This month's headlines
 

A Lodge for All Seasons. While your 2010 Annual Conference Committee fine-tunes the agenda for the upcoming conference, to be held May 16-18, in Keystone, Colo., this might be a good time for you and your family to begin planning your trip to the Rockies. 'We have got to get it together.' Past President Shawn Walker calls on industry to work together to draw up some standards for vendor credentialing, in letter to materials management magazine. IMDA member finds that docs open doors. Credibility is a must when selling innovative medical devices and equipment. Even more so when that sale must be made to the C suite. Grandview Medical's Kevin Trout is using doctors to help open some doors.

Keystone Resort, Colorado site of the 2010 Annual Conference

The vendor credentialing tug-of-war. Editorial in the Journal of Healthcare Contracting calls for a commonsense, bipartisan approach to the vendor credentialing issue, and commends the work of the Healthcare Industry Supply Chain Institute to try to quantify the cost to the industry of credentialing.

Trends in cardiovascular therapies. A significant amount of new device development is occurring in the areas of vascular medicine,  interventional cardiology, endovascular medicine and structural heart disease. But truly revolutionary technology, or what is called "disruptive technology," is not expected to be introduced until the end of 2011.
 

Annual Conference A Lodge for All Seasons

IMDA members who come for the Golf Tournament, which begins at 9 a.m. on Sunday, May 16, will experience the par-71, Hurdzan-Fry course. The par-35 front nine is oriented around the path of the Snake River, and the par-36 back nine winds through a lodgepole pine forest. Impressive elevation changes, variable bunkers, water hazards, and five sets of tees on each hole combine to challenge golfers of all abilities. The 16th hole features a 194-foot elevation drop from tee to green, and the scenic 18th hole offers 12 bunkers and spectacular views of Lake Dillon.

Down to business

The Conference will begin with an opening session at 3:30 p.m. on Sunday, May 16, and will end at 12 noon on Tuesday, May 18. The Manufacturers Forum -- the industry's only gathering place for manufacturers of innovative medical technology and specialty sales and marketing organizations -- will be open for a total of six hours throughout the Conference. Here's a look at the Conference schedule.

Sunday, May 16

• 9 a.m.: IMDA golf tournament.
• 4 p.m.: Opening session. Attendee introductions, manufacturer introductions, and sharing of the important business issues they are addressing.
• 5 to 7 p.m.: Manufacturers Forum and Welcome Reception.

Monday, May 17

• 7 a.m.: Continental breakfast.
• 8 to 10 a.m.: Keynote presentation, "Reinventing the Specialty Sales and Marketing Organization," by Gerry Layo.
• 12 to 2 p.m.: Manufacturers Forum and Lunch.
• 2 to 3:30 p.m. Brainstorming session: How can IMDA members re-invent themselves to remain relevant and profitable in the decade ahead.
• 3:45 to 5:15 p.m.: Member-led breakout sessions on selected topics.
• 6 to 7:30 p.m.: Manufacturers Forum and Reception.
• 7:30 to 10 p.m.: Awards Dinner.

Tuesday, May 18

• 7:30 a.m.: Continental breakfast/Annual business meeting.
• 8:30 to 10 a.m.: Member-led breakout sessions.
• 10:15 to 12: Closing session.

Stay tuned to IMDA Update and your e-mailbox for more details.

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Will the "universal passport" -- which would give vendor sales reps access to all hospitals and assign risk to vendors based on the data gathered about them -- ever become reality? Probably not, according to a couple of vendor credentialing firms interviewed in a recent article in Healthcare Purchasing News. ("Data standards for vendor reps debatable," February 2010.) Hospitals want to do their own thing, and nobody can stop them, according to the two, from Vendormate and Status Blue.

But that still doesn't mean it's a bad idea and not worth pursuing, according to IMDA Past President and vendor credentialing expert Shawn Walker.

Walker took some time to respond in writing to the article. "Clearly, there is a not a 'one-size-fits-all' diagnosis that a vendor credentialing company can use to identify risk in the supply chain," she wrote. Nevertheless, "[m]aterials managers and suppliers should work together to get standards in place now," she wrote. "Now that Joint Commission has unequivocally stated that it is bowing out of the vendor credentialing morass, it falls to the rest of us to get together and try to make some sense out of an out-of-control process."

