BBI Contributing Editor

BALTIMORE, Maryland – This year's Association for the Advancement of Medical Instrumentation (AAMI; Arlington, Virginia) conference was quite different from the last. While the focus was just as strongly on medical telemetry, the bias obvious in last year's conference toward a particular wireless solution was gone. In its place were even-handed comparisons of the advantages and challenges facing hospitals, as they select a new band in which to relocate their telemetry systems, currently being operated in the UHF or VHF bands.

Immediately after last year's AAMI meeting, the Federal Communications Commission (FCC) carved out the new, wireless medical telemetry system band, initially a 6 MHz slice of RF spectrum where CH-37 previously was (608-614 MHz). This slice is the immediately available part of a larger slice, ultimately 14 MHz that will be created for interference-free medical operations in the U.S. Such spectrum is normally auctioned off by the FCC, and this much of the scarce RF spectrum is enormously valuable. Recently a 6 MHz slice of spectrum brought $600 million to the FCC, and 30 MHz slice cost those who received it $16 billion. So the free gift of this spectrum to the medical community was a generous gesture indicating the importance and sympathy the FCC has for medical telemetry operations.

The reason this spectrum was created is that the Public Land Mobile Radio (PLMR) UHF band is being "refarmed," which has the effect of making more channels in the existing spectrum by making each channel smaller. Current channel sizes of 25 kHz are being reduced to 12.5 kHz in October 2002, and ultimately to 6.25 kHz shortly thereafter. Because medical transmitters use 25 Khz-wide channels and cannot be changed, they will occupy two and ultimately four adjacent channels in the future as the band is refarmed, and this multiples the potential for interference. Therefore, with the many new licenses being granted, disruption of medical operations in all major cities is a foregone conclusion. Should patient injuries occur due to such disruptions, the hospital could be subject to negligence suits that include damages, since the problem is well-known, and the FCC has already acted to create alternative spectrum and warned hospitals to move out of this band, or remain at their own risk.

Since last June, the freeze on new PLMR applications that had existed in the lower half of this band has been lifted, and new users have been pouring into this spectrum. Fortunately, these new users affect only a small number of hospitals, as only about 20% of the hospitals using the UHF band are located in the lower half of the spectrum. The other 80% occupy the 460 MHz to 470 MHz upper half of the spectrum. The FCC already has indicated that the remaining freeze will be lifted on the upper part of the band by October 2002 at the latest.

The other spectrum where medical telemetry has operated is the VHF TV bands, yet these also are in trouble. With the mandate that commercial TV stations begin high-definition TV (HDTV) operations, every U.S. TV station has been assigned a second operating frequency on which to simultaneously broadcast HDTV signals, while it continues to broadcast conventional (NTFS) signals on their existing channels. The net result in metropolitan areas is that the space previously available for medical to squeeze in between adjacent channels is going away, and all medical VHF operations in bigger cities will have to cease and hospitals move to a new and safer spectrum.

Two alternative slices of RF spectrum currently are alternatives for medical use. The first is the newly-created WMTS band at 608 MHz. In this band, medical is the primary user and interference from outside of the band is unlikely. The alternative is the Industrial, Scientific and Medical (ISM) band, with spectrum at 2.4 GHz (and 900 MHz). Of these two ISM alternatives, the most interesting is the 2.4 GHz spectrum, which offers 83 MHz of spectrum. The 900 MHz slice has 26 MHz of spectrum. All providers looking to leave either the VHF or UHF bands will have to select among one or more of these three alternative bands and do so quickly. The catch-22 is that not all vendors can offer systems in all of these bands, so vendors have been working aggressively to pitch the band they can offer as the ideal choice and characterize alternatives as less than ideal. This becomes quite a task, however, because many vendors use bands for instrument telemetry that they then discourage for patient-worn telemetry – a bit of industry duplicity that health care providers have begun to see through as more information about the bands has become available.

The stakes are high. With approximately 125,000 channels of telemetry installed currently in U.S. hospitals, of which perhaps 85% to 90% will be replaced sometime in the next 30 months, the stakes and the risks for vendors are large. The potential for large swings in vendor market shares is great anytime a replacement cycle is dramatically shortened. To appreciate who specifically is at risk, Table 1 shows the percentage each major vendor has of the total installed base of patient-worn telemetry systems in the U.S. market.

