The Pentagon has a number of fairly absurd rules and regulations that govern their procurement process. These regulations tend to raise the cost of many purchases that the Department of Defense is mandated to make, so items end up costing more. It’s typical bureaucratic inefficiency, but in this case, many people wonder if it was more than waste.
According to a recent DoD inspector general’s report, they may have vastly overspent on a strange item that most would not think of when they consider the United States military: breast pumps. Yes, according to the report, the Pentagon overspent by up to $16 MILLION dollars when purchasing breast pumps.
The regulations that forced the military to do this were included in the 2015 National Defense Authorization Act, which was pushed through during the Obama administration and signed by Barack Obama himself.
The Defense Health Agency purchased the breast pumps, providing them to beneficiaries in what was once the North, South, and West Tricare regions.
They first ordered these breast pumps so that Tricare could offer a free ‘standard’ breast pump to all new mothers in the military.
Essentially, the 2015 NDAA required that every servicemember and/or dependent who presented a physician’s prescription would receive a free breast pump and supplies, such as tubing, and bottles per every ‘birth event.’
In other words, every time a servicemember or their dependent had a child, he or she could get a free breast pump and additional equipment to properly utilize it.
According to the Inspector General’s report, the breast pump that the DHA was providing to servicemembers and their dependents was worth about $192 if purchased in a store.
However, the military was paying as much as $1,400 for each device, an absurd markup for such a simple piece of equipment.
Under existing DoD policy in 2015, military personnel could order the pump either from a medical supply company and send the bill to Tricare, or they could purchase a pump at the store and submit the receipt on their own.
However, the military failed to require that contractors for the North, South, and West Tricare regions utilize suppliers with fixed reimbursement rates.
Because of this, the DHA overpaid for “breast pumps by 91.2 percent,” in 54,006 of 59,251 machines, and frivolously squandered 56.8 percent extra on more than half of the sets of “replacement parts” ordered under the program.
In other words, if they HAD used fixed reimbursement rate suppliers, they would have saved $12.2 million on the breast pumps alone, and would have saved another $4 million on the replacement parts.
The report concluded that if the military refused to change its policy, it could end up overpaying by $81 million over the next five years.
According to the IG’s report, the worst price for the breast pump, however, came from Pennsylvania. A supplier in what was then Tricare’s North region charged $1,400 for a “Medela Pump in Style Starter Set.”
At the time, that particular model of breast pump retailed for $192. Somehow, the military ended up paying a 729% markup over retail prices for a breast pump.
So, how did the Obama-era Pentagon attempt to fix the problem? Did they cap the amount that they would pay for a breast pump relative to the MSRP or the standard retail price in most stores? Did they provide Tricare beneficiaries with a list of places they could purchase appropriately-priced breast pumps without having to fear that they would be soaked by a medical supplier?
No. Instead, the Obama solution was to attempt to stop soldiers from being able to access out-of-network providers and retail organizations in order to find the breast pumps they needed.
Tricare rejected that solution, and decided instead that they would attempt to include fixed reimbursement rates across the system to prevent such an over expense from ever happening.
However, Obama appointees wanted to blame the one percent of people who bought their own pumps and submitted receipts for reimbursement. Somehow, because one percent of people bought equipment in the retail marketplace, 90 percent of the purchases had to be covered by taxpayers, and at a ridiculously high price.
Military health insurance can, and absolutely should, allow some measure of privatization. It is much easier for dependents and servicemembers to get their own breast pumps, with their own prescriptions, than it is for military to keep a stock of them on hand and then distribute them as needed.
The U.S. military paid $420 for every M16 produced when they bought the rights to the design and provided it to a competitor, FN Herstal. The military can obviously effectively negotiate on price, so what happened here?
This kind of absurd overspending was born out of an administration entirely unconcerned with the military and the conditions for servicemembers. It is a direct result of the failures of former-President Obama’s leadership, and his choice of partisan Pentagon pets.
Wasting money like that makes the U.S. Military less combat-effective, and it spends money that could go into superior training and better equipment.