The Centers for Medicare & Medicaid Services' (CMS; Baltimore) announcement last month that it plans to create the Council on Technology and Innovation (CTI), replacing its Medicare Technology Council (MTC), is an attempt to move new technologies through the coverage process, if not more quickly, at least more openly. The formation of CTI was mandated by the Medicare Modernization Act of 2003 (MMA), and Sean Tunis, MD, co-chair of the council and director of the Office of Clinical Standards and Quality at CMS, is espousing the "more openly" mantra.

"We are going to try to work more on the transparency – the visibility – of the issues that are being dealt with by the CDI, so people have more of an idea of what is going on and what is being accomplished," Tunis told Cardiovascular Device Update. More than anything else, Tunis said, the ultimate mission of CTI is to minimize the barriers to important and effective new technologies so that Medicare beneficiaries have better access. "I think that there is a slight difference in view as to whose benefit the CTI was established for," he said. "The CTI was established to benefit the Medicare beneficiary population, not established for the more narrow purpose for promoting the medical device and pharmaceutical industries. Our ultimate stakeholders are the beneficiaries and simply putting new medical devices into the marketplace isn't the goal of the CTI."

Tunis noted that "something we didn't do with the MTC, but will do with the CTI, is use regular open-door forums as an opportunity to have an exchange about what we're doing and what is going on at CTI meetings. People will have the opportunity to ask questions and make comments." Making processes more transparent has been a "cross-cutting theme" at CMS recently, he said. Going forward, he added, there would be many more opportunities for stakeholders to react to and provide input on new policy development. Tunis said one of the overriding goals of the CTI was to "be more explicit" about the kinds of issues it deals with and what the outcomes are. "We are planning to have our first open-door meeting sometime in early October to listen to stakeholders' specific suggestions about what they'd like to see the CTI work on in terms of its portfolio of activities, in addition to the kind of processes people would find helpful in terms of making the process more interactive."

CMS Administrator Mark McClellan said the council would work to anticipate new technologies and create ways to make their transition to Medicare coverage "predictable and fast," in addition to providing doctors and patients with better information about benefits and treatment options.

The council will be organized into two working groups. The first, on "Effective Innovation," will develop ways to improve the efficiency and timeliness of the coverage, coding and payment processes. Specific steps include facilitating greater stakeholder understanding of those processes, making sure that the processes are based on the best and latest scientific knowledge, and creating enhanced opportunities for stakeholders to communicate with CMS. The council will oversee work CMS has already begun, in collaboration with independent organizations, to develop the capacity for what the agency calls "horizon scanning" in order to identify high-value technologies and services that may benefit from earlier awareness.

The second group, on "Better Evidence," will help identify priorities for Medicare-supported clinical research on treatments for which important questions about their effectiveness or cost persist and where additional or better information to answer these questions could help guide more effective decision making by doctors and patients, CMS said. The council will help identify and develop study methods for gathering reliable evidence about the risks and benefits of new and existing medical technologies that can be carried out more easily on a regular basis, such as simple protocols, registries and other study methods.

"We have been of the view that one of the major barriers to the rapid dissemination of effective technology is information about the clinical utility and effectiveness of new technologies," Tunis said. "So we decided that it also belongs in CTI's portfolio in order to be more proactive in using CMS' existing authorities to try and stimulate better quality research and more evidence." He said the "most potent thing" CMS can do in terms of enhancing beneficiaries' access to new technology is to "identify systematic ways to improve the ability of creating better evidence."

Along with Tunis, Herb Kuhn, director of CMS's Center for Medicare Management, will serve as executive coordinator and co-chair for the council.

Study: 15 diseases lead cost explosion

Health insurers say that new, advanced healthcare technologies are fueling America's healthcare costs. Both the Advanced Medical Technology Association (AdvaMed; Washington) and Medical Device Manufacturers Association (also Washington) reply that med-tech is altogether affordable, given the benefit of saving and maintaining lives. A new study chimes in: The root cause is expensive disease – or rather diseases – that require the use of more medical technology. The study, released in August by Emory University (Atlanta) and published in the journal Health Affairs, says that 15 medical conditions have produced $100 billion in increased health spending in the U.S., half of the overall $200 billion increase from 1987 to 2000.

The study identified the 15 most costly medical conditions, in order, as heart disease, trauma, cancer, pulmonary conditions, mental disorders, hypertension, diabetes, arthritis, back problems, cerebrovascular disease such as stroke, pneumonia, skin disorders, endocrine disorders, infectious disease and kidney disease. Lead author Ken Thorpe, chair of the Department of Health Policy and Management in Emory's Rollins School of Public Health, called the study "a focus on the patients who are driving the growth."

The cost of healthcare is projected to account for 15% of gross domestic product (GDP) in 2004, up from 11% in 1987. And the cost of health insurance during the past three years has jumped by an average of 12.5% each year, the study noted. During the study's 13-year period, health spending rose at about double the inflation rate, the report said. During this period, healthcare spending increased at an average annual rate of 7.5% per year (in nominal dollars) and 5.1% per year when adjusting for inflation.

The study examined healthcare spending by patients with the most expensive medical conditions and the factors that caused the increased spending. One factor was substantial increases in patients treated. For example, though the prevalence of mental disorders stayed basically stable between 1987 and 2000, the number of people treated for those conditions nearly doubled. That surge was caused by a rise in the identification and diagnosis of these disorders as well as the increased availability of psychotropic medications, the study said. Another example: cases involving pulmonary disorders, such as asthma, rose 50%.