As Table 1 illustrates, the largest vendors are the ones with the most exposure – that is, the largest installed bases of telemetry. If hospitals defect from these vendors in moving to a new frequency spectrum in any large quantities, these vendors could be dramatically affected, immediately and for years to come in the future. This makes movement to a new telemetry band a high-stakes situation for nearly every vendor in the industry. The operational characteristics of the available bands for new telemetry operation are listed in Table 2 on page 211.

It is clear that the vendor offering the most flexible solution at the present time in the new WMTS band is Data Critical (Bothell, Washington), now in the process of being acquired by GE Medical Systems (Waukesha, Wisconsin) in a $68 million deal announced in late July. Data Critical's solution is the only one that offers an inexpensive access point (AP), bidirectional transmission solution for both patient-worn and portable monitor wireless communications. It is also the only one that has an FDA-pending nurse pager-portable central station option. The Data Critical solution is a frequency-hopping approach which supports bidirectional transmission of patient vital signs and facilitates remote control of the bedside device, be it patient-worn or a portable monitor. This novel solution positions Data Critical (and by extension, GE Medical) with more features than Phillips/Agilent (Andover, Massachusetts), Spacelabs (Redmond, Washington) or Siemens (Danvers, Massachusetts) in this band. Each of these other four major vendors offer a patient-worn transmitter only in the WMTS band, and use the ISM band for their wireless network for their portable monitors, a solution that requires two vastly different wireless infrastructures. The WMTS infrastructure of these companies includes many antennas, splitters and amplifiers connected to a centralized group of receivers, one for each transmitter. In the ISM band the infrastructure is a much simpler bidirectional AP, which converts the signals to wired, IEEE 802.3 Ethernet, routed among all APs and the centralized monitoring displays and documentation devices.

In the ISM band, in addition to the four vendors who use it for their portable monitors, two vendors – Welch Allyn/Protocol (Beaverton, Oregon) and Criticare Systems (Waukesha, Wisconsin) – offer a new type of device: a patient-worn monitor. Unlike a telemetry transmitter, these patient-worn monitors include a display on the patient-worn device that shows the waveforms and vital signs, and enunciates alarm violations. It uses a transceiver capable of both sending patient data (like a traditional patient-worn transmitter), and also is able to receive data from other beds and central stations or even control signals from remote locations. These new devices are thus patient monitors worn by a patient (rather than sitting on a shelf next to the patient), and hence the name.

Part of a wireless solution includes rapid notification of attending staff whenever a life-threatening event occurs. This has been accomplished in the present generation by the use of one-way pagers, developed by Data Critical and OEM'd to each of the major telemetry system vendors, including: Philips/Agilent, GE Medical, Spacelabs, Welch Allyn, Siemens and several others. This requires the nurse to carry the pager, made by Data Critical or some other manufacturer, such as Motorola (Schaumburg, Illinois). Nurses also are increasingly carrying in-hospital, wireless mobile phones to facilitate voice communications at the point of care, and minimize the need to stop patient care activities and move to some fixed location where conventional wall or desk-mounted telephone services are available.

The advantage of the ISM band in combination with patient-worn monitors (PWMs) is that it is possible to integrate voice data along with patient vital signs data. Two approaches to doing this are voice-over-IP and DECT (a European standard for sending voice over LANs). By merging voice communications with patient vital signs data, a portable, mobile central station device small enough to be carried around by a nurse is possible. Indeed, prototypes of such devices have already been shown in packages that resemble today's cell phones or portable digital assistants. The ability to merge paging, voice communications and patient vital signs displays on these devices provides the basic infrastructure for streamlining nursing care, making the nurse more efficient and enhancing patient safety as nurse-to-patient ratios expand as the nursing shortage develops.

Table 3 features an overview of the vendors and products available in the various bands.

