GAO Submits Report on IMD Use

The U.S. Government Accountability Office (GAO) has released a report regarding the rate of increase of the use of implantable medical devices (IMDs). The report is titled “Medicare: Trends in Beneficiaries Served and Hospital Resources Used in Implantable Medical Device Procedures.”

The GAO’s job, according to the Budget and Accounting Act of 1921, is to “investigate, at the seat of government or elsewhere, all matters relating to the receipt, disbursement, and application of public funds, and shall make to the president … and to Congress … reports [and] recommendations looking to greater economy or efficiency in public expenditures.” The only official reason for releasing the report the GAO provides is that IMDs are important to improving people’s lives, and “with beneficiaries expected to live longer and innovations in IMD technology, the use of orthopedic and cardiac IMDs is likely to continue to have important implications for hospital services paid for by Medicare.”

The release of this report comes in the thick of discussion and legislation efforts to repeal the upcoming medical device excise tax, the most notable of which is H.R. 436, the Health Care Cost Reduction Act of 2012.

The GAO report highlights IMDs for Medicare patients only, which limits it to a certain demographic primarily over the age of 65. The report covers IMD trends between 2003 and 2009. According to the report, which points out that the primary function of IMDs for patients in this demographic is to prolong and improve life, orthopedic and cardiac implants accounted for nearly all IMD-related Medicare spending in 2009. With the U.S. population aging increasingly, and life expectancy continuously rising, the report predicts a continued rise in the use of IMDs and related spending for Medicare.

“Overall, orthopedic IMD [hospital] admission rates were substantially higher in 2009 compared with 2003, while admission rate patterns among cardiac IMDs were mixed,” stated the report. “Admission rates rose for each of the orthopedic IMDs in our study, with knee replacement rates growing 6.7 percent per year. The picture for inpatient cardiac IMD procedures was more mixed; admission rates for dual-chamber pacemakers decreased steadily while rates for AICDs and drug-eluting stents increased through 2006 and generally declined thereafter, in part reflecting a shift of surgeries to the outpatient setting. While the proportion of both orthopedic and cardiac IMD beneficiaries in poor or very poor health grew throughout our period of study, this trend was far more evident for cardiac IMD beneficiaries after 2007.”

The most common orthopedic procedures, according to the report, were knee replacements followed by hip replacements. Though shoulder replacements and lumbar fusions were far less common in the years reported on, their rate of increase has been rapid.

The trends in cardiac IMD inpatient admission rates fluctuated over the study period. Inpatient hospital admission rates for drug-eluting stents increased between 2003 and 2006, declines between 2006 and 2007, and reached a stasis thereafter. Automated implantable cardioverter-defibrillator implantations increased, but declined after 2006. The rate of inpatient dual-chamber pacemaker hospital admissions decreased steadily.

Overall, the use of IMDs is increasing. Supporters of the medical device tax could see this trend as bolstering their argument. Namely, that since the sale of medical devices is steadily increasing, it will offset the effects of the tax on device companies. Sen. Orrin Hatch (R-Utah), an outspoken critic of the device tax in the Senate disagrees.

“When you have data like this that shows medical devices are improving Americans’ lives for the better, it’s baffling why the White House chose to tax the medical device industry to fund the president’s health law,” Hatch said.

Opponents of the tax see it as a squeeze and a punishment on an industry that benefits Americans in various ways—not just in terms of health, but innovation, job creation, and economic benefits as well.

Ann-Marie Lynch, executive vice president for payment and healthcare delivery policy at the Advanced Medical Technology Association (AdvaMed), said the report offered important information for lawmakers.

“It’s clear implantable medical devices improve patient health, save lives and deliver tremendous value to the overall health system,” she said. “This report adds important new data for policy makers and others to consider. The report repeatedly finds advancements in medical technology allow patients to recover more quickly, often in home settings. Shortening recovery times is not just good for patients but can help to reduce overall health care costs. The report found the average length of stay for beneficiaries receiving implantable orthopedic medical devices decreased considerably across all health status groups.”