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Archive for August 3rd, 2006

The New York Times is reporting today about how Medicare changes that were planned are being reversed.  I guess it’s a fancy way of saying that nothing has changed.

The “scale back” (lack of change) was argued as being a good thing.  In particular, the new payment system would have made heavy cuts into the payments for cardiac coronary artery drug-eluting stents, defibrillators, and other “newest technology.”  The New York Times cites a number of analysts:

“The final rule significantly moderates proposed cuts for cardiac procedures,’’ Citigroup said in a note to investors. Lehman Brothers described the final rule as “a win for cardiac and orthopedic device companies, specialty hospitals and general acute care hospitals.’’ The Prudential Equity Group said the final rule, which takes effect on Oct. 1, was “favorable for device manufacturers’’ like Boston Scientific, Medtronic and St. Jude Medical.

The part that concerns me, however, is what follows:

“Under the final rule, hospitals will receive much smaller increases than originally proposed for treating some conditions, like pneumonia and chronic obstructive pulmonary disease.”

The issue I have is with the assumption that the newest technology represent the best of medicine.  As a self-proclaimed gadget geek, this might surprise you, but it is not entirely clear that the latest findings are the best and most accurate.  In particular regarding devices, very few of these have good long term studies showing safety and efficacy.  In fact, by their very nature, because they are new technologies, nobody truly knows what is going to happen 20 years down the road.

Medical devices, unlike other technologies, don’t automatically improve.  Windows XP (no matter how bad) is better than Windows 95, is better than Windows 3.1, but it’s not clear if the new hip device is worth 50% more than the old hip device.  This goes hand-in-hand with the fact that a major reason for rising health care costs in this country for the past 20 years is due to medical technology such as these.

I’m not down on medical devices in general.  The innovation of these companies is commendable.  I just worry that the “new technology” is taking precedence over tried and true technology such as antibiotics.  I worry that innovation is being steered away from less profitable fields like pulmonology and into fields flush with money such as cardiology and orthopedics.  In my hospital, I can already see that the patients who have “high-paying” problems generally get preference, and these payment structures only exaggerate the multiple-tier system.

I suppose these payment systems are examined by people smarter and better informed than me.  I am happy that the health care field is getting money, I just wonder if it is going to the right place, and whether we are creating the proper incentives for innovators within our field.
The complete article, as usual, is below:

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