Alicia Ault

Starting in April 2008, retailers and suppliers in 10 metropolitan areas that sell certain durable medical equipment will have to become accredited and enter a competitive bidding process, according to a final rule issued by the Centers for Medicare and Medicaid Services.

Unlike other entities, physicians may opt out of competitive bidding and accreditation, but they will still have to accept a single payment for the durable medical equipment (DME) item instead of a fee schedule-based payment, Acting CMS Administrator Leslie Norwalk said in a briefing with reporters.

The new competitive bidding program was developed to reduce Medicare's substantial DME expenditures and to decrease the out-of-pocket burden for beneficiaries, who are liable for copayments of 20%.

"The final rule we are announcing today is focused on improving both service delivery and the quality of care, while getting savings for beneficiaries and taxpayers," Ms. Norwalk said in a statement.

She estimated that Medicare could shave $1 billion a year off its DME tab by the time the program is fully implemented in 2010.

The final rule will apply initially only to 10 categories of supplies and only to suppliers in 10 competitive bidding areas (CBA) that have been established by CMS. Physicians, hospitals, and other entities that sell DME, prosthetics, orthotics, and certain other supplies will be required to submit bids to CMS proposing charges for the items.

Bidding will probably be open until late June. CMS will evaluate the bids and then, probably in December, the agency will award contracts to a certain number of bidders in each CBA, Ms. Norwalk said in the briefing.

Beginning in April 2008, Medicare will pay a single amount for each item in those areas instead of basing payments on a fee schedule, as it has in the past.

CMS will expand the program to 70 bidding areas in 2009, and to more CBAs, and to cover more DME items after that, Ms. Norwalk said.

The new process was required by the Medicare Prescription Drug Improvement and Modernization Act of 2003. CMS outlined its intentions in a proposed rule in August 2006. It also gathered data from two pilot studies that ran from 1999 to 2002 in San Antonio and in Polk County, Fla., Ms. Norwalk said. After incorporating public comments and experience from the pilot, CMS published the final rule in the Federal Register.

Suppliers in the following 10 areas will be the first subject to the new requirements: Charlotte-Gastonia-Concord, N.C./S.C.; Cincinnati-Middletown, Ohio/Ky./Ind.; Cleveland-Elyria-Mentor, Ohio; Dallas-Fort Worth-Arlington, Tex.; Kansas City, Mo./Kans.; Miami-Fort Lauderdale-Miami Beach, Fla.; Orlando-Kissimmee, Fla.; Pittsburgh; Riverside-San Bernardino-Ontario, Calif.; and San Juan-Caguas-Guaynabo, Puerto Rico.

The locations were selected because they are 10 of the largest Metropolitan Statistical Areas in the United States and because each area had high costs and/or high utilization of DME items in the 10 focus categories. Although New York, Los Angeles, and Chicago are among the largest Metropolitan Statistical Areas and have high costs and utilization, CMS decided to exclude those areas initially to simplify the process, Ms. Norwalk said.

The 10 categories include: oxygen supplies and equipment; standard power wheelchairs, scooters, and accessories; complex rehabilitative power wheelchairs and accessories; mail-order diabetes supplies; enteral nutrients, equipment, and supplies; continuous positive airway pressure (CPAP) devices; respiratory assist devices and supplies and accessories; hospital beds and accessories; negative pressure wound therapy pumps and supplies and accessories; walkers and related accessories; and support surfaces (group 2 and 3 mattresses and overlays).

In most CBAs, only nine categories will be subject to bidding in 2008. All 10 will be covered in the Miami and the San Juan areas.

Since 60% of diabetic supplies are delivered through mail-order, CMS decided to require those suppliers to be subject to competitive bidding. Thus, patients with diabetes will continue to have the option of mail-order and it should be less costly, according to CMS. Payment for supplies obtained at a pharmacy or elsewhere will still be covered under the old Medicare fee schedule, even in the 10 CBAs, the agency said.

Blood glucose monitors are not subject to competitive bidding.

To qualify to bid, suppliers have to be accredited by 1 of 10 agencies certified by CMS. Those include the Joint Commission on Accreditation of Healthcare Organizations, the Board of Orthotist/Prosthetist Certification, and the Accreditation Commission for Health Care Inc.

Generally, bidders also have to be in good standing with Medicare, have an active National Supplier Clearinghouse number, and agree to service an entire bidding area, regardless of where a beneficiary may be located.

Of the winning contract slots, 30% are set aside for small suppliers—those with gross revenue of $3.5 million or less per year.

A list of the accrediting bodies, bidding criteria, and other details can be found online at www.cms.hhs.gov/CompetitiveAcqforDMEPOS

Starting in April 2008, retailers and suppliers in 10 metropolitan areas that sell certain durable medical equipment will have to become accredited and enter a competitive bidding process, according to a final rule issued by the Centers for Medicare and Medicaid Services.

Unlike other entities, physicians may opt out of competitive bidding and accreditation, but they will still have to accept a single payment for the durable medical equipment (DME) item instead of a fee schedule-based payment, Acting CMS Administrator Leslie Norwalk said in a briefing with reporters.

The new competitive bidding program was developed to reduce Medicare's substantial DME expenditures and to decrease the out-of-pocket burden for beneficiaries, who are liable for copayments of 20%.

"The final rule we are announcing today is focused on improving both service delivery and the quality of care, while getting savings for beneficiaries and taxpayers," Ms. Norwalk said in a statement.

She estimated that Medicare could shave $1 billion a year off its DME tab by the time the program is fully implemented in 2010.

The final rule will apply initially only to 10 categories of supplies and only to suppliers in 10 competitive bidding areas (CBA) that have been established by CMS. Physicians, hospitals, and other entities that sell DME, prosthetics, orthotics, and certain other supplies will be required to submit bids to CMS proposing charges for the items.

Bidding will probably be open until late June. CMS will evaluate the bids and then, probably in December, the agency will award contracts to a certain number of bidders in each CBA, Ms. Norwalk said in the briefing.

Beginning in April 2008, Medicare will pay a single amount for each item in those areas instead of basing payments on a fee schedule, as it has in the past.

CMS will expand the program to 70 bidding areas in 2009, and to more CBAs, and to cover more DME items after that, Ms. Norwalk said.

The new process was required by the Medicare Prescription Drug Improvement and Modernization Act of 2003. CMS outlined its intentions in a proposed rule in August 2006. It also gathered data from two pilot studies that ran from 1999 to 2002 in San Antonio and in Polk County, Fla., Ms. Norwalk said. After incorporating public comments and experience from the pilot, CMS published the final rule in the Federal Register.

Suppliers in the following 10 areas will be the first subject to the new requirements: Charlotte-Gastonia-Concord, N.C./S.C.; Cincinnati-Middletown, Ohio/Ky./Ind.; Cleveland-Elyria-Mentor, Ohio; Dallas-Fort Worth-Arlington, Tex.; Kansas City, Mo./Kans.; Miami-Fort Lauderdale-Miami Beach, Fla.; Orlando-Kissimmee, Fla.; Pittsburgh; Riverside-San Bernardino-Ontario, Calif.; and San Juan-Caguas-Guaynabo, Puerto Rico.

The locations were selected because they are 10 of the largest Metropolitan Statistical Areas in the United States and because each area had high costs and/or high utilization of DME items in the 10 focus categories. Although New York, Los Angeles, and Chicago are among the largest Metropolitan Statistical Areas and have high costs and utilization, CMS decided to exclude those areas initially to simplify the process, Ms. Norwalk said.

The 10 categories include: oxygen supplies and equipment; standard power wheelchairs, scooters, and accessories; complex rehabilitative power wheelchairs and accessories; mail-order diabetes supplies; enteral nutrients, equipment, and supplies; continuous positive airway pressure (CPAP) devices; respiratory assist devices and supplies and accessories; hospital beds and accessories; negative pressure wound therapy pumps and supplies and accessories; walkers and related accessories; and support surfaces (group 2 and 3 mattresses and overlays).

In most CBAs, only nine categories will be subject to bidding in 2008. All 10 will be covered in the Miami and the San Juan areas.

Since 60% of diabetic supplies are delivered through mail-order, CMS decided to require those suppliers to be subject to competitive bidding. Thus, patients with diabetes will continue to have the option of mail-order and it should be less costly, according to CMS. Payment for supplies obtained at a pharmacy or elsewhere will still be covered under the old Medicare fee schedule, even in the 10 CBAs, the agency said.

Blood glucose monitors are not subject to competitive bidding.

To qualify to bid, suppliers have to be accredited by 1 of 10 agencies certified by CMS. Those include the Joint Commission on Accreditation of Healthcare Organizations, the Board of Orthotist/Prosthetist Certification, and the Accreditation Commission for Health Care Inc.

Generally, bidders also have to be in good standing with Medicare, have an active National Supplier Clearinghouse number, and agree to service an entire bidding area, regardless of where a beneficiary may be located.

Of the winning contract slots, 30% are set aside for small suppliers—those with gross revenue of $3.5 million or less per year.

A list of the accrediting bodies, bidding criteria, and other details can be found online at www.cms.hhs.gov/CompetitiveAcqforDMEPOS

Starting in April 2008, retailers and suppliers in 10 metropolitan areas that sell certain durable medical equipment will have to become accredited and enter a competitive bidding process, according to a final rule issued by the Centers for Medicare and Medicaid Services.

Unlike other entities, physicians may opt out of competitive bidding and accreditation, but they will still have to accept a single payment for the durable medical equipment (DME) item instead of a fee schedule-based payment, Acting CMS Administrator Leslie Norwalk said in a briefing with reporters.

The new competitive bidding program was developed to reduce Medicare's substantial DME expenditures and to decrease the out-of-pocket burden for beneficiaries, who are liable for copayments of 20%.

"The final rule we are announcing today is focused on improving both service delivery and the quality of care, while getting savings for beneficiaries and taxpayers," Ms. Norwalk said in a statement.

She estimated that Medicare could shave $1 billion a year off its DME tab by the time the program is fully implemented in 2010.

The final rule will apply initially only to 10 categories of supplies and only to suppliers in 10 competitive bidding areas (CBA) that have been established by CMS. Physicians, hospitals, and other entities that sell DME, prosthetics, orthotics, and certain other supplies will be required to submit bids to CMS proposing charges for the items.

Bidding will probably be open until late June. CMS will evaluate the bids and then, probably in December, the agency will award contracts to a certain number of bidders in each CBA, Ms. Norwalk said in the briefing.

Beginning in April 2008, Medicare will pay a single amount for each item in those areas instead of basing payments on a fee schedule, as it has in the past.

CMS will expand the program to 70 bidding areas in 2009, and to more CBAs, and to cover more DME items after that, Ms. Norwalk said.

The new process was required by the Medicare Prescription Drug Improvement and Modernization Act of 2003. CMS outlined its intentions in a proposed rule in August 2006. It also gathered data from two pilot studies that ran from 1999 to 2002 in San Antonio and in Polk County, Fla., Ms. Norwalk said. After incorporating public comments and experience from the pilot, CMS published the final rule in the Federal Register.

Suppliers in the following 10 areas will be the first subject to the new requirements: Charlotte-Gastonia-Concord, N.C./S.C.; Cincinnati-Middletown, Ohio/Ky./Ind.; Cleveland-Elyria-Mentor, Ohio; Dallas-Fort Worth-Arlington, Tex.; Kansas City, Mo./Kans.; Miami-Fort Lauderdale-Miami Beach, Fla.; Orlando-Kissimmee, Fla.; Pittsburgh; Riverside-San Bernardino-Ontario, Calif.; and San Juan-Caguas-Guaynabo, Puerto Rico.

The locations were selected because they are 10 of the largest Metropolitan Statistical Areas in the United States and because each area had high costs and/or high utilization of DME items in the 10 focus categories. Although New York, Los Angeles, and Chicago are among the largest Metropolitan Statistical Areas and have high costs and utilization, CMS decided to exclude those areas initially to simplify the process, Ms. Norwalk said.

The 10 categories include: oxygen supplies and equipment; standard power wheelchairs, scooters, and accessories; complex rehabilitative power wheelchairs and accessories; mail-order diabetes supplies; enteral nutrients, equipment, and supplies; continuous positive airway pressure (CPAP) devices; respiratory assist devices and supplies and accessories; hospital beds and accessories; negative pressure wound therapy pumps and supplies and accessories; walkers and related accessories; and support surfaces (group 2 and 3 mattresses and overlays).

In most CBAs, only nine categories will be subject to bidding in 2008. All 10 will be covered in the Miami and the San Juan areas.

Since 60% of diabetic supplies are delivered through mail-order, CMS decided to require those suppliers to be subject to competitive bidding. Thus, patients with diabetes will continue to have the option of mail-order and it should be less costly, according to CMS. Payment for supplies obtained at a pharmacy or elsewhere will still be covered under the old Medicare fee schedule, even in the 10 CBAs, the agency said.

Blood glucose monitors are not subject to competitive bidding.

To qualify to bid, suppliers have to be accredited by 1 of 10 agencies certified by CMS. Those include the Joint Commission on Accreditation of Healthcare Organizations, the Board of Orthotist/Prosthetist Certification, and the Accreditation Commission for Health Care Inc.

Generally, bidders also have to be in good standing with Medicare, have an active National Supplier Clearinghouse number, and agree to service an entire bidding area, regardless of where a beneficiary may be located.

