Balancing high costs, potential savings

New medical technology often comes at a high price, so hospitals under mounting financial pressure must weigh the economic impact against sometimes unclear clinical data.

A hybrid PET/MRI system can produce better images of soft-tissue areas, which can lead to more accurate diagnoses of certain cancers, but the new technology is costly, with a list price of $7 million.

“Everything is under the microscope for cost examination,” said Rob Maliff, director of the applied solutions group at the ECRI Institute, an independent health technology assessment organization based in Plymouth Meeting, Pa. “That could be some hospital's entire capital budget.”

The institute included hybrid PET/MRI scanners on its annual list of technologies for hospital executives to monitor in 2013. While several of the technologies cited on the Top 10 C-Suite Watch List have appeared in previous years, much of the focus this year is on the economic impact of new technology on hospital margins.

“Technology has to be quality-enhancing,” Maliff said. “Is it also cost-reducing? … Does it really improve patient care and make it a less costly patient-care experience?”

MRI-compatible pacemakers are another example of a technology that requires hospitals to compare the additional costs with the benefits.

The device costs $1,300 more than a standard pacemaker, is reimbursed under the same rate as standard pacemakers and puts physicians in a position to predict which patients will need future MRI scans. They can also be used only with older MRI systems at a time when some hospitals are acquiring the newer and more expensive 3T MRI systems.

“Hospital margins are very tight and very thin,” Maliff said. “Technology like this, which can really impact cost, without a change in reimbursement, can really impact a hospital.”

However, for patients who are likely to need MRIs in the future, the new pacemakers may prevent additional risks. Patients with standard pacemakers who undergo MRI scans could face adverse events, such as changes in pacing or interference with pacemaker operations.

In its report, the ECRI Institute said: “So how does a cardiologist (and the hospital where the procedure is performed) determine whether the patient gets a more expensive MR-conditional device or the routine one, regardless of the cost difference between the device models?”

Charlie Miceli, vice president of supply chain and information systems at Fletcher Allen Healthcare, Burlington, Vt., said his organization has purchased several of the new Medtronic pacemakers, which were first approved by the Food and Drug Administration in 2011.

Medtronic, which said its second-generation MRI-conditional pacemaker received FDA approval last week, has sold more than 100,000 of the devices worldwide and it estimated that more than 10% of the patients who have received them in the U.S. have undergone MRIs.

“You really have to look at the total cost of taking care of the patient,” Miceli said.

With technologies that can prevent costly follow-up procedures, such as those that help to prevent infections or falls, spending more money up front is often the better solution, he added. “That whole paradigm is changing with the move from fee-for-service to population health,” Miceli said. “The cost of the events that you're eliminating far outweighs any costs.”

Some of the other cost-conscious technologies included on this year's ECRI Institute list are bariatric surgery as a more cost-effective way of dealing with moderate obesity and type 2 diabetes; the strategic planning necessary to equip facilities for minimally invasive cardiac surgery; and incorporating imaging systems into operating rooms.