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PHOENIX, Arizona – Evidence. Data. Communication.

On a checklist of words most used, these scored among the highest at this year's annual meeting of the Health Industry Manufacturers Association (HIMA; Washington), held here in late March. Most often, the context of these terms was the growing benefits of modern medical technology and their life-enhancing potential for populations worldwide.

But another group of terms – reimbursement, insurers, payers, cost, and value – was in even more frequent use during the HIMA gathering at the idyllic Pointe Hilton Resort at Squaw Peak. In all, the language of the gathering pointed up a growing dilemma of the industry: That the benefits of new technologies must somehow be explained and balanced against their price tags.

Not surprisingly, those making up the membership of HIMA are the True Believers, committed to a faith that medical technology can save lives, help us live longer and improve the quality of lives that are lived longer. But such faith flourishes in a skeptical world. And the health care sector of that world is increasingly dominated by large governmental bureaucracies (often meaning suspicion of innovation), the forces of managed care (meaning heavy cost containment pressures), and a decidedly mixed bag of public attitudes concerning technology in general and medical technology in particular.

Focusing on this value/cost relationship, HIMA brought together a variety of government and industry experts at its annual meeting. The main question: How to convince various audiences that medical technology is something they must invest in over the long haul, not just the short term?

Increasing emphasis on evidence

To develop that strategy, opinion clearly isn't enough. More evidence is needed – evidence of benefits and evidence substantiating economic as well as clinical value.

This may be one weakness in the FDA's current regulatory procedure, suggested David Feigal, director of the agency's Center for Devices and Radiological Health (CDRH), via videotaped message. Feigal emphasized that the agency's focus is clinical rather than economic data. "We ask for a different kind of information [than insurers]. We are not asked to consider cost or value when we approve products," he said.

Additionally, he noted that the agency is less rigorous in seeking some types of comparative data. "The FDA does not ask for comparative studies, in contrast to Europe," he said, where some regulatory agencies require companies "to establish a need for a product above and beyond an older product."

Overall though, Feigal called the emphasis on better evidence "very appropriate – evidence is the keystone to accountability. It's asked for by the medical consumer and by those trying to understand how and why decisions are made." And he stressed the FDA's current attempt to specify the most appropriate levels of evidence: "I hope we are as successful in reengineering these areas as we have other areas in the past."

How much is too much?

Several of those areas were reviewed by Liz Jacobson, deputy director for science at CDRH. These included restructuring of some approval processes, expansion of the number of products available for third party review, greater use of abbreviated 510(k)s, and broader adoption of non-recognized standards.

But remaining are two thorny questions: How much evidence is enough? How much evidence is too much? Responding to pressures both external and internal (the latter, chiefly decreases in staff), CDRH is seeking to reduce heaps of data and documentation in favor of approval applications that are "skinnier," or, in the agency's parlance, whatever is "least burdensome."

Putting the least-burdensome provisions into place, she said, "is requiring a culture change. We feel that the data required should be only that needed and what is appropriate. It should be interactive and transparent." She acknowledged a "rocky start" with industry in developing this strategy, but added that more recently, the agency is "finally cooking and things seem to be going in a positive direction."

Referring to a report from The Lewin Group (Washington), developed in collaboration with HIMA and issued at the meeting, Jacobson acknowledged the "tons and tons of money [spent by medical technology industries] in R&D. We don't want to be the bottleneck in that process."

Notably, CDRH recently appointed its first ombudsman to deal with concerns and help to keep them from turning into problems (see Market Updates, this issue). Although not scheduled to begin his new duties until April, Les Weinstein made an initial presentation at the HIMA gathering, encouraging the industry to contact him with questions and issues.

'More than one path to heaven'

Addressing the issue of appropriate evidence was John Eisenberg, PhD, director of the Agency for Healthcare Research and Quality (AHRQ; Washington), a U.S. Health and Human Services arm with the task of evaluating the effectiveness of U.S. health care through research.

Eisenberg described AHRQ as "an advocate of evidence-based research," but he argued against a one-size-fits-all approach. "There will be more than one path to heaven," Eisenberg said. "Different groups will make different decisions, based on the same evidence ... [and] multiple guidelines for different topics. It depends on who's recommending which particular clinical practice."

To look more closely at after-market product assessment, AHRQ has funded programs at four institutions: Duke University (Durham, North Carolina), the University of Southern California (Los Angeles, California), Vanderbilt University (Nashville, Tennessee), and Georgetown University (Washington). Those universities will be receiving additional funds to pursue key issues related to evidence, assessment, and both clinical and public policy issues, Eisenberg said.

Eisenberg stated 10 principles important to the assessment of new technology. Among these were the need for new measurements and new scientific models of technology assessment; the recognition that technology assessment is not a "hit-and-run activity," but rather an ongoing process; increased emphasis on training in assessment methods; and a need for greater collaboration both between countries and between the various agencies doing assessment. And national resources, he said, "should be linked – not parallel, but all working together for quick, effective information."

AHRQ, according to Eisenberg's vision, will become "an evidence factory for the nation. We need to scan the horizon to see what technologies are emerging, what's on the horizon, and what needs to be evaluated. We need to think about how strong evidence has to be before decisions can get made." To the HIMA membership, he said: "We need your help."