Here is the text of Walker's letter:

To the Editor:

I read with interest your article on the potential for -- and wisdom of -- vendor-credentialing standards ("Data standards for vendor reps debatable"). If hospitals could agree on the information they require of their vendors, costs for everyone in the supply chain would be reduced. As your sources point out, however, that's a tall order if no one resolves to lead the charge.

As president (and now past-president) of IMDA, the association for specialty sales and marketing companies, I have been quite involved in the vendor-credentialing issue. Last year, IMDA was part of a consortium of associations -- including AHRMM, AORN, AdvaMed, HIGPA and others -- that hammered out recommended standards for the credentialing of "clinical" sales reps, that is, those who call on areas in close proximity to patients receiving treatment. Unfortunately, AHRMM withdrew its support for this document at the last moment. But the other organizations have stood by it. (To see the document, go to www.IMDA.org and click on the vendor credentialing box.)

As the people you interviewed point out, there's no way standards can be legislated or pushed down materials managers' throats. Even if it were possible to enforce, it seems inconceivable that any one metric could "measure up" an organization's financial viability/ability to provide products & services.

If this were possible, I feel certain that Wall Street would have had much more visibility to our current economic crisis WELL in advance of it's coming to pass. Alas, such is not the case. Conversely, millions of us successfully fly all over the globe everyday on bankrupt airlines. Clearly, there is not a "one-size-fits-all" diagnosis that a vendor credentialing company can use to identify risk in the supply chain.

That said, we believe that it is in the best interest of all players in the supply chain to bring some order to this process. IMDA members -- many of which are small companies -- incur huge costs in terms of dollars and time to meet the many, varied, credentialing requirements of all our customers. I know of at least one major US manufacturer who spent $1 million in 2009 on vendor credentialing. Due to these credentials artificially "expiring" after one year, they will no doubt spend at least another $1 million in 2010.

We're heartened that the Healthcare Industry Supply Chain Institute -- a sister organization to the Health Industry Group Purchasing Association -- has commissioned a study to try to attach a dollar amount to today's vendor credentialing activities. We believe HISCI will find the amount to be in the hundreds of millions of dollars.

Hospitals admit that ultimately, these fees will be more likely than not to get passed along to them in the form of price increases. This benefits no one, as there is no discernable increase in patient safety or quality of care as a result of all this expenditure.

If voluntary standards were to be put in place, we believe that a system not unlike that of today's credit reporting system -- mentioned several times in your article -- could take shape. Vendors could register with these companies once, and hospital supply chain executives could scan proof of credentialing on demand, or reps could show a "Vendor Passport" that would enable them to get a badge.

Materials managers and suppliers should work together to get standards in place now. To wait until the industry adopts electronic health records, as one of the people you spoke to suggested, would be wasting an opportunity to improve efficiency in the supply chain. Indeed, the argument for delaying standardization in this area seems only to serve the cottage industry that vendor credentialing has become. The rest of us -- hospitals, distributors and manufacturers alike -- end up paying more and more as the chaos continues.

Now that Joint Commission has unequivocally stated that it is bowing out of the vendor credentialing morass, it falls to the rest of us to get together and try to make some sense out of an out-of-control process. I implore you and your members to come up with a national standard -- similar to a Code of Ethics -- which your members would embrace and enforce. There are many organizations in this industry who would happily work with you to achieve this goal in a timely and cost-effective basis.

Thank you.

Shawn Walker
Partner
Bay State Anesthesia
North Andover, Mass.

IMDA Announcement Refer a member and get $50 Every time IMDA gains a member, our collective voice grows louder, our collective wisdom becomes greater, and our collective influence in the market grows. It's good for everyone. And there's no better source for new members than current ones. After all, you know the market, you know the people. That's why IMDA is offering members $50 for every new member who joins as a result of your referral. So when you're walking the floor at your next trade show, or taking a break at your next sales meeting, keep an eye out for companies that might benefit by joining IMDA. Collect business cards and send them to headquarters. Fifty bucks is nice. But the added wisdom, knowledge and camaraderie that a new member brings are even greater payoffs.

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Credibility is a must when selling innovative medical devices and equipment. Even more so when that sale must be made to the C suite. But even the most skillful specialty sales rep won't get a chance to demonstrate his or her credibility if the healthcare executive won't see them. Sometimes they need help.

Last year, Kevin Trout of Grandview Medical Resources decided to get help, in the form of a company called Doctor to Doctor Sales Solutions. Based in Denver, Colo., Doctor to Doctor is a prospecting company with a twist: It uses physicians to make the first contact with provider executives, including C suite executives as well as other physicians, and to provide an entrée for the specialty distributor rep. Its CEO is Steven Deitch, M.D., and its president is Mark Brumer, MPH, RD.

