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DOTmed Industry Sector Report: Insurance Providers

by Kathy Mahdoubi, Senior Correspondent | August 05, 2009




The current argument in the industry is whether language in the Medical Device Amendments of 1976 to the Federal Food, Drug and Cosmetic Act preempts professional liability in the case of class III, premarket approved devices. The Supreme Court ruled in the Riegel case that the FDA deemed the device safe after "rigorous" testing, and therefore Medtronic should not be held liable. This question of liability and federal preemption has been argued in and out of courts for decades.

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The Medical Device Safety Act of 2009 was reintroduced in March 2009 and, if passed, would nullify that preemption language in the Medical Device Amendments of 1976 and overturn the US Supreme Court ruling in Riegel v. Medtronic.

"We think that there are going to be serious ramifications," says Robert Clark, Senior Director of Government Affairs and Medtronic's official spokesperson on the preemption issue. "Rolling back the preemption structure would put a chill on innovation and restrict patient access to technology that has saved thousands of lives."

Dr. William H. Maisel, Director of The Medical Device Safety Institute at the Beth Israel Deaconess Medical Center, Harvard Medical School, states that manufacturers of these devices should be held accountable for defective devices and the injuries they cause patients.

"The Supreme Court decision says if you've received approval you're no longer liable for what happens," says Maisel. "Relying on the FDA alone to catch those who don't follow the rules is setting up for disaster and in some cases that's what has been happening. The threat of litigation is a safety force. It increases the chances that manufacturers will perform the way they should."

Potential lawsuits and increased risk of financial losses

This is the second year the Medical Device Safety Act has been brought before Congress. The Act's former draft never made it out of committee, but Maisel believes that the tides are changing and thinks it will get passed by both the House and Senate. What this could mean for insurance providers and the manufacturers, dealers and practitioners they insure is more time in court and a financial beating.