New Technology: Can We Afford It?

1. New Technology: Can We Afford It? Eastern Orthopaedic Association New Orleans, October 2016 Thomas P. Sculco, M.D. Hospital for Special Surgery

2. Disclosure: Royalty, Exactech Corporation

3. Short History of Medicine and Technology

4. In medicine we have made a great deal of progress…..

5. 2000 B.C. “Here, eat this root”

6. 1000 B.C. “That root is heathen, say this prayer”

7. 1300 A.D. “That prayer is superstition, take this potion”

8. 1920 A.D. “That potion is snake oil, take this pill”

9. 1950 A.D. “That pill is ineffective, take this antibiotic”

10. 2016 A.D. “That antibiotic is artificial, eat this root”

11. What are the forces in joint replacement at work today?

12. The Demographic Environment

13. Currently > 1 million Total Hip and Knee Replacements performed yearly in U.S.

14. The demand for joint replacement will increase significantly

15. Factors leading to growth TJA • Population growth • Younger patients undergoing replacement • More patients have health insurance • Less fear and apprehension about the procedure

16. U.S. Aging Population In 2026 : 37 % increase > 65 yo

17. Joint Replacement projections in 2030 174 % increase THR 674% increase TKR Kurtz,S et al. JBJS, 2007 r

18. Growth of Knee Replacement in Sweden

19. The Economic Environment

20. ..

22. Costs not sustainable

23. CMS shifting away from fee for service 30 % bundled payment 50 % 2026 ? 100 %

24. How do the forces of technology and cost interplay?

25. Health Care Cost vs GNP New or increased use of technology adds 40-50% cost annually Callahan, D. Hastings Institute , 2012

26. Health Care Cost vs GNP ½ cost increase due to technology

27. “If you want to constrain costs, you have to restrain the growth of technology” Mark Pauley, Chairman Health Care Systems Department, Wharton School of Business

28. “The trade-offs between incremental improvement and the additional costs (of technology)…are poorly understood and seldom investigated rigorously…” N.Engl J Med, 2011

29. Technology has been a powerful force in the Evolution of joint replacement

30. The evolution of joint replacement has been bumpy…

31. There has been the good, and the ugly…

36. Implant design has improved through technology

37. Fact #1 Long term data of current hip and knee designs demonstrate 90-95% success rates at 15-20 year follow-up

38. Swedish Registry 2014

40. 15 year compression molded PE

41. Today there has been a maturation of implant technology Many time proven designs available with outstanding long term results

42. Fact #2 Patients demand for new technology does influence selection

43. Demand for New Technology Direct to consumer marketing Internet Embedded in American medical culture: latest is best

44. Patient Demands • Anterior hip approach • PRP, stem cell injections • Verilast implant (Billy Jean King) • Female knee

45. New Technology “Patients expect it, doctors are trained to use it, the medical industries make billions selling it and the media love to write about it. “ Callahan,D. Co-founder, President Hastings Center

46. The economic and social incentives to develop and diffuse it are powerful, and the disincentives so far are weak and almost helpless.”Callahan,D Co-founder, President, Hastings Center

47. The Current Health Care System “provides misaligned incentives that create over-utilization or mis- utilization of everything that’s new” Uwe Reinhardt, Health Care Economist, 2008

48. Fact # 3 New Technology in joint replacement is expensive

49. What is the Cost/Benefit Analysis of New Technology Increasingly the question will be:

50. Need to evaluate the comparative effectiveness of emerging and existing technologies and price the new in a way that reflects their incremental value Uwe Reinhardt