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May 2002
Cuts like a knife: $250,000 award over botched surgery
A San Diego jury awarded a 47-year-old man who emerged from abdominal surgery to find that doctors had left a 14-inch surgical knife in his stomach $250,000 in damages this week. Dan Jennings, who underwent an operation in 2000 to repair a bowel problem and learned that surgeons had left a large metal retractor blade inside him, sued Palomar Medical Center and two doctors, claiming that the instrument caused a flesh eating bacterial infection and other medical problems. Jennings said his medical woes persisted even though the blade was removed two weeks later and gave him a fear of hospitals. He also said he suffered from insomnia, which cost him his job with a company that sells sleep aid products.
Jennings initially sought $4 million in damages but said he was happy with the verdict. "(Doctors and hospitals) need to be accountable for what they do," Jennings told reporters outside court. "This was very good and I'm satisfied."
The hospital's lawyers told a jury that there was no evidence the surgical mishap caused his medical problems and said Jennings deserved no more than $50,000 in damages.
Amersham wins Novation contract
Irving, TX-based Novation announced that Amersham Health has been awarded a three-year sole-source agreement to provide participating Novation facilities with Amersham Health's full line of brachytherapy products including OncoSeed (Iodine-125 Seeds), RAPID Strand (Iodine-125 Seeds), EchoSeed (Iodine-125) and TheraSeed.
Big putts: DreamWeaver uniting fore healthcare
There's still time to make your summer plans count, both on the golf course and as a way of benefiting America's healthcare. The DreamWeaver Medical Foundation is inviting all HPN readers to hit the little white ball with the pros and network with top healthcare executives at the United Fore Care Classic, August 19-25 at the Park Meadows Country Club in Park City, UT. The event includes a senior PGA tournament along with daily healthcare-specific events each day. Sponsorship opportunities are also still available. For further information, contact DreamWeaver at 435-940-2501 or visit their website at www.unitedforecare.com/healthcare. The DreamWeaver Medical Foundation assists charities with equipment, supplies and funding for humanitarian healthcare worldwide.
$9 billion boost in hospital Medicare payments in the works
According to a report yesterday from the American Hospital Association, House Republican lawmakers, working closely with AHA, have crafted, as part of their Medicare prescription drug bill, a tentative package that provides more than $9 billion in additional hospital funding over 10 years. The bill would provide a higher Medicare inpatient prospective payment system update of market basket minus 0.25 percentage points, rather than minus 0.55 now in place for fiscal 2003. Hospitals would receive the full market basket update in FY 2004 and cuts from FY 2004-FY 2007, as in an earlier Ways and Means Committee draft, would be eliminated under the tentative Medicare bill. The Indirect Medical Education adjustment would increase from its current 5.5 percent to 6.0 percent in FY 2003, and from 5.5 percent under current law to 5.9 percent in FY 2004. The bill would also increase the Medicare disproportionate share hospital cap to 10 percent for rural and small urban hospitals, phased in over five years.
Mad cow rules to cut blood supply, group warns
America's Blood Centers warned yesterday that its members, which supply nearly half of the U.S. blood supply, could lose more than 300,000 donations as a result of mandated donor deferrals related to mad cow disease that go into effect on Friday. Another round of restrictions take effect Oct. 31, and the blood center alliance said the restrictions combined with the increased demand for blood could cause a shortfall of about 1 million blood donations by the end of this year.
The restrictions, mandated by the FDA, bar donors who have lived in France for five or more years since 1980; visited or lived in the United Kingdom for at least three months between 1980 and 1996; or received a blood transfusion in the U.K. since 1980. In addition, the FDA has barred donations from military personnel or dependents who spent six months or more in military bases in northern Europe between 1980 and 1990 or in southern Europe between 1980 and 1996.
J&J's weaker stent results may help rivals
Johnson & Johnson is expected to report results from its U.S. trial of drug-coated stents that fall short of its near-perfect data from an earlier European trial but are still impressive, say analysts' reports. In September, J&J, which is based in New Brunswick, NJ, said its drug-coated stents completely prevented arteries from becoming reclogged in a large-scale European trial. Then, in March the company reported similar long-term results and used the data to launch a drug-coated stent in Europe in April, the only such device available commercially.
Physicians expect drug-coated stents to revolutionize the treatment of coronary artery disease, more than doubling the current stent market to $5 billion in 2003. In early results from a J&J U.S. clinical trial, analysts believe the J&J data showed restenosis, or reclogging, rates of 8 percent to 9 percent, well above the zero percent levels reported in Europe. Still, that's well below the 25 to 30 percent of reclogging that occurs with conventional stents.
J&J, along with rivals Boston Scientific Corp., Natick, MA, and Guidant Corp., Indianapolis, IN, all released data that show the new stents, inserted in arteries after coronary angioplasty, give better results than older versions that are not drug-coated. Earlier this month, Medtronic Inc., Minneapolis, and Abbott Laboratories Inc., Abbott Park, IL, announced a technology-swapping agreement to jump-start their efforts in the new market.
Natus Medical, Broadlane sign three-year pact
San Francisco-based Broadlane Inc. said this morning that it has awarded a three-year contract to Natus Medical, San Carlos, CA, to provide its line of ALGO Newborn Hearing Screening equipment and supplies to Broadlane's customer base of more than 450 acute care hospitals. The agreement actually took effect on May 1.
Allegiance to distribute Encore Medical products
Allegiance Corp., McGaw Park, IL, will distribute a line of orthopedic soft goods products manufactured by Encore Medical, Austin, TX, following agreement on a two-year deal announced late last week. Allegiance will sell the products through its Best Value Products program, which provides a select offering of products that Allegiance distributes or manufactures.
