If a hobbyist can build a prototype ECG in a garage for just $5, but major manufacturers like HP or Welch-Allyn sell professional ECGs for $1,500-$12,000, then something is wrong with medical device pricing. I am definitely not saying that, should I end up in the ER, I want to see my neighbor’s 15-year-old son hacking together my ECG with a bread board and soldering iron. But what is reasonable?
Real-time monitoring devices that are invaluable for many patients at high risk are astronomically expensive when they should be cheap and ubiquitous. If Amazon can make the Kindle for $300, then someone can certainly make a real-time vitals monitoring device that can go anywhere for less…am I wrong? Certainly there are many legitimate expenses regarding certification, testing, compliance with FDA standards and approval etc., but ECGs (in some form) have been around since 1872. Why haven’t the costs come down more over time? Is the answer lack of competition?
Medical devices are a regulated market under the FDA, but there are no cost controls. Critics of cost controls point out that they deter investment in promising technology, stifling innovation. This might be true, but the way the medical device market works now is comparable to a de facto monopoly, in some cases. For highly specialized and expensive equipment, very few companies actually produce the devices, allowing them to charge exorbitant prices in their competition-free environment. There has to be a way to control costs and at the same time foster innovation.
If the process was approached like generic drug approval, costs could be reduced significantly. As detailed in a previous post, the approval of generic drugs does not require the full-scale testing requirements of initial drug approval. Rather, the manufacturer has to show the drug is chemically and biological equivalent to the previously approved version. An analogous process could be used in medical device approval. If manufacturers could use existing approved designs, the approval process would be much simpler. Of course, the patent system would need to be changed for this to work, but that change would be less harmful to innovation than imposing cost control measures.
Read about the $5 ECG here and this site promoting an Open Source ECG. Also, check out this page to learn more about over-priced medical devices.