Of the winning contract slots, 30% are set aside for small suppliers—those with gross revenue of $3.5 million or less per year.

A list of the accrediting bodies, bidding criteria, and other details can be found online at www.cms.hhs.gov/CompetitiveAcqforDMEPOS

Mich. Derm Faces Jail Time

A Michigan dermatologist has been found guilty of defrauding Medicare and a Blue Cross Blue Shield plan. Dr. Robert W. Stokes of Grand Rapids, Mich., faces up to 10 years in prison for his conviction on 31 counts of health care fraud. The U.S. Attorney for the Western District of Michigan alleged that Dr. Stokes was upcoding surgical procedures and then billing for follow-up visits for post-operative infections that did not exist. Dr. Stokes came to the attention of federal authorities through patient complaints and audits conducted by Medicare and Blue Cross Blue Shield of Michigan. The Health and Human Services Department's Office of Inspector General and the Federal Bureau of Investigation conducted the inquiry into Dr. Stokes' billing practices and estimated that he fraudulently charged at least $500,000. Dr. Stokes has agreed to cease the practice of medicine, but has not been sentenced yet. His attorney, Mark Kriger of LaRene and Kriger in Detroit, said in an interview that his client had no fraudulent intent and will appeal the conviction.

Medicis Settles With Feds

Medicis Pharmaceutical Corp. of Scottsdale, Ariz. has agreed to pay the U.S. government $9.8 million to settle allegations that it illegally promoted Loprox (ciclopirox) as a diaper rash treatment. Loprox is not approved by the Food and Drug Administration for skin disorders in children under age 10 years. The settlement is the result of a whistle-blower complaint by four former Medicis sales representatives, who, as a result, will get a portion of the settlement. They alleged that from 2001 to 2004, Medicis representatives targeted pediatricians in an attempt to get them to prescribe Loprox for diaper rash. The case was jointly investigated by the FDA and the Kansas Attorney General's office. Medicis says "the alleged off-label promotion" was by its former pediatric sales division, which it divested in 2004. "Medicis confronted this situation head on and fully cooperated with the government, consistent with the company's strong commitment to compliance and integrity," said company general counsel Jason Hanson in a statement.

Top Ten Questions on Injectables

Safety is a top concern about the use of injectable treatments among women aged 25 years and older, according to a survey by Harris Interactive commissioned by the National Women's Health Resource Center (NWHRC) and Allergan Inc. About 1,300 women were queried by Harris in early April. After safety, respondents' next nine questions were about cost, whether results would look natural, duration of treatment and length of the procedure, insurance coverage, whether there would be pain, scarring, bruising or other side effects, and finally, if facial expressions would still be possible after treatment. The survey is part of a joint Allergan-NWHRC campaign to educate women on injectable treatments; fuller results will be released later this summer. The not-for-profit, independent NWHRC develops and distributes objective women's health information based on the latest advances in medical research and practice, according to its Web site.

IVIG Pay, Access Issues Confirmed

Two new reports from HHS confirm that Medicare payments for intravenous immune globulin (IVIG) are severely lagging behind price increases from manufacturers, making it difficult for hospitals and physicians to offer the therapy. In an April report, the HHS Inspector General found that in the third quarter of 2006, 56% of hospitals and 59% of physicians bought IVIG at prices below the Medicare reimbursement amount, which means they were able to marginally profit on the therapy. But that means that 44% of hospitals and 41% of physicians paid more for IVIG than Medicare reimbursed, said Marcia Boyle, president of the Immune Deficiency Foundation, in an interview. Further, the Inspector General found that a majority of physicians and hospitals were underpaid by Medicare relative to IVIG price for the first half-quarters of the year. Medicare acknowledged that the market was fragile, due to tight supplies and price increases and that physicians in hospitals would face the same crisis this year that they did last.

Debridement Restrictions Lifted

The American Academy of Family Physicians said it has succeeded in its drive to remove restrictive language from a Medicare carrier's draft local coverage determination on wound care. The restriction would have affected physicians in Texas, Delaware, Maryland, and Virginia. Last December, AAFP questioned TrailBlazer Health Enterprises' proposed debridement limits of three times for one wound. AAFP said that although repetitive debridement of one wound is uncommon, sometimes, serial debridement is the only option. TrailBlazer removed the restrictions from its final policy, released in April.

Juries Side With MDs

Juries in malpractice cases sympathize more with physicians and less with their patients, according to an extensive review of studies involving malpractice cases from 1989 to 2006. Philip Peters, of the University of Missouri-Columbia School of Law, found that plaintiffs rarely win weak cases, although they have more success in cases viewed as a "toss-up" and better outcomes in cases with strong evidence of medical negligence. Mr. Peters, whose study appeared in the May edition of the Michigan Law Review, said that several factors systemically favor medical defendants in the courtroom, including the defendant's superior resources, physicians' social standing, social norms against "profiting" by injury, and the jury's willingness to give physicians the benefit of the doubt when evidence conflicts.

Mich. Derm Faces Jail Time

A Michigan dermatologist has been found guilty of defrauding Medicare and a Blue Cross Blue Shield plan. Dr. Robert W. Stokes of Grand Rapids, Mich., faces up to 10 years in prison for his conviction on 31 counts of health care fraud. The U.S. Attorney for the Western District of Michigan alleged that Dr. Stokes was upcoding surgical procedures and then billing for follow-up visits for post-operative infections that did not exist. Dr. Stokes came to the attention of federal authorities through patient complaints and audits conducted by Medicare and Blue Cross Blue Shield of Michigan. The Health and Human Services Department's Office of Inspector General and the Federal Bureau of Investigation conducted the inquiry into Dr. Stokes' billing practices and estimated that he fraudulently charged at least $500,000. Dr. Stokes has agreed to cease the practice of medicine, but has not been sentenced yet. His attorney, Mark Kriger of LaRene and Kriger in Detroit, said in an interview that his client had no fraudulent intent and will appeal the conviction.

Medicis Settles With Feds

Medicis Pharmaceutical Corp. of Scottsdale, Ariz. has agreed to pay the U.S. government $9.8 million to settle allegations that it illegally promoted Loprox (ciclopirox) as a diaper rash treatment. Loprox is not approved by the Food and Drug Administration for skin disorders in children under age 10 years. The settlement is the result of a whistle-blower complaint by four former Medicis sales representatives, who, as a result, will get a portion of the settlement. They alleged that from 2001 to 2004, Medicis representatives targeted pediatricians in an attempt to get them to prescribe Loprox for diaper rash. The case was jointly investigated by the FDA and the Kansas Attorney General's office. Medicis says "the alleged off-label promotion" was by its former pediatric sales division, which it divested in 2004. "Medicis confronted this situation head on and fully cooperated with the government, consistent with the company's strong commitment to compliance and integrity," said company general counsel Jason Hanson in a statement.

Top Ten Questions on Injectables

Safety is a top concern about the use of injectable treatments among women aged 25 years and older, according to a survey by Harris Interactive commissioned by the National Women's Health Resource Center (NWHRC) and Allergan Inc. About 1,300 women were queried by Harris in early April. After safety, respondents' next nine questions were about cost, whether results would look natural, duration of treatment and length of the procedure, insurance coverage, whether there would be pain, scarring, bruising or other side effects, and finally, if facial expressions would still be possible after treatment. The survey is part of a joint Allergan-NWHRC campaign to educate women on injectable treatments; fuller results will be released later this summer. The not-for-profit, independent NWHRC develops and distributes objective women's health information based on the latest advances in medical research and practice, according to its Web site.

IVIG Pay, Access Issues Confirmed

Two new reports from HHS confirm that Medicare payments for intravenous immune globulin (IVIG) are severely lagging behind price increases from manufacturers, making it difficult for hospitals and physicians to offer the therapy. In an April report, the HHS Inspector General found that in the third quarter of 2006, 56% of hospitals and 59% of physicians bought IVIG at prices below the Medicare reimbursement amount, which means they were able to marginally profit on the therapy. But that means that 44% of hospitals and 41% of physicians paid more for IVIG than Medicare reimbursed, said Marcia Boyle, president of the Immune Deficiency Foundation, in an interview. Further, the Inspector General found that a majority of physicians and hospitals were underpaid by Medicare relative to IVIG price for the first half-quarters of the year. Medicare acknowledged that the market was fragile, due to tight supplies and price increases and that physicians in hospitals would face the same crisis this year that they did last.

Debridement Restrictions Lifted

The American Academy of Family Physicians said it has succeeded in its drive to remove restrictive language from a Medicare carrier's draft local coverage determination on wound care. The restriction would have affected physicians in Texas, Delaware, Maryland, and Virginia. Last December, AAFP questioned TrailBlazer Health Enterprises' proposed debridement limits of three times for one wound. AAFP said that although repetitive debridement of one wound is uncommon, sometimes, serial debridement is the only option. TrailBlazer removed the restrictions from its final policy, released in April.

Juries Side With MDs

Juries in malpractice cases sympathize more with physicians and less with their patients, according to an extensive review of studies involving malpractice cases from 1989 to 2006. Philip Peters, of the University of Missouri-Columbia School of Law, found that plaintiffs rarely win weak cases, although they have more success in cases viewed as a "toss-up" and better outcomes in cases with strong evidence of medical negligence. Mr. Peters, whose study appeared in the May edition of the Michigan Law Review, said that several factors systemically favor medical defendants in the courtroom, including the defendant's superior resources, physicians' social standing, social norms against "profiting" by injury, and the jury's willingness to give physicians the benefit of the doubt when evidence conflicts.

Mich. Derm Faces Jail Time

A Michigan dermatologist has been found guilty of defrauding Medicare and a Blue Cross Blue Shield plan. Dr. Robert W. Stokes of Grand Rapids, Mich., faces up to 10 years in prison for his conviction on 31 counts of health care fraud. The U.S. Attorney for the Western District of Michigan alleged that Dr. Stokes was upcoding surgical procedures and then billing for follow-up visits for post-operative infections that did not exist. Dr. Stokes came to the attention of federal authorities through patient complaints and audits conducted by Medicare and Blue Cross Blue Shield of Michigan. The Health and Human Services Department's Office of Inspector General and the Federal Bureau of Investigation conducted the inquiry into Dr. Stokes' billing practices and estimated that he fraudulently charged at least $500,000. Dr. Stokes has agreed to cease the practice of medicine, but has not been sentenced yet. His attorney, Mark Kriger of LaRene and Kriger in Detroit, said in an interview that his client had no fraudulent intent and will appeal the conviction.

Medicis Settles With Feds

Medicis Pharmaceutical Corp. of Scottsdale, Ariz. has agreed to pay the U.S. government $9.8 million to settle allegations that it illegally promoted Loprox (ciclopirox) as a diaper rash treatment. Loprox is not approved by the Food and Drug Administration for skin disorders in children under age 10 years. The settlement is the result of a whistle-blower complaint by four former Medicis sales representatives, who, as a result, will get a portion of the settlement. They alleged that from 2001 to 2004, Medicis representatives targeted pediatricians in an attempt to get them to prescribe Loprox for diaper rash. The case was jointly investigated by the FDA and the Kansas Attorney General's office. Medicis says "the alleged off-label promotion" was by its former pediatric sales division, which it divested in 2004. "Medicis confronted this situation head on and fully cooperated with the government, consistent with the company's strong commitment to compliance and integrity," said company general counsel Jason Hanson in a statement.

Top Ten Questions on Injectables

Safety is a top concern about the use of injectable treatments among women aged 25 years and older, according to a survey by Harris Interactive commissioned by the National Women's Health Resource Center (NWHRC) and Allergan Inc. About 1,300 women were queried by Harris in early April. After safety, respondents' next nine questions were about cost, whether results would look natural, duration of treatment and length of the procedure, insurance coverage, whether there would be pain, scarring, bruising or other side effects, and finally, if facial expressions would still be possible after treatment. The survey is part of a joint Allergan-NWHRC campaign to educate women on injectable treatments; fuller results will be released later this summer. The not-for-profit, independent NWHRC develops and distributes objective women's health information based on the latest advances in medical research and practice, according to its Web site.

IVIG Pay, Access Issues Confirmed

Two new reports from HHS confirm that Medicare payments for intravenous immune globulin (IVIG) are severely lagging behind price increases from manufacturers, making it difficult for hospitals and physicians to offer the therapy. In an April report, the HHS Inspector General found that in the third quarter of 2006, 56% of hospitals and 59% of physicians bought IVIG at prices below the Medicare reimbursement amount, which means they were able to marginally profit on the therapy. But that means that 44% of hospitals and 41% of physicians paid more for IVIG than Medicare reimbursed, said Marcia Boyle, president of the Immune Deficiency Foundation, in an interview. Further, the Inspector General found that a majority of physicians and hospitals were underpaid by Medicare relative to IVIG price for the first half-quarters of the year. Medicare acknowledged that the market was fragile, due to tight supplies and price increases and that physicians in hospitals would face the same crisis this year that they did last.

Debridement Restrictions Lifted

The American Academy of Family Physicians said it has succeeded in its drive to remove restrictive language from a Medicare carrier's draft local coverage determination on wound care. The restriction would have affected physicians in Texas, Delaware, Maryland, and Virginia. Last December, AAFP questioned TrailBlazer Health Enterprises' proposed debridement limits of three times for one wound. AAFP said that although repetitive debridement of one wound is uncommon, sometimes, serial debridement is the only option. TrailBlazer removed the restrictions from its final policy, released in April.