Bottled up: Broadlane, bioMérieux in blood culture deal
Broadlane Inc. and bioMérieux, Durham, NC, have reached agreement on a five-year contract for bioMérieux to provide blood culture equipment and instrumentation to San Francisco-based Broadlane's healthcare provider customers. Under terms of the multi-source agreement, Broadlane customers will have access to bioMérieux's line of blood culture bottles, media and instrumentation. The deal compliments bioMérieux's existing Broadlane contract that covers bioMérieux's VITEK antimicrobial identification and susceptibility system. The agreement is expected to add as much as 1.2 million additional blood culture bottles and 120 additional instruments to bioMérieux's annual sales volume.
Masimo files antitrust suit against Tyco
Masimo Corporation announced it has filed suit in the United States District Court in Los Angeles against Tyco Health Care Group, L.P. and Mallinckrodt Inc. for what Masimo claims is "damage to its business resulting from the anti-competitive business practices of Tyco in connection with its Nellcor pulse oximetry brand." The lawsuit alleges, among other things, that Tyco harmed Masimo through a series of illegal exclusionary and anti-competitive acts designed to maintain its monopoly in the market for pulse oximetry sensors and patient cables in the U.S. Masimo is seeking recovery of damages and injunctive relief. The lawsuit alleges that Tyco has shut Masimo out of more than 90 percent of the relevant markets through various means, including entry into exclusive dealing contracts with purchasers, and in particular, group purchasing organizations.
AmeriNet going mobile
AmeriNet, the St. Louis-based group purchasing organization, and Mobility Inc., La Jolla, CA, a designer and manufacturer of mobility assistance devices, have reached agreement on a contract covering products from Mobility's AirLift line of toileting systems. The products are designed to help restore independence, privacy and dignity among the injured, elderly, disabled, ill and obese.
Instrumentarium Imaging in group buy with Premier
Premier Inc. has signed a group buy agreement with Instrumentarium Imaging covering its computer aided detection for mammography, specifically the MammoReader, a sophisticated computer-aided detection analysis system used to help combat breast cancer and improve women's health.
Lawson signs $1.8 million contract with Group Health Cooperative
Lawson Software, St. Paul, MN, announced the signing of a contract with Seattle-based Group Health Cooperative, the nation's largest consumer-governed healthcare system.
Broadlane awards respiratory therapy products pact to Hudson RCI
San Francisco-based Broadlane Inc. and Hudson RCI, Temecula, CA, have agreed on a three-year dual-source contract covering respiratory therapy products. The agreement took effect May 1. Under terms of the deal, Broadlane customers have access to a wide range of Hudson RCI products. Specific respiratory product lines covered by the agreement include cannulas, nebulizers, airways, breathing exercisers, resuscitation bags and heated humidification systems.
Isolyser changes name to Microtek Medical Holdings
Isolyser Company Inc., a company that created a stir in the mid and late 1990s when it launched a unique, but ultimately unsuccessful waste management system, announced today it has changed its name to Microtek Medical Holdings. According to a statement from Isolyser, the new name "more accurately reflects its focus on the healthcare industry and its core business unit, Microtek Medical, Inc." Since 1999, Microtek has generated substantially all of Isolyser's net revenues. The company's stock will continue to be traded on Nasdaq under its new symbol MTMD after being traded for years as OREX, a name that comes from its former healthcare product line of dissolvable drapes, gowns and other items. The company expects that the name and symbol change will be effective on July 1.
Sulzer delays settlement decision
Sulzer Medica has delayed a decision whether to accept a $1 billion settlement agreement in a lawsuit filed over defective hip and knee implants. Attorneys representing the Swiss-based artificial joint manufacturer say they hope to convince a "reluctant" group of plaintiffs to accept the agreement. Sulzer Medica, which operates an orthopedics unit in Austin, TX, admitted that due to a manufacturing process error, trace amounts of lubricant contaminated artificial hips and knees used in some 30,000 people. About 3,500 people in that group have required corrective surgery to date.
Nova Biomedical, HealthTrust Purchasing Group sign agreement on blood gas analyzers and connectivity solutions
Waltham, MA-based Nova Biomedical Corporation and HealthTrust Purchasing Group have signed a three-year multi-source agreement for the supply of Nova blood gas analyzers and connectivity solutions, effective May 1, 2002. Under the agreement, Nova Biomedical will provide its series of Stat Profile pHOx blood gas/critical care analyzers and Remote Testing Management System to HPG members. Nova Stat Profile pHOx analyzers and Remote Testing Management Systems are used by small, medium and large hospitals, as well as integrated health networks, to improve patient outcomes and reduce the cost of care.
McKesson honors Beckman Coulter
McKesson Corporation handed Beckman Coulter Primary Care Diagnostics (BCPCD) the Best Field Support Primary Care award during McKesson Corporation's National Sales Conference in Las Vegas last week. Beckman Coulter is a global biomedical company, with headquarters in Fullerton, CA.
AmeriNet, Del Imaging sign three-year agreement
St. Louis-based GPO giant AmeriNet has signed a three-year agreement with Del Medical Imaging Corporation, a manufacturer of general-purpose radiographic imaging systems. The agreement, effective June 1, will allow AmeriNet's members to obtain Del radiographic systems for hospitals, outpatient clinics and medical centers.
Broadlane Inc. and HealthLine Solutions sign five-year contract
HealthLine Solutions Inc. has signed a five-year contract that calls for HealthLine to provide cart inventory management systems to Broadlane's healthcare customers. HealthLine, based in Texas, provides specialized healthcare inventory systems. Under the terms of the agreement, Broadlane customers will have access to HealthLine's Visual Cart Inventory Management System (VisCIMS). The VisCIMS System is designed to simplify inventory management and patient billing by matching bar codes of medical supplies with the patients who require them.
