[Congressional Record (Bound Edition), Volume 147 (2001), Part 1]
[Extensions of Remarks]
[Page 48]
[From the U.S. Government Publishing Office, www.gpo.gov]



      RE-INTRODUCTION OF THE MEDICARE UNIVERSAL PRODUCT NUMBER ACT

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                     HON. LOUISE McINTOSH SLAUGHTER

                              of new york

                    in the house of representatives

                       Wednesday, January 3, 2001

  Ms. SLAUGHTER. Mr. Speaker, it is my pleasure to re-introduce today a 
bill that could provide a significant new tool in the battle against 
Medicare waste, fraud and abuse: the Medicare Universal Product Number 
Act.
  In 1996, the first-ever comprehensive audit of Medicare's books 
revealed that Medicare was losing more than $23 billion every year to 
waste, fraud, and abuse--almost 14 percent of the program's budget. 
Since that time, the Department of Health and Human Services has taken 
important steps to crack down on abusive practices. By fiscal year 
1999, net payment errors totaled an estimated $13.5 billion, or about 8 
percent of total Medicare fee-for-service benefit payments.
  While significant progress has been made, we must do more to ensure 
that all Medicare funds are used for the benefit of patients. In 
particular, room for improvement exists in Medicare's reimbursement for 
durable medical equipment (DME). Durable medical equipment includes 
supplies like catheters, wheelchairs, walkers, and ostomy supplies 
needed by patients. Many Americans would undoubtedly be shocked to 
learn that the Medicare program frequently pays for DME without knowing 
exactly what product was supplied to the beneficiary. Under the current 
system, items are grouped under broad codes. Medicare pays the average 
price for all the items included in that category, no matter whether 
the least or most expensive one was provided. Moreover, the coding 
system does not allow government officials to determine exactly which 
product under the code was supplied.
  The Medicare Universal Product Number Act will empower Medicare to 
know precisely what items are being supplied. This bill would require 
all medical equipment paid for by Medicare to have a Universal Product 
Number (UPN) very similar to the bar codes on groceries. When suppliers 
submit claims for reimbursement, they will identify items by UPN. 
Medicare will know exactly what equipment has been provided and 
reimburse accordingly. The UPN can be an invaluable aid in tracking 
down improper payments, identifying willful upcoding and fraud, and 
reducing program waste.
  UPNs are already used extensively by the Department of Defense, 
Veterans Administration, and many private hospitals and health care 
purchasing cooperatives. HCFA should recognize the utility of UPNs for 
Medicare and support the passage of the Medicare Universal Product 
Number Act.
  I am proud to be joined in this effort by my distinguished colleague 
from Corning, Representative Amo Houghton, who has a long record of 
activism on health and Medicare. I would also like to note that this 
legislation has the support of the American Orthotics & Prosthetics 
Association, the Healthcare Electronic Data Interchange Coalition 
(HEDIC), the Health Industry Distributors Association, the Health 
Industry Group Purchasing Association, Invacare, the National 
Association for Medical Equipment Services (NAMES), the National 
Association of Wholesaler-Distributors, Premier, Inc., the Uniform Code 
Council, and VHA, Inc.
  Medicare program integrity is improving, but we still have a long way 
to go. The current system is wasteful and vulnerable to abuse. UPNs are 
a common-sense solution to make Medicare a smart health consumer for 
the sake of older Americans, taxpayers, and medical equipment suppliers 
alike.

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