Juries Side With MDs

Juries in malpractice cases sympathize more with physicians and less with their patients, according to an extensive review of studies involving malpractice cases from 1989 to 2006. Philip Peters, of the University of Missouri-Columbia School of Law, found that plaintiffs rarely win weak cases, although they have more success in cases viewed as a "toss-up" and better outcomes in cases with strong evidence of medical negligence. Mr. Peters, whose study appeared in the May edition of the Michigan Law Review, said that several factors systemically favor medical defendants in the courtroom, including the defendant's superior resources, physicians' social standing, social norms against "profiting" by injury, and the jury's willingness to give physicians the benefit of the doubt when evidence conflicts.

The full Senate has approved a 5-year reauthorization of the Medical Device User Fee Modernization Act as part of a legislative package that included reauthorization of the Prescription Drug User Fee Act.

MDUFMA is due to expire Sept. 30. The law governs how much manufacturers are expected to pay for review of their products and also sets out review timetables that the agency must meet.

The medical device industry was largely happy with the bill as passed.

“The agreement provides additional resources to [the Food and Drug Administration] to hire additional reviewers providing patients with access to safe, lifesaving medical devices in a timely manner,” AdvaMed President and CEO Stephen J. Ubl said in a statement.

“The agreement also provides manufacturers with a more predictable fee schedule with regard to user fee rates,” he said.

The device user fee portion of the bill is largely the result of an agreement hammered out earlier this year by the FDA and the industry.

In a briefing with reporters unveiling the specifics of the agreement, Dr. Jeffrey Shuren, the FDA's assistant director for policy, touted its “aggressive performance goals.”

Under current law, in fiscal year 2007, the FDA is required to make a decision on 90% of premarket approval applications (PMAs) within 320 days, and on 50% within 180 days.

With the new proposal, 60% of PMAs will be reviewed within 180 days, and 90% within 295 days in fiscal year 2008.

This year, 90% of priority PMAs are required to be reviewed within 300 days, and 80% of 510(k)s within 90 days. Under the new proposal, in fiscal year 2008, 90% of priority PMAs will be reviewed within 280 days, and 50% within 180 days. Ninety percent of 510(k)s will be reviewed within 90 days, and almost all—98%–-within 150 days.

Dr. Jesse Goodman, director of the FDA's Center for Biologics Evaluation and Research, said that the current law had expedited the division's review of devices for blood testing and transfusion, and for cellular therapies and tissues. Before the program, it took an average of 123 days to review an application; in 2006, the average was about 55 days, Dr. Goodman told reporters.

The agency also is proposing to streamline its review of diagnostic imaging devices and said it would publish draft guidance on the issue by October 2008. The FDA would also make more use of private, outside inspectors.

Currently, manufacturers have to go through a lengthy process to use third-party reviewers.

Under the new proposal, they'd only have to give 30 days' notice, and they would be allowed to use the reviewers for a larger number of inspections.

The FDA estimated that it will require $220 million to review devices in fiscal year 2008, of which it plans to raise about $49 million from user fees. Over the 5 years of the program, it will need $1.2 billion, of which $287 million will come from industry.

In the past 5 years, the agency has had to go back to manufacturers to seek supplemental increases when there was a shortfall—which occurred when there were fewer new device applications than had been anticipated.

If the new legislation becomes law, fees will be fixed for each year of the program. Half the fees will come from applications—for new devices, supplements, manufacturing modifications, and classification information—and half from two new fees: one for manufacturing establishments and single-device reprocessors, and a periodic annual report fee. About 425 devices are subject to annual reporting requirements.

The House is still weighing prescription drug and medical device user fee reauthorizations.

Both the House and the Senate must move quickly to avoid layoffs and interruptions at the FDA, which has become heavily dependent on industry user fees to finance its work.

Senate Reauthorizes Prescription Drug User Fee Act; House Still in Early Phases

After some last-minute wrangling over drug reimportation and regulation of advertising, the Senate voted 93–1 to fund another 5 years of the Prescription Drug User Fee Act.

Among other issues, PDUFA governs how much pharmaceutical manufacturers pay to have their products reviewed by the Food and Drug Administration, and how quickly the agency must complete those reviews. The current PDUFA law expires Sept. 30.

Some have criticized the program, saying that it lets a regulated industry have too much power over its regulators. But the FDA has become increasingly dependent on user fees to fund its work.

At least one amendment to the original legislation (S. 1082) was passed that would give the agency more teeth. Senators voted 64–30 to approve Sen. Chuck Grassley's (R-Iowa) amendment to increase fines—from $10,000 to $250,000—for companies that don't comply with FDA directives on label changes, postapproval studies, and communicating new information about safety.

The penalties would double every 30 days, but would be capped at $2 million.

“These penalties need to be more than just an insignificant cost of doing business in order to affect behavior,” said Sen. Grassley in a statement.

Drug safety has been a significant focus of the legislation as it has made its way through the Senate.

Sen. Edward Kennedy (D-Mass.) and Sen. Michael Enzi (R-Wy.) had been hoping to attach proposals for improved drug safety to the PDUFA reauthorization, but most of their suggestions were defeated or watered down in a committee vote in mid-April.

The centerpiece of their proposals was to require a risk evaluation and mitigation strategy (REMS) plan for all new chemical entities and biologics. Instead, the Senate Health, Education, Labor, and Pensions committee voted to give the FDA authority to determine when a new drug should have a REMS. That provision made it into the legislation that passed the full Senate. The panel also voted to require the FDA to set up a public-private partnership for routine surveillance of postmarketing drug safety, which also was part of the final bill.

PDUFA would allow the FDA to collect $393 million in drug user fees in 2008, including a $30 million increase for postapproval drug safety programs.

The bill would also require drug makers to publish a registry of all late-phase II, and all phase III and IV trials, and to make all trial results available in a public database.

Finally, PDUFA would fund another 5 years of the Best Pharmaceuticals for Children Act. Companies that conduct pediatric studies of their products are eligible for additional patent life under the law, which expires Oct. 1. The new 5-year program will extend a drug's patent life by 3 months (instead of 6 offered under the previous law) if sales of the product are more than $1 billion and by 6 months if sales are less than $1 billion.

Under the Best Pharmaceuticals for Children Act, the Government Accountability Office found that drug sponsors have initiated pediatric drug studies for most of the on-patent drugs for which the FDA has requested studies. About 87% of drugs studied had labeling changes, often because the pediatric drug studies found that children might have been exposed to ineffective drugs or dosing; overdosing; or previously unknown side effects.

The Senate vote was hailed by the brand name and generic pharmaceutical industries.

“The significant increases in user fees will provide the FDA the resources necessary to improve and modernize its already strong drug safety monitoring system,” PhRMA President and CEO Billy Tauzin said in a statement.

The generic industry was happy, as it secured a promise from a group of Senators to markup legislation authorizing generic copies of biologic drugs by mid-June, with a goal of incorporating it into the final House-Senate agreement on the PDUFA law.

The Generic Pharmaceutical Association also praised a group of senators who secured passage of an amendment requiring the FDA to move forward on generic drug applications even though a brand name company has filed a citizen's petition questioning the generic. In the past, the FDA has not been able to consider approval of a generic until the petition was resolved—and, filing a petition has become a common strategy used by the brand name industry, according to the GPhA.

The PDUFA legislation still has far to go before it becomes law. The House is still in the early phases of work.

The full Senate has approved a 5-year reauthorization of the Medical Device User Fee Modernization Act as part of a legislative package that included reauthorization of the Prescription Drug User Fee Act.

MDUFMA is due to expire Sept. 30. The law governs how much manufacturers are expected to pay for review of their products and also sets out review timetables that the agency must meet.

The medical device industry was largely happy with the bill as passed.

“The agreement provides additional resources to [the Food and Drug Administration] to hire additional reviewers providing patients with access to safe, lifesaving medical devices in a timely manner,” AdvaMed President and CEO Stephen J. Ubl said in a statement.

“The agreement also provides manufacturers with a more predictable fee schedule with regard to user fee rates,” he said.

The device user fee portion of the bill is largely the result of an agreement hammered out earlier this year by the FDA and the industry.

In a briefing with reporters unveiling the specifics of the agreement, Dr. Jeffrey Shuren, the FDA's assistant director for policy, touted its “aggressive performance goals.”

Under current law, in fiscal year 2007, the FDA is required to make a decision on 90% of premarket approval applications (PMAs) within 320 days, and on 50% within 180 days.

With the new proposal, 60% of PMAs will be reviewed within 180 days, and 90% within 295 days in fiscal year 2008.

This year, 90% of priority PMAs are required to be reviewed within 300 days, and 80% of 510(k)s within 90 days. Under the new proposal, in fiscal year 2008, 90% of priority PMAs will be reviewed within 280 days, and 50% within 180 days. Ninety percent of 510(k)s will be reviewed within 90 days, and almost all—98%–-within 150 days.

Dr. Jesse Goodman, director of the FDA's Center for Biologics Evaluation and Research, said that the current law had expedited the division's review of devices for blood testing and transfusion, and for cellular therapies and tissues. Before the program, it took an average of 123 days to review an application; in 2006, the average was about 55 days, Dr. Goodman told reporters.

The agency also is proposing to streamline its review of diagnostic imaging devices and said it would publish draft guidance on the issue by October 2008. The FDA would also make more use of private, outside inspectors.

Currently, manufacturers have to go through a lengthy process to use third-party reviewers.

Under the new proposal, they'd only have to give 30 days' notice, and they would be allowed to use the reviewers for a larger number of inspections.

The FDA estimated that it will require $220 million to review devices in fiscal year 2008, of which it plans to raise about $49 million from user fees. Over the 5 years of the program, it will need $1.2 billion, of which $287 million will come from industry.

In the past 5 years, the agency has had to go back to manufacturers to seek supplemental increases when there was a shortfall—which occurred when there were fewer new device applications than had been anticipated.

If the new legislation becomes law, fees will be fixed for each year of the program. Half the fees will come from applications—for new devices, supplements, manufacturing modifications, and classification information—and half from two new fees: one for manufacturing establishments and single-device reprocessors, and a periodic annual report fee. About 425 devices are subject to annual reporting requirements.

The House is still weighing prescription drug and medical device user fee reauthorizations.

Both the House and the Senate must move quickly to avoid layoffs and interruptions at the FDA, which has become heavily dependent on industry user fees to finance its work.

Senate Reauthorizes Prescription Drug User Fee Act; House Still in Early Phases

After some last-minute wrangling over drug reimportation and regulation of advertising, the Senate voted 93–1 to fund another 5 years of the Prescription Drug User Fee Act.

Among other issues, PDUFA governs how much pharmaceutical manufacturers pay to have their products reviewed by the Food and Drug Administration, and how quickly the agency must complete those reviews. The current PDUFA law expires Sept. 30.

Some have criticized the program, saying that it lets a regulated industry have too much power over its regulators. But the FDA has become increasingly dependent on user fees to fund its work.

At least one amendment to the original legislation (S. 1082) was passed that would give the agency more teeth. Senators voted 64–30 to approve Sen. Chuck Grassley's (R-Iowa) amendment to increase fines—from $10,000 to $250,000—for companies that don't comply with FDA directives on label changes, postapproval studies, and communicating new information about safety.

The penalties would double every 30 days, but would be capped at $2 million.

“These penalties need to be more than just an insignificant cost of doing business in order to affect behavior,” said Sen. Grassley in a statement.

Drug safety has been a significant focus of the legislation as it has made its way through the Senate.

Sen. Edward Kennedy (D-Mass.) and Sen. Michael Enzi (R-Wy.) had been hoping to attach proposals for improved drug safety to the PDUFA reauthorization, but most of their suggestions were defeated or watered down in a committee vote in mid-April.

The centerpiece of their proposals was to require a risk evaluation and mitigation strategy (REMS) plan for all new chemical entities and biologics. Instead, the Senate Health, Education, Labor, and Pensions committee voted to give the FDA authority to determine when a new drug should have a REMS. That provision made it into the legislation that passed the full Senate. The panel also voted to require the FDA to set up a public-private partnership for routine surveillance of postmarketing drug safety, which also was part of the final bill.

PDUFA would allow the FDA to collect $393 million in drug user fees in 2008, including a $30 million increase for postapproval drug safety programs.

The bill would also require drug makers to publish a registry of all late-phase II, and all phase III and IV trials, and to make all trial results available in a public database.

Finally, PDUFA would fund another 5 years of the Best Pharmaceuticals for Children Act. Companies that conduct pediatric studies of their products are eligible for additional patent life under the law, which expires Oct. 1. The new 5-year program will extend a drug's patent life by 3 months (instead of 6 offered under the previous law) if sales of the product are more than $1 billion and by 6 months if sales are less than $1 billion.

Under the Best Pharmaceuticals for Children Act, the Government Accountability Office found that drug sponsors have initiated pediatric drug studies for most of the on-patent drugs for which the FDA has requested studies. About 87% of drugs studied had labeling changes, often because the pediatric drug studies found that children might have been exposed to ineffective drugs or dosing; overdosing; or previously unknown side effects.

The Senate vote was hailed by the brand name and generic pharmaceutical industries.

“The significant increases in user fees will provide the FDA the resources necessary to improve and modernize its already strong drug safety monitoring system,” PhRMA President and CEO Billy Tauzin said in a statement.

