SEARCH
Current Location:
>
> This Story


Log in or Register to rate this News Story
Forward Printable StoryPrint Send us your Comments

Never Miss a Story

Sign up for email alerts

 

More Industry Headlines

Genetic test predicts sensitivity of tumors to radiation therapy Customizing dose to a particular tumor instead of standard uniform dose

Certain cardiovascular factors may predict Alzheimer’s Alcohol, smoking, diabetes and obesity all increase risk

Is China the new frontier for medical equipment manufacturers? 'Made in China 2015' initiative aims to boost quality — and competitiveness

Guerbet to acquire Mallinckrodt's contrast agent business Deal valued at $270 million will be paid in cash

Study finds cardiac CT scans damage cells No damage detected in doses under 7.5 milliSieverts, however

NHS in U.K. to bring proton therapy to Manchester and London Another big contract for Varian, as proton tipping point continues

Family members of ICU patients may be at risk for PTSD New research indicates active decision-making reduces psychological distress

Samsung launches new high-end ultrasound The HS70A uses S-Vision technology to reduce image noise

Laser clinic sues Cynosure, alleges fraudulent device advertising Practice seeks more than $5 million over failure to remove tattoos

Health care industry merger mania continues with Anthem's deal to buy Cigna Meanwhile employer-based insurance is thriving

Price disclosure doesn't
always work, researchers find

Will Mandatory Medical Technology Price Disclosure Actually Increase Prices?

by Barbara Kram , Editor
A new study found that pending congressional legislation seeking the mandatory disclosure of prices for certain medical technologies would likely result in increased prices and "provide no tangible benefits to patients."

The study by Robert W. Hahn, senior fellow at the American Enterprise Institute, and Hal J. Singer, president of Criterion Economics, examines the potential economic impact of the Transparency in Medical Device Pricing Act of 2007 (S. 2221), recently introduced in the U.S. Senate.

Story Continues Below Advertisement

Discover A New Dimension in Breast Health...TomoSPOT

Skin Markers for 3D Breast Tomosynthesis - for your lowest possible recall rates. Try TomoSPOTS today! Request your complimentary sample kit at 800-233-5539 or info@beekley.com



In the report, the researchers review previous attempts by governments to impose price disclosure rules in a number of other industries including cell phones, groceries, cement, barges, railroads and long-distance telephone services. The authors use evidence from case studies and other sources to identify four conditions that, if satisfied, imply that mandatory price disclosure would provide large benefits to consumers or other purchasers.

"We found that mandatory price disclosure, as proposed in S.2221 is unlikely to benefit patients or hospitals and worse, will likely increase costs," said Hahn.

The authors write that in order for price disclosure to have a favorable effect, there must be large search costs that are reduced substantially, and that the pricing information disclosed be current. The industry-specific market conditions essential for lower prices to occur would require that any savings be passed on to end users, and that there is a large variation in the price paid by purchasers and consumers.

The report finds that the conditions that would likely result in large cost increases as the result of pricing disclosure are met.

Specifically, the report finds that:

* The medical device industry is concentrated among a few firms.
* There are few, if any, economical substitutes for many medical devices.
* Competitors repeatedly interact in the marketplace.
* Some medical devices are standardized whereas other devices are differentiated.
* Firms do not already know their rivals' prices.

The report's findings conclude that:

* Significant search costs for hospitals and patients would remain.
* Disclosure would not provide current price information since the data would be at least three months old.
* The structure of the healthcare industry would not ensure that hospitals pass cost savings on to consumers.

"Applying these conditions to the medical device industry, we conclude that mandatory price disclosure policy would likely increase prices hospitals pay for these products and provide no tangible benefit to patients," said the authors.

The study was supported by the Advanced Medical Technology Association.

More information and the full report are available at: www.criterioneconomics.com.





Related:


Interested in Medical Industry News? Subscribe to DOTmed's weekly news email and always be informed. Click here, it takes just 30 seconds.
Advertise
Increase Your
Brand Awareness
Auctions + Private Sales
Get The
Best Price
Buy Equipment/Parts
Find The
Lowest Price
Daily News
Read The
Latest News
Directory
Browse All
DOTmed Users
Ethics on DOTmed
View Our
Ethics Program
Gold Parts Vendor Program
Receive PH
Requests
Gold Service Dealer Program
Receive RFP/PS
Requests
Healthcare Providers
See all
HCP Tools
Jobs/Training
Find/Fill
A Job
Parts Hunter +EasyPay
Get Parts
Quotes
Recently Certified
View Recently
Certified Users
Recently Rated
View Recently
Certified Users
Rental Central
Rent Equipment
For Less
Sell Equipment/Parts
Get The
Most Money
Service Technicians Forum
Find Help
And Advice
Simple RFP
Get Equipment
Quotes
Virtual Trade Show
Find Service
For Equipment
Access and use of this site is subject to the terms and conditions of our LEGAL NOTICE & PRIVACY NOTICE
Property of and Proprietary to DOTmed.com, Inc. Copyright ©2001-2015 DOTmed.com, Inc.
ALL RIGHTS RESERVED