There are vast differences in the current capabilities of the products available from various vendors. This may become a critical issue because of the rapid transition period forced upon the medical industry by the FCC actions of last June. The industry task force had requested a four-year transition period. What the FCC specified was a two-year period, which is 17 months longer than it normally allows. However, two years is shorter than the design cycle of many vendors, particularly the larger ones who are designing their own proprietary solutions rather than adopting commercially available transceiver and infrastructure solutions available from other industries. This means that initially, and for most of the period that hospitals have to make this transition, the largest vendors who have historically designed their own systems from scratch will be offering products that are simply retuned or down-shifted versions of their existing UHF solutions – solutions that were never designed to be bidirectional and which have cumbersome and expensive infrastructures. If hospitals don't feel that such solutions are what they want to lock themselves into for the next seven to 10 years, then it spells real trouble for the largest vendors in particular.

The companies with the greatest opportunity to dramatically increase their telemetry market share include GE Medical/Data Critical/VitalCom, Welch Allyn/Protocol, Datascope (Paramus, New Jersey), Nihon-Kohden (Irvine, California) and to a lesser extent, Criticare Systems. Of these, Welch Allyn and Criticare are offering ISM solutions, while Data Critical and its two OEMs, Datascope and Nihon-Kohden are offering the only bidirectional, frequency-hopping solutions in the WMTS band. Large orders are falling to Data Critical/Vitalcom and Welch-Allyn, but order volumes are up for all vendors, in some cases as much as 300% over unit sales just a year ago. It will be interesting to tally up the score at the end of 2001 and again at the end of 2002 in the telemetry segment of the market. There will be some dramatic market share changes.

Since VitalCom (Tustin, California) holds the best WMTS technology, and it is now a part of Data Critical, that has led to some interesting opportunities for expansion of market share by acquisition – in which GE Medical played a trump card with its Data Critical purchase agreement. VitalCom, which has historically lost money, was acquired cheaply by Data Critical. However, Data Critical also is an historic money loser, at much higher levels than Vitalcom, and likewise was vulnerable to being acquired. With the Vitalcom and Data Critical products due to become more well-integrated, the company became a more attractive target.

To some degree or another, the suitors included Datascope and Philips/Agilent, the latter of which has the largest installed base to protect and may be most at risk in this segment due to product-line limitations. Some "wild-card companies" such as Welch Allyn and Hill-Rom (Batesville, Indiana) might have seen this as a means of insuring their bets on ISM technology or making a dramatic entry into the wireless segment of the patient monitoring market. It was thought that Spacelabs also could have benefitted from the Data Critical product, but having had such a bad year in 2000, it may not have been in a position to make any further acquisitions. Some have identified Spacelabs itself as an acquisition target, since Cardiac Science (Irvine, California) made an abortive attempt to do just that only a year ago. While most industry watchers felt that Philips/Agilent had the most to win or lose by such an acquisition and had the resources to cut a deal, GE Medical, wrapped up Data Critical without much of a fight. And without an enormous cash outlay – at least by GE standards.

However, telemetry will be a market with a short-term winner, since the rapid turnover forced by the FCC during the next three years will decimate the market for new units during the 2004 through 2009 period, when there will not be any old units to replace. The telemetry market will shrink dramatically to its lowest common denominator, a growth segment of around 7,500 to 15,000 units per year. This is far too few to be shared among all of the suppliers offering products for this segment, so any company that depends upon this segment in those years for the majority of its revenues is going to be in real trouble and may not survive the likely extended period in which unit sales will be at their lowest levels in decades. Introducing a new telemetry system during the 2003-2004 time period will be the kiss of death, as the likelihood of obtaining enough unit sales during the following five years to recoup the dollars spent on research and development of such a product will be small to nonexistent, at least in the U.S. market.

Another area of activity at this year's AAMI gathering involved updates on biphasic defibrillators. While the data on the efficacy of various biphasic waveforms remained controversial, what was clear was that any biphasic waveform is more effective and has fewer adverse effects than any of the monophasic defibrillators. The message to the provider community is to move away from monophasic to any of the newer biphasic units available – all of which are dramatically better than their monophasic counterparts.

The biphasic defibrillator market has two segments that have high growth rates. The automatic external defibrillator segment (AED) for first responders is high growth, with Philips/Agilent and Medtronic PhysioControl (Bothell, Washington) as the major recipients of unit sales in that segment. The in-hospital biphasic AED market also is a high growth area, but in this segment Zoll Medical (Burlington, Massachusetts) and its popular M-Series are edging out its larger competitors and gaining market share.

