The median prices for selected costly hospital products dipped in 2014 as hospital supply-chain leaders continued to negotiate tougher deals and clamp down on physician-preference items.
The overall median price for high-spend products dropped 1.5% from 2013 to 2014, from $144,278 to $142,072, according to data from the ECRI Institute, a not-for-profit based in Plymouth Meeting, Pa., that evaluates medical procedures, devices, drugs and processes.
The price of embolization coils plunged 17.6% in 2014, the biggest drop of any product. But the cost of hip implant acetubular shells rose 13.2% last year, the biggest jump on the list.
“Overall, there is more focus on reducing costs,” said Timothy Browne, director of ECRI's PriceGuide service. “The mindset that physicians can get what they want and have no interaction with supply chain no longer sits well.”
Experts say C-suite executives and physicians are working more closely with supply-chain organizations to reduce device costs. Supply and demand also plays a role in median prices. The price of newer devices will stay high for a time, at least until more vendors enter the marketplace and drive prices down. But most established categories will trend down, Browne said.
From 2007 to 2011, the seven largest categories of implantable medical devices saw substantial declines in the average selling price paid by hospitals on both a nominal and inflation-adjusted basis, said Donald May, executive vice president of payment and healthcare delivery policy at the Advanced Medical Technology Association.
Declines in average inflation-adjusted prices ranged from 17% to 34%, depending on the device type. They included drug-eluting stents (34%), bare-metal stents (27%), cardiac resynchronization therapy defibrillators and pacemakers (26%), implantable defibrillators (24%), artificial hips (23%) and artificial knees (17%).
In 2011, the most recent year for which medical technology cost data are available, prices increased just 0.7%, about one-fifth the rate of price increases in the overall economy and for other medical goods and services, May said.
“Given these historical trends of low cost growth and new pressures on the health system to provide more integrated, low-cost care, we anticipate these spending trends for the device industry are likely to continue,” he said.
Follow Michael Sandler on Twitter: @MHmsandler
