Transcript Medical Device Industry - Current Challenges

Keeping health care ahead of the curve with the latest
innovations is our specialty and has been for nearly 50 years.
Core Business
• EMS Sales
• Hospital Sales
• Product Development and
Engineering
• Biomedical Clinical Services
• Mercury Manufactured
Products
• Medical Gas Certification
• Home Care
Medical Device Industry
Current Challenges
• Federal Mandate
• Electronic Medical Records by 2014.
• Hospitals face penalties of 1% in 2015, incrementing
each year up to 5% as Medicare/Medicaid
reimbursement reductions.
• Federal grants and funding, Medicare incentive payments,
to assist with implementation, from American Recovery
Reinvestment Act.
• Connectivity
• With EMR implementation process, customers are now
demanding new electronic devices have ‘connectivity’.
U.S. HOSPITALS ALSO FACING
• NRP (Neonatal Resuscitation Program).
– 2012 Guidelines
* Laryngeal Masks
* Medical Air / Compressor
* Blender
* SP 0 2
• JCAHO
– 10/24/11 – Laryngoscope blades can no longer lay in drawers or
on towels. Must be wrapped
• SCIP (Surgical Care Improvement Project)
• ASA Sedation Standard 3.2.4; AHA, ERC, Joint
Commission guidelines.
– CO2 Monitoring
“Vendor Credentialing”
for hospital access - no common
standard.
Capital Funding
Access challenges for hospitals.
New ‘Sunshine Law’ disclosure
regulation for financial relationship
reporting with physicians. NPI
information at registration so if the
exhibitor gives away anything (food,
beverage, etc.) the vendor will have the
details for reporting to HHS.
Many device companies
developing consumables with
chip recognition to limit
competition, allowing them to
maintain a foreseeable revenue
stream.
The product sale cycle in a typical hospital
has greatly lengthened and involves a
variety of other players beyond clinicians,
legal, VAC/VAT, procurement, finance.
One recent comment which appeared in
the Grey Sheet, stated “all products are
considered commodities, unless proven
otherwise”.
Reimbursement Coding Change
• ICD-9 to ICD-10 (International Classification of
Diseases). U.S. is behind the rest of the world.
• This change would replace the current set
of 14,000 diagnosis codes to approximately
69,000 codes.
• Implementation date October 1, 2013, was
delayed on 2/16/12 by HHS for unspecified time.
Centers for Medicare & Medical Services
(CMS)
reimbursement cutbacks, including
additional percentage reduction for missing
EMR/EHR implementation.
(UDI) Unique Device Identifier
• Passed by congress in 2007. Implementation date
2013.
• FDA still has not issued final rules to industry. Initial
proposed regulation 60-70 pages after a 200 page
preamble.
• The senior FDA advisor once stated “It’s not written
in a way that’s easy to understand. It’s a legal
document, written by our lawyers, reviewed by our
lawyers, I don’t understand most of it”
Continued next page…..
•EU drafting guidelines
•UDID (Global Database)
•Include GMDN
(Global Medical Device Nomenclature)
• While these UDI labeling changes are in
process, FDA is proposing to poll healthcare
providers on “how to best standardize medical
device labeling”, which is to take place in 2012.
FDA plans for “on-line” labeling repository for all
devices, as part of FDA reform plan.
FDA just announced plans to survey industry for
comments related to it’s “Emergency Shortages
Data Collection System”. System is available only
to CDRH Emergency Shortage Team and Senior
management. Separate from this system, U.S.
Department of Commerce Bureau of Industry and
Security conducted a similar mandatory survey in
2011.
Global Location Number (GLN)
as a common numbering system to identify
any legal entity/trading partner.
•
Two bar code standards:
GS–1 (formerly UCC) Uniform Code Counsel
HIBC – Health Industry Business Council
Outside U.S., some countries ignore;
mandating use of another format
Global Medical Device Nomenclature
Pending addition to labeling rule changes
Healthcare Bill
In 2013 most medical devices will be subject
to 2.3% Medical Device Tax unless congress
intervenes. IRS has published a draft
“Proposed Rule Making Regulation” on
February 3, 2012. Supreme Court hears
arguments week of March 26, 2012, with
ruling by June, 2012.
•First Excise tax payment due January 29, 2013.
FDA Reforms (MDUFA III)
Review and possible rewrite of the entire device
approval process including IOM (Institute of
Medicine) recommendation to scrap current
510k process and start over.
• 510k statute review time (90 days) missed
• 510k costs to double by 2017
• Establishment registration fees to increase
50% by 2017.
• European Union
(CE) requirement changes.
 Increasing individual country
requirements (not harmonized).
Underwriters Laboratories (UL)
New and Updated Electrical
Standard for Medical Devices:
IEC 60601-1 (800 pages)
New Outside Entity
• Hospitals contracting with outside entities (i.e.
MedApproved) for prescreening new technologies
before introduction into system.
http://www.medapproved.com
• Hospitals contracting with outside parties for recall
management i.e. (RASMAS (Risk and Safety
Management Alert System)).
http://www.rasmas.noblis.org
Patent Reform Law
• First to file vs. previous first to invent.
• May impact how industry interfaces “discloses”
with developers.
FDA “PREDICT” IMPACT
Introduction of new importation clearing system
“PREDICT” dramatically affecting all companies
importing materials
___________
Mandatory
CO2
Monitoring
SCIP
NRP 2012
JCAHO
DEC 21
2012
JAN 1
2013
JAN 29
2013
MAR 16
2013
SEP 30
2013
OCT 1
2013
Myan
Calendar
Runs Out
(Doomsday?)
Medical Device
Tax
(PRICES WILL
GO UP!)
1ST medical
device excise
tax payment
due
Patent Law
Reform
takes effect
UDI
Implementation
Date from
CDRH
ICD10
Implementation
(NOW DELAYED)
FDA Poll to
standardize
medical device
labeling.
National Strategy for Global
Supply Chain Security
2014
EMR/EHR Takes
effect
Questions?
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