According to Modern Healthcare, medical supplies and equipment account for the largest increase in healthcare spending. Finally, ultrasound scanners perform a medical test that uses high-frequency sound waves to capture real-time images of the inside of the body. These policymakers might point out that the United States spends far more per capita on medical devices than either the world's second largest purchaser of medical devices, Japan, or the third largest, Germany (Table 5). The doc covers the medical device industry, which has benefited from weak regulations and from selling its products at extremely high prices.
But others argue vehemently that medical technology is one of the main drivers of healthcare spending. In a 2004 study of power wheelchairs, the OIG compared the 2003 Medicare rate with the average prices offered to patients on suppliers' websites (Figure 5-1 (Department of Health and Human Services, 2004a). The trade association has also pointed out that the costs of most medical devices have increased less than inflation. The size and characteristics of the medical device market are further complicated by the large number of products and the pace at which manufacturers introduce technical changes to their products.
But that pace of change can fail if manufacturers succeed in shifting market share to a related drug in the same class. Drug price negotiations are based primarily on changes in market share among competing drugs in a given drug class. The report, entitled Lack of Price Transparency May Hamper Hospitals' Ability to Be Prudent Purchasers of Implantable Medical Devices, examined the purchasing history of 60 hospitals and found that some of them paid much more than others for the same device. They are often purchased by physicians and reimbursed through health insurance, rather than through a prescription drug benefit.
It acknowledges that, in addition to hospitals, data from outpatient medical centres and physician groups would be needed for a more comprehensive analysis. The Bleeding Edge documents the complications and high costs of various medical devices, such as metal hip replacements, the Essure contraceptive coil and transvaginal mesh.