Hospitals team up to combat nursing shortage
Central Florida hospitals have joined forces to battle the area's chronic nursing shortage. Orlando Regional Healthcare System, Florida Hospital, Health Central Inc. in Ocoee, Osceola Regional Hospital in Kissimmee and Central Florida Regional Hospital in Sanford will spend a total of $1 million to increase enrollment in nursing schools at two local community colleges. So says a recent article in the Orlando Sentinel. Around 9,000 nursing positions are vacant statewide. Orlando Regional and Florida Hospital each have about 200 unfilled nursing jobs.
AHIMA and HIMSS to offer combined certification for healthcare security and privacy
Recognizing the growing need by all healthcare facilities to formalize their health information security and privacy programs, the American Health Information Management Association and the Healthcare Information and Management Systems Society formed a collaborative agreement to offer certification in those areas to meet the industry's needs. AHIMA will offer the Certified in Healthcare Privacy and HIMSS will offer the Certified in Healthcare Security. The two organizations will jointly offer a combined certification covering both disciplines, the Certified in Healthcare Privacy and Security credential.
Approved May 17 by AHIMA's House of Delegates, AHIMA will begin administering the CHP examination in the fall of 2002. HIMSS will begin administering the CHS examination in February 2003 at their Annual Conference and Exhibition. The CHPS exam will be offered in February 2003. For more information, contact AHIMA's certification department at (312) 233-1100 or via e-mail at
certdept@ahima.org.
HIPAA Summit to offer three audioconferences
The HIPAA Summit will offer three live, 90-minute HIPAA audioconferences, each featuring a panel of industry experts and key government officials. The schedule is as follows:
Each of the audioconferences take place at the following times: 8 a.m-9:30 a.m. ADT (Alaska); 9 a.m.-10:30 a.m. H/AST (Hawaii-Aleutian); 10 a.m.-11:30 a.m. PDT (and Arizona); 11 a.m.-12:30 p.m. MDT; Noon-1:30 pm. CDT; 1 p.m.-2:30 p.m. EDT.
Registration Fee per Site is $225 for each audioconference or $595 for all three audioconferences. Log on to register at www.HIPAAAudioconferences.com. The registration form can be downloaded from www.HIPAAAudioconferences.com, and the completed form can be faxed to (760) 771-3183 or sent to HIPAA Summit Audioconference Office, 7790 Barberry Ave., Yucca Valley CA 92284. For more information, call (800) 684-4549, e-mail RegistrationHQ@aol.com, or review the registration pages at www.HIPAASummit.com.
Cardiac Science external defibrillator receives American Electronics Association award
Irvine, CA-based Cardiac Science Inc. has received the 2002 American Electronics Association High Tech Award in the category of Best Medical Product/Technology for the new Powerheart automated external defibrillator (AED). The Powerheart AED, which received FDA approval in February, eliminates the need for the rescuer to determine whether or not the cardiac arrest victim has a pulse prior to attaching the defibrillator device, according to the company. The defibrillator can continuously monitor a conscious victim's heart rhythm after he or she has been revived, protecting the victim against the reoccurrence of a subsequent cardiac arrest until he or she can be admitted to a hospital, according to the company.
University of South Alabama installs Cybernet Medical in-home patient data monitoring system
The University of South Alabama Office of Emerging Technologies in Mobile recently installed Cybernet Medical's Internet Medical Database Server System for in-home patient data monitoring. Cybernet Medical is an Ann Arbor, MI-based developer of biometric monitoring technology and medical devices for outpatient care. Used in conjunction with Cybernet's MedStar interface device and data collection server, the Internet database server system establishes a secure website that enables University of South Alabama Hospital physicians to retrieve and view chronic patient physiological data transmitted from a patients' home over standard phone lines. The physicians can then analyze changes in a patient's condition and recommend appropriate action.
Johns Hopkins Health System selects QuadraMed to help manage patient identification data
QuadraMed Corporation, San Rafael, CA, said Johns Hopkins Health System has selected its Master Patient Index Integrity Management software and consulting services to manage patient identification data. The multi-year license agreement represents a $1.1 million investment. Hopkins will use QuadraMed's consulting services to link patients who are currently seen at Johns Hopkins Hospital and at Johns Hopkins Bayview Medical Center, according to the company. Both hospitals will use the MPI Integrity Management Software to integrate patient identification information from different systems. QuadraMed's v 4.0 MPI Integrity Management software suite is comprised of three integrated product modules -- MPIspy, SmartMerge and SmartID -- which provide clients with a cost-effective solution for establishing and maintaining accurate patient identity across an enterprise. New features of the product suite include enhanced record management functionality, improved flexibility, increased record matching accuracy, and expanded integration capabilities.
120 patients opt out of Sulzer Orthopedics lawsuit
About 120 patients who experienced faulty hip and knee replacements plan to opt out of a $1 billion settlement in a class action lawsuit, according to a May 16 article in the Houston Chronicle. The settlement covers nearly 3,500 patients in the U.S. who received faulty artificial joints made by Sulzer Orthopedics, Austin, TX. Sulzer Medica, the Switzerland-based parent company, said it plans to negotiate to reduce the number of patients opting out of the settlement. Under the terms of the settlement, patients who received implants without complications will receive $200,000 each. Those who experienced complications will receive a higher amount, according to the Chronicle.
Healthlink, Vinson & Elkins L.L.P. form strategic alliance
Healthlink, a healthcare information technology consulting services company, and the law firm of Vinson & Elkins L.L.P., are forming a strategic alliance to help clients sort through the complex set of HIPAA regulations - from initial planning, assessments and remediation services to interpreting the new regulations and understanding legal issues surrounding compliance. The agreement allows the companies to jointly pursue business opportunities in the healthcare systems market. Healthlink and Vinson & Elkins will focus primarily on HIPAA assessment and compliance, and information assurance and security engagements for hospital providers and owners/operators of health plans.