There is an accelerated replacement of defibrillators occurring in the U.S. market, as manual, monophasic waveform defibrillators are being replaced with AED defibs with biphasic waveforms in the U.S. hospital, inpatient setting. This is a response to the new American Heart Association (Dallas, Texas) resuscitation guidelines issued in the spring of 2000. We expect this to continue for the next couple of years as more and more hospitals struggle to meet the three-minute guidelines now in force, with the limited nurse staff available in hospital clinical units, particularly in non-ICU units where nursing personnel may not be CPR-trained and certified. This trend is resulting in replacement of installed units with biphasic AEDs. A newcomer to this segment, Cardiac Science, offers the Powerheart defibrillator. While these units can work as AEDs, they are intended to be attached to the patient continuously. They are somewhat more expensive, however, than competitive AEDs, and are not capturing a large percentage of the units being replaced, which are going to Zoll and to a lesser extent to Philips/Agilent.

The exhibit floor at the Baltimore Convention Center provided us with our first opportunity to see the new Nihon-Kohden monitoring system. It showcased some interesting innovations. Like the last generation of Mennen Medical units, it is has a core of configured capabilities (ECG, Resp, Temp, NIBP, SpO₂) and then augments these with either two or four additional parameters, each of which plugs into identical front panel (universal) connectors. This clever trick is accomplished by doing the A/D conversion and parameter tagging in the transducer connectors. In spite of this, the cables cost only about $200, according to the company. The design must provide power for the A/D from the front panel connectors to the cable.

The displays are active-matrix, color LCD, with excellent viewing angles. The display remains quite crisp as extreme horizontal viewing angles, even maintaining color purity, and from above. The housing has room for a strip chart recorder, or documentation can be obtained by attaching a commercial inkjet or laser printer directly to the monitor or through the central station. The line currently includes three models, two with about a 12-inch display and a lower-acuity model with an 8-inch display. All are running at SVGA (high) resolutions, and are crisp and clean.

Nihon-Kohden is offering Data Critical's OEM frequency-hopping telemetry, the most advanced WMTS telemetry currently available. At present, this uses the Data Critical central station and the new bedsides the NK central station. However, NK indicated that its bedsides are being interfaced to the Data Critical central, allowing a single central station to work with both hardwired and wireless bedsides and patient-worn telemetry. The system is aggressively priced, including competitive pricing at the bedside, making it competitive in either networked or stand-alone configurations.

These new products certainly thrust Nihon-Kohden back into the competitive limelight for monitoring negotiations, particularly after the central station integration is accomplished. The fact that NK is offering (along with Datascope and Data Critical) the best WMTS telemetry solution may cause some hospitals to give them more consideration than they have received in some time. The system is easy to use, and it offers three user-defined macro function keys on the screen, allowing monitoring functions to be make easily accessible. For example, in a surgical ICU or open-heart OR, where multiple invasive pressure lines are managed, a "Zero All" function key can be displayed, making the zeroing of all lines (once they have been opened to air) a one-touch affair. In some other clinical unit, this user-definable button might be dedicated to some other function. Other functions are almost as convenient to access via the touch-screen user interface and shallow menu structure, all of which combines to make this a very easy monitor to learn and operate.

Nihon-Kohden has borrowed an idea from the last generation of Datascope monitors – a split screen that display both vital sign trends and real-time waveforms. It has made splitting the screen into a trend and real-time section as simple as touching it and dragging the boundary across the screen. The touch screen and functions activate when the pressure is removed from the touch screen, making the touch interface quite insensitive to unintentional touch or activation. The implementation is quite well done.

With a nice new product line and aggressive pricing, it may be hard for competitors to find a weakness in the Nihon-Kohden position. Ultimately, lack of a nationwide, direct sales organization may be the only weakness, and it is one that cannot be remedied overnight. While NK builds its direct organization and expands its dealer network, competitors may have time to capture business in areas where Nihon-Kohden is not recognized or actively represented. In geographies where it is represented, and in its current installed base, however, the company's new monitoring system looks like a winner and should help NK expand its share.