Hospitals see big potential for savings, but safety remains an issue for some
The supply chain staff at Beth Israel Deaconess Medical Center in Boston in late 2009 proposed a new program that would recycle two categories of single-use medical devices by sending them to an outside vendor to be disabled, sterilized and repackaged. Such a program would produce big savings, they promised.
And they were right. The 642-bed academic medical center saved roughly $375,000 in 2012 by having the devices reprocessed—sometimes at half the cost of original devices. It also diverted 10,000 pounds of medical waste, which is estimated to cost about $1 or $2 per pound to discard.
Now, the hospital reprocesses 15 categories of medical devices.
The idea “came up from supply chain as a cost-savings opportunity and it kind of evolved from there,” says Adam Robinson, a clinical contract manager at Beth Israel Deaconess.
Reprocessing single-use medical devices is not new. The practice has been around for decades, but the market has reported significant growth in recent years as more hospitals have started to implement reprocessing programs in an effort to save money and reduce waste.
In addition, some of the largest devicemakers in the U.S. have gone from critics of repro- cessing to owners of third-party reprocessing companies.
“Of the different sustainability activities that hospitals are adopting across the country, this seems to be one of the more popular ones,” says Susan Kaplan, a research assistant professor at the University of Illinois at Chicago. “The main reasons are the cost savings and the benefits to the environment.”
However, there are still limitations to widespread adoption of reprocessing. Some clinicians continue to express concerns about the safety and performance of reprocessed devices, which can put hospital administrators and physicians at odds over the adequacy of the reprocessing process, and not all hospitals are moving forward with plans to implement these programs despite the potential for cost savings.
“The weight of the other pressures impacting healthcare as it begins to adopt the Affordable Care Act—(which is) just an enormous set of demands—might be a barrier,” says Gary Cohen, president of Health Care Without Harm, a coalition of providers and environmental, community and other groups that support sustainability in the healthcare sector. “However, because this is such a significant cost-savings measure, you’d think that would be something that would be overcome.”
Hospitals across the U.S. are reporting that reprocessing programs have led to millions of dollars in savings across the sector. The programs often serve as a hospital’s flagship sustainability effort. Medical devices ranging from endoscopes to surgical forceps can be reprocessed.
About 3,000 of the nation’s 5,000 or so hospitals have implemented reprocessing programs, according to the Association of Medical Device Reprocessors, which represents Stryker Sustainability Solutions and Johnson & Johnson’s SterilMed. While many academic medical centers were early adopters of such programs, reprocessing proponents range from hospitals operated by for-profit players such as HCA to large not-for-profits such as 962-bed Yale-New Haven (Conn.) Hospital.
Stryker Sustainability and SterilMed say they are reporting year-over-year growth based on the number of hospitals that are starting new programs as well as on the hospitals that are expanding the number of device categories to reprocess.
Both companies declined to disclose revenue figures. Stryker and SterilMed, which was acquired by J&J in 2011 for an undisclosed amount, make up about 95% of the estimated $373 million market for third-party reprocessing. Stryker paid $525 million in
cash in 2010 to acquire Phoenix-based Ascent Healthcare Solutions and renamed it Stryker Sustainability Solutions.
Mike Gustafson, worldwide president of SterilMed, says the company helps “hospitals build robust reprocessing programs so that they can achieve their economic and environmental goals.”
“Both hospitals and independent delivery networks, as well as clinicians, (understand) the need to increase access to care and improve affordability and they’re looking for solutions,” he adds.
Both companies say the practice of reprocessing is safe, and noted that the Food and Drug Administration regulates the reprocessing of single-use devices and has strengthened its existing oversight since 2000. All reprocessed devices must receive 510(k) clearance from the FDA, which also inspects reprocessing companies and monitors reports of adverse events. The 510(k) pathway does not require clinical testing.
During the past decade, the practice of reprocessing has faced increased scrutiny at both the state and federal levels, but a pair of Government Accountability Office reports found little evidence of harm, with a 2008 report concluding that currently available information did not indicate reprocessed devices were less safe than original devices.
