The scope of a materials manager’s role may vary from hospital to hospital, ranging from transactional purchasing to a more strategic accountability for optimal supply chain management.

Materials managers can increase their influence in the product selection process and price negotiations no matter the depth or breadth of their position. In order to make informed decisions that are in the best interest of the patient and the hospital, materials managers are challenged to stay current on the facts – including cost, reimbursement and clinical benefit – of new high-end clinical procedures and devices.

Two recent product introductions in the cardiovascular market lend themselves to this kind of analysis: The Medtronic Sentry and the Boston Scientific Liberté.

Medtronic Sentry
The Medtronic InSync Sentry CRT-D implantable defibrillator received FDA clearance in late 2004 for use in patients with severe congestive heart failure (CHF) in combination with certain other indications. In addition to regulating heart rhythms, the Sentry technology includes functionality to monitor fluid build-up in the thoracic cavity. It also has an alarm to alert the patient’s cardiologist to address this condition proactively. Ideally, preemptive treatment can prevent hospitalization.

Currently, fluid build-up is monitored by the patient weighing himself daily. Weight gains at certain thresholds trigger a call or visit to the cardiologist’s office. By the time this occurs, the patient’s condition is already somewhat compromised. So the "early warning system" in the Sentry can be of value in enabling earlier intervention.

However, the alarm feature has not yet been cleared for marketing by the FDA. The Sentry is being implanted, but with the alarm function disabled. Until the FDA clears the alarm, patients follow the normal protocol of monitoring their weight gain between physician office visits.

A patient receiving the implant is classified into one of three possible DRGs, depending upon diagnoses and additional procedures performed. The chart reflects national average Medicare reimbursement for the three relevant DRGs. Reimbursement covers the cost of the implant, as well as all other costs of the hospitalization. For example, a hospital paying $34,000 for the Sentry system, and receiving payment at national average levels, will lose approximately $5,500-$9,200 per admission for patients classified as DRG 536 or DRG 515, respectively.

It should be noted that the Sentry qualifies for a new technology add-on payment. However, this add-on payment is not automatically paid to the hospital. The parameters for obtaining the additional payment of up to $16,000 per case are somewhat narrow, and the hospital may not qualify to receive it once the bill has been submitted to the Medicare fiscal intermediary. It is difficult for the hospital to calculate prior to the case, whether added payment will be received subsequently.

Boston Scientific Liberté
A new bare metal stent (BMS) from Boston Scientific, the Liberté, has received FDA marketing clearance. The Liberté is noteworthy because it will be the platform for the next Taxus drug-eluting stent (DES) from Boston Scientific. The Taxus Liberté DES was introduced in January 2005 for use in 18 countries outside the U.S.