Medical Device Daily Washington Editor

With an incoming Congress and administration seeming certain to turn up the pressure on both FDA and the device industry, the Advanced Medical Technology Association (AdvaMed; Washington) has published an amended version of its code of ethics that the association hopes will clarify some areas of ethical behavior between device makers and healthcare providers.

Whether the move will help stave off further legislative action on Capitol Hill remains to be seen, but the code of ethics for drugmakers published earlier this year by the Pharmaceutical Research and Manufacturers of America (PhRMA; Washington) at the very least puts both big pharma and device makers on a more sound footing to head off potential legislation than they would otherwise enjoy.

Chris White, general counsel at AdvaMed, told reporters on Thursday's conference call that "our board of directors overwhelmingly approved" the revision. White noted that AdvaMed has "not only have updated our existing provisions ... we have extended our compliance leadership into new areas," including provisions dealing with payment of royalties and with evaluation of evaluation products, which he characterized as the "functional equivalent of a [drug] sample."

White said the association will be "working aggressively over the next several months to inform physicians and our other collaborators" of the update, which he said will "go a long way to clarify ethical relationships."

Regarding the effective date of the code, White said "our board endorsed a six-month phase-in period," which he said is consistent with phase-ins of earlier revisions. "I would note that it is also consistent with the PhRMA code phase-in period," he said in reference to the time elapsed between the drug industry's code, which was unveiled in August.

White also said the code modification was not a response to the roll-out of a new Massachusetts law dealing with industry-physician relations, saying that AdvaMed had commenced with this current effort "before the Massachusetts law was even on the horizon." He also stated that AdvaMed "did not vet our document with any legislators or staff," but "we hope to inform the relevant staff members and members of Congress of the expansion."

According to the press release published by AdvaMed last Thursday, the code includes "an explicit prohibition on providing entertainment or recreation" to doctors and other healthcare professionals as well as "all non-educational branded promotional items, regardless of value," which would seem include pens.

The revision document indicates that evaluation products "may be provided at no charge to allow health care professionals to assess the appropriate use and functionality of the product and determine whether and when to use, order, purchase, or recommend the product in the future." However, any such products which are described generally as multiple use products should be available to the healthcare entity "only for a period of time that is reasonable under the circumstances to allow an adequate evaluation," the term of which "should be set in advance in writing."

Companies that wish to sport the AdvaMed code of ethics logo must certify their compliance systems by July 1 of each year starting in 2009.

CBO reports reform no easy matter

The Congressional Budget Office has published two reports that further address the cost of healthcare reform, and the documents jointly further reinforce the notion that reforming healthcare will be no cakewalk.

The blog entry announcing the release at the CBO web site states that the first of the two documents, titled Key Issues in Analyzing Major Health Insurance Proposals, details some of the issues that will arise in any attempts to substantially overhaul healthcare. Among the findings of that report, according to the CBO blog entry, are that federal spending on Medicare and Medicaid will jump from about 4% of GDP next year to about 12% by 2050, and that "without changes in policy the average number of non-elderly people who are uninsured will rise from at least 45 million in 2009 to about 54 million in 2019."

CBO's analysis suggests that "premium subsidies or mandates to obtain health insurance would not [by themselves] achieve universal coverage," but a combination of the two might bring coverage to near-universal levels. The blog also points out that while "serious concerns exist about the efficiency of the healthcare system," most proposals to fix this create their own problems.

For instance, "the wider adoption of health information technology or greater use of preventive medical care could improve people's health, but would probably generate either modest reductions or increases in spending within a 10-year budgetary window."

The budget options document, which spans 235 pages, goes over such items as the private health insurance market and the tax treatment of health insurance. The document states that CBO projections forecast that, without any changes in federal law, total spending on health care will rise from 16% of GDP in 2007 to 25% in 2025 and close to 50% in 2082."

One chapter is titled "Closing the Gap Between Medicare's Spending and Receipts," and states that a total increase in the payroll tax of 1% (currently employer and employee each pay 1.45% of the employee's pay for a total of 2.9%) in this tax to 3.9% would raise revenues for Medicare Part A by almost $210 billion between next year and 2013 and by more than $590 billion between next year and 2018.

In contrast, a similar increase for those whose incomes are $150,000 a year or more would generate only about $77 billion between 2009 and 2018. CBO states that it advocates no particular approach, however.