Medical sales reps have long had a close relationship with physicians, providing services as a surgical consultant as well as a medtech dealer, but that dynamic may be about to change in a big way.
That may be good news for hospitals looking to cut their surgical costs, but it’s a mixed blessing for the industry. Anonymous readers offered a mixed reaction to the news, with some lauding the efforts to reduce sales reps’ unnecessary travel and on-site time while others warned that hospitals were misdirecting their cost-cutting efforts.
Medical sales jobs have long been among the more lucrative jobs in the healthcare industry and they continue to come with 6-figure salaries, according to a 2014 Medical Sales Salary Report from MedReps.com. Considering base and commission, medical sales reps command an average of about $141,000, according to the survey of more 2,700 respondents.
Reps in certain industries reported even higher salaries. Those in health IT/software took in nearly $173,000 and those in medical/surgical devices reported more than $158,000, according to the report. More than a third also had a company car or car allowance and a gas card.
The reps reported that they spent an average of 20% of their time traveling between customers. Those that traveled between 25-50% of the time saw far higher commissions than those that traveled less or not at all, the survey found. Medical sales reps are frequently on the road, not just to sell their companies’ wares but also to provide support in the operating room, helping physicians with best practices and troubleshooting issues that may arise.
The relationship is well-entrenched, but some hospitals are looking to shake things up. Loma Linda University Medical Center in California told Modern Healthcare that the hospital is getting deep discounts for certain knee and hip implants by training its own staff to take the place of company sales reps.
"Sales reps have created this necessity for themselves with the surgeon, and we’re saying it’s not as necessary as everyone thinks it is," Loma Linda executive director Justin Freed told the news source. He did not reveal which manufacturer he was working with.
So-called "rep-less" sales models appear to be gaining in popularity as hospitals look to reduce costs and dilute industry influence in the clinic, but the trend got a mixed reaction, at best, from MassDevice.com’s readers.
Participants in an anonymous forum alternatively voiced wariness and disapproval, with a few voices in the crowd lauding the efforts.
"I think this could work on a situational basis. Some items they could eliminate reps and save, others are much more service intensive and require a high level of expertise," one commenter wrote, adding that orthopedic sales reps, like those fading out at Loma Linda, may be the most expendable.
Another commenter warned that the shift may raise ire among physicians, who often rely on the expertise of sales reps who have seen hundreds of procedures with a given device where the OR team may have seen only a handful.
Perhaps the most impassioned arguments came from a pair of posters who warned that hospitals administrators were mistakenly blaming medical devices and medtech sales reps for the high cost of care.
"I have been selling orthopedic implants for 14 years and have never got a price increase on my implants. In fact the price has gone down 30%-50% on hips, knees and revision implants for both," an anonymous commenter wrote. "Orthopedics, cardiac, and oncology are the top 3 money makers for hospitals. Medical devices are only a small fraction of the cost."
It wouldn’t be the first time that medical devices have been implicated in the ever-rising cost of U.S. healthcare. The industry has been batting back price-hike accusations for years with its own studies showing that medical device prices have barely budged in over 2 decades.