The economics of medical procedure innovation.

This paper explores the economic incentives for medical procedure innovation. Using a proprietary dataset on billing code applications for emerging medical procedures, we highlight two mechanisms that could hinder innovation. First, the administrative hurdle of securing permanent, reimbursable billing codes substantially delays innovation diffusion. We find that Medicare utilization of innovative procedures increases nearly nine-fold after the billing codes are promoted to permanent (reimbursable) from provisional (non-reimbursable). However, only 29 percent of the provisional codes are promoted within the five-year probation period. Second, medical procedures lack intellectual property rights, especially those without patented devices. When appropriability is limited, specialty medical societies lead the applications for billing codes. We indicate that the ad hoc process for securing billing codes for procedure innovations creates uncertainty about both the development process and the allocation and enforceability of property rights. This stands in stark contrast to the more deliberate regulatory oversight for pharmaceutical innovations.

Cost-effectiveness analysis alongside a pilot study of prophylactic negative pressure wound therapy.

BACKGROUND: Negative pressure wound therapy (NPWT) is increasingly used prophylactically following surgery despite limited evidence of clinical or cost-effectiveness. OBJECTIVE: To evaluate whether NPWT is cost-effective compared to standard care, for the prevention of surgical site infection (SSI) in obese women undergoing elective caesarean section, and inform development of a larger trial. METHODS: An economic evaluation was conducted alongside a pilot randomised controlled trial at one Australian hospital, in which women were randomised to NPWT (n = 44) or standard care (n = 43). A public health care provider perspective and time horizon to four weeks post-discharge was adopted. Cost-effectiveness assessment was based on incremental cost per SSI prevented and per quality-adjusted life year (QALY) gained. RESULTS: Patients receiving NPWT each received health care costing AU$5887 (±1038) and reported 0.069 (±0.010) QALYs compared to AU$5754 (±1484) and 0.066 (±0.010) QALYs for patients receiving standard care. NPWT may be slightly more costly and more effective than standard care, with estimated incremental cost-effectiveness ratios (ICERs) of AU$1347 (95%CI dominant- $41,873) per SSI prevented and AU$42,340 (95%CI dominant- $884,019) per QALY gained. However, there was considerable uncertainty around these estimates. CONCLUSIONS: NPWT may be cost-effective in the prophylactic treatment of surgical wounds following elective caesarean section in obese women. Larger trials could clarify the cost-effectiveness of NPWT as a prophylactic treatment for SSI. Sensitive capture of QALYs and cost offsets will be important given the high level of uncertainty around the point estimate cost-effectiveness ratio which was close to conventional thresholds. AUSTRALIAN AND NEW ZEALAND TRIAL REGISTRATION NUMBER: ACTRN12612000171819.

A comparison of dexmedetomidine-midazolam with propofol for maintenance of anesthesia in children undergoing magnetic resonance imaging.

BACKGROUND: Dexmedetomidine is an alpha(2) agonist that is currently being investigated for its suitability to provide anesthesia for children. We compared the pharmacodynamic responses to dexmedetomidine-midazolam and propofol in children anesthetized with sevoflurane undergoing magnetic resonance imaging (MRI). METHODS: Forty ASA 1 or 2 children, 1-10 yr of age, were randomized to receive either dexmedetomidine-midazolam or propofol for maintenance of anesthesia for MRI after a sevoflurane induction. Dexmedetomidine was administered as an initial loading dose (1 microg/kg) followed by a continuous infusion (0.5 microg x kg(-1) x h(-1)). Midazolam (0.1 mg/kg) was administered i.v. when the infusion commenced. Propofol was administered as a continuous infusion (250-300 microg x kg(-1) x min(-1)). Recovery times and hemodynamic responses were recorded by one nurse who was blinded to the treatments. RESULTS: We found that the times to fully recover and to discharge from the ambulatory unit after dexmedetomidine administration were significantly greater (by 15 min) than those after propofol. Analysis of variance demonstrated that heart rate was slower and systolic blood pressure was greater with dexmedetomidine than propofol. Respiratory indices for the two treatments were similar. During recovery, hemodynamic responses were similar. Cardiorespiratory indices during anesthesia and recovery remained within normal limits for the children's ages. No adverse events were recorded. CONCLUSION: Dexmedetomidine-midazolam provides adequate anesthesia for MRI although recovery is prolonged when compared with propofol. Heart rate was slower and systolic blood pressure was greater with dexmedetomidine when compared with propofol. Respiratory indices were similar for the two treatments.