GAO report linking doc influence to high prices irks devicemakers
Devicemakers criticized a new report from the Government Accountability Office finding that physician influence on hospital purchasing may cause hospitals to pay more for some implantable medical devices. Healthcare Supply Chain Association President Curtis Rooney, though, said in a statement that the findings highlight what hospitals and group purchasing organizations already know: “Medical device pricing secrecy decreases competition” and “artificially drives up healthcare costs.” The GAO analyzed the prices that 31 hospitals paid for cardiac devices and found a “substantial variation” in the lowest and highest prices that a hospital paid and noted that physicians with strong preferences may limit a hospital’s ability to receive volume discounts. For example, for hospitals that provided the GAO with pricing information about automated implantable cardioverter defibrillators, the difference between the lowest and highest price paid for one product was $8,723. The Advanced Medical Technology Association said in a statement that it would be inappropriate to make public policy conclusions from the report, calling the hospital negotiations for devices “complex and highly competitive.” The GAO noted that several hospitals and GPOS did not provide detailed information about prices, citing the effect of rebates and discounts on pricing and confidentiality clauses between hospitals and manufacturers. The report said that without available data to compare the costs of certain devices, it is difficult for hospitals to educate physicians about how preference can affect pricing.