Leaders in the medical device industry, hospital executives, physicians, and consultants gathered in the Grand Hyatt in Washington DC today at InHealth's 2011 Health Technology Summit. The purpose of the meeting was to discuss the macroeconomic climate in health care and how its pressures will determine the future of clinical technology innovation. Many of discussion points centered on the balance between value and volume. This balance, while rooted in the shifting payment methodologies in the delivery system, also emerged as a dynamic within the medical device industry. Academics, analysts, and industry reps emphasized that the 'new normal' in health care would make the demonstration of value pervasive through all aspects of the delivery system.
Dr. David M. Cutler, the Otto Eckstein Professor of Applied Economics at Harvard University, started of the day with a keynote address that introduced medical technology innovation within the context of the health care system this country has built across the past few decades. He began recalling the story of a heart attack suffered by President Dwight Eisenhower. The President suffered a heart attack while in office in 1955, and after the event was on bed rest for six weeks to recuperate. In the decades following the President Eisenhower's attack, the advances in clinical technology has enabled revascularization (through angioplasty and stenting, as well as coronary artery bypass grafting), such that patients suffering a heart attack recover faster, live longer, and have overall better outcomes. Dr. Cutler emphasized that though the cost of treating a heart attack has climbed dramatically, there is a clear, demonstrable benefit in health and longevity. Today, Dr. Cutler articulated, the advancements made in technology have lead to increasing complexities and, in correlation, the overuse of care. For that reason, the challenge for healthcare is to coordinate that complexity more effectively.
InHealth 2011: Value Versus Volume
In a somewhat surprising move in light of the many changes underway with health care reform legislation, the Centers for Medicare and Medicaid Services (CMS) has further expanded its National Coverage Determination policy for FDG-PET imaging of solid tumors and myelomas. The recent move grants more opportunity for providers of PET imaging services to receive reimbursement when FDG-PET is used to inform the initial treatment plans for cancer patients. The policy revision marks the second time in the past year in which CMS has expanded coverage for FDG-PET imaging of tumors. While this move will be welcomed by many patients and providers alike, it may be a ripe proving ground for CMS at the national and local levels to engage in further utilization review for advanced imaging services.
CMS to Lift "Only One" Provision from PET Coverage Policy
Medical innovation isn't the same as it was five years ago. It isn't the same as it was one year ago. Cutting-edge advances in nanotechnology and molecular and genomic medicine seem to occur on a monthly basis. In fact, just last week, the first self-replicating synthetic cell was created. How do we make sense of news like this? What does it mean (or does it mean anything) for hospitals?
Such a dizzying pace of innovation isn't helped by the pressures of reform legislation. Hospitals are struggling to understand the potential impact of comparative effectiveness, episodic bundling, the Acute Care Episode (ACE) demonstration project, and the medical excise tax and how these products of the Patient Protection and Affordable Care Act will affect the future of their medical enterprise. The passing of reform legislation has awoken hospitals to major problems with the way they plan for clinical service line growth, as well as with the way they acquire and deploy new clinical technologies. Hospitals find themselves pressured by physicians and consumers to provide care in innovative ways and, in increasingly competitive markets, hospitals have realized that they are unprepared to make principled and deliberate decisions about which service lines to grow, which to defend, and where partnership and divestment strategies make sense. While innovation has changed over the past few years, the dollars involved and the high stakes have not. Moving forward, hospitals cannot afford to get it wrong - scarce dollars, reputations, and political capital hang in the balance at the prospect of poor investment decisions.
A New Era of Clinical Service Line Investment - Regenerative Medicine