The generic industry was happy, as it secured a promise from a group of Senators to markup legislation authorizing generic copies of biologic drugs by mid-June, with a goal of incorporating it into the final House-Senate agreement on the PDUFA law.

The Generic Pharmaceutical Association also praised a group of senators who secured passage of an amendment requiring the FDA to move forward on generic drug applications even though a brand name company has filed a citizen's petition questioning the generic. In the past, the FDA has not been able to consider approval of a generic until the petition was resolved—and, filing a petition has become a common strategy used by the brand name industry, according to the GPhA.

The PDUFA legislation still has far to go before it becomes law. The House is still in the early phases of work.

The full Senate has approved a 5-year reauthorization of the Medical Device User Fee Modernization Act as part of a legislative package that included reauthorization of the Prescription Drug User Fee Act.

MDUFMA is due to expire Sept. 30. The law governs how much manufacturers are expected to pay for review of their products and also sets out review timetables that the agency must meet.

The medical device industry was largely happy with the bill as passed.

“The agreement provides additional resources to [the Food and Drug Administration] to hire additional reviewers providing patients with access to safe, lifesaving medical devices in a timely manner,” AdvaMed President and CEO Stephen J. Ubl said in a statement.

“The agreement also provides manufacturers with a more predictable fee schedule with regard to user fee rates,” he said.

The device user fee portion of the bill is largely the result of an agreement hammered out earlier this year by the FDA and the industry.

In a briefing with reporters unveiling the specifics of the agreement, Dr. Jeffrey Shuren, the FDA's assistant director for policy, touted its “aggressive performance goals.”

Under current law, in fiscal year 2007, the FDA is required to make a decision on 90% of premarket approval applications (PMAs) within 320 days, and on 50% within 180 days.

With the new proposal, 60% of PMAs will be reviewed within 180 days, and 90% within 295 days in fiscal year 2008.

This year, 90% of priority PMAs are required to be reviewed within 300 days, and 80% of 510(k)s within 90 days. Under the new proposal, in fiscal year 2008, 90% of priority PMAs will be reviewed within 280 days, and 50% within 180 days. Ninety percent of 510(k)s will be reviewed within 90 days, and almost all—98%–-within 150 days.

Dr. Jesse Goodman, director of the FDA's Center for Biologics Evaluation and Research, said that the current law had expedited the division's review of devices for blood testing and transfusion, and for cellular therapies and tissues. Before the program, it took an average of 123 days to review an application; in 2006, the average was about 55 days, Dr. Goodman told reporters.

The agency also is proposing to streamline its review of diagnostic imaging devices and said it would publish draft guidance on the issue by October 2008. The FDA would also make more use of private, outside inspectors.

Currently, manufacturers have to go through a lengthy process to use third-party reviewers.

Under the new proposal, they'd only have to give 30 days' notice, and they would be allowed to use the reviewers for a larger number of inspections.

The FDA estimated that it will require $220 million to review devices in fiscal year 2008, of which it plans to raise about $49 million from user fees. Over the 5 years of the program, it will need $1.2 billion, of which $287 million will come from industry.

In the past 5 years, the agency has had to go back to manufacturers to seek supplemental increases when there was a shortfall—which occurred when there were fewer new device applications than had been anticipated.

If the new legislation becomes law, fees will be fixed for each year of the program. Half the fees will come from applications—for new devices, supplements, manufacturing modifications, and classification information—and half from two new fees: one for manufacturing establishments and single-device reprocessors, and a periodic annual report fee. About 425 devices are subject to annual reporting requirements.

The House is still weighing prescription drug and medical device user fee reauthorizations.

Both the House and the Senate must move quickly to avoid layoffs and interruptions at the FDA, which has become heavily dependent on industry user fees to finance its work.

Senate Reauthorizes Prescription Drug User Fee Act; House Still in Early Phases

After some last-minute wrangling over drug reimportation and regulation of advertising, the Senate voted 93–1 to fund another 5 years of the Prescription Drug User Fee Act.

Among other issues, PDUFA governs how much pharmaceutical manufacturers pay to have their products reviewed by the Food and Drug Administration, and how quickly the agency must complete those reviews. The current PDUFA law expires Sept. 30.

Some have criticized the program, saying that it lets a regulated industry have too much power over its regulators. But the FDA has become increasingly dependent on user fees to fund its work.

At least one amendment to the original legislation (S. 1082) was passed that would give the agency more teeth. Senators voted 64–30 to approve Sen. Chuck Grassley's (R-Iowa) amendment to increase fines—from $10,000 to $250,000—for companies that don't comply with FDA directives on label changes, postapproval studies, and communicating new information about safety.

The penalties would double every 30 days, but would be capped at $2 million.

“These penalties need to be more than just an insignificant cost of doing business in order to affect behavior,” said Sen. Grassley in a statement.

Drug safety has been a significant focus of the legislation as it has made its way through the Senate.

Sen. Edward Kennedy (D-Mass.) and Sen. Michael Enzi (R-Wy.) had been hoping to attach proposals for improved drug safety to the PDUFA reauthorization, but most of their suggestions were defeated or watered down in a committee vote in mid-April.

The centerpiece of their proposals was to require a risk evaluation and mitigation strategy (REMS) plan for all new chemical entities and biologics. Instead, the Senate Health, Education, Labor, and Pensions committee voted to give the FDA authority to determine when a new drug should have a REMS. That provision made it into the legislation that passed the full Senate. The panel also voted to require the FDA to set up a public-private partnership for routine surveillance of postmarketing drug safety, which also was part of the final bill.

PDUFA would allow the FDA to collect $393 million in drug user fees in 2008, including a $30 million increase for postapproval drug safety programs.

The bill would also require drug makers to publish a registry of all late-phase II, and all phase III and IV trials, and to make all trial results available in a public database.

Finally, PDUFA would fund another 5 years of the Best Pharmaceuticals for Children Act. Companies that conduct pediatric studies of their products are eligible for additional patent life under the law, which expires Oct. 1. The new 5-year program will extend a drug's patent life by 3 months (instead of 6 offered under the previous law) if sales of the product are more than $1 billion and by 6 months if sales are less than $1 billion.

Under the Best Pharmaceuticals for Children Act, the Government Accountability Office found that drug sponsors have initiated pediatric drug studies for most of the on-patent drugs for which the FDA has requested studies. About 87% of drugs studied had labeling changes, often because the pediatric drug studies found that children might have been exposed to ineffective drugs or dosing; overdosing; or previously unknown side effects.

The Senate vote was hailed by the brand name and generic pharmaceutical industries.

“The significant increases in user fees will provide the FDA the resources necessary to improve and modernize its already strong drug safety monitoring system,” PhRMA President and CEO Billy Tauzin said in a statement.

The generic industry was happy, as it secured a promise from a group of Senators to markup legislation authorizing generic copies of biologic drugs by mid-June, with a goal of incorporating it into the final House-Senate agreement on the PDUFA law.

The Generic Pharmaceutical Association also praised a group of senators who secured passage of an amendment requiring the FDA to move forward on generic drug applications even though a brand name company has filed a citizen's petition questioning the generic. In the past, the FDA has not been able to consider approval of a generic until the petition was resolved—and, filing a petition has become a common strategy used by the brand name industry, according to the GPhA.

The PDUFA legislation still has far to go before it becomes law. The House is still in the early phases of work.

WASHINGTON — Food and Drug Administration officials said in March that they have started several new initiatives in response to the Institute of Medicine's call to upgrade and overhaul its drug safety efforts. The projects, including a pilot project to more closely monitor the postmarketing safety of four new molecular entities and a plan to put more postmarketing data on the agency's Web site, were revealed at a meeting sponsored by the IOM.

In a September 2006 report that lambasted FDA's safety oversight, the IOM called on the agency to issue an interim report on selected drugs' postmarketing safety at least 18 months, and no longer than 5 years, after launch.

“I think 5 years is too late to find out what a drug is doing,” said Dr. Robert Temple, associate director for medical policy at the FDA.

The FDA's Center for Drug Evaluation and Research (CDER) has begun a pilot project with four new molecular entities to pull together all available data at 1, 2, and 3 years after launch. Officials will look at the Adverse Events Reporting System database, ongoing postmarketing studies, and other data to see how much can be learned about each particular drug at each time point, said Dr. Temple. He would not disclose which drugs are part of the pilot.

The FDA also plans to publish a newsletter on its Web site that will provide up-to-date information on a drug's postmarketing experience, said Dr. Ellis Unger, acting deputy director for science at CDER's Office of Surveillance and Epidemiology.

He promised a full accounting but noted that the agency will not disclose any proprietary information.

The IOM report also urged Congress to give the FDA greater and more precise enforcement powers, partly to compel pharmaceutical manufacturers to fulfill their commitments to gather postmarketing data.

Peter Barton Hutt, a former FDA general counsel and now senior counsel with Covington and Burling in Washington said that most companies comply with FDA requests because “industry is terrified of FDA.” Mr. Hutt said FDA had all the enforcement power it needed already. He argued that the agency did, however, need more funding outside of the user fees it collects.

FDA critics have said the agency is unduly beholden to industry because of user fees. Former FDA Deputy Commissioner Mary Pendergast noted that those fees were likely to make up 80% of the agency's drug review and safety budget if Congress did not provide additional money for fiscal 2007.

She also noted that as of fiscal 2006, companies had 1,632 pending postmarketing commitments. The number of studies being requested is on the rise, said Ms. Pendergast, noting that the average was 1.5 per approved drug before 2003 and 5 per approved drug in 2003–2004. In the most recent report to Congress (fiscal 2006), 63% of those studies had not been started, she said. The agency needs a better hammer to get those studies done, said Ms. Pendergast.

WASHINGTON — Food and Drug Administration officials said in March that they have started several new initiatives in response to the Institute of Medicine's call to upgrade and overhaul its drug safety efforts. The projects, including a pilot project to more closely monitor the postmarketing safety of four new molecular entities and a plan to put more postmarketing data on the agency's Web site, were revealed at a meeting sponsored by the IOM.

In a September 2006 report that lambasted FDA's safety oversight, the IOM called on the agency to issue an interim report on selected drugs' postmarketing safety at least 18 months, and no longer than 5 years, after launch.

“I think 5 years is too late to find out what a drug is doing,” said Dr. Robert Temple, associate director for medical policy at the FDA.

The FDA's Center for Drug Evaluation and Research (CDER) has begun a pilot project with four new molecular entities to pull together all available data at 1, 2, and 3 years after launch. Officials will look at the Adverse Events Reporting System database, ongoing postmarketing studies, and other data to see how much can be learned about each particular drug at each time point, said Dr. Temple. He would not disclose which drugs are part of the pilot.

The FDA also plans to publish a newsletter on its Web site that will provide up-to-date information on a drug's postmarketing experience, said Dr. Ellis Unger, acting deputy director for science at CDER's Office of Surveillance and Epidemiology.

He promised a full accounting but noted that the agency will not disclose any proprietary information.

The IOM report also urged Congress to give the FDA greater and more precise enforcement powers, partly to compel pharmaceutical manufacturers to fulfill their commitments to gather postmarketing data.

Peter Barton Hutt, a former FDA general counsel and now senior counsel with Covington and Burling in Washington said that most companies comply with FDA requests because “industry is terrified of FDA.” Mr. Hutt said FDA had all the enforcement power it needed already. He argued that the agency did, however, need more funding outside of the user fees it collects.

FDA critics have said the agency is unduly beholden to industry because of user fees. Former FDA Deputy Commissioner Mary Pendergast noted that those fees were likely to make up 80% of the agency's drug review and safety budget if Congress did not provide additional money for fiscal 2007.

She also noted that as of fiscal 2006, companies had 1,632 pending postmarketing commitments. The number of studies being requested is on the rise, said Ms. Pendergast, noting that the average was 1.5 per approved drug before 2003 and 5 per approved drug in 2003–2004. In the most recent report to Congress (fiscal 2006), 63% of those studies had not been started, she said. The agency needs a better hammer to get those studies done, said Ms. Pendergast.

WASHINGTON — Food and Drug Administration officials said in March that they have started several new initiatives in response to the Institute of Medicine's call to upgrade and overhaul its drug safety efforts. The projects, including a pilot project to more closely monitor the postmarketing safety of four new molecular entities and a plan to put more postmarketing data on the agency's Web site, were revealed at a meeting sponsored by the IOM.

In a September 2006 report that lambasted FDA's safety oversight, the IOM called on the agency to issue an interim report on selected drugs' postmarketing safety at least 18 months, and no longer than 5 years, after launch.

“I think 5 years is too late to find out what a drug is doing,” said Dr. Robert Temple, associate director for medical policy at the FDA.

The FDA's Center for Drug Evaluation and Research (CDER) has begun a pilot project with four new molecular entities to pull together all available data at 1, 2, and 3 years after launch. Officials will look at the Adverse Events Reporting System database, ongoing postmarketing studies, and other data to see how much can be learned about each particular drug at each time point, said Dr. Temple. He would not disclose which drugs are part of the pilot.

The FDA also plans to publish a newsletter on its Web site that will provide up-to-date information on a drug's postmarketing experience, said Dr. Ellis Unger, acting deputy director for science at CDER's Office of Surveillance and Epidemiology.

He promised a full accounting but noted that the agency will not disclose any proprietary information.

The IOM report also urged Congress to give the FDA greater and more precise enforcement powers, partly to compel pharmaceutical manufacturers to fulfill their commitments to gather postmarketing data.