In eight of the top 15 medical conditions, the study found that a rise in the cost per case – rather than an increase in cases – accounted for most of the growth in spending. The number of people treated for heart disease stayed about the same between 1987 and 2000. But the rise in the cost per treated case, caused mainly by more expensive and effective drugs and technologies, is what accounted for nearly 70% of the rise in medical spending for that category, the study said.

The report also found that a key factor cited as driving rising health costs has been the explosion of new medical technologies, which can improve care but tend to cost more than older modalities of treatment. However, it noted that the total cost is also a function of how many people are receiving treatment for a given condition. The rise in treated-case prevalence may reflect improvements in medical technology that allow expanded treatment of a particular condition. It could also reflect changes in the diagnosis or reporting of disease. Finally, the rise could reflect factors such as the aging of the population.

Data for the study came from the 1987 National Medical Expenditure Survey (NMES) and the 2000 Medical Expenditure Panel Survey, Household Component (MEPS-HC). The 1987 NMES surveyed 34,459 people, and the 2000 MEPS, 25,096 people. Both surveys are nationally representative samples of the U.S civilian non-institutionalized population, the report said. The process adjusted the 1987 data from charges to payments, the same measure used in the 2000 data.

The report said that while the value of increased spending per person for these top 15 medical conditions may appear at first glance to reflect a truly "wasteful" increase in healthcare spending, the new approaches represented by the added cost replaced less costly (but also less effective) means for treating heart disease – and heart attacks in particular. Thus, the report noted that while spending per person with heart disease is going up, death rates associated with this condition continue to go down.

Just days prior to the release of the Emory study, AdvaMed released the contents of a letter it had sent to Tommy Thompson, secretary of the Department of Health and Human Services (HHS), responding to a request for input on how HHS might measure the value to society of advances in healthcare. That letter noted that over the past 20 years life expectancy has risen by three years and senior disability has dropped by 25%, and argued that the expenditures contributing to these improved figures "are ignored when healthcare expenditures are discussed. Gains in life expectancy, reductions in disability and improvements in overall health have a real economic benefit to society and should be routinely measured and accounted for," according to the letter.

NEJM study to help cause of AED providers

Representatives of companies in the business of offering automatic external defibrillators (AEDs) to the marketplace agree that while there was no doubt for them beforehand, an article in The New England Journal of Medicine published last month does help bring greater public awareness to the need for and benefits of AEDs in public places to help save the lives of victims of sudden cardiac arrest (SCA). Such public sites include everything from sports stadiums and ballparks to businesses and public libraries, as well as water patrol boats and lifeguard stands. In other words, wherever people gather.

"Clearly, in the first few years [of offering AEDs], it was all about education and trying to explain what these devices did," Cardiac Science (Irvine, California) Chairman and CEO Raymond Cohen told CDU. "Today, it's more about creating awareness ... a study like this in NEJM is very helpful, of course, because then it gets into USA Today and The Wall Street Journal, and you've got more people reading about it."

The study, called the Public Access Defibrillation (PAD) Trial and conducted by the National Heart, Lung and Blood Institute (NHLBI; Bethesda, Maryland) and the American Heart Association (AHA; Chicago, Illinois), found that deploying AEDs in public places and training citizens to use them can double the chances of surviving SCA for the general population. Cohen cited the estimates that each year about 450,000 Americans die as a result of SCA, which makes it the leading cause of death in the U.S. Currently, 95% of SCA victims die before reaching the hospital due to the length of time it takes for emergency personnel to arrive on the scene.

The PAD study was conducted from July 2000 through September 2003. The study compared the "number of patients who survived to hospital discharge after out-of-hospital cardiac arrest at a community facility where trained volunteers were able to recognize the event, telephone 911, and perform CPR" to the "number of patients who survived to hospital discharge after out-of-hospital cardiac arrest at a community facility where volunteers could also provide defibrillation with an on-site AED." In the study, there were 30 survivors among 128 cardiac arrests for those receiving both CPR and the use of AEDs. In those groups receiving only CPR, there were 15 survivors among 107 cardiac arrests.

Cam Pollack, senior product marketing manager at the Philips Medical Systems (Andover, Massachusetts) unit of Royal Philips Electronics, told CDU, "Essentially, we've known for a long time that early defibrillation works, and there have been plenty of studies that show that 10% per minute is the amount of decline that you see in survival chances when someone is in cardiac arrest." However, he said, there has been no widespread study like this one until now. "Certainly, it is another proof-point, a strong proof-point, to the fact that a good, solid early defibrillation program can save lives," Pollack said, noting that it highlights the importance of training volunteers and putting devices in place on "a more widespread basis." According to the Frost & Sullivan 2003 World External Defibrillator Markets Study, Philips is the world market share leader in AEDs with 45% of the revenues, built on the line of HeartStart products from its Heartstream unit in Bothell, Washington.

Paula Lank, vice president of clinical affairs and clinical research at Medtronic (Minneapolis), whose AED activities are centered on its Medtronic Physio-Control (Redmond, Washington) business with its line of Lifepak products, said the significant media attention the NEJM study has received makes its impact "very significant." She said this trial "really established for the first time the clear scientific evidence that training and equipping lay responders in a program that had an emergency response system really improved survival rates."

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