Keeping health care ahead of the curve with the latest innovations is our specialty and has been for nearly 50 years.

Core Business• EMS Sales• Hospital Sales• Product Development

and Engineering• Biomedical Clinical

Services• Mercury Manufactured

Products• Medical Gas Certification• Home Care

Medical Device Industry

Current Challenges

• Federal Mandate• Electronic Medical Records by 2014.• Hospitals face penalties of 1% in 2015, incrementing each year up to 5% as Medicare/Medicaid reimbursement reductions.• Federal grants and funding, Medicare incentive payments, to assist with implementation, from American Recovery Reinvestment Act.

• Connectivity• With EMR implementation process, customers are now demanding new electronic devices have ‘connectivity’.

U.S. HOSPITALS ALSO FACING• NRP (Neonatal Resuscitation Program).

– 2012 Guidelines* Laryngeal Masks * Blender* Medical Air / Compressor * SP02

• JCAHO– 10/24/11 – Laryngoscope blades can no longer lay

in drawers or on towels. Must be wrapped

• SCIP (Surgical Care Improvement Project)• ASA Sedation Standard 3.2.4; AHA, ERC, Joint

Commission guidelines.– CO2 Monitoring

“Vendor Credentialing” for hospital access - no

common standard.

Capital Funding

Access challenges for hospitals.

New ‘Sunshine Law’ disclosure regulation for financial

relationship reporting with physicians. NPI information at registration so if the exhibitor

gives away anything (food, beverage, etc.) the vendor will

have the details for reporting to HHS.

Many device companies developing consumables with chip recognition to

limit competition, allowing them to maintain a

foreseeable revenue stream.

The product sale cycle in a typical hospital has greatly lengthened and involves a variety of other

players beyond clinicians, legal, VAC/VAT, procurement, finance.

One recent comment which appeared in the Grey Sheet,

stated “all products are considered commodities, unless

proven otherwise”.

'

‘.

Reimbursement Coding Change

• ICD-9 to ICD-10 (International Classification of Diseases). U.S. is behind the rest of the world.• This change would replace the current set of 14,000 diagnosis codes to approximately 69,000 codes.• Implementation date October 1, 2013, was delayed on 2/16/12 by HHS for unspecified time.

Centers for Medicare & Medical

Services (CMS) reimbursement cutbacks, including additional percentage reduction for missing EMR/EHR implementation.

(UDI) Unique Device Identifier• Passed by congress in 2007. Implementation

date 2013. • FDA still has not issued final rules to industry.

Initial proposed regulation 60-70 pages after a 200 page preamble.

• The senior FDA advisor once stated “It’s not written in a way that’s easy to understand. It’s a legal document, written by our lawyers, reviewed by our lawyers, I don’t understand most of it”

Continued next page…..

•EU drafting guidelines

•UDID (Global Database)•Include GMDN (Global Medical Device Nomenclature)

• While these UDI labeling changes are in process, FDA is proposing to poll healthcare providers on “how to best standardize medical device labeling”, which is to take place in 2012.

FDA plans for “on-line” labeling repository for all devices, as part of FDA reform plan.

FDA just announced plans to survey industry for comments related to it’s “Emergency Shortages Data Collection System”. System is available only to CDRH Emergency Shortage Team and Senior management. Separate from this system, U.S. Department of Commerce Bureau of Industry and Security conducted a similar mandatory survey in 2011.

Global Location Number (GLN)

as a common numbering system to identify any legal entity/trading

partner.

•

Two bar code standards: GS–1 (formerly UCC) Uniform Code

Counsel HIBC – Health Industry Business

Council

Outside U.S., some countries ignore; mandating use of another format

Global Medical Device Nomenclature

Pending addition to labeling rule changes

Healthcare Bill

In 2013 most medical devices will be subject to 2.3% Medical Device Tax unless congress intervenes. IRS has published a draft “Proposed Rule Making Regulation” on February 3, 2012. Supreme Court hears arguments week of March 26, 2012, with ruling by June, 2012.•First Excise tax payment due January 29, 2013.

FDA Reforms (MDUFA III)

Review and possible rewrite of the entire device approval process including IOM (Institute of Medicine) recommendation to scrap current 510k process and start over.

• 510k statute review time (90 days) missed• 510k costs to double by 2017• Establishment registration fees to increase 50% by 2017.

• European Union (CE) requirement changes.

Increasing individual country requirements (not harmonized).

Underwriters Laboratories (UL)

New and Updated Electrical Standard for Medical

Devices: IEC 60601-1 (800 pages)

New Outside Entity• Hospitals contracting with outside entities

(i.e. MedApproved) for prescreening new technologies before introduction into system.

http://www.medapproved.com• Hospitals contracting with outside parties

for recall management i.e. (RASMAS (Risk and Safety Management Alert System)).

http://www.rasmas.noblis.org

Patent Reform Law

• First to file vs. previous first to invent. • May impact how industry interfaces “discloses” with developers.

FDA “PREDICT” IMPACT

Introduction of new importation clearing system “PREDICT” dramatically affecting all companies importing materials

___________Mandatory

CO2 Monitoring

SCIPNRP 2012

JCAHO

DEC 212012

MyanCalendarRuns Out

(Doomsday?)

JAN 1 2013

Medical DeviceTax

(PRICES WILL GO UP!)

JAN 292013

1ST medical device excise tax payment

due

MAR 162013

Patent Law Reform

takes effect

SEP 302013

UDI Implementation

Date from CDRH

OCT 12013

ICD10 Implementation (NOW DELAYED)

2014

EMR/EHR Takes effect

National Strategy for Global Supply Chain Security

FDA Poll to standardize

medical device labeling.

Questions?

Thank You