Medical Device Daily Washington Editor

Medical device report (MDR) citations continue to pepper warning letters and the Oct. 9 warning letter to Philips Healthcare (Andover, Massachusetts) was no exception. The warning letter was conspicuous because of the time lag, between the warning and the inspection of Philips' location in Andover, which took place between late January and early March. The warning letter also discussed manufacturing problems with external defibrillators that the agency suggested may have affected other devices, but a company spokesman told Medical Device Daily that this issue did not affect the recently recalled HeartStart FR2.

FDA indicated in the warning letter that Philips had successfully answered two of the three citations, and the third, according to Philips, has also since been resolved.

The citation for MDRs stated only that the firm had failed to "develop, maintain, and implement written MDR procedures that ensure timely and effective identification, communication and evaluation of events that may be subject to MDR requirements." The only further detail was that the firm's "response to this observation appears to be adequate."

FDA offered no details as to why it found adequate the company's response to a citation for complaint handling. The warning letter states that one of the company's procedures calls for complaints to be closed within 90 days, but that "several repairs and complaints regarding" an unnamed model of external defibrillator "using the [redacted] prone to silver dendrites . . . were reported as early as August 27, 2007 but were not submitted as MDRs to FDA until Jan. 21, 2009."

The last citation in the warning letter dealt with corrective and preventive action (CAPA), with FDA alleging that Philips did not "perform an evaluation of the magnitude" of a component problem that resulted in a recall to see whether it was "endemic to other device models." The warning letter notes that Philips had identified a root cause "and had implemented a correction" by Jan. 19, but that the company "was unable to detail the impact of the problem on other devices to the investigators" when the inspection began. The warning letter states that a follow-up inspection "will be required to assure that corrections are adequate."

Company spokesman Ian Race told MDD via e-mail that the discussion of components of external defibrillators addresses the firm's HeartStart XL, a defibrillator for use in clinical settings, and that those components were not used in the HeartStart FR2, an automated unit that was the subject of a recall (Medical Device Daily, Sept. 30, 2009). He also said that the agency's New England district office, which authored the warning letter, "confirmed by telephone on Oct. 13 that our response to this inspectional observation appeared to be adequate."

DME bidding to roll despite legislation

The competitive bidding program for durable medical equipment (DME) has sparked at least as much action on Capitol Hill as the Medicare Part B imaging controversy, and the Centers for Medicare & Medicaid Services reported yesterday that it intends to move forward with the program despite pending legislation that would put an end to bidding. Congress scuttled the latest DME bidding program last year as part of the Medicare Improvements for Patients and Providers Act of 2008 (MDD, February 20, 2009).

According to the Oct. 21 CMS statement, CMS is now accepting bids from suppliers who are accredited and bonded "after implementing a number of important modifications to the program and conducting an intensive supplier outreach and education effort." The agency notes that 93% of all DME suppliers in the U.S. have met accreditation requirements. Those companies in the nine bidding areas have 60 days to file their bids for a variety of equipment and supplies, including various mobility items such as wheelchairs and walkers. Also on the list are continuous positive airway pressure units and supplies for diabetics. However, negative pressure wound therapy devices are off the list.

Jonathan Blum, director of CMS's Center for Medicare Management said in the statement that competitive bidding "is an essential tool to help Medicare beneficiaries pay appropriately for high quality healthcare items and services furnished by Medicare-approved suppliers." He also said CMS has "worked closely with stakeholders and members of the Program Advisory and Oversight Committee, which represents beneficiaries, manufacturers and suppliers, to help us implement the program with benefits for patients, taxpayers, and the entire healthcare system."

As one might expect, the move has its critics in industry, but CMS also faces opposition from Capitol Hill in the form of H.R. 3790, sponsored by Rep. Kendrick Meek (D-Florida). The bill, which has yet to be christened with a formal title, would do away with bidding and has to clear both the House Ways and Means and Energy and Commerce Committees, which are both hip deep in healthcare reform. The bill is said to be budget neutral despite cuts in each of the next three years of 0.25% for all DME groups with the exception of complex power mobility units, followed by two years of 0.5% cuts to the same groups of equipment.

In an Oct. 21 statement, the American Association for Homecare (AAHomecare; Arlington, Virginia) offered support for the bill, describing the bidding program as "deeply flawed" and noting that the five years of reduced payments would "ensure that seniors and taxpayers receive the savings projected for the bid program."

Tyler Wilson, President of AAHomecare, said the association's members "recognize the need to control costs in Medicare," but argued that the provider industry "has seen far more than its share of reimbursement cuts over the past 10 years."

Wilson also made the case that the bidding program would "put the vast majority of [providers] out of business even if they agree to new, lower reimbursement rates," which he said is "not good for the seniors and people with disabilities who depend on quality home medical equipment and services in order to remain independent." n

Mark McCarty, 703-268-5690