Medical Device Daily Executive Editor

SAN FRANCISCO – One result of the rise of the "informed consumer" in healthcare is a greater awareness of new medical technologies, that trend fueled by the availability of a wealth of online information and an increased focus on health in both printed and electronic media.

And, as the members of a "Power Panel" of representatives from three major California-headquartered healthcare provider organizations said during last week's Frost & Sullivan Medical Devices Executive Summit here, that awareness has triggered greater demand on healthcare provider organizations to make such technologies available to the patients they treat.

That means, the panelists said, that med-tech manufacturers must produce devices that both provide a benefit and lower – or at least contain – costs.

Ian Leverton, MD, vice president of clinical integration at Sutter Health (San Francisco), which operates 26 hospitals and a "countless" number of outpatient clinics and other facilities, said Sutter believes it can best compete in the marketplace as "a high-value provider."

He said he looks for similar characteristics in new medical technologies, telling conference attendees at the Hyatt at Fisherman's Wharf that "the value for me with new devices is not as an incremental improvement but [rather] a remarkable improvement in quality as a leapfrog' technology."

In evaluating products, he said that Sutter "is looking for a benefit to the stakeholders," because "in the final analysis, someone pays for new technology."

While he noted that "consumers want access to the latest technologies as soon as they are available," Leverton said Sutter involves the 8,000 or so physicians affiliated with the system in evaluating and selecting new devices, "and it's difficult to harness all those physicians to make a decision."

He said one of the major benefits of expensive, California-mandated "seismic refits" of the facilities within which it operates, give the system "a chance to look down the pike and see the impact of technology on the building phase."

Leverton said that Sutter "likes group purchasing" programs generally, but acknowledged that standardizing across its affiliated hospitals "is not as easy as it looks." He added: "We standardize where we can on two systems."

Larry Wilson, CFO and senior vice president of finance, planning and consulting for the Northern California Region of Kaiser Permanente (Oakland, California), said, "one of the challenges we face is that we have everything healthcare under one roof." A second challenge, he said, "is how to provide more access to areas of care." He added that Kaiser "constantly evaluates our ability to do things in settings other than where it [traditionally] has been done."

In the healthcare information technology (IT) area, he said, "our approach is best of suite.' We look at ideas vendors bring to the table to address our human resource needs." With new medical devices, Wilson said Kaiser is particularly interested in how IT that is built into those devices "works with our other IT systems."

Panelist Scott Carswell, vice president for strategy and network development at Catholic Healthcare West (San Francisco), a provider with 21 different healthcare systems operating in California, Nevada and Arizona, cited the system's broad diversity. "We can study technology on a system-wide basis," he said, "but we don't make purchasing decisions from the top down."

The main thing the system looks at, Carswell said, "is return on investment." Noting that Catholic Healthcare spends a lot of time looking at the technical benefits of "buildings, equipment, whatever," he said that in looking at new products, its medical device committee "also assesses their political and cultural impact," for example, on physician groups.

Noting that his system is "less integrated than Sutter and Kaiser," Carswell added, "Sometimes it's better for companies to work individually with hospitals; other times, it's better to work with the system."

In response to a question about how new devices get selected for use in the panelists' respective systems, Leverton said that Sutter doesn't make "a conscious attempt to keep certain technology from patients, but we need to rationalize their use."

For instance, he said: "Not every [coronary artery disease] patient needs a drug-eluting stent."

Wilson said, "we work with Blue Cross/Blue Shield on the appropriateness of certain treatments." He added: "I thought Kaiser was going to be a follower, not a leader" in adoption of new technology, but in certain areas, such as imaging, "we're turning out to be leaders."

Carswell that that outcomes play a big role in technology adoption decisions. "In some cases, such as stents, the benefits are so obvious that we need to move quickly to their use."

At Sutter, Leverton said, "we have a variety of research projects to measure benefits," but in some cases, such as the intensive care unit, where there's a twin focus on saving lives while at the same time reducing costs, "measuring the benefits is not so easy."

Wilson said that at Kaiser, "we generally make decisions as an entire system."

He said that if vendors "can show their new technology will have a positive impact downstream on a disease state such as CHF [congestive heart failure], it has a good chance."

Carswell said vendors "can differentiate themselves" in approaching Catholic Health Services on the basis of "here's how we can help you."

Leverton chimed in: "You need to consider how your product integrates with what we already have." He said med-tech companies "have to recognize how you fit in – we simply can't afford to buy everything."