The May 2026 NBER Digest discusses Competition and Fraud in Health Care, Working Paper 34802, issued in February. The study examines Medicare procurement of durable medical equipment after a move from administered prices to competitive bidding. The authors find that fraudulent firms gained market share as legitimate providers exited, reflecting a cost advantage for fraudulent operators.
The findings concern a specific setting. They do not establish the same outcome in employer health plans or every supplier market. Their relevance is a governance question: how does a purchaser assess quality and conduct alongside the price offered?
Examine the comparison behind a tender This editor recommends making evaluation criteria explicit before comparing proposals. Price, service commitments, credentials and evidence supporting a claim should be visible separately. Understand which requirements are mandatory and who confirms that suppliers satisfy them. A decision record should show how those elements were assessed, rather than preserving only the final ranking of proposals.
An attractive offer deserves a clear explanation of how it is delivered. Ask which costs and services are included, which assumptions support the price and which responsibilities remain elsewhere. The aim is to understand the proposal, not infer quality or misconduct from price alone. Questions and responses should be documented so that the purchaser can distinguish a resolved concern from one still requiring evidence.
Continue oversight after selection This editor recommends agreeing reporting and review arrangements before the contract begins. Know what evidence can be requested, how an exception is investigated and which contractual process applies if a concern is confirmed. Oversight needs a named owner and an escalation route independent of informal relationships. The employer should also understand how a provider’s subcontracting arrangements affect those commitments.
Service measures should relate to employee experience. A vendor may meet a financial target while access or administration issues remain elsewhere. Review both kinds of evidence and identify where responsibility crosses contractual boundaries. Personal information should be limited to the legitimate purpose of the review. Reporting should help the purchaser investigate a concern without collecting information unrelated to that task.
The research supports careful procurement governance rather than a universal verdict on competition. Benefits teams can examine whether their purchasing process makes quality, accountability and ongoing evidence as clear as the quoted cost. A follow-up review should test whether the promised oversight arrangements work in practice.
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