IMDA Announcement Looking for lines? View a list of all medical devices receiving FDA marketing clearance in January by visiting the FDA Website. You might find a company in need of your expertise.

Guinea pig

After listening to 2009 IMDA Annual Conference keynote speaker Joe Flower, Trout resolved to make more efforts to reach the C suite to sell a new piece of equipment. That's why, when he got a call from Doctor to Doctor (presumably because of his position as IMDA president), he was intrigued. "I told them I was willing to be a guinea pig," he says. And he's glad he did. "We'll probably sell anywhere from half a million to three-quarters of a million dollars this year as a result of their effort."

The process is simple, but it does require a high level of organization and coordination between Doctor to Doctor and the specialty distributor. Step 1 was to educate (by phone) Doctor to Doctor on the equipment, with emphasis on its cost-saving potential, favorable clinical outcomes, and differentiating factors vis a vis the competition. Together, Grandview and Doctor to Doctor mapped out how the latter would approach providers, including how to handle objections.

Step 2 was to provide Doctor to Doctor a database of 172 hospitals targeted by Grandview. For each one, Grandview provided the names of key executives, as well as the name of the Grandview rep associated with the account.

Grandview's reps and Doctor to Doctor share a calendar, so that when Doctor to Doctor makes a phone call, it can set up an appointment on the spot, confident that the rep can make the call. "It's difficult enough to make an appointment with someone in the C level," says Trout. "You don't want to have to go and reschedule it."

Trout pays Doctor to Doctor a nominal monthly fee, as well as a commission on sales that can be directly attributed to Doctor to Doctor's efforts. In turn, Doctor to Doctor agrees to get Grandview reps between five and seven face-to-face meetings a month. Thus far, they have delivered.

Reps onboard

"My reps love it," says Trout. "These guys have been phenomenal in getting some of the C level people we would never have had access to. And we have very good salespeople." What's more, in most cases, the Grandview rep ends up meeting with a team of people, including C suite executives and key department heads, such as infection control or patient safety. Because the C suite is the primary decision-maker on the product, neither Doctor to Doctor nor Grandview have ruffled materials managers' feathers. "At some point, we'll be driven to purchasing to negotiate price," says Trout.

Trout went into the agreement with Doctor to Doctor on a six-month trial basis. But he was so pleased with the results, that he is renewing the agreement on a month-by-month basis. (At press time, Doctor to Doctor was still working through the list of 172 hospitals.)

"They're really good people, and they're really good at selling to the C level," says Trout. "Not only did they impress me, but they impressed my salespeople too. You can't believe how enthusiastic [sales reps] become after just a few meetings have been set up. And if your salespeople buy into it, it's a winner."

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An editorial in the February edition of the Journal of Healthcare Contracting calls for a common sense, bipartisan approach to the vendor credentialing issue. The editorial points to the work of the Healthcare Industry Supply Chain Institute to quantify the cost to vendors of vendor credentialing. It also commends Terumo Medical Corp. Director of Health Systems Integration Marty Miller -- who heads the HISCI task force -- for calling for vendor credentialing standards.

Here is the editorial, titled "The vendor credentialing tug-of-war."

Seems like the vendor credentialing issue becomes more of a tug-of-war every day. As providers demand more, vendors push back harder. While providers make their case for the need for credentialing, vendors wish the whole thing would go away. Isn't there any middle ground, any win-win? One group trying to find it is the Healthcare Industry Supply Chain Institute.

HISCI is the sister organization of the Health Industry Group Purchasing Association; it is comprised of suppliers and GPOs, and its chief mission is supply chain education. It was created in January 2007 after the group purchasing industry decided its lobbying organization should comprise only GPOs, not suppliers.

Not long after it was created, some of HISCI's members urged that it get involved in vendor credentialing. One was Marty Miller, director, health systems integration, Terumo Medical Corp. Already, in 2007, Miller could see that as hospitals' demands of their vendors grew, so too would the costs incurred by vendors. At some point, he reasoned, vendors would rebel. Hence, the potential for litigation. Roughly a year later, Miller accepted a request to chair a HISCI committee on vendor credentialing.