Montefiore Medical Center selects Medcon for cardiac image management
New York City-based Montefiore Medical Center has selected Medcon, Whippany, NJ, to provide cardiac image management and archiving for its cardiac cath and echo labs. "Medcon provides not only the necessary multimodality, but also allows the storage of cath and echo images under one patient record, in one central database. Medcon's patient-centric solution is very appealing to us," said George Szarka, Technical Administrator of the Heart Center Information Technology Group. The site performs more than 5,200 procedures each year.
LifePoint Hospitals announces pricing of convertible subordinated notes
LifePoint Hospitals Inc., Brentwood, TN, announced today the pricing of a private placement of $200 million of its 4½ percent convertible subordinated notes due 2009. The offering is expected to close on May 22. The company has also granted the initial purchasers an option to acquire, within 30 days, an additional $50 million of notes, said a release from LifePoint. The notes are convertible into shares of LifePoint common stock at a conversion price of $47.36 per share, which represents a 30 percent conversion premium over the closing price on May 16. LifePoint Hospitals intends to use the net proceeds of this offering for general corporate purposes, which may include capital improvements on its existing facilities, repurchases of its 10¾ percent senior subordinated notes and working capital, according to the company.
CLARIFICATION: Abbott informed of FDA decision on diagnostic manufacturing operations
North Chicago-based Abbott Laboratories announced today that it has been informed by the U.S. Food and Drug Administration that its Lake County, IL diagnostic manufacturing operations will be found not in conformity with the Quality System Regulation (QSR). This follows an inspection of the Lake County diagnostic manufacturing operations, which concluded in January 2002, and is related to a consent decree between Abbott and the FDA. Abbott said it expects to receive a formal report from the FDA explaining its decision. After a thorough review of that report, Abbott said it will have a clearer understanding of the FDA's decision and the next steps.
The facility in question remains in operation. Certain products, such as tests for vitamin deficiencies, were suspended from the market pending the FDA decision. Tests deemed medically necessary by the FDA, like HIV, hepatitis, cardiac and thyroid tests, are still available, an Abbott spokesman said.
"We are obviously deeply disappointed with the decision," said Richard A. Gonzalez, president and chief operating officer, Abbott Medical Products Group. "We remain committed to ensuring that the quality system meets the agency's expectation, and that the diagnostic products impacted by the consent decree are made available to patients, laboratories, and hospitals as soon as possible."
In previous disclosures, Abbott indicated it may be subject to additional costs if it is found not in conformity with the QSR. Abbott said that until it has the opportunity to thoroughly review the formal FDA report and assess the agency's expectation regarding QSR conformity, it is not able to estimate any potential financial impact. Once that assessment is completed, Abbott will be able to determine if there is any change to guidance on 2002 earnings per share.
Editor's note: Incorrect information was inadvertently printed in an earlier release. HPN regrets the error.
Gene testing holds promise for lucrative future
Roche Holding expects to strike pay dirt with genetic testing. The Basel, Switzerland-based drug manufacture says genetic testing is critical to developing safer, more effective medicine at a faster pace. The company believes it may have the corner on a nonexistent market that could swell to $5 billion in the next 10 years. Roche says it plans testing to target medications only toward people who will benefit from them. According to current estimates, many drugs are effective in about 60 percent of patients who take them. Moreover, researchers at the University of Toronto estimate that adverse drug reactions kill 100,000 people every year - the fifth-leading cause of death in the U.S.
Sulzer Medica adopts a new name
From June 1, 2002, medical technology company Sulzer Medica will operate under the "Centerpulse" brand. The name change is a legal consequence of last-year's spin-off from Swiss parent company, Sulzer AG, and now signifies the independence of the globally active medical technology company in its communications, too. The new name is to be presented for adoption to shareholders tomorrow at the Annual General Meeting in Zurich.
ProVation Medical releases software version
Minneapolis-based ProVation Medical Inc. announced the recently released its fourth generation of software, Version 3.5, for its new customers and installed base of 200 Gastroenterology (GI) customers. The software's new features, driven by extensive customer input and validation, will be highlighted at the Digestive Disease Week Tradeshow in San Francisco, CA, May 19-22.
Louisiana IDN signs with Encision
The Willis-Knighton Health System, a four-hospital system based in Louisiana, has committed to converting to AEM Laparoscopic Instruments for their minimally invasive surgical procedures. The instruments are manufactured by Boulder, CO-based Encision Inc. Willis-Knighton says it is converting from conventional instrumentation to AEM Instruments to advance patient safety in their laparoscopic surgical procedures. The four major hospitals in the network perform more than 5,000 laparoscopic procedures per year.
Premier expands robot deal with McKesson
Premier Inc. says it has expanded its agreement with McKesson Automation Inc. for their ROBOT-Rx product. ROBOT-Rx is a centralized, robotic drug distribution system that automates the storing, dispensing, returning, restocking and crediting of unit-dose, bar coded inpatient medications. The product is currently installed in more than 300 facilities throughout the country. Under the terms of the agreement, McKesson Automation is the exclusive vendor for automated robotic pharmacy dispensing technology, ROBOT-Rx. In addition to the ROBOT-Rx product, McKesson Automation will offer Premier preferred pricing for other products, including AcuDose-Rx, a family of decentralized unit-based cabinets used in-patient care areas to store, dispense and track bar coded narcotic, floorstock and PRN medications.
Premier hospitals identify key factors for safety syringes, phlebotomy devices
The Premier Safety Institute has released the results of two six-month field evaluations it conducted to learn from members what they look for in safety syringe and phlebotomy devices. The evaluation was designed to identify performance considerations for safety devices that would contribute to innovation in future product designs and to gain additional member input for Premier's contracting process.
Users expect phlebotomy devices to have a very reliable safety feature as well as being easy to use. A majority (71 percent) of users felt comfortable using the phlebotomy devices after 10 uses. An overwhelming majority (81 percent) felt the devices would prevent needlesticks.
