I-Team: Cape Cod Man Charged Nearly $700 For Knee Brace Available Online For $125

BOSTON (CBS) - When Bob Messina twisted his knee during a workout, his doctor sent him for an X-ray. He was given a knee brace and told to wear it for a week and see how he felt.

His knee improved, but the real pain started when he opened the bill for the brace. "I was in shock," he said.

Bob had not yet reached his insurance deductible, so he expected to pay out-of-pocket, but he couldn't believe how much he was being charged. "I didn't expect it to be $672.22," he said.

That shock turned to anger when Bob did a quick Google search on his laptop and discovered the exact same brace was available on several sites for as little as $125.

Bob says he never would have agreed to take the brace if he knew upfront what it was going to cost. "I would have worn the one I got at CVS," he said. The supply company told us that Bob was informed of the pricing, something that Bob adamantly denies.

The pricing all comes back to Medicare. The agency decides what it will pay for certain durable medical equipment, in this case up to $712 for a knee brace which is a markup of 400 percent.

Many suppliers use the same pricing structure even for patients with private insurance.

"It's not right," Bob told the I-Team.

Apparently, the head of the Medicare division in charge of setting those pricing standards agreed. In 2012 Laurence Wilson told a congressional committee that prices for medical equipment were 'grossly inflated' and that the system is plagued with "fraudulent practices."

When we contacted Medicare, a spokesperson told us since then prices have been reduced on other equipment like wheelchairs through the competitive bidding process, but not for items like knee braces.

According to David Seltz, the director of the Massachusetts Health Policy Commission, this is a significant problem. He told us the Commonwealth needs to look at ways to control excessive charges. "It's an outrageous practice that patients are being put in a place where they are being charged two or three times the cost of some of these devices," he said.

Bob just wants someone to crack down on supply companies that he believes are taking advantage of a broken system. "The person that's charging $125 is certainly making a profit or they wouldn't be in business. This company charging $672 dollars, he's raking us over the coals," he said.

We reached out to both Massachusetts senators. Senator Warren's office declined to comment. A spokesperson for Senator Markey told us that supply companies have resisted efforts by Medicare to include things like braces in the competitive bidding process which lowered prices for other durable goods like wheelchairs.

This is an issue that could become more widespread as more people choose higher deductible plans in an effort to cut costs.