Peter Barton Hutt, a former FDA general counsel and now senior counsel with Covington and Burling in Washington said that most companies comply with FDA requests because “industry is terrified of FDA.” Mr. Hutt said FDA had all the enforcement power it needed already. He argued that the agency did, however, need more funding outside of the user fees it collects.

FDA critics have said the agency is unduly beholden to industry because of user fees. Former FDA Deputy Commissioner Mary Pendergast noted that those fees were likely to make up 80% of the agency's drug review and safety budget if Congress did not provide additional money for fiscal 2007.

She also noted that as of fiscal 2006, companies had 1,632 pending postmarketing commitments. The number of studies being requested is on the rise, said Ms. Pendergast, noting that the average was 1.5 per approved drug before 2003 and 5 per approved drug in 2003–2004. In the most recent report to Congress (fiscal 2006), 63% of those studies had not been started, she said. The agency needs a better hammer to get those studies done, said Ms. Pendergast.

Physicians and other health care providers who fail to comply with the May 23 deadline to acquire and start using National Provider Identifiers will not be penalized if they can show they deployed a “contingency plan,” the Centers for Medicare and Medicaid Services announced.

“Covered entities that have been making a good faith effort to comply with the NPI provisions may, for up to 12 months, implement contingency plans that could include accepting legacy provider numbers on HIPAA transactions in order to maintain operations and cash flows,” said CMS Acting Administrator Leslie Norwalk in a statement.

The agency decided to create this grace period “after it became apparent that many covered entities would not be able to fully comply with the NPI standard” by the original deadline, Ms. Norwalk said. The new compliance guideline can be downloaded from the agency's Web site (http://www.cms.hhs.gov/NationalProvIdentStand

According to Dr. Joseph S. Eastern, a Belleville, N.J., dermatologist who lectures widely on practice management issues, one poorly understood aspect of the NPI transition is the “taxonomies,” or supplemental codes that categorize the scope of your office's clinical services. For more on taxonomy codes, visit http://codelists.wpc-edi.com/mambo_taxonomy_2.asp

To ensure a smooth transition for your practice, CMS lists seven steps:

1. Apply for an NPI at https://nppes.cms.hhs.gov.

2. Update your practice software, including billing applications, to incorporate your NPI.

3. Share your NPI with other providers, health plans, clearinghouses, and anyone else who may need it for billing purposes.

4. Communicate with all your health plans and clearinghouses; make sure they are all prepared for the NPI transition.

5. Test your systems to make sure they can process claims and any other HIPAA-related transactions with the NPI.

6. Educate your staff thoroughly on the NPI transition.

7. Implement use of your NPI in all your business practices.

Be sure to ask your software vendors to upgrade your system so that it incorporates your NPI, Dr. Eastern said.

Physicians and other health care providers who fail to comply with the May 23 deadline to acquire and start using National Provider Identifiers will not be penalized if they can show they deployed a “contingency plan,” the Centers for Medicare and Medicaid Services announced.

“Covered entities that have been making a good faith effort to comply with the NPI provisions may, for up to 12 months, implement contingency plans that could include accepting legacy provider numbers on HIPAA transactions in order to maintain operations and cash flows,” said CMS Acting Administrator Leslie Norwalk in a statement.

The agency decided to create this grace period “after it became apparent that many covered entities would not be able to fully comply with the NPI standard” by the original deadline, Ms. Norwalk said. The new compliance guideline can be downloaded from the agency's Web site (http://www.cms.hhs.gov/NationalProvIdentStand

According to Dr. Joseph S. Eastern, a Belleville, N.J., dermatologist who lectures widely on practice management issues, one poorly understood aspect of the NPI transition is the “taxonomies,” or supplemental codes that categorize the scope of your office's clinical services. For more on taxonomy codes, visit http://codelists.wpc-edi.com/mambo_taxonomy_2.asp

To ensure a smooth transition for your practice, CMS lists seven steps:

1. Apply for an NPI at https://nppes.cms.hhs.gov.

2. Update your practice software, including billing applications, to incorporate your NPI.

3. Share your NPI with other providers, health plans, clearinghouses, and anyone else who may need it for billing purposes.

4. Communicate with all your health plans and clearinghouses; make sure they are all prepared for the NPI transition.

5. Test your systems to make sure they can process claims and any other HIPAA-related transactions with the NPI.

6. Educate your staff thoroughly on the NPI transition.

7. Implement use of your NPI in all your business practices.

Be sure to ask your software vendors to upgrade your system so that it incorporates your NPI, Dr. Eastern said.

Physicians and other health care providers who fail to comply with the May 23 deadline to acquire and start using National Provider Identifiers will not be penalized if they can show they deployed a “contingency plan,” the Centers for Medicare and Medicaid Services announced.

“Covered entities that have been making a good faith effort to comply with the NPI provisions may, for up to 12 months, implement contingency plans that could include accepting legacy provider numbers on HIPAA transactions in order to maintain operations and cash flows,” said CMS Acting Administrator Leslie Norwalk in a statement.

The agency decided to create this grace period “after it became apparent that many covered entities would not be able to fully comply with the NPI standard” by the original deadline, Ms. Norwalk said. The new compliance guideline can be downloaded from the agency's Web site (http://www.cms.hhs.gov/NationalProvIdentStand

According to Dr. Joseph S. Eastern, a Belleville, N.J., dermatologist who lectures widely on practice management issues, one poorly understood aspect of the NPI transition is the “taxonomies,” or supplemental codes that categorize the scope of your office's clinical services. For more on taxonomy codes, visit http://codelists.wpc-edi.com/mambo_taxonomy_2.asp

To ensure a smooth transition for your practice, CMS lists seven steps:

1. Apply for an NPI at https://nppes.cms.hhs.gov.

2. Update your practice software, including billing applications, to incorporate your NPI.

3. Share your NPI with other providers, health plans, clearinghouses, and anyone else who may need it for billing purposes.

4. Communicate with all your health plans and clearinghouses; make sure they are all prepared for the NPI transition.

5. Test your systems to make sure they can process claims and any other HIPAA-related transactions with the NPI.

6. Educate your staff thoroughly on the NPI transition.

7. Implement use of your NPI in all your business practices.

Be sure to ask your software vendors to upgrade your system so that it incorporates your NPI, Dr. Eastern said.

WASHINGTON — Several individual physicians and professional organizations urged members of Congress to extend tax credits or deductions and small business loans to physicians who purchase information systems and to require Medicare to offer an incentive payment to physicians who make the move to electronic medical records.

Adopting electronic medical records (EMRs) can make practices more efficient, but the initial expense—both monetary and in staff training—can be devastating to small physician offices, the witnesses told the panel members at a House Small Business Subcommittee on Regulation, Healthcare and Trade hearing.

Subcommittee chairman Charles Gonzalez (D-Tex.) agreed that the federal government should give physicians some kind of financial carrot to invest in health information technology. “Right now there are inadequate incentives for health care providers to adopt many of these technologies,” he said.

“Without changes in the way we promote health IT, small physician practices will be left behind the technological curve, and as a result, patients will fail to benefit from the quality of care electronic health records provide,” added Mr. Gonzalez, who recently reintroduced his National Health Information Incentive Act. The bill was aimed at assisting smaller practices but would also direct Medicare to make add-on payments for office visits facilitated by EMRs.

The American College of Physicians has called for just such a payment for several years, Dr. Lynne Kirk, ACP president, said at the hearing.

Mr. Gonzalez also noted that the full Small Business Committee recently passed the Small Business Lending Improvements Act of 2007 (H.R. 1332). That bill would let small practices borrow from the Small Business Administration to finance information systems.

Coming up with the capital for health IT is particularly tough for smaller physician groups, Dr. Kirk noted. One 2006 study showed that only 13%–16% of solo practitioners had adopted health IT, she said. Small practices are the lifeblood of internal medicine, she said, adding that 20% of internists are in solo practices and 50% are in practices of five or fewer physicians.

Acquisition costs average $44,000 per physician and yearly upkeep amounts to about $8,500 per physician, according to a 2005 study published in Health Affairs, Dr. Kirk said.

To help defray both the initial investment and ongoing maintenance costs, ACP advocates an add-on payment from Medicare scaled to the complexity of the technology.

The initial capital costs could be offset by grants, loans, or tax credits from the federal government, Dr. Kirk said.

The lack of reimbursement for using health IT is a major obstacle to adoption, said Dr. Mark Leavitt, chairman of the Certification Commission for Healthcare Information Technology, a publicly funded agency that for the last year has been vetting hardware and software systems.

CCHIT has certified 57 office-based systems, he said. Some payers are now offering financial incentives to physicians who use these certified systems, Dr. Leavitt said. The Hawaii Medical Service Association (Blue Cross and Blue Shield of Hawaii) announced in November 2006 that it was setting aside $20 million to help individual physicians buy EMR systems, though it required those investments to be in CCHIT-certified systems.

Dr. Margaret Kelley, an obstetrician in a two-person practice with her father in San Antonio, said they had spent $100,000 to purchase an EMR system. Initially, the system devastated the practice's efficiency, said Dr. Kelley, who also spoke on behalf of the American College of Obstetricians and Gynecologists.

“It took our practice nearly 2 years to be able to accommodate as many patients as we could before we invested in our EMR system,” Dr. Kelley said. Even so, they would not consider returning to their old way of practice, noting that one of the biggest benefits has been the ability to access patient charts 24 hours a day, she said.

Similarly, Dr. David O. Shober said that buying and implementing an EMR system at his two-physician family practice has been draining but beneficial.

In 2004, the practice—then comprising four physicians and two offices—spent $200,000 to buy a system. Yearly costs have averaged $50,000-$60,000, said Dr. Shober, who is based in New Castle, Pa. The system has allowed the practice to create more thorough notes, standardize charts, and retrieve records easily and quickly.

But the physicians have run into obstacles, including the inability of their system to communicate with radiology centers and labs, and the refusal of many pharmacies in their community to accept an e-prescription, he said.

“The only way to provide incentives for the adoption of health IT is to provide financial assistance,” said Dr. Shober, adding that the federal government should make no-interest loans available.

Dr. Kevin Napier, an internist in a nine-physician family and internal medicine practice in Griffin, Ga., said that he and his colleagues had spent $400,000 for the purchase of a system and subsequent training since 2005.

The physicians are financing the system at a cost of $1,000 a month each, and their payments will continue for the next 3 years, he said.

There was a huge drop in patient volume and income the first year of implementation, but the benefits have outweighed the risks, Dr. Napier said.

WASHINGTON — Several individual physicians and professional organizations urged members of Congress to extend tax credits or deductions and small business loans to physicians who purchase information systems and to require Medicare to offer an incentive payment to physicians who make the move to electronic medical records.

Adopting electronic medical records (EMRs) can make practices more efficient, but the initial expense—both monetary and in staff training—can be devastating to small physician offices, the witnesses told the panel members at a House Small Business Subcommittee on Regulation, Healthcare and Trade hearing.

Subcommittee chairman Charles Gonzalez (D-Tex.) agreed that the federal government should give physicians some kind of financial carrot to invest in health information technology. “Right now there are inadequate incentives for health care providers to adopt many of these technologies,” he said.

“Without changes in the way we promote health IT, small physician practices will be left behind the technological curve, and as a result, patients will fail to benefit from the quality of care electronic health records provide,” added Mr. Gonzalez, who recently reintroduced his National Health Information Incentive Act. The bill was aimed at assisting smaller practices but would also direct Medicare to make add-on payments for office visits facilitated by EMRs.

The American College of Physicians has called for just such a payment for several years, Dr. Lynne Kirk, ACP president, said at the hearing.

Mr. Gonzalez also noted that the full Small Business Committee recently passed the Small Business Lending Improvements Act of 2007 (H.R. 1332). That bill would let small practices borrow from the Small Business Administration to finance information systems.

Coming up with the capital for health IT is particularly tough for smaller physician groups, Dr. Kirk noted. One 2006 study showed that only 13%–16% of solo practitioners had adopted health IT, she said. Small practices are the lifeblood of internal medicine, she said, adding that 20% of internists are in solo practices and 50% are in practices of five or fewer physicians.

Acquisition costs average $44,000 per physician and yearly upkeep amounts to about $8,500 per physician, according to a 2005 study published in Health Affairs, Dr. Kirk said.

To help defray both the initial investment and ongoing maintenance costs, ACP advocates an add-on payment from Medicare scaled to the complexity of the technology.

The initial capital costs could be offset by grants, loans, or tax credits from the federal government, Dr. Kirk said.

The lack of reimbursement for using health IT is a major obstacle to adoption, said Dr. Mark Leavitt, chairman of the Certification Commission for Healthcare Information Technology, a publicly funded agency that for the last year has been vetting hardware and software systems.

CCHIT has certified 57 office-based systems, he said. Some payers are now offering financial incentives to physicians who use these certified systems, Dr. Leavitt said. The Hawaii Medical Service Association (Blue Cross and Blue Shield of Hawaii) announced in November 2006 that it was setting aside $20 million to help individual physicians buy EMR systems, though it required those investments to be in CCHIT-certified systems.

Dr. Margaret Kelley, an obstetrician in a two-person practice with her father in San Antonio, said they had spent $100,000 to purchase an EMR system. Initially, the system devastated the practice's efficiency, said Dr. Kelley, who also spoke on behalf of the American College of Obstetricians and Gynecologists.

