In a letter to the Centers for Medicare & Medicaid Services (CMS) Acting Administrator Andy Slavitt on Friday, Department of Health and Human Services (HHS) Inspector General Daniel Levinson calls on CMS to work with the Accredited Standards Committee (ASC) X12 to incorporate unique device identifiers (UDIs) for implantable devices into insurance claims forms.
According to Levinson, doing so could help CMS keep track of the costs associated with recalled and defective medical devices and improve patient safety.
The letter comes just months after Slavitt and FDA Commissioner Robert Califf wrote to ASC X12 Chair Gary Beatty urging the committee to incorporate UDIs into the next version the claims forms, which are set to be proposed on 1 December 2016.
Congress first required the US Food and Drug Administration (FDA) to implement a system for UDIs in the 2007 Food and Drug Administration Amendments Act. Despite some challenges to rolling out UDIs on FDA's side, one of the biggest battles has been over whether to incorporate the identifiers into insurance claims forms.
Advocates for incorporating UDI into claims forms argue that the resulting data could make it easier to track the performance and safety of medical device. However, medical device industry group AdvaMed has opposed incorporating UDI into claims forms, saying that doing so would be "costly [and] pose significant challenges."
HHS OIG Review
When questioned by Senators Elizabeth Warren (D-MA) and Charles Grassley (R-IA) last year, Levinson was unable to come up with exact figures for how much Medicare had spent on failed or recalled devices, but estimated the figure was likely in the billions.
However, Levinson now says that a preliminary review into Medicare spending on failed or recalled medical devices has found the program has spent $1.5 billion on services and procedures for just seven implantable cardiac devices that were recalled or had high failure rates.
"Our ongoing review shows that the lack of medical- device-specific information in the claims data impedes the ability of the Centers for Medicare & Medicaid Services to readily identify and effectively track Medicare's total costs related to the replacement of recalled or defective devices," Levinson writes.
In order to arrive at the $1.5 billion figure, Levinson says his office had to resort to "complex audit procedures and the time-consuming process of obtaining and reviewing device recipients' medical records." By incorporating UDIs into claims forms, Levinson says that Medicare could significantly cut its costs and identify issues with specific devices more quickly.
"We believe that CMS should collaborate with the Accredited Standards Committee X12 to include the device identifier (DI) portion of the Unique Device Identifier (UDI) for implantable devices on the next version of the claims forms," Levinson writes. The DI, which identifies only the specific version or model of a device and its labeler.
Levinson also goes one step further by suggesting that eventually, claims forms should incorporate the production identifier (PI), which indicates more granular information about a device, such as its lot or batch, serial number, expiration date or manufacturing date.
"We believe that including the PI portion(s) of the UDI on the claim forms could also help identify and track Medicare's aggregate costs related to recalled or defective devices and would provide patient safety benefits by enabling the identification of specific batches and lots of recalled devices," Levinson writes.