The report by the inspector general for the Department of Health and Human Services said that Medicare — the federal government health insurance system for senior citizens — paid close to 474,000 claims for vacuum erection systems (VES), totaling roughly $172.4 million from 2006 to 2011.
Annual claims for the devices — each of which costs the government about $360 — nearly doubled from $20.6 million in 2006 to $38.6 million in 2011, the report said.
Penis pumps are among the few viable treatment courses for erectile dysfunction, or ED, a condition that affects as many as 30 million American men, according to the National Institutes of Health.
Wasteful spending is a major sticking point in budget talks in Washington as legislators try to reach a workable compromise on a mammoth $1 trillion spending bill.
"Medicare payment amounts for VES remain grossly excessive compared with the amounts that non-Medicare payers pay," the report said. "Medicare currently pays suppliers more than twice as much for VES as the Department of Veterans Affairs and consumers over the Internet pay for these types of devices."
The report said that if Medicare had adjusted its payments to roughly the sticker price non-Medicare consumers shell out for the devices, the U.S. government would have saved an average of $14.4 million for each of the six years in question.
Reuters contributed to this report.