“This is the toughest economic and regulatory environment since the early 1990s,” said Sen. Coleman. “Even though 99.6 percent of all devices approved through the 510(k) process have never been subject to a Class One recall, the government is still calling for increased regulations.” According to him, to ensure maximum innovation, it is vital that Congress enact fundamental regulatory and patent reform.


Published 3/1/2012
Madeleine Lovette

Status Quo Is Stifling Innovation

We must change the course of the current direction of our nation’s health policy system,” keynote speaker and former U.S. Senator Norm Coleman told members of the Orthopaedic Political Action Committee (PAC), during a luncheon held in conjunction with the 2012 AAOS Annual Meeting. In his remarks, Sen. Coleman addressed current healthcare regulations, which he maintains are stifling healthcare innovation, and outlined his ideal course for the future.

As former chair of the Permanent Subcommittee on Investigations and former co-chair of the Senate Medical Technology Caucus, Sen. Coleman understands the many economic and regulatory challenges confronting medical providers and businesses. He blamed the current financial situation on several entrepreneurial and economic barriers.

Stifling innovation
According to Sen. Coleman, the duration and complexity of the regulatory review process in the United States is a barrier to economic success. The high cost of bringing devices to market and the time-consuming patent system is causing the country to become less competitive and prompting firms to seek regulatory approval overseas. Even more companies are expected to pursue regulatory approval abroad when the medical technology industry becomes subject to a 2.3 percent excise tax in 2013.

Senator Norm Coleman

Sen. Coleman agrees with many policymakers and physicians that the Independent Payment Advisory Board will negatively affect access to care. He expressed concerns both about the panel’s lack of accountability and about expected cuts to Medicare coverage for expensive treatments to meet budgetary targets.

The potential negative effects of the Physician Payment Sunshine Act, another of the provisions mandated by the Affordable Care Act, are also an issue. According to Sen. Coleman, this act will place a burden on industry by increasing reporting costs and could potentially discourage physician-industry collaboration.

SGR formula
Sen. Coleman said that a permanent fix to the sustainable growth rate (SGR) formula is unlikely to pass this year, but expressed confidence that a patch will be enacted by the March 1 deadline. He favors the Ryan-Wyden plan, a bipartisan proposal introduced by Rep. Paul Ryan (R-Wisc.) and Sen. Ron Wyden (D-Ore.), as a solution to the SGR dilemma.

The proposal gives seniors the option to either stick with their current Medicare plan or use a government-funded subsidy to choose a privately run plan. “Seniors should be able to choose the health care that best fits their needs,” said Sen. Coleman. “The Ryan-Wyden plan is the solution to ensuring Medicare’s solvency and preserving patient access.”

Medical liability reform
Lastly, Sen. Coleman believes that medical liability reform is long overdue and is critical to a healthy economy. “We’ve had three expert groups (the Congressional Budget Office, the 2012 Fiscal Commission, and the team of Pete Domenici and Alice Rivlin) confirm that medical malpractice reform will achieve billions of dollars in savings to the federal budget,” he said.

“There are great possibilities for the future, but we need laws that encourage innovation and entrepreneurship. If these necessary reforms do not occur, I fear that we will either lose our future innovators, physicians, and engineers to more amiable markets or they will choose different careers altogether,” Sen. Coleman concluded.

Madeleine Lovette is the communications specialist in the AAOS office of government relations; she can be reached at lovette@aaos.org