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RSNA 2013: Siemens' policy VP talks health care reform and more

by Loren Bonner, DOTmed News Online Editor | December 09, 2013

Also as it relates to hospital consolidation, it's a different conversation when you are selling products to a C-suite executive than a radiologist. And I think these issues work together — whether it's consolidation or the payment reform — you're talking to a new customer, in this case the C-suite executive, or a new industry stakeholder and that's important and it forces us to adapt.

DMN: We've mostly heard about the new health care exchanges from a consumer point of view. But I'm hearing some talk here at RSNA about exchanges threatening reimbursement for providers. What are your thoughts about that?
DF: Two things to think about there. One is with cost of reimbursement — how much will each diagnostic lab test be reimbursed for, and second is what are the obstacles that a physician has to go through to help a patient get that test? I think in many ways, those obstacles are at least as important. And what I'm especially fearful of is that in both these cases you have non-clinicians making the decisions, and whether it's the cost of the test or the reimbursement for the test or the hurdles imposed to obtain a test — that takes the decision-making out of the hands of the physicians and patients and puts it in the hands of someone in an office somewhere who doesn't know either of them and that is something we have to be really worried about and keep an eye on.

DMN: The medical device tax has been in effect for almost a year now. How has it affected Siemens?
DF: The tax is 2.3 percent tax on revenues — that's important to keep in mind because people often think it's on profits. In leading up to the tax, in 2012, we had to put in a lot of effort and resources into being able to pay. You'd think that it'd be obvious how much you should pay but there is actually a lot of work we had to do to create internal systems that were pretty costly, frankly, in order to be able to pay accurately. Since you are losing 2.3 percent of your margin, you also have to make decisions about R&D, employment, all that kind of stuff.

DMN: Many were expecting a repeal of the tax to be placed in the budget plan that was passed in October. But it was not. What do you think the chances are of a repeal?
DF: We were obviously very encouraged by the momentum that it got in the last negotiations and we are hopeful that this is something on the table during these fiscal negotiations that will go on over the next month and a half or so.

DMN: Last year, you mentioned some challenges a company like yours faces with the UDI requirement. Have any of the challenges you'd foreseen with the rule been worked out, especially in light of the final UDI rule that was released in September?

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