“It took our practice nearly 2 years to be able to accommodate as many patients as we could before we invested in our EMR system,” Dr. Kelley said. Even so, they would not consider returning to their old way of practice, noting that one of the biggest benefits has been the ability to access patient charts 24 hours a day, she said.

Similarly, Dr. David O. Shober said that buying and implementing an EMR system at his two-physician family practice has been draining but beneficial.

In 2004, the practice—then comprising four physicians and two offices—spent $200,000 to buy a system. Yearly costs have averaged $50,000-$60,000, said Dr. Shober, who is based in New Castle, Pa. The system has allowed the practice to create more thorough notes, standardize charts, and retrieve records easily and quickly.

But the physicians have run into obstacles, including the inability of their system to communicate with radiology centers and labs, and the refusal of many pharmacies in their community to accept an e-prescription, he said.

“The only way to provide incentives for the adoption of health IT is to provide financial assistance,” said Dr. Shober, adding that the federal government should make no-interest loans available.

Dr. Kevin Napier, an internist in a nine-physician family and internal medicine practice in Griffin, Ga., said that he and his colleagues had spent $400,000 for the purchase of a system and subsequent training since 2005.

The physicians are financing the system at a cost of $1,000 a month each, and their payments will continue for the next 3 years, he said.

There was a huge drop in patient volume and income the first year of implementation, but the benefits have outweighed the risks, Dr. Napier said.

WASHINGTON — Several individual physicians and professional organizations urged members of Congress to extend tax credits or deductions and small business loans to physicians who purchase information systems and to require Medicare to offer an incentive payment to physicians who make the move to electronic medical records.

Adopting electronic medical records (EMRs) can make practices more efficient, but the initial expense—both monetary and in staff training—can be devastating to small physician offices, the witnesses told the panel members at a House Small Business Subcommittee on Regulation, Healthcare and Trade hearing.

Subcommittee chairman Charles Gonzalez (D-Tex.) agreed that the federal government should give physicians some kind of financial carrot to invest in health information technology. “Right now there are inadequate incentives for health care providers to adopt many of these technologies,” he said.

“Without changes in the way we promote health IT, small physician practices will be left behind the technological curve, and as a result, patients will fail to benefit from the quality of care electronic health records provide,” added Mr. Gonzalez, who recently reintroduced his National Health Information Incentive Act. The bill was aimed at assisting smaller practices but would also direct Medicare to make add-on payments for office visits facilitated by EMRs.

The American College of Physicians has called for just such a payment for several years, Dr. Lynne Kirk, ACP president, said at the hearing.

Mr. Gonzalez also noted that the full Small Business Committee recently passed the Small Business Lending Improvements Act of 2007 (H.R. 1332). That bill would let small practices borrow from the Small Business Administration to finance information systems.

Coming up with the capital for health IT is particularly tough for smaller physician groups, Dr. Kirk noted. One 2006 study showed that only 13%–16% of solo practitioners had adopted health IT, she said. Small practices are the lifeblood of internal medicine, she said, adding that 20% of internists are in solo practices and 50% are in practices of five or fewer physicians.

Acquisition costs average $44,000 per physician and yearly upkeep amounts to about $8,500 per physician, according to a 2005 study published in Health Affairs, Dr. Kirk said.

To help defray both the initial investment and ongoing maintenance costs, ACP advocates an add-on payment from Medicare scaled to the complexity of the technology.

The initial capital costs could be offset by grants, loans, or tax credits from the federal government, Dr. Kirk said.

The lack of reimbursement for using health IT is a major obstacle to adoption, said Dr. Mark Leavitt, chairman of the Certification Commission for Healthcare Information Technology, a publicly funded agency that for the last year has been vetting hardware and software systems.

CCHIT has certified 57 office-based systems, he said. Some payers are now offering financial incentives to physicians who use these certified systems, Dr. Leavitt said. The Hawaii Medical Service Association (Blue Cross and Blue Shield of Hawaii) announced in November 2006 that it was setting aside $20 million to help individual physicians buy EMR systems, though it required those investments to be in CCHIT-certified systems.

Dr. Margaret Kelley, an obstetrician in a two-person practice with her father in San Antonio, said they had spent $100,000 to purchase an EMR system. Initially, the system devastated the practice's efficiency, said Dr. Kelley, who also spoke on behalf of the American College of Obstetricians and Gynecologists.

“It took our practice nearly 2 years to be able to accommodate as many patients as we could before we invested in our EMR system,” Dr. Kelley said. Even so, they would not consider returning to their old way of practice, noting that one of the biggest benefits has been the ability to access patient charts 24 hours a day, she said.

Similarly, Dr. David O. Shober said that buying and implementing an EMR system at his two-physician family practice has been draining but beneficial.

In 2004, the practice—then comprising four physicians and two offices—spent $200,000 to buy a system. Yearly costs have averaged $50,000-$60,000, said Dr. Shober, who is based in New Castle, Pa. The system has allowed the practice to create more thorough notes, standardize charts, and retrieve records easily and quickly.

But the physicians have run into obstacles, including the inability of their system to communicate with radiology centers and labs, and the refusal of many pharmacies in their community to accept an e-prescription, he said.

“The only way to provide incentives for the adoption of health IT is to provide financial assistance,” said Dr. Shober, adding that the federal government should make no-interest loans available.

Dr. Kevin Napier, an internist in a nine-physician family and internal medicine practice in Griffin, Ga., said that he and his colleagues had spent $400,000 for the purchase of a system and subsequent training since 2005.

The physicians are financing the system at a cost of $1,000 a month each, and their payments will continue for the next 3 years, he said.

There was a huge drop in patient volume and income the first year of implementation, but the benefits have outweighed the risks, Dr. Napier said.

Pfizer Beats Lipitor Challenges

The U.S. Supreme Court has declined to take action on Ranbaxy Laboratories Ltd.'s appeal of a lower court ruling that upheld Pfizer's patent for Lipitor (atorvastatin). The U.S. District Court for the District of Delaware ruled in late 2005 that Lipitor's two patents—due to expire in 2010 and 2011—were valid, and that Ranbaxy's marketing a generic before 2011, as planned, would constitute infringement. Ranbaxy's appeal of the ruling was declined by the Supreme Court in early April. As a result, Lipitor—the world's top-selling drug, with sales of about $13 billion in 2006—is protected from generic competition until 2011. Pfizer also recently sued Ranbaxy, India's largest drug company, to block its efforts to sell a generic version of Caduet (amlodipine/atorvastatin). Finally, Pfizer has won an injunction against sales of Ranbaxy's generic Lipitor in Denmark.

FDA Posts Postapproval Study Data

All postmarketing studies of medical devices ordered by the Food and Drug Administration since January 2005 are now listed on an FDA Web site, the agency reported. The site gives the manufacturer's name and the name of the product being studied, and includes a short description of the trial. It also shows whether a company is submitting required updates to the FDA, but it does not reveal any data, such as interim findings. “Electronic access will give the public an opportunity to see progress being made on a company's postmarket commitments,” said Dr. Daniel Schultz, director of the agency's Center for Devices and Radiological Health, in a statement. The data site is

www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfPMA/pma_pas.cfm

Skirting Self-Referral on Imaging

A study published online in the journal Health Affairs said that many physicians are finding ways to skirt a Medicare law—known as Stark II—that prohibits most referrals to facilities in which they have an ownership interest. Using data from a large California-based insurer, Jean Mitchell, a professor of public policy at Georgetown University, found that 33% of providers who billed for magnetic resonance imaging (MRI), 22% who billed for computed tomography (CT), and 17% of those who billed for positron emission tomography (PET) were technically self-referring. A majority—61% of MRI billers and 64% of CT billers—did not own the equipment but had lease or payment-per-scan arrangements that would violate federal and state antikickback statutes, said Ms. Mitchell.

ACC Update on Stents for Patients

The American College of Cardiology has published a one-page patient information update on stents. The page notes that only a patient and a physician can decide if a stent is necessary and appropriate for that particular patient. It goes on to outline several points patients should keep in mind, including that stents do not cure coronary artery disease, that all stents reduce symptoms of heart disease, that coated stents are more effective in preventing recurrent blockage, and that it is important to follow a cardiologist's recommendations on taking anticlotting agents such as aspirin, clopidogrel, and ticlopidine. The update can be found on ACC's Web site,

www.acc.org

Angiomax Patent Relief?

The Medicines Co. is seeking congressional intervention again to extend the patent on its anticoagulant Angiomax (bivalirudin), due to expire in 2010. The company missed the deadline for filing a 5-year extension application by 1 day in 2000, and has been seeking to have it rectified since, primarily through the U.S. Patent Office. However, last month, Rep. Duncan Delahunt (D-Mass.) reintroduced a bill to allow the Patent Office to accept unintentionally late filings.

CMS Softens NPI Stance

Physicians and other health care providers who fail to comply with the May 23 deadline to acquire and start using National Provider Identifiers will not be penalized if they can show they deployed a “contingency plan,” the Centers for Medicare and Medicaid Services announced. “Covered entities that have been making a good faith effort to comply with the NPI provisions may, for up to 12 months, implement contingency plans that could include accepting legacy provider numbers on HIPAA transactions in order to maintain operations and cash flows,” said CMS Acting Administrator Leslie Norwalk in a statement. The agency decided to create this grace period “after it became apparent that many covered entities would not be able to fully comply with the NPI standard” by the original deadline, Ms. Norwalk said. The new compliance guideline can be downloaded from the agency's Web site (

http://www.cms.hhs.gov/NationalProvIdentStand

1 in 3 Physicians Now Female

A major demographic shift is underway in medicine as female physicians become more numerous, and this trend will influence the way medical groups recruit and retain physicians throughout their career cycles, according to the 2006 Retention Survey from the American Medical Group Association and Cejka Search, an executive search organization. In 2006, female physicians accounted for 35% of physicians employed in the medical groups responding to the survey, compared with 28% in the previous survey. The study revealed that factors such as “poor cultural fit” and family issues are the driving forces in physician turnover. Part-time and flexible work options also are growing in importance, the survey found.

Pfizer Beats Lipitor Challenges

The U.S. Supreme Court has declined to take action on Ranbaxy Laboratories Ltd.'s appeal of a lower court ruling that upheld Pfizer's patent for Lipitor (atorvastatin). The U.S. District Court for the District of Delaware ruled in late 2005 that Lipitor's two patents—due to expire in 2010 and 2011—were valid, and that Ranbaxy's marketing a generic before 2011, as planned, would constitute infringement. Ranbaxy's appeal of the ruling was declined by the Supreme Court in early April. As a result, Lipitor—the world's top-selling drug, with sales of about $13 billion in 2006—is protected from generic competition until 2011. Pfizer also recently sued Ranbaxy, India's largest drug company, to block its efforts to sell a generic version of Caduet (amlodipine/atorvastatin). Finally, Pfizer has won an injunction against sales of Ranbaxy's generic Lipitor in Denmark.

FDA Posts Postapproval Study Data

All postmarketing studies of medical devices ordered by the Food and Drug Administration since January 2005 are now listed on an FDA Web site, the agency reported. The site gives the manufacturer's name and the name of the product being studied, and includes a short description of the trial. It also shows whether a company is submitting required updates to the FDA, but it does not reveal any data, such as interim findings. “Electronic access will give the public an opportunity to see progress being made on a company's postmarket commitments,” said Dr. Daniel Schultz, director of the agency's Center for Devices and Radiological Health, in a statement. The data site is

www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfPMA/pma_pas.cfm

Skirting Self-Referral on Imaging

A study published online in the journal Health Affairs said that many physicians are finding ways to skirt a Medicare law—known as Stark II—that prohibits most referrals to facilities in which they have an ownership interest. Using data from a large California-based insurer, Jean Mitchell, a professor of public policy at Georgetown University, found that 33% of providers who billed for magnetic resonance imaging (MRI), 22% who billed for computed tomography (CT), and 17% of those who billed for positron emission tomography (PET) were technically self-referring. A majority—61% of MRI billers and 64% of CT billers—did not own the equipment but had lease or payment-per-scan arrangements that would violate federal and state antikickback statutes, said Ms. Mitchell.

ACC Update on Stents for Patients

The American College of Cardiology has published a one-page patient information update on stents. The page notes that only a patient and a physician can decide if a stent is necessary and appropriate for that particular patient. It goes on to outline several points patients should keep in mind, including that stents do not cure coronary artery disease, that all stents reduce symptoms of heart disease, that coated stents are more effective in preventing recurrent blockage, and that it is important to follow a cardiologist's recommendations on taking anticlotting agents such as aspirin, clopidogrel, and ticlopidine. The update can be found on ACC's Web site,

www.acc.org

Angiomax Patent Relief?

The Medicines Co. is seeking congressional intervention again to extend the patent on its anticoagulant Angiomax (bivalirudin), due to expire in 2010. The company missed the deadline for filing a 5-year extension application by 1 day in 2000, and has been seeking to have it rectified since, primarily through the U.S. Patent Office. However, last month, Rep. Duncan Delahunt (D-Mass.) reintroduced a bill to allow the Patent Office to accept unintentionally late filings.

