Understanding "Reimbursement" in the Medical Device Industry

S

SmokeMonster

#1
Hi All,

I'm relatively new to Medical Devices. I've looking to understand "reimbursement" . I've googled it but it's difficult but I've not found anything that explains it satisfactorily.

What I need is a definition forst of all, then a description of the process. I'm aware this is different depending on the country but let's say the UK for now.

Any help would be appreciated.
 
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ScottK

Not out of the crisis
Staff member
Super Moderator
#2
I did some googling and it seems to me that the reimbursement thing is more of a Finance issue that QA. It has to do with getting your CE marked product approved by the government at a specified price, for which they reimburse you. And it's based on the country, not the EU as a whole.

Anyone else have any feedback on this?
 
M

MedDev2011

#3
Reimbursement has to do with how much money a health care professional can receive for use of a particular device. Generally, reimbursement in a country is related to the type of health care available. If it is government sponsored (many European countries) then there is a level of reimbursement set for a technology/device by a branch of the government.
For the UK specifically, there is often a technology appraisal performed by National Institute for Health and Clinical Excellence (NICE). NICE works with the National Health Service (NHS) to provide clinical guidelines and technical evaluations. Generally, a positive technical evaluation by NICE leads to reimbursement (and a lack of reimbursement for a negative evaluation). If a similar technology exists in a country, then the reimbursement level is usually already set. For many European countries, if a new technology is introduced, no one can get paid for using the technology if there is no reimbursement level set.
In other countries, sometimes the level of reimbursement is lower for a similar product that is #2 to the market, lower for product #3 to the market, etc.
Assistance can often be found with a good physician advocate in the country or other in-country person who has been working in the industry.
Hope that helps!
 
M

MIREGMGR

#4
I can't speak to UK practices or any EU system, but in the general case, note that there are two ways of structuring a reimbursement system: reimbursement for use of a particular product, and reimbursement of a set amount for the entire process of treating-to-completion a diagnosed condition.

The first type of system operates as already described. Some system experts consider that system-type to result in over-use of devices by a few participants so as to increase their reimbursement.

The second type of system is based on total-treatment reimbursements that are about equal to the average cost of a number of audited treatment-courses for a given condition. This reimbursement amount of course over-reimburses if the care provider has lower costs, and under-reimburses for higher costs, so it powerfully motivates the care provider to not over-prescribe, not waste anything, and adopt minimum-cost processes. Some argue that it de-motivates patient-focused care in order to minimize costs.

USA currently has a diverse system of care for privately insured individuals, operated by many separate insurance companies using disparate rules, but mostly of the second type in general. USA has a government-funded reimbursement system for care provided to individuals who are eligible for Medicaid/Medicare, i.e. persons over the age of 62 and/or (in some cases) unable to afford adequate care themselves. This system is kind of a hybrid right now, but supposedly is transitioning to the second system-approach. USA also may be moving toward a much broader government-funded reimbursement system for most working age individuals and children. If that system is implemented, it's probably going to be the second system-type from inception.
 
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