Lynn Wilson of Neenah, Wisc. Visit to learn more or call 1-800-985-1353.


Post a Comment