CMS Softens NPI Stance

Physicians and other health care providers who fail to comply with the May 23 deadline to acquire and start using National Provider Identifiers will not be penalized if they can show they deployed a “contingency plan,” the Centers for Medicare and Medicaid Services announced. “Covered entities that have been making a good faith effort to comply with the NPI provisions may, for up to 12 months, implement contingency plans that could include accepting legacy provider numbers on HIPAA transactions in order to maintain operations and cash flows,” said CMS Acting Administrator Leslie Norwalk in a statement. The agency decided to create this grace period “after it became apparent that many covered entities would not be able to fully comply with the NPI standard” by the original deadline, Ms. Norwalk said. The new compliance guideline can be downloaded from the agency's Web site (

http://www.cms.hhs.gov/NationalProvIdentStand

1 in 3 Physicians Now Female

A major demographic shift is underway in medicine as female physicians become more numerous, and this trend will influence the way medical groups recruit and retain physicians throughout their career cycles, according to the 2006 Retention Survey from the American Medical Group Association and Cejka Search, an executive search organization. In 2006, female physicians accounted for 35% of physicians employed in the medical groups responding to the survey, compared with 28% in the previous survey. The study revealed that factors such as “poor cultural fit” and family issues are the driving forces in physician turnover. Part-time and flexible work options also are growing in importance, the survey found.

Pfizer Beats Lipitor Challenges

The U.S. Supreme Court has declined to take action on Ranbaxy Laboratories Ltd.'s appeal of a lower court ruling that upheld Pfizer's patent for Lipitor (atorvastatin). The U.S. District Court for the District of Delaware ruled in late 2005 that Lipitor's two patents—due to expire in 2010 and 2011—were valid, and that Ranbaxy's marketing a generic before 2011, as planned, would constitute infringement. Ranbaxy's appeal of the ruling was declined by the Supreme Court in early April. As a result, Lipitor—the world's top-selling drug, with sales of about $13 billion in 2006—is protected from generic competition until 2011. Pfizer also recently sued Ranbaxy, India's largest drug company, to block its efforts to sell a generic version of Caduet (amlodipine/atorvastatin). Finally, Pfizer has won an injunction against sales of Ranbaxy's generic Lipitor in Denmark.

FDA Posts Postapproval Study Data

All postmarketing studies of medical devices ordered by the Food and Drug Administration since January 2005 are now listed on an FDA Web site, the agency reported. The site gives the manufacturer's name and the name of the product being studied, and includes a short description of the trial. It also shows whether a company is submitting required updates to the FDA, but it does not reveal any data, such as interim findings. “Electronic access will give the public an opportunity to see progress being made on a company's postmarket commitments,” said Dr. Daniel Schultz, director of the agency's Center for Devices and Radiological Health, in a statement. The data site is

www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfPMA/pma_pas.cfm

Skirting Self-Referral on Imaging

A study published online in the journal Health Affairs said that many physicians are finding ways to skirt a Medicare law—known as Stark II—that prohibits most referrals to facilities in which they have an ownership interest. Using data from a large California-based insurer, Jean Mitchell, a professor of public policy at Georgetown University, found that 33% of providers who billed for magnetic resonance imaging (MRI), 22% who billed for computed tomography (CT), and 17% of those who billed for positron emission tomography (PET) were technically self-referring. A majority—61% of MRI billers and 64% of CT billers—did not own the equipment but had lease or payment-per-scan arrangements that would violate federal and state antikickback statutes, said Ms. Mitchell.

ACC Update on Stents for Patients

The American College of Cardiology has published a one-page patient information update on stents. The page notes that only a patient and a physician can decide if a stent is necessary and appropriate for that particular patient. It goes on to outline several points patients should keep in mind, including that stents do not cure coronary artery disease, that all stents reduce symptoms of heart disease, that coated stents are more effective in preventing recurrent blockage, and that it is important to follow a cardiologist's recommendations on taking anticlotting agents such as aspirin, clopidogrel, and ticlopidine. The update can be found on ACC's Web site,

www.acc.org

Angiomax Patent Relief?

The Medicines Co. is seeking congressional intervention again to extend the patent on its anticoagulant Angiomax (bivalirudin), due to expire in 2010. The company missed the deadline for filing a 5-year extension application by 1 day in 2000, and has been seeking to have it rectified since, primarily through the U.S. Patent Office. However, last month, Rep. Duncan Delahunt (D-Mass.) reintroduced a bill to allow the Patent Office to accept unintentionally late filings.

CMS Softens NPI Stance

Physicians and other health care providers who fail to comply with the May 23 deadline to acquire and start using National Provider Identifiers will not be penalized if they can show they deployed a “contingency plan,” the Centers for Medicare and Medicaid Services announced. “Covered entities that have been making a good faith effort to comply with the NPI provisions may, for up to 12 months, implement contingency plans that could include accepting legacy provider numbers on HIPAA transactions in order to maintain operations and cash flows,” said CMS Acting Administrator Leslie Norwalk in a statement. The agency decided to create this grace period “after it became apparent that many covered entities would not be able to fully comply with the NPI standard” by the original deadline, Ms. Norwalk said. The new compliance guideline can be downloaded from the agency's Web site (

http://www.cms.hhs.gov/NationalProvIdentStand

1 in 3 Physicians Now Female

A major demographic shift is underway in medicine as female physicians become more numerous, and this trend will influence the way medical groups recruit and retain physicians throughout their career cycles, according to the 2006 Retention Survey from the American Medical Group Association and Cejka Search, an executive search organization. In 2006, female physicians accounted for 35% of physicians employed in the medical groups responding to the survey, compared with 28% in the previous survey. The study revealed that factors such as “poor cultural fit” and family issues are the driving forces in physician turnover. Part-time and flexible work options also are growing in importance, the survey found.

The Senate Health, Education, Labor and Pensions Committee has voted to fund another 5 years of the Best Pharmaceuticals for Children Act.

Companies that conduct pediatric studies of their products are eligible for additional patent life under the law, which expires Oct. 1.

The new 5-year program will extend a drug's patent life by 3 months if sales of the product are more than $1 billion and by 6 months if sales are less than $1 billion.

An amendment to strip the patent-life-extensions was defeated.

Under the Best Pharmaceuticals for Children Act, the Government Accountability Office found that drug sponsors have initiated pediatric drug studies for most of the on-patent drugs for which the Food and Drug Administration has requested studies.

About 87% of drugs studied had labeling changes, often because the pediatric drug studies found that children might have been exposed to ineffective drugs or dosing, overdosing, or previously unknown side effects.

The federal government can order manufacturers to conduct pediatric studies, but that almost never happens because the bureaucratic hurdles for making such a request are so high, according to the Health, Education, Labor and Pensions (HELP) committee, so an amendment was added to streamline the process.

In other drug matters, the HELP panel completed its version of the 5-year reauthorization of the Prescription Drug User Fee and Modernization Act, but generally without any restrictions on drug advertising or a requirement that most drugs have a risk management program—proposals that had been championed by Committee Chairman Edward Kennedy (D-Mass.) and his colleague Sen. Michael Enzi (R-Wyo.).

The two senators had been hoping to attach their proposals for improved drug safety to the Prescription Drug User Fee and Modernization Act (PDUFA) reauthorization, but most of their suggestions were defeated or watered down in committee.

The centerpiece of their bill was the risk evaluation and mitigation strategy (REMS) plan, which would have been required for all new chemical entities and biologics.

Instead the HELP committee voted to give Food and Drug Administration authority to determine when a new drug should have a REMS. The panel also voted to require FDA to set up a public-private partnership for routine surveillance of postmarketing drug safety.

The bill “establishes a new way to oversee drug safety that is flexible enough to be tailored to each new drug, yet strong enough to allow decisive action when problems are discovered,” Sen. Kennedy said in a statement.

According to a statement by Sen. Enzi, the bill gives the FDA explicit new authority in the postmarketing area—which critics say the agency does not now have.

“Right now, the FDA has its hands tied behind its back when it tries to manage the risks of drugs already on the market.

“This bill will clarify and strengthen the FDA's authority and give it new tools to take measured and appropriate steps to protect the health and safety of Americans, when the agency's postmarket surveillance signals potential dangers from a drug or therapy,” he said. “Pulling a drug from the market and denying patients who need it should not be the only tool available to the FDA.”

As passed by the Senate panel, PDUFA would allow the FDA to collect $393 million in drug user fees in 2008, including a $30 million increase for postapproval drug safety programs.

The bill would also require drugmakers to publish a registry of all late-phase II, phase III, and phase IV trials, and to make all trial results available in a public database.

The PDUFA legislation still has far to go before it becomes law. The Senate package will now go to the floor for a vote, and the House is still in the early phases of work, with the Energy and Commerce Health Subcommittee continuing to hold hearings.

The Senate Health, Education, Labor and Pensions Committee has voted to fund another 5 years of the Best Pharmaceuticals for Children Act.

Companies that conduct pediatric studies of their products are eligible for additional patent life under the law, which expires Oct. 1.

The new 5-year program will extend a drug's patent life by 3 months if sales of the product are more than $1 billion and by 6 months if sales are less than $1 billion.

An amendment to strip the patent-life-extensions was defeated.

Under the Best Pharmaceuticals for Children Act, the Government Accountability Office found that drug sponsors have initiated pediatric drug studies for most of the on-patent drugs for which the Food and Drug Administration has requested studies.

About 87% of drugs studied had labeling changes, often because the pediatric drug studies found that children might have been exposed to ineffective drugs or dosing, overdosing, or previously unknown side effects.

The federal government can order manufacturers to conduct pediatric studies, but that almost never happens because the bureaucratic hurdles for making such a request are so high, according to the Health, Education, Labor and Pensions (HELP) committee, so an amendment was added to streamline the process.

In other drug matters, the HELP panel completed its version of the 5-year reauthorization of the Prescription Drug User Fee and Modernization Act, but generally without any restrictions on drug advertising or a requirement that most drugs have a risk management program—proposals that had been championed by Committee Chairman Edward Kennedy (D-Mass.) and his colleague Sen. Michael Enzi (R-Wyo.).

The two senators had been hoping to attach their proposals for improved drug safety to the Prescription Drug User Fee and Modernization Act (PDUFA) reauthorization, but most of their suggestions were defeated or watered down in committee.

The centerpiece of their bill was the risk evaluation and mitigation strategy (REMS) plan, which would have been required for all new chemical entities and biologics.

Instead the HELP committee voted to give Food and Drug Administration authority to determine when a new drug should have a REMS. The panel also voted to require FDA to set up a public-private partnership for routine surveillance of postmarketing drug safety.

The bill “establishes a new way to oversee drug safety that is flexible enough to be tailored to each new drug, yet strong enough to allow decisive action when problems are discovered,” Sen. Kennedy said in a statement.

According to a statement by Sen. Enzi, the bill gives the FDA explicit new authority in the postmarketing area—which critics say the agency does not now have.

“Right now, the FDA has its hands tied behind its back when it tries to manage the risks of drugs already on the market.

“This bill will clarify and strengthen the FDA's authority and give it new tools to take measured and appropriate steps to protect the health and safety of Americans, when the agency's postmarket surveillance signals potential dangers from a drug or therapy,” he said. “Pulling a drug from the market and denying patients who need it should not be the only tool available to the FDA.”

As passed by the Senate panel, PDUFA would allow the FDA to collect $393 million in drug user fees in 2008, including a $30 million increase for postapproval drug safety programs.

The bill would also require drugmakers to publish a registry of all late-phase II, phase III, and phase IV trials, and to make all trial results available in a public database.

The PDUFA legislation still has far to go before it becomes law. The Senate package will now go to the floor for a vote, and the House is still in the early phases of work, with the Energy and Commerce Health Subcommittee continuing to hold hearings.

The Senate Health, Education, Labor and Pensions Committee has voted to fund another 5 years of the Best Pharmaceuticals for Children Act.

Companies that conduct pediatric studies of their products are eligible for additional patent life under the law, which expires Oct. 1.

The new 5-year program will extend a drug's patent life by 3 months if sales of the product are more than $1 billion and by 6 months if sales are less than $1 billion.

An amendment to strip the patent-life-extensions was defeated.

Under the Best Pharmaceuticals for Children Act, the Government Accountability Office found that drug sponsors have initiated pediatric drug studies for most of the on-patent drugs for which the Food and Drug Administration has requested studies.

About 87% of drugs studied had labeling changes, often because the pediatric drug studies found that children might have been exposed to ineffective drugs or dosing, overdosing, or previously unknown side effects.

The federal government can order manufacturers to conduct pediatric studies, but that almost never happens because the bureaucratic hurdles for making such a request are so high, according to the Health, Education, Labor and Pensions (HELP) committee, so an amendment was added to streamline the process.

In other drug matters, the HELP panel completed its version of the 5-year reauthorization of the Prescription Drug User Fee and Modernization Act, but generally without any restrictions on drug advertising or a requirement that most drugs have a risk management program—proposals that had been championed by Committee Chairman Edward Kennedy (D-Mass.) and his colleague Sen. Michael Enzi (R-Wyo.).

The two senators had been hoping to attach their proposals for improved drug safety to the Prescription Drug User Fee and Modernization Act (PDUFA) reauthorization, but most of their suggestions were defeated or watered down in committee.

The centerpiece of their bill was the risk evaluation and mitigation strategy (REMS) plan, which would have been required for all new chemical entities and biologics.

Instead the HELP committee voted to give Food and Drug Administration authority to determine when a new drug should have a REMS. The panel also voted to require FDA to set up a public-private partnership for routine surveillance of postmarketing drug safety.