Clinicians also believe that the number one consideration for selecting a safety syringe is the device's ability to deliver an accurate medication dose. Having a reliable safety feature came in second. A vast majority (81 percent) of participants felt comfortable with the safety syringe after five uses, and a similar number (79 percent) believed the devices would protect against needlesticks.
HHS issues guidelines on disaster readiness for ventilation systems
The Department of Health and Human Services yesterday issued new guidelines for protecting ventilation systems in commercial and government buildings from chemical, biological and radiological attacks. The plans address the physical security of ventilation systems, airflow and filtration, systems maintenance, program administration and maintenance staff training. "This guidance offers reasonable and practical measures to reduce the likelihood of a contaminant attack and to minimize the impact if one occurs," said Office of Homeland Security director Tom Ridge. A spokesman for AHA's American Society for Healthcare Engineering said the document raises issues that should be considered while performing JCAHO-required hazard vulnerability assessments. A copy of the HHS guidance is available at www.cdc.gov/niosh.
Honoring a late leader, JCAHO creates patient safety award
The Joint Commission on Accreditation of Healthcare Organizations and the National Quality Forum yesterday announced the creation of the John M. Eisenberg Patient Safety
Awards. Named in memory of the respected leader of the Agency for Healthcare Research and Quality - the award will recognize individuals and healthcare organizations which have made significant contributions to improving patient safety.
Dr. Eisenberg, who died in March, was a pioneer in promoting patient safety and played a central role in launching the National Quality Forum. He was also a strong advocate for the Joint Commission's patient safety initiatives. Up to four John M. Eisenberg Patient Safety Awards will be presented each year, one to recognize individual lifetime achievements in patient safety and three in the categories of advocacy, system innovation, and research. However, awards will only be made to those who meet the award criteria and will not necessarily be given in each category every year. An expert panel will select the recipients.
The 2002 awards will be presented at the NQF Annual Meeting on October 1-2 in Washington, D.C. Thereafter, the presentation of the awards will rotate between the annual meetings of the two sponsors. Questions may be e-mailed to
EisenbergAward@jcaho.org.
Hospitals face new round of budget cuts
A treacherous financial situation for the nation's hospitals could get even worse over the next five years after another tough round of federal cuts that will hit hard at their bottom line. The cuts could hit teaching hospitals particularly hard, according to a report in the Atlanta Business Chronicle.
In the report, the Centers for Medicare and Medicaid Services (formerly the HCFA), which administers the $245 billion Medicare program, has proposed dropping Medicare reimbursements to hospitals by $21 billion over the next five years, beginning in October. Medicare is the largest single payer of hospital services, paying for 30.5 percent of national expenditures in 2000.
In Atlanta, teaching hospitals like Grady Memorial Hospital and Emory University Hospital could see their reimbursements slip by 15 percent -- or $4.2 billion -- over the next five years beginning as soon as Oct. 1.
Premier inks contract with Huntleigh Healthcare
Premier Inc. and Huntleigh Healthcare Inc., Eatontown, NJ, announced the signing of a new 42-month contract that covers Huntleigh's line of Intermittent Pneumatic Compression Systems for the prevention of deep vein thrombosis (DVT). The dual source agreement takes effect June 1.
Consorta, Medical Indicators in three-year pact
Consorta, Inc., Rolling Hills, IL, announced they have agreed to a three-year contract with Medical Indicators, Carlsbad, CA, that took effect May 1. The deal makes Medical Indicators a preferred provider of disposable/reusable oral and auxillary thermometers for participating Consorta members.
Medical Action acquires specialty packaging and collection product manufacturer
Medical Action Industries, Hauppauge, NY, a supplier of medical and surgical disposable products, today announced that it has agreed to acquire the specialty packaging and collection systems for the containment of infectious waste and sterilization products business of MD Industries, Northbrook, IL.
The acquisition marks Medical Action's second such deal in the past six months and eighth transaction in the past eight years. MD Industries had net revenues in excess of $7,000,000 for the year ended December 31, 2001.
Feds said to widen prescription drug probe
The U.S. Attorney's office in Boston has widened its five-year investigation into the sales practices of prescription-drug companies, subpoenaing records involving the distribution of a best-selling drug, Prevacid, made by TAP Pharmaceuticals, a joint venture of Abbott Laboratories and Takeda Chemical Industries of Japan, and two managed care drug distributors, Caremark Rx and Express Scripts. According to a report in the New York Times, the companies said that they had received subpoenas in the last 10 days. Caremark and Express Scripts said the subpoenas requested records for Prevacid, an ulcer treatment that had $3 billion in 2001 sales, as well as for Lupon, a prostate cancer treatment also made by TAP, that had sales of $800 million. All three companies said that federal investigators had told them they were not targets of the current phase of the investigation.
Last October, TAP paid $875 million to settle criminal and civil charges that the company had defrauded Medicare and Medicaid, the government insurance programs for elderly, disabled and low-income people. As part of that settlement, TAP admitted that its sales people had helped doctors charge the government for free samples of Lupon. The agreement was the largest healthcare fraud settlement, the Times reported.
Court approves proposed $1 billion Sulzer Medica settlement
A U.S. federal court approved a proposed $1 billion settlement by Sulzer Medica in a lawsuit over faulty joint implants. The settlement is subject to approval by the majority of plaintiffs in the suit. If the proposal is not accepted, the company says it will begin bankruptcy proceedings for its subsidiary Sulzer Orthopedics, according to published reports.
