New Medical Devices Spur Medicare Spending Growth

September 26, 2016

Some of the fastest-growing Medicare costs stem from doctors using new medical devices for testing and treatment in their offices, recent data shows.

According to a Wall Street Journal analysis, four of the top 10 fastest-growing Medicare services from 2012 to 2014 involved new medical devices being used by doctors in their offices, instead of in care settings where they might typically be used.

The appeal to doctors of using these new devices is clear: because of the way Medicare payments are structured, their use can be very lucrative. There is also the convenience factor for both doctors and patients. And in an era when technology offers sophisticated medical innovations small enough for use in doctors’ offices, it’s easy to see how doctors are tempted to use cool new devices.

But the consequences of doctors using more medical devices in their offices is an uptick in Medicare spending, to the tune of $135 million, according to Medicare billing records. While that amount of money is a drop in the bucket of total Medicare spending, if the trend continues, it could result in meaningful increases.

So while in-office testing and treatment has its advantages, it’s a trend that bears watching from a cost-benefit point of view.

To read the article in the Wall Street Journal, click here.

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