Knowledge and practice: A widening gap

The difficulty of keeping pace with new technologies was emphasized by Robert Waller, MD, president emeritus of the Mayo Foundation (Rochester, Minnesota) and a member of the Healthcare Leadership Council (Washington). Waller noted the publication of "two million scientific articles each year" and a widening gap between this new knowledge and deployment for patient care." We have this gap, he said, "because of a system that is flawed. Much of the health care system was designed for another science and another time. We don't need to manage the current system that we have as much as we need to change it."

The reformed health care system should be more "patient centered," offer more choices and have much more market competition, he said. Competition, he said, "encourages innovation" and provides "the underpinnings of research and education." Government's role in this system would be to put more reliance on "private sector innovations and market forces, eliminating price controls.

"We won't succeed by overcoming each other," Waller said. "Collaboration is on target, and the enemy is disease. The more we innovate, the better chance to improve quality. Higher quality equates to lower costs; the lower the cost per unit of service, the better opportunity to improve access. When innovation goes up, quality goes up ... Improving quality by any name is not oversold. It needs to be woven into the fabric of how we all think and act and feel."

Communicating with HCFA ...

Communicating the quality and value of medical technology to government and others is imperative, of course. And two speakers focused on the need to deliver the message to the Health Care Financing Administration (HCFA; Baltimore, Maryland) and to the Medicare bureaucracy which it administers.

Bruce Vladeck, PhD, professor of health policy at the Mount Sinai School of Medicine (New York) has worked for both government and the private sector. Noting that he has spent the past two years at an academic medical center "on the cutting edge of the development and utilization of technology and new devices," he acknowledged experiencing "some culture shock outside the Beltway" and a "Washington time warp." Those within the Beltway, he said, are making forecasts about Medicare – including "many of the most dire predictions" – based on models "consistently erroneous in projections of short-term performance of the economy."

Rather than conceding errors in those models, Washington's typical response "is not to concede the theories are wrong but that there is something wrong with reality or something not being fully measured," Vladeck added.

For HCFA, the primary models for coverage should be based on clinical and scientific determinations of effectiveness, Vladeck asserted. "What is needed is some kind of national, open, enforceable coverage policy." And he said he is "more optimistic about rational coverage policies now than I have ever been before."

... and the difficulties of communication

Less optimistic was Rep. Bill Thomas (R-California), who charged that HCFA is attempting to delay restructuring and that the government is failing to encourage innovation. "The Beltway doesn't make sense of venture capital being placed in businesses, including yours," he told the HIMA meeting attendees. "The government is failing to provide a clear structure and process to allow innovation to come into large government programs like Medicare. This is having a damaging effect on venture capital so that it goes someplace else."

Along with others at the meeting, Thomas focused on the increasing numbers of the elderly and objected to a "one-size-fits-all policy" that fails to clarify how funds are allocated. "I'm most worried about [having] a structure that allows for rational public debate." He advocated governmental funding of clinical trials that will put regulatory approval and consideration for reimbursement on parallel tracks. "That is a better way to determine what items to be added to a list than to review letters sent in during a comment period," he said.

Accomplishing these goals is rather unlikely, at least for now, Thomas suggested. He referred to both a "stranglehold by the AMA [American Medical Association] on coding issues, and the intractable nature of HCFA.

"You can reorganize HCFA 'til the cows come home," he said. "But the problem is that it needs to be reculturized, and frankly I think that is an impossible task. HCFA is pretty good at payment and enforcement, but it's not good at overseeing a competitive model. The goal of government is always command and control."

Accepting the challenge

HIMA's leadership and its members are more than ready to take on these issues and communicate the need for changes in public policies and governmental practices, the organization's president, Pamela Bailey, told the group. "I believe the future welfare of patients worldwide can be transformed by the people in this room," she said. "This has been a decade of unprecedented changes globally. These changes have been marked by downsizing, consolidation, and cost containment, yet we're stronger than we ever were."

Bailey said that the organization's strategy has been to emphasize cooperation and collaboration with policy makers in order to deliver industry's message and to develop "smart policy positions."

HIMA's goal, she said, "is to create an echo chamber where other organizations can echo our concerns," she said. Among those she hopes will echo this message will be the presidential candidates.

"Elections bring change," she said. "With change comes opportunity. Together, we have an opportunity to accelerate the progress of reform and truly make a difference." She said there is a new appreciation of "our issues" in Washington. "It's up to us to continue the dialogue and continue the communication process so this next session of congress is the one that rolls back the barriers that get in the way of doing your work of developing medical technology."

No apologies

Underlining this theme, HIMA Chairman Ron Dollens, president and CEO of Guidant (Indianapolis, Indiana), didn't duck the cost/value relationship of new medical technology. "Health system decisionmakers need to understand that where technology increases expenditures, people are accessing health care and living longer. We refuse to apologize for these outcomes."

He said the industry needs to "capture and quantify patient outcomes – society will not know the results of innovation if they don't know what they don't have."

Another dimension he pointed to is the new product development time frame the industry must face in the coming century. "If I look 18 months ahead, there will be seven therapies that didn't exist today that society will get the benefit of," Dollens said. "Sixty percent of everything we sell is less than 12 months old and society is getting the benefit of this investment.

"We're not at a loss for challenges or opportunities. Policy makers and patients must understand the value of technology, where it originates and how we can encourage or discourage its advances."

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