Pharmacy & Therapeutics - June 2008 - (Page 348)

Challenges in Evaluating and Standardizing Medical Devices in Health Care Facilities C. Lee Ventola, MS Introduction Recent decades have witnessed major advances in medical technologies that have been responsible for earlier and more accurate diagnoses, more effective treatments, and the ability of people to live longer, healthier lives.1,2 But because new technology is the primary driver of rapidly rising health care expenditures, these advances do not come without a cost. Therefore, a careful evaluation of drugs, supplies, equipment, and even discharge criteria is increasingly necessary in clinical practice.3 In an effort to control costs, health care facilities are now being more selective in how they evaluate and purchase medical devices. Although safety was previously the primary concern, there is now a growing demand for data on efficacy and cost effectiveness to enable this selectivity. However, a number of obstacles prevent medical devices from undergoing the standard formulary committee review process that is applied to drugs. Value analysis teams, payment caps, and group purchasing organizations are alternative means by which the merits of medical devices can be evaluated and by which costs can be controlled. Establishing a Formulary for Medical Devices Via P&T Committee Review: Is It Feasible? Unfortunately, the application of a formulary committee review to medical devices might not be as straightforward or feasible as it is for drugs. Dr. Randy Vogenberg, RPh, PhD, Chief Strategic Officer of Employer-Based Pharmaceutical Strategies and Adjunct Assistant Professor of Pharmacy Management at the University of Rhode Island, noted that “with drugs, very clearly the P&T committee is the final decision maker but [it is] generally not the final decision maker for medical devices.” The standard responsibility of formulary committees is to provide the clinical judgment of physicians, pharmacists, other specialists, and sometimes advisory subcommittees involved with the selection and use of drugs within health care organizations.6,7 Pharmacy and therapeutics (P&T) committees assess drugs according to efficacy, safety, outcomes, and relative costs4 and establish policies for drug access and administration.6 During the formulary review process, balancing costs and health outcomes is critical, and the use of commonly available data is necessary to do so.7 The result of a P&T committee review is a hospital formulary that specifies permitted drugs and drug categories and medications available only by exception.4 Formularies must be continually updated so that they remain current with advances in medicine and with the launch of new products.6 “… the P&T committee is the final decision maker [for drugs], but [it is] generally not the final decision maker for medical devices.” Although the P&T committee model has been a successful approach to drug standardization, there are inherent obstacles to applying this process to medical devices.4 Throughout the health care system, from health plans to hospitals, formulary committees for pharmaceuticals have few correlates in the coverage of devices.8 Dr. Vogenberg explained: Typically, a P&T committee doesn’t get directly involved in reviewing medical devices but may be advisory to a surgical or medical supplies committee. A P&T committee would get involved only in a secondary or tertiary role to make sure medical device authorizations coordinate with everything else that is going on in a hospital. The absolute final decision would be by the medical executive committee in a hospital. Hospitals Pressured by Escalating Supply Costs Supply costs are a major area where hospital expenditures are escalating.4 Hospital executives frequently rank increased costs and pricing pressures as their primary concerns.5 The average hospital’s supply costs grew by nearly 40% in the two years from 2003 to 2005 to more than $50.5 million.4 This problem is exacerbated by the disproportionate constraint of health insurance reimbursements.5 For example, between 1991 and 2004 the cost of orthopedic implant devices rose by 132%, whereas hospital reimbursement rose by only 16%.5 The problem of rising costs is further compounded by the growing demand for procedures for which medical devices are required. According to the National Center for Health Statistics (NCHS), knee replacements increased by 40% between 2000 and 2004 and are expected to expand by another 673% by the year 2030.4 Hospitals are therefore increasingly aware that choice of medical device, based solely on safety or physician preference, is no longer adequate and that cost effectiveness is also critical. Christine Maroulis, Director, Health Economics and Reimbursement, Ethicon Women’s Health and Urology, a division of Ethicon, Inc., a Johnson & Johnson company, observed, “As hospital revenues have been constrained and reimbursements have decreased, hospitals are looking everywhere to find savings, so we’ve definitely witnessed this change in our customer’s perspective over the last few years.” Ms. Ventola is a Consultant Medical Writer living in New Jersey. One obstacle to the creation of a medical device review process by a P&T committee is that fewer clinical trial data are Disclosure: The author has no commercial or financial relationships to disclose in regard to this article. Accepted for publication April 27, 2008. 348 P&T® • June 2008 • Vol. 33 No. 6

Table of Contents Feed for the Digital Edition of Pharmacy & Therapeutics - June 2008

Editorial Aliskiren Reduces Plasma Renin Activity Medication Errors Prescription: Washington New Drugs/Drug News/ New Medical Devices Drug Forecast Challenges in Evaluating and Standardizing Medical Devices in Health Care Facilities California e-Pedigree Rules Pose Challenges For Pharmacies Pharmaceutical Approval Update American Psychiatric Association At a Glance: Dermatology Trends in Managed Care

Pharmacy & Therapeutics - June 2008

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