Survey: No funding reduction for hospitals
Some 69 percent of American voters are against reductions in funding to hospitals. So says a poll conducted by the Coalition to Protect America's Health Care. Among those who identified themselves as "strong Republicans," 64% opposed reductions like those under consideration for fiscal 2003 by the Bush administration and congressional Republicans. About 82% of women and 79% of all "independent" voters opposed reductions, according to the survey. A majority of the respondents say they recognize that hospitals are experiencing difficult financial times.
AmeriNet facilities choose USCS to help reduce management asset costs
USCS Equipment Technology Solutions has been chosen to partner with two AmeriNet members to reduce their equipment maintenance expenses via USCS' LIFECYCLE Managed Maintenance Program: Laurel Health System, Tioga County, PA, and Albert Lindley Lee Memorial Hospital, Fulton, NY.
Laurel Health System, a nonprofit, six-facility, integrated health and human services organization that serves a rural population of 50,000 people, was created in 1989 through the affiliation of Soldiers and Sailors Memorial Hospital and North Penn Comprehensive Health Services. The USCS agreement guarantees savings for its two main facilities for three years.
Albert Lindley Lee Memorial Hospital, opened in 1910, currently is a 67-bed facility with more than two dozen departments providing health services ranging from arthroscopy to x-ray. USCS' LIFECYCLE Program will bring cost control and proven results to the facility for the next three years.
AmeriNet Choice contract awarded to Maxxim
St. Louis-based AmeriNet and Maxxim Medical, Waltham, MA, have agreement on a five-year AmeriNet Choice contract covering Maxxim's can liner business. Also included in the contract is Maxxim full line of hamper and biohazard bags. Maxxim estimated the sales volume of the agreement at a potential $4 million annually. Further, the company noted that over the life of the contract, there is the potential for $20 million in total sales volume.
Hospitals utilizing testing system to improve patient safety
Two hospital systems in the state of Washington are the first in the nation to test a system that provides doctors with real-time health information about their patients delivered on a secure communications network. Hospitals taking part in the demonstration project include Deaconess Medical Center and Valley Hospital and Medical Center, both part of Spokane-based Empire Health Services, and Swedish First Hill, Swedish Providence and Swedish Ballard, which belong to Seattle's Swedish Medical Center. Through PSI, the non-profit, voluntary group of doctors, hospitals and patients that developed the system, handheld computers, connected via a wireless network, are used to gain access to five categories of vital clinical information: diagnoses or "problem list," laboratory results, medications, allergies and immunizations. Research shows that incomplete or inaccurate data in these areas contributes to a significant percentage of all medical errors. Based on the results from the demonstration project, a national rollout of the PSI system is planned for next year. For more information, visit www.ptsafety.org
Viatronix gets preferred-vendor agreement with Tenet
Tenet Healthcare Corp., Santa Barbara, CA, and Viatronix Inc., Stony Brook, NY, have signed a three-year, preferred-vendor agreement that will enable Tenet hospitals to offer the Viatronix V3D Virtual Colonoscopy System for colorectal cancer screening. Using helical CT images of the patient's abdomen, the Viatronix V3D-Colon module reconstructs three-dimensional views of the interior of the patient's colon for analysis by a physician. These reconstructed views simulate those obtained by a conventional colonoscopy.
AORN debuts patient safety initiative; Sandel Medical kicks in cool million
The Association of periOperative Registered Nurses has announced the creation of a Patient Safety First program. Sandel Medical Industries, Chatsworth, CA, announced it is making a $1 million contribution as an exclusive sponsor of the program. The program will determine strategies and initiatives designed to place the organization in the forefront of patient safety issues in the perioperative setting and support AORN's efforts to coordinate a common venue for dialogue among the various members of the multidisciplinary perioperative team. The safety initiative will focus on providing system solutions designed with safety as the first priority, so that these solutions can be implemented in clinical environments.
Allegiance fetes suppliers
Allegiance Healthcare has singled out several of its laboratory and med-surg suppliers for outstanding efforts on behalf of McGaw Park, IL-based Allegiance and its customers. The companies were evaluated on numerous criteria including field sales support, customer service, sales growth, marketing and product introductions, operational excellence, and other support services.
This year's winners include:
Becton Dickinson, Franklin Lakes, NJ
Outstanding New Product Introduction, Laboratory, for its Eclipse line of blood collection needles.
Convatec, Princeton, NJ
Outstanding Health Systems Support, Med-surg, and Partner of the Year, Med-surg, for demonstrating a strong commitment to driving sales growth and operational efficiencies.
Cypress Medical Products, McHenry, IL
Gold Level World Class Supply Partner for excellence in supply chain management.
Hygenic Corp., Akron, OH
Gold Level World Class Supply Partner, Best Value Product partner, recognized for excellence in quality production and timely deliveries of its products, which include medical straps and tourniquets.
International Technidyne, Edison, NJ
Gold Level World Class Supply Partner for distinguishing itself across a broad range of criteria to earn Allegiance's highest level of excellence. ITC actively supports the advanced use of EDI.
Kendro Laboratory Products, Newtown, CT
Outstanding Field Sales Support, Laboratory for their support through product demonstrations, in-services and benefits selling has led to tremendous growth in their business with Allegiance and their recognition at the field level.
Mabis Healthcare, Lake Forest, IL
Outstanding Sales Achievement, Med-surg, for delivering an impressive sales growth rate with Allegiance.
Nerl Diagnostics, East Providence, RI
Gold Level World Class Supplier for its efforts at making the supply chain more efficient.
Ortho-Clinical Diagnostics, Raritan, NJ
Outstanding Health Systems Support, Laboratory, for attention to detail and contract timeliness that provide Allegiance with seamless contract implementation and outstanding support in serving health systems.
Quidel Corp., San Diego, CA
Outstanding Sales Achievement, Laboratory, and Partner of the Year, Laboratory, for consistently demonstrating excellent performance across all Best Value criteria.
