The inspector general did not identify the manufacturers of the seven devices, but officials said they included implanted cardio defibrillators and a pacemaker that had either been recalled because of flaws or had “prematurely failed.” Pacemakers and implantable defibrillators are small devices placed under the skin to help treat irregular heartbeats.
How best to identify these defects and cut Medicare spending associated with fixing them has been under consideration at various times since 2007, according to the report. But it remains a contentious issue.
The inspector general recommended that hospitals and doctors be required to submit detailed information identifying failed devices, like serial and batch numbers, during the billing process.
“This could help reduce Medicare costs by identifying poorly performing devices more quickly, which could also protect beneficiaries from unnecessary costs and improve their chances of receiving appropriate follow-up care more quickly,” the report said.
David Lamir, an official in the inspector general’s Boston office, said the $1.5 billion figure represented a “drop in the bucket” of the true costs to Medicare from medical products that malfunction. He said device failures not only waste money, but also can expose patients to a “high risk of illness,” including needless surgeries.
The report said that medical device recalls nearly doubled from 2003 through 2012 and noted that they have probably cost Medicare billions of dollars. In the past five to six years, more than 200 cardiac devices have been recalled, according to the inspector general’s office. In most cases, manufacturers withdrew their products voluntarily after reports surfaced of injuries or malfunctions. Device makers are required to report problems they learn of, often from doctors and hospitals, to a database run by the Food and Drug Administration.
Diana Zuckerman, president of the National Center for Health Research who has testified before Congress on device safety, said her organization supports making hospitals report malfunctioning devices when they seek Medicare payments to cover an implant surgery. She said the change would help officials pinpoint faulty devices before issuing a recall for tens of thousands of products in patients.
“It would be much more obvious much more quickly which implanted devices were causing problems,” she said.
Medical device companies and some doctors have opposed tighter reporting, arguing that it would be costly and difficult to integrate with existing payment claim forms and might not yield useful information.
“It is abundantly clear that data collected in electronic health records is a far superior and more cost-effective method for monitoring the performance of medical devices,” said Mark Leahey, who heads the Medical Device Manufacturers Association. The trade group represents nearly 300 device companies.
Mr. Leahey said that the electronic health record “captures the full clinical history of the patient, their changing health status and detailed information on their medical treatments,” including any surgically implanted devices.
A spokesman for the Centers for Medicare and Medicaid Services said the agency had not seen the report and would have no comment.
But in written remarks included in the report, Seema Verma, the agency’s administrator, said the tighter reporting requirement was “under consideration” and that the agency would “carefully evaluate the potential that this policy would impose a burden on physicians unnecessarily.”