The FDA has said that the risks of getting a healthcare-acquired infection from inadequately reprocessed medical devices, which may retain blood or tissue, are “relatively low … although the potential for outbreaks of infections associated with their use remains an important public health concern.”
“A lot of the furor and the controversy began to go away after the FDA began regulating the practice,” says Chris Lavanchy, engineering director at the ECRI Institute, a not-for-profit organization that researches patient-safety and technology issues. “Everything we’ve looked into has suggested that there’s really not an issue” with safety.
However, a committee opinion released last year by the American College of Obstetricians and Gynecologists called for studies that evaluate the safety, quality and cost-effectiveness of reprocessed single-use devices used in gynecologic procedures. “Physicians should be informed whether the instruments used in surgery are original or reprocessed, and adverse events should be reported to improve the safety information about reprocessed single-use devices,” the opinion states.
The opinion also questioned whether patients should be informed that a reprocessed device will be used during a surgery.
Much of the committee’s concern stemmed from physicians who say they weren’t aware that hospitals were providing reprocessed devices to doctors, says Dr. Denise Elser, a gynecologic surgeon in Chicago.
Because hospitals don’t generally track whether a reprocessed device was used in a procedure, it is difficult to understand whether those devices lead to more com- plications or injuries. “We have no real data on that,” she says. “What we’re asking for is to help us understand this is safe because right now we haven’t been given that information.”
Another factor may contribute to lingering concerns among clinicians. Several sources say that Johnson & Johnson and
Stryker were major critics of reprocessing before making their investments in the sector. And, in some cases, hospitals might be hesitant to promote their use of reprocessed devices to patients who are uninformed about the reprocessing process.
“Some hospitals have expressed that there’s a publicity issue from when reprocessing was still the Wild West,” ECRI’s Lavanchy says. The practice is “much more prevalent today.”
A 2012 study funded by the Commonwealth Fund looked at different hospital sustainability programs that include reprocessing programs, as well as energy use reduction, waste reduction and more efficient purchasing of operatingroom supplies. The study recommended that all hospitals adopt these types of sustainability programs.
“Given the return on investment, the authors recommend that all hospitals adopt such programs and, in cases where capital investments could be financially burdensome, that public funds be used to provide loans or grants, particularly to safety-net hospitals,” the authors wrote.
The Healthier Hospitals Initiative, an alliance of hospitals and health systems that are seeking to boost sustainability in the healthcare sector, released a report in April
“Some hospitals have expressed that there’s a publicity issue from when reprocessing was still the Wild West. (The practice is) much more prevalent today.” —Chris Lavanchy ECRI Institute
that found 185 hospitals saved $32 million last year by reprocessing single-use medical devices. HHI is aligned with Health Care Without Harm.
According to published reports, Tenet Healthcare Corp. reported saving $9.4 million and diverting more than 1.5 million pounds of medical waste from landfills last year, while the Franciscan Health System, based in Tacoma, Wash., and affiliated with Catholic Health Initiatives, expects to gener- ate about $2 million in savings this year.
“Reprocessing of single-use devices is really becoming a very common standard of practice,” says Diane Karagory, a senior director at Huron Healthcare, which is part of the Huron Consulting Group.
She estimates that a reprocessed device can cost between 30% and 50% less than the original device. Data from Practice Greenhealth, a notfor-profit focused on improving environmental practices in healthcare, show that a new ultrasound catheter costs about $2,900, while a reprocessed one is $1,400. New laparoscopic instruments may cost $1,240 when purchased from the original equipment manufacturer, but a reprocessed one might cost only $250.
“There is a whole dimension about educating clinicians,” says Cohen of Health Care Without Harm. “I think it’s true with a lot of these sustainability measures that the biggest issue is culture change.”
SterilMed’s reprocessing facility in Maple Grove, Minn., uses an ultrasonic process to clean single-use medical devices.