The bill “establishes a new way to oversee drug safety that is flexible enough to be tailored to each new drug, yet strong enough to allow decisive action when problems are discovered,” Sen. Kennedy said in a statement.

According to a statement by Sen. Enzi, the bill gives the FDA explicit new authority in the postmarketing area—which critics say the agency does not now have.

“Right now, the FDA has its hands tied behind its back when it tries to manage the risks of drugs already on the market.

“This bill will clarify and strengthen the FDA's authority and give it new tools to take measured and appropriate steps to protect the health and safety of Americans, when the agency's postmarket surveillance signals potential dangers from a drug or therapy,” he said. “Pulling a drug from the market and denying patients who need it should not be the only tool available to the FDA.”

As passed by the Senate panel, PDUFA would allow the FDA to collect $393 million in drug user fees in 2008, including a $30 million increase for postapproval drug safety programs.

The bill would also require drugmakers to publish a registry of all late-phase II, phase III, and phase IV trials, and to make all trial results available in a public database.

The PDUFA legislation still has far to go before it becomes law. The Senate package will now go to the floor for a vote, and the House is still in the early phases of work, with the Energy and Commerce Health Subcommittee continuing to hold hearings.

WASHINGTON — Several individual physicians and professional organizations urged members of Congress to extend tax credits or deductions and small business loans to physicians who purchase information systems and to require Medicare to offer an incentive payment to physicians who make the move to electronic medical records.

Adopting electronic medical records (EMRs) can make practices more efficient, but the initial expense—both monetary and in staff training—can be devastating to small physician offices, the witnesses told the panel members at a House Small Business Subcommittee on Regulation, Healthcare and Trade hearing.

Subcommittee chairman Charles Gonzalez (D-Tex.) agreed that the federal government should give physicians some kind of financial carrot to invest in health information technology.

“Right now there are inadequate incentives for health care providers to adopt many of these technologies,” Rep. Gonzalez said.

“Without changes in the way we promote health IT, small physician practices will be left behind the technological curve, and as a result, patients will fail to benefit from the quality of care electronic health records provide,” added Mr. Gonzalez, who recently reintroduced his National Health Information Incentive Act. The bill was aimed at assisting smaller practices but would also direct Medicare to make add-on payments for office visits facilitated by EMRs.

The American College of Physicians has called for just such a payment for several years, Dr. Lynne Kirk, ACP president, said at the hearing.

Mr. Gonzalez also noted that the full Small Business Committee recently passed the Small Business Lending Improvements Act of 2007 (H.R. 1332). That bill would let small practices borrow from the Small Business Administration to finance information systems.

Coming up with the capital for health IT is particularly tough for smaller physician groups, Dr. Kirk noted. One 2006 study showed that only 13%–16% of solo practitioners had adopted health IT, she said.

Small practices are the lifeblood of internal medicine, she said, adding that 20% of internists are in solo practices and 50% are in practices of five or fewer physicians.

Acquisition costs average $44,000 per physician and yearly upkeep amounts to about $8,500 per physician, according to a 2005 study published in Health Affairs, Dr. Kirk said. To help defray both the initial investment and ongoing maintenance costs, ACP advocates an add-on payment from Medicare scaled to the complexity of the technology. The initial capital costs could be offset by grants, loans, or tax credits from the federal government, Dr. Kirk said.

The lack of reimbursement for using health IT is a major obstacle to adoption, said Dr. Mark Leavitt, chairman of the Certification Commission for Healthcare Information Technology (CCHIT), a publicly funded agency that has been vetting hardware and software systems.

CCHIT has certified 57 office-based systems, he said. Some payers are now offering financial incentives to physicians who use these certified systems, Dr. Leavitt said. The Hawaii Medical Service Association (Blue Cross and Blue Shield of Hawaii) announced in November 2006 that it was setting aside $20 million to help individual physicians buy EMR systems, though it required those investments to be in CCHIT-certified systems.

WASHINGTON — Several individual physicians and professional organizations urged members of Congress to extend tax credits or deductions and small business loans to physicians who purchase information systems and to require Medicare to offer an incentive payment to physicians who make the move to electronic medical records.

Adopting electronic medical records (EMRs) can make practices more efficient, but the initial expense—both monetary and in staff training—can be devastating to small physician offices, the witnesses told the panel members at a House Small Business Subcommittee on Regulation, Healthcare and Trade hearing.

Subcommittee chairman Charles Gonzalez (D-Tex.) agreed that the federal government should give physicians some kind of financial carrot to invest in health information technology.

“Right now there are inadequate incentives for health care providers to adopt many of these technologies,” Rep. Gonzalez said.

“Without changes in the way we promote health IT, small physician practices will be left behind the technological curve, and as a result, patients will fail to benefit from the quality of care electronic health records provide,” added Mr. Gonzalez, who recently reintroduced his National Health Information Incentive Act. The bill was aimed at assisting smaller practices but would also direct Medicare to make add-on payments for office visits facilitated by EMRs.

The American College of Physicians has called for just such a payment for several years, Dr. Lynne Kirk, ACP president, said at the hearing.

Mr. Gonzalez also noted that the full Small Business Committee recently passed the Small Business Lending Improvements Act of 2007 (H.R. 1332). That bill would let small practices borrow from the Small Business Administration to finance information systems.

Coming up with the capital for health IT is particularly tough for smaller physician groups, Dr. Kirk noted. One 2006 study showed that only 13%–16% of solo practitioners had adopted health IT, she said.

Small practices are the lifeblood of internal medicine, she said, adding that 20% of internists are in solo practices and 50% are in practices of five or fewer physicians.

Acquisition costs average $44,000 per physician and yearly upkeep amounts to about $8,500 per physician, according to a 2005 study published in Health Affairs, Dr. Kirk said. To help defray both the initial investment and ongoing maintenance costs, ACP advocates an add-on payment from Medicare scaled to the complexity of the technology. The initial capital costs could be offset by grants, loans, or tax credits from the federal government, Dr. Kirk said.

The lack of reimbursement for using health IT is a major obstacle to adoption, said Dr. Mark Leavitt, chairman of the Certification Commission for Healthcare Information Technology (CCHIT), a publicly funded agency that has been vetting hardware and software systems.

CCHIT has certified 57 office-based systems, he said. Some payers are now offering financial incentives to physicians who use these certified systems, Dr. Leavitt said. The Hawaii Medical Service Association (Blue Cross and Blue Shield of Hawaii) announced in November 2006 that it was setting aside $20 million to help individual physicians buy EMR systems, though it required those investments to be in CCHIT-certified systems.

WASHINGTON — Several individual physicians and professional organizations urged members of Congress to extend tax credits or deductions and small business loans to physicians who purchase information systems and to require Medicare to offer an incentive payment to physicians who make the move to electronic medical records.

Adopting electronic medical records (EMRs) can make practices more efficient, but the initial expense—both monetary and in staff training—can be devastating to small physician offices, the witnesses told the panel members at a House Small Business Subcommittee on Regulation, Healthcare and Trade hearing.

Subcommittee chairman Charles Gonzalez (D-Tex.) agreed that the federal government should give physicians some kind of financial carrot to invest in health information technology.

“Right now there are inadequate incentives for health care providers to adopt many of these technologies,” Rep. Gonzalez said.

“Without changes in the way we promote health IT, small physician practices will be left behind the technological curve, and as a result, patients will fail to benefit from the quality of care electronic health records provide,” added Mr. Gonzalez, who recently reintroduced his National Health Information Incentive Act. The bill was aimed at assisting smaller practices but would also direct Medicare to make add-on payments for office visits facilitated by EMRs.

The American College of Physicians has called for just such a payment for several years, Dr. Lynne Kirk, ACP president, said at the hearing.

Mr. Gonzalez also noted that the full Small Business Committee recently passed the Small Business Lending Improvements Act of 2007 (H.R. 1332). That bill would let small practices borrow from the Small Business Administration to finance information systems.

Coming up with the capital for health IT is particularly tough for smaller physician groups, Dr. Kirk noted. One 2006 study showed that only 13%–16% of solo practitioners had adopted health IT, she said.

Small practices are the lifeblood of internal medicine, she said, adding that 20% of internists are in solo practices and 50% are in practices of five or fewer physicians.

Acquisition costs average $44,000 per physician and yearly upkeep amounts to about $8,500 per physician, according to a 2005 study published in Health Affairs, Dr. Kirk said. To help defray both the initial investment and ongoing maintenance costs, ACP advocates an add-on payment from Medicare scaled to the complexity of the technology. The initial capital costs could be offset by grants, loans, or tax credits from the federal government, Dr. Kirk said.

The lack of reimbursement for using health IT is a major obstacle to adoption, said Dr. Mark Leavitt, chairman of the Certification Commission for Healthcare Information Technology (CCHIT), a publicly funded agency that has been vetting hardware and software systems.

CCHIT has certified 57 office-based systems, he said. Some payers are now offering financial incentives to physicians who use these certified systems, Dr. Leavitt said. The Hawaii Medical Service Association (Blue Cross and Blue Shield of Hawaii) announced in November 2006 that it was setting aside $20 million to help individual physicians buy EMR systems, though it required those investments to be in CCHIT-certified systems.

WASHINGTON — The first study of emergency Medicaid expenditures for illegal immigrants shows that childbirth is the most expensive component. However, at least in North Carolina, that expense amounted to less than 1% of the state's Medicaid budget, showing that state and federal authorities are not pouring huge amounts of dollars into providing care for undocumented immigrants, Dr. C. Annette DuBard, the study's lead author, said at a media briefing presented by the Journal of the American Medical Association.

With debate growing over whether states should pay for illegal immigrants' health care, Dr. DuBard, a research associate at the University of North Carolina at Chapel Hill and Dr. Mark W. Massing of the Carolinas Center for Medical Excellence in Cary, N.C., set out to document the expenditures. They published their results in a special issue of JAMA devoted to access to care issues (JAMA 2007;297:1085–92).

North Carolina experienced a 274% increase in its foreign-born population during the 1990s. From 2001 to 2004, 48,000 undocumented immigrants received emergency Medicaid services in North Carolina. Overall, spending rose from $41 million in 2001 to $53 million in 2004.

Childbirth and complications of pregnancy accounted for 86% of total expenditures in 2001, dropping to 82% in 2004. Given that most children born to illegal immigrants are granted citizenship, it “calls into question the rationale of excluding this population from comprehensive contraceptive and prenatal care coverage,” the authors said.

Eight states provide coverage for prenatal care under the State Children's Health Insurance Program and five other states cover prenatal care regardless of immigration status, according to the authors.

WASHINGTON — The first study of emergency Medicaid expenditures for illegal immigrants shows that childbirth is the most expensive component. However, at least in North Carolina, that expense amounted to less than 1% of the state's Medicaid budget, showing that state and federal authorities are not pouring huge amounts of dollars into providing care for undocumented immigrants, Dr. C. Annette DuBard, the study's lead author, said at a media briefing presented by the Journal of the American Medical Association.

With debate growing over whether states should pay for illegal immigrants' health care, Dr. DuBard, a research associate at the University of North Carolina at Chapel Hill and Dr. Mark W. Massing of the Carolinas Center for Medical Excellence in Cary, N.C., set out to document the expenditures. They published their results in a special issue of JAMA devoted to access to care issues (JAMA 2007;297:1085–92).

North Carolina experienced a 274% increase in its foreign-born population during the 1990s. From 2001 to 2004, 48,000 undocumented immigrants received emergency Medicaid services in North Carolina. Overall, spending rose from $41 million in 2001 to $53 million in 2004.

Childbirth and complications of pregnancy accounted for 86% of total expenditures in 2001, dropping to 82% in 2004. Given that most children born to illegal immigrants are granted citizenship, it “calls into question the rationale of excluding this population from comprehensive contraceptive and prenatal care coverage,” the authors said.

Eight states provide coverage for prenatal care under the State Children's Health Insurance Program and five other states cover prenatal care regardless of immigration status, according to the authors.

WASHINGTON — The first study of emergency Medicaid expenditures for illegal immigrants shows that childbirth is the most expensive component. However, at least in North Carolina, that expense amounted to less than 1% of the state's Medicaid budget, showing that state and federal authorities are not pouring huge amounts of dollars into providing care for undocumented immigrants, Dr. C. Annette DuBard, the study's lead author, said at a media briefing presented by the Journal of the American Medical Association.

With debate growing over whether states should pay for illegal immigrants' health care, Dr. DuBard, a research associate at the University of North Carolina at Chapel Hill and Dr. Mark W. Massing of the Carolinas Center for Medical Excellence in Cary, N.C., set out to document the expenditures. They published their results in a special issue of JAMA devoted to access to care issues (JAMA 2007;297:1085–92).

North Carolina experienced a 274% increase in its foreign-born population during the 1990s. From 2001 to 2004, 48,000 undocumented immigrants received emergency Medicaid services in North Carolina. Overall, spending rose from $41 million in 2001 to $53 million in 2004.

Childbirth and complications of pregnancy accounted for 86% of total expenditures in 2001, dropping to 82% in 2004. Given that most children born to illegal immigrants are granted citizenship, it “calls into question the rationale of excluding this population from comprehensive contraceptive and prenatal care coverage,” the authors said.

Eight states provide coverage for prenatal care under the State Children's Health Insurance Program and five other states cover prenatal care regardless of immigration status, according to the authors.