One of the committee's first tasks was to try to quantify the costs associated with vendor credentialing. It has engaged an outside consultant to conduct such a study, which is ongoing. It seems a good place to start, though, as Miller points out, no matter what numbers that consultant arrives at, they probably will be disputed by providers. Even so, perhaps having some raw numbers on the table might help both sides begin a more serious, solution-oriented discussion about vendor credentialing.

Miller has some other sensible ideas about credentialing. He believes that providers and suppliers can come together on the issue by applying some of the same principles that form the basis of successful manufacturer/GPO relationships -- agreed-upon standards of performance, some kind of safeguards (insurance) to guarantee that performance, and the ability to audit performance.

Of the three, setting standards may be the most far-reaching. And in that regard, suppliers and providers are on the same side of the fence when it comes to vendor credentialing, says Miller. For example, both can agree that the safety of the patient is paramount, and that such things as vaccinations and criminal background checks aren't unreasonable. What's more, both can agree that sales reps shouldn't be training physicians on their devices and equipment unless they themselves have a high level of education specific to those products.

Auditability is important too, Miller points out. GPOs are in a good position to make sure, for example, that manufacturers are, indeed, training their sales reps on the equipment that they sell.

Despite the common ground, the supply side and sell side have some huge differences to iron out. The problem is, if the industry doesn't come to any agreement, all sides will end up paying. As Miller says, "Anyone who has taken one high school economics class learned that the cost of making a product and selling it add up to product price."

"This is a case where leadership needs to occur," says Miller. Maybe HISCI can provide it. If they can't, who will?

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A significant amount of new device development is occurring in the areas of vascular medicine, interventional cardiology, endovascular medicine and structural heart disease. But truly revolutionary technology, or what is called "disruptive technology," is not expected to be introduced until the end of 2011. That's the assessment of the cardiology team of Novation, the Irving, Texas-based purchasing group owned by VHA and the University HealthSystem Consortium.

The Novation cardiology team recently published a review of innovations in the fields of cardiovascular and peripheral vascular technology, which they viewed at the 2009 Vascular InterVentional Advances (VIVA 09) meeting and the 2009 Transcatheter Cardiovascular Therapeutics Symposium (TCT 2009). Among the innovations reviewed are:

• Cardiovascular devices (e.g., bioabsorbable coronary stents and drug-eluting coronary stents).
• Neurovascular devices (e.g., vascular reconstruction stent, thrombus debulking system).
• Peripheral vascular devices (including AAA systems, atherectomy devices, contrast removal system).
• Structural heart devices (e.g., mitral valve clip, aortic valve, imaging system).

The report can be viewed at http://flipflashpages.uniflip.com/2/13518/46051/pub/document.pdf.

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IMDA Update Published by IMDA 5204 Fairmount Ave., Downers Grove, IL 60515 Phone:  (630) 655-9280 (866) IMDA-YES (866-463-2937) Fax: (630) 493-0798 Website:  www.imda.org E-mail:  imda@imda.org   Staff Katie Swartz: Executive Director Judy Keel: Executive Vice President Patti Perillo:  Senior Administrator Mary Moran:  Chief Financial Officer Mark Thill, Editor & Communications Director (847) 255-0716 Mitchell Kramer, Legal Counsel (800) 451-7466 Barbara Kramer, Legal Counsel (734) 930-5452 George Ayd, Jr., Insurance Administrator (703) 652-1309         2009-2010 Directors President Kevin Trout, Grandview Medical Resources, Inc. (412) 914-0950 President-Elect Anthony Marmo, Martab Medical (201) 512-1100 Secretary/Treasurer Hal Freehling, Jr., O.E. Meyer Company (419) 609-1633 Chairman of the Board Dave Campbell, PhD, Vital/Med Systems Corporation (303) 660-0888 Directors-at-Large Tom Birmingham, Bay State Anesthesia, Inc. (978) 682-6321 George Howe, Mercury Medical (727) 573-0088 Philip M. Reilly, KOL Bio-Medical Instruments, Inc. (703) 378-8600 Don Reiter, Specialty Respiratory Care, Inc. (818) 717-8807 x19 Bill Schultz, IPV Medical, LLC (760) 212-2769 Past-President Shawn Walker, Bay State Anesthesia, Inc. (978) 682-6321 Manufacturer Representative to Board Tim Beevers, Beevers Manufacturing & Supply (503) 472-9055 The ideas presented in this newsletter may or may not be applicable to your particular situation.  Always consult your tax advisor, attorney or CPA before putting them into effect.