Boston, MA. The status of healthcare legislation now being considered in Congress was one focus of the 21st Annual Conference of the Massachusetts Medical Device Industry Council (MassMEDIC) held here today. The event was co-located with other conferences including BIOMEDevice and ESC Boston.
In a “fireside chat,” Scott Whitaker, president and CEO of the Advanced Medical Technology Association (ADVAMED), discussed how the policies of the Trump Administration will impact the medtech industry and the current climate of medtech innovation. He said that he was skeptical of new Republican-sponsored healthcare legislation passing, but on entering the Boston Convention & Exhibition Center this morning he learned that a key Republican opponent of the legislation had switched his vote to “yes.”
Whitaker said his organization takes no position on the insurance aspects of the bill, emphasizing instead the repeal of the medical device tax imposed as part of the Affordable Care Act. The proposed American Health Care Act repeals the medical device tax, and consequently Whitaker’s organization favors advancing it on to the Senate. As for the insurance aspects, Whitaker said his organization supports insurance for as many people as possible at the lowest cost possible but with support for the complete medical technology ecosystem.
Should the American Health Care Act fail to advance, he said, ADVAMED favors attaching the medical-device-tax repeal to the next appropriate legislative vehicle—such as a bill addressing the Children’s Health Insurance Program. The device-tax repeal has bipartisan support, he said, adding he expects it to pass this year. He called for a permanent repeal of the tax, saying manufacturers need certainty.
Hospital and health-system needs
MassMEDIC organizers said that to grow their companies and advance patient care, medical device executives should focus on the broader, evolving and more sophisticated set of needs of hospitals and health systems that are increasingly consolidated as well as integrated across the care continuum.
The organization said a new report from L.E.K. Consulting identifies and characterizes the major meaningful shifts within the U.S. healthcare landscape manifesting in the trends affecting hospitals and hospital systems, their changing priorities, and how the broader ecosystem is adapting accordingly.
The report cites the trend of Medicare and other payers shifting toward value-based payment that is closely tied to outcomes. In response, hospital systems are evolving their models, and medical device and healthcare IT/service companies that serve payers and providers are expanding their roles to provide broader product offerings, as well as more value-added services, including data and technology offerings.
Monish Rajpal, managing director of L.E.K. Consulting, said that the bases of competition in the industry are shifting, and medical device companies need to grow their capabilities—including data connectivity, analytics, consultative offerings and more—to react to or take advantage of ongoing changes.
“With the increased focus on integration across sites of care, accountability for outcomes and costs, and competition for critical mass at every level, it is not surprising that a large and growing cadre of hospitals are receptive to third-party participation in solving major issues. Medtech companies on the other hand need to look for ways to broaden their base of business and improve their overall relevance and sustainability, making this potentially a true win-win opportunity in healthcare, especially if the partnerships evolve into longer term, value-based relationships rather than transactional ones based on product price competition alone,” said Rajpal in a press release.
“The landscape for the medical device industry is changing,” added Tom Sommer, president of MassMEDIC. “Device companies need to adapt to new initiatives coming from the federal government, while at the same time continuing to innovate to address the needs of patients and hospitals. It’s an unprecedented time; however, Massachusetts’ companies are in a good position to succeed.”
Read the entire L.E.K. report here.
Update: The House of Representatives has passed the GOP health-care bill.
