The latest trend in the business of medical devices? Risk-sharing between device makers and those on the liability hook when something goes wrong, typically hospitals and insurers.

Such novel arrangements are surfacing in many different health care areas, including orthopedics, infection management and cardiology, according to a recent Reuters report.

Leaders of this new guarantee initiative include Medtronic, Johnson & Johnson and St. Jude Medical. Orthopedic device makers are also considering similar protection for hip and knee implants.

A combination of a number of market forces, including slowing sales, pressure from evidence-based medicine approaches that demand that the usefulness of devices be established, and increasing consumer pressure when a procedure goes wrong has led to the new approach, which could ease the compensation pressure on U.S. hospitals and insurers, including Medicare, and boost acceptance of new technologies - and sales.

Companies have also been faced with billions of dollars of settlements over problems stemming from the use of their devices. And the liability exposure does not look like it will diminish going forward. For example, in March, the Court of Justice of the European Union (CJEU) found that in a situation in which a medical device has a potential defect, all products of the same model may be classified as defective, with no need to necessarily show that in a specific individual patient the device is faulty, according to legal site A&L Goodbody, based on an InfoCuria case report.

This means that a device maker could potentially have to cover replacement of every product implanted in order "to restore the level of safety which a person is entitled to expect," noted the site.

Without referencing the recent European ruling, the latest report cites numerous industry sources who state that this new risk-sharing is a coming trend. The shift is "big," according to Susan DeVore, chief executive of hospital contracting negotiator Premier Inc., noting to the news agency that "the world is changing.”

At present the guarantees don't spell out the details of compensations, but executives told the news agency that once such arrangements are common, it's expected that the details will be ironed out.

Not everyone is happy with the present vagueness of these new agreements. Consumers Union’s Safe Patient Project Director Lisa McGiffert told the news agency that she would consider these moves of much greater value if companies "would come right out and say I will pay for the product and the replacement if something goes wrong.”

Nor will these new arrangements protect manufacturers from potential liability, according to Rick Boothman, executive director of clinical safety and chief risk officer for the University of Michigan Health System.

For both manufacturers and hospitals the hope is that this new initiative will lead to more evidence-based outcome tracking – and for device makers, to boost acceptance and sales of their products. "We are really doing this to promote a technology and a benefit that we know exists, to remove any doubt and to speed up market acceptance," said Omar Ishrak, CEO at Medtronic, in a Reuters interview.

Medtronic is guaranteeing a drop in hospital infection rates for procedures using its Tyrx, a mesh sleeve that surrounds a cardiac implant with antibiotics. And if rates don't go down, the company will cover the price of related infection treatments.

J&J's Biosense Webster unit takes a slightly different approach with its Thermocool catheter ablation treatment for abnormal heart rhythm. If a repeat procedure is needed on the same patient within 12 months, the hospital gets a price break in its devices. And J&J’s Ethicon surgical products business plans a risk arrangement for its Biopatch antimicrobial dressing, according to the report.

If revision surgery is needed in the first year for St. Jude Medical's Quadra heart rhythm device due to problems with the company’s Quartet lead wire, there will be a 45 percent rebate.

And HealthTrust Purchasing Group is close to a deal to share risk on a number of procedures, including spinal fusion. The company is owned by Parallon, part of No. 1 U.S. hospital operator HCA Holdings Inc.

The full Reuters article can be read here.