Sage Products Inc., Cary, IL
Outstanding New Product Introduction, Med-surg; Gold Level World Class Supply Partner and Outstanding Operational Support, Med-surg, for its introduction of the Comfort Shield line of incontinence care products.
Sakura Finetek U.S.A. Inc., Torrance, CA
Outstanding Operational Support, Laboratory, and Gold Level World Class Supply Partner. This histology manufacturer has been an Allegiance Best Value Product partner for many years.
Sysmex Corporation, Long Grove, IL
Outstanding New Partner of the Year, Laboratory, recognized for its urinalysis products, this supplier has demonstrated strong sales, financials and operational performance in a short period of time.
Wampole Laboratories, Cranbury, NJ
Outstanding Sales Achievement, Laboratory, for exceptional sales growth and financial results over the previous fiscal year.
Welch Allyn, Beaverton, OR
Care Continuum Partner of the Year; Outstanding Field Sales Support, Med-surg, and Outstanding Sales Achievement, Med-surg. For the first time, Allegiance recognized a winner based solely on its commitment and results focused on the Care Continuum business. Welch Allyn was also recognized for its outstanding field sales support and sales achievement.
Hospitals utilizing testing system to improve patient safety
Two hospital systems in the state of Washington are the first in the nation to test a system that provides doctors with real-time health information about their patients delivered on a secure communications network. Hospitals taking part in the demonstration project include Deaconess Medical Center and Valley Hospital and Medical Center, both part of Spokane-based Empire Health Services, and Swedish First Hill, Swedish Providence and Swedish Ballard, which belong to Seattle's Swedish Medical Center. Through PSI, the non-profit, voluntary group of doctors, hospitals and patients that developed the system, handheld computers, connected via a wireless network, are used to gain access to five categories of vital clinical information: diagnoses or "problem list," laboratory results, medications, allergies and immunizations. Research shows that incomplete or inaccurate data in these areas contributes to a significant percentage of all medical errors. Based on the results from the demonstration project, a national rollout of the PSI system is planned for next year. For more information, visit www.ptsafety.org
MedSafe in safety alliance with Massachusetts network
MedSafe, Waltham, MA, has partnered with Cambridge Health Alliance to assist with the regulatory requirements surrounding the system's Hazardous Materials Program.
MedSafe will provide a variety of services for the Boston area system over the next three years, including creating management plans in the areas of hazardous materials, chemical spill response, employee testing and monitoring for exposure control and plans for handling and disposal of hazardous materials to comply with all state and federal requirements. In addition, MedSafe will provide access to a customized electronic library of material safety data sheets through MSDSdirect, available through MedSafe's Ahead of the Curve Web portal. Cambridge Health Alliance is comprised of the Cambridge Hospital, Somerville Hospital, Whidden Memorial Hospital, the Cambridge Public Health Department, over 20 primary care sites and Network Health - a statewide managed Medicaid health plan.
Allegiance gains patent-pending status for online kitting service
Allegiance Healthcare Corp., McGaw Park, IL, announced that it has a patent pending for its PackManager system, an Internet-based procedure pack management service. PackManager is used in hospitals and other healthcare facilities to design custom surgical-procedure packs that are manufactured and distributed by Allegiance. The packs contain single-use supplies used to perform a variety of procedures. With Allegiance's PackManager system, healthcare providers can view, create and modify packs online, analyze and standardize their use, evaluate options for cost savings, and manage their pack inventory. The system also includes a national database of best-demonstrated practices in supply usage and management.
Duke to lay off 300 in cost-saving bid
Duke University Health System, Durham, N.C., said it would lay off 300 employees and eliminate an additional 100 positions through attrition in an effort to shore up the system's budget. The cuts represent 4 percent of the three-hospital system's 10,000 employees. Duke said the layoffs could come as soon as June and most likely would be at system headquarters and at its flagship, 750-bed Duke University Hospital in Durham. In a news release, Duke said its budget and ability to meet long-term capital needs have been hurt by a cumulative $200 million reduction in Medicare reimbursement to the system since the Balanced Budget Act of 1997. Duke also said it expects Medicaid cuts in fiscal 2003, which begins July 1. Other cost-saving measures include a $16 million reduction in procurement costs for office supplies and cuts in travel and temporary labor costs.
Kimberly-Clark launches education initiative
Kimberly-Clark yesterday announced the launch of a new education initiative for healthcare professionals, one that pulls together its existing instructional offerings under one umbrella as well as adding to its breadth and scope. The initiative, known as The Knowledge Network, will provide new and enhanced informational resources available to healthcare personnel, making them easier to access and making sure each program presents the most current data available, and where appropriate, ensuring accredited content. An extensive number of new programs have been added as well.
The company also said that for the sixth year, it would again underwrite the Georgetown University Healthcare Leadership Institute and provide a series of scholarships to customers and through its affiliations with professional organizations such as AORN. For 2002, the AORN Foundation will underwrite the travel expenses to Georgetown for the Scholarship winners.
Milwaukee IDN moves to Web-based supply chain solution
Aurora Health Care, a Milwaukee-based regional health care provider, said yesterday it is employing new Web-based technologies to streamline the often costly and cumbersome purchasing process. Along with partners Medibuy and Allegiance Healthcare, said is making "great strides" toward integrating a full Web-based supply chain.
Through Nashville, TN-based Medibuy, a pioneer in Internet-based commerce between healthcare providers and suppliers, Aurora has begun sending Web-based purchase orders to one of its key suppliers. In addition, Aurora and Allegiance Healthcare, McGaw Park, IL, say they have initiated XML for all three major transaction sets within the supply chain: purchase orders, order confirmations and invoices. Allegiance is Aurora's primary distributor of med-surg supplies.
