Medical device prices have barely budged in 20 years, says med-tech lobby

July 14, 2011 by MassDevice staff

Amid controversies over medical device reimbursement and user fees, med-tech lobby AdvaMed's study finds that prices and spending rates have been flat over the last two decades.

AdvaMed spending chart

Medical device spending vs. national health expenditures

As Congress considers cuts in health care spending and the FDA prepares to reauthorize users fees for medical devices, industry lobby AdvaMed issued a report finding that national medical device prices and spending have barely budged over the last two decades.

Device and diagnostic prices have increased at an average annual rate of 1.0 percent compared to national inflation at 2.8 percent, according to the report.

Medical device spending has gone from 5.3 percent of national health expenditures in 1989 to 5.9 percent in 2009, according to the study.

"A significant driver of changed medical practice has been the development of new medical devices," the report concludes. "In view of the conventional wisdom about the role of medical technology in driving up costs, it is surprising that the cost of medical devices during this period has risen little as a share of total national health expenditures and, since 1992, has remained essentially constant as a percent of national health expenditures."

The study aims to pit the rising value of improved medical devices against flat spending as the industry battles the FDA's reauthorization of the user fees it collects to help pay for medical device reviews. Recent meeting minutes demonstrated that industry and agency were still a long way from compromise.