Jul ‘11
19
Medical Device Industry Bites the Hand that Feeds It
When the national debt dominates everything in politics, and elected Democrats are joining Republicans in advocating trillion dollar cuts in entitlement spending, and Medicare pays for one-third of all healthcare services in the country, why is it that the American medical industry insists on a break? Even though we Americans pay it 50% more for the same value results as everyone else in the world pays its medical industry. The answer: Because this industry is at the heart of the entitlement culture in America. Which it blames on the excessive expectations of American healthcare consumers.
Latest evidence: Led by ADVAMED, the national trade association for medical devices, 400 device companies demand Congress repeal the 2.3% excise tax on devices which was part of the 2009-10 deal to pay for expanding access to devices and other products for 32 million more Americans. Guess why? And what’s new? Because the tax , which is not yet in effect, “will kill jobs all across America and will raise the price of health care at a time we should lower costs.” A dear friend in CA – a diabetic with Parkinson’s – needs a new knee. His insurer refuses to pay California Pacific Medical Center the $140,000 the hospital says they will charge for their services and that of their chiropractic surgeon. Why? Because the price, including the medical device, is outrageous compared with alternatives.
The real problem for the device industry with the PPACA health reform, is the potential in the new law for bringing payment and delivery system accountability and competition into medical markets. Accountability for results, not fees for services whose price has been re-inflated all along the line by the cultural relationships between surgeons dependent on devices and device companies for their incomes, and an industry dependent on surgeons for iterative new applications, rapid diffusion beyond original use, marketing via patient and prescriber influence and relationships, and high volume utilization.
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