Longer hospital stays result from out-of-specialty care
A study of more than 5,000 hospital patients, reported in a recent issue of The Archives of Internal Medicine, found that about one-fourth were treated by medical specialists working out of their area of expertise, and that these patients tended to have longer hospital stays and slightly higher mortality rates. The findings, by Dr. Scott R. Weingarten of the Cedars-Sinai Medical Center in Los Angeles and his colleagues, come as doctors debate the appropriate ratio of specialists to primary care physicians.
The report noted that some studies had found that people treated by specialists for conditions like heart attacks and strokes did better than other patients. It also pointed to a survey of primary care doctors showing that one-fourth believed they were being asked to provide a range of care that was too broad. But this study found that the patients studied were better off seeing primary care doctors than specialists out of their field. Given how often the specialists are called upon to work outside their fields, the researchers wrote, it is possible that the specialists "have similar concerns that the scope of conditions that they treat outside of their subspecialty is greater than it should be." The study looked at patients being treated at six hospitals in the Cleveland area who were suffering from congestive heart failure, bleeding ulcers and pneumonia.
McKesson to acquire Canadian imaging concern
McKesson Corp., San Francisco, announced that it has signed a definitive agreement to acquire A.L.I. Technologies Inc., Vancouver, B.C., Canada, by means of a cash tender offer for approximately $340 million. A.L.I. provides enterprise medical imaging solutions, including PACS. The acquisition is expected to close within 90 days and is subject to regulatory approval and other customary conditions. With the acquisition of A.L.I., McKesson will expand its Horizon Clinicals offering to include data, documents, voice and medical images.
Novation ends contract with Specialty Labs
Novation, Irving, TX, says it has discontinued its contract with Specialty Laboratories Inc., Santa Monica, CA. The reason for the action, which takes effect on July 29, was not disclosed. The original agreement was initiated on May 1, 2001 and provided Novation members with access to discounted clinical laboratory services from Specialty Laboratories.
AGFA Canada awarded multi-million dollar PACS order
Agfa Canada has signed a multi-million dollar contract to install and service a fully integrated PACS system in nine networked northeastern Ontario hospitals. Agfa claims that the project, referred to as NORad, will improve access to specialty care for patients living in rural and remote communities by digitizing and connecting image data among nine community hospitals.
Portex, Futura Medical form sharps safety distribution alliance
Portex Inc., a unit of Smiths Medical, London, U.K., has signed an agreement with Medisys which provides Portex with distribution rights to several sharps safety products from Futura Medical Corporation, Solano Beach, CA, a subsidiary of Kingston, NY-based Medisys. The arrangement includes the Futura Safety Scalpel, Futura Safety Lancet, Futura Safety Syringe family of products, and the Futura needleless IV valve. Portex, based in this country in Keene, NH, gains exclusive distribution rights in North America, Japan and the United Kingdom for the safety scalpel, safety syringe and needleless I.V. valve. Portex will have non-exclusive distribution rights in the U.S. for the safety lancet. The agreement took effect March 28. In the next several months, these products will be transitioned to Portex labeled products.
CMS releases pivotal hospital market study
The Centers for Medicare and Medicaid Services gave a glowing account of for-profit hospitals' financial performance and said not-for-profit hospitals should be financially stable for the next year or two, reports Modern Healthcare. The agency's highly anticipated "market update" will play a key role in the development of its recommendations to Congress regarding future hospital payments, CMS administrator Thomas Scully has said. While the report acknowledged lingering effects of Medicare cuts to hospitals in the Balanced Budget Act of 1997, it cited one analyst's "cautious optimism" about the short-term performance of not-for-profit hospitals.
Senators rip GPOs for business practices
Top executives from the nation's largest group purchasing organizations were chided for their companies' business practices yesterday at a hearing before the antitrust subcommittee of the Senate Judiciary Committee in Washington. Both Richard Norling, the chief executive of Premier, and Novation president Mark McKenna were criticized by senators at the hearing for their groups' sole-source contracting policies and charges of possible conflicts of interest and self-dealing. "We have heard startling allegations of scandal and conflicts of interest that have infected" these groups, said Sen. Herb Kohl (D-WI), who chairs the subcommittee. "These practices are appalling and cannot be tolerated."
At the hearing, Kohl asked the GPO executives to meet with manufacturers and physicians to "to create a code of conduct that will address these ethical problems and contracting issues," and report back to the committee in three months. In addition, both the Federal Trade Commission and the Department of Justice were asked to open investigations into whether the buying groups had violated federal antitrust guidelines.
UHS in pact with Vapotherm
Vapotherm Inc. has signed an agreement with Universal Hospital Services Inc., Bloomington, MN, which names UHS as the primary rental agency for the Vapotherm 2000i hospital units. The one-year agreement, valued at approximately $1 million, allows UHS to place devices in hospitals under a variety of short-term and long-term rental agreements. Vapotherm is a privately held medical device manufacturer headquartered in Annapolis, MD, which focuses on respiratory therapies that assist in the treatment of chronic lung diseases.
ConMed files for IPO
ConMed Corp., Utica, NY, a manufacturer of instruments, implants and video equipment for arthroscopic sports medicine, and powered surgical instruments, such as drills and saws, for orthopedic, ENT, neuro-surgery and other surgical specialties, yesterday announced plans to file a registration statement with the Securities and Exchange Commission in connection with a primary offering of 3,000,000 shares of its common stock. Salomon Smith Barney Inc. and UBS Warburg LLC are acting as managing underwriters of the offering.
Fisher to distribute for DiaSys
DiaSys Corp., a medical equipment maker based in Waterbury, CT, announced that it has signed a distribution agreement with Fisher Scientific International Inc. Under terms of the deal, Fisher HealthCare, a division of New Hampshire-based Fisher Scientific, will market and sell DiaSys' entire line of laboratory workstations and laboratory products. DiaSys makes diagnostic workstations that automate laboratory analysis of bodily fluids. The company also makes test kits, collection tubes and other products.