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A Bank of America analyst called it the “Death of the Device Salesman.”
He was talking about a 2013 Wright Medical Group strategy to dramatically reduce hip and knee prices with a “no-frills” option that excluded logistical support or onsite technicians.
Fast forward to the August 2014 headline, “Smith & Nephew Goes Rep-Less With Some Hips and Knees.” See http://bit.ly/Syncera for the full article.
Here Smith & Nephew (SNN) was doing the same thing: Cutting orthopedic implant prices in half on some older systems and offering support only through an iPad app. A MassDevice article last week at http://bit.ly/rep-less cast doubt on this “disruptive model.”
From the MassDevice article, Stryker CEO Kevin Lobo was skeptical of the rep-less model for orthopedics. “Until these procedures are de-skilled, it’s very hard to imagine [not having] the sales force and the services we provide in the hospitals. We are not seeing [the rep-less concept] in any meaningful way in the market.”
The commenters at the “Smith & Nephew Goes Rep-Less” article at http://bit.ly/Syncera were angry.
“Chris” wrote: Sophisticated buyers will use the information provided to them by Syncera to reverse engineer the rock bottom price and then hit the full service supplier with that price.
“Paul” wrote: Have you been a rep in an OR? I spent 3 hours last night in a hemiarthroplasty for which my fat paycheck was about $60.
“Louden” wrote: Everyone who has ever stepped foot in the OR knows without the rep it will be a disaster. An iPad is not going to be their salvation.
Piper Jaffray analyst Matt Miksic said the Syncera model would have unintended consequences, with these questions:
• If hospitals can already negotiate aggressively with manufacturers for their current and prior implant lines, with full service, instruments sets and inventories included, why would they want to subject themselves, their surgeons and their patients to the risks associated with ‘leaner’ technology based service in the OR?
• If surgeons can already match the demand of a patient with various implant designs, why would they want limit themselves to older generation implant systems?
• How will patients know when they are getting access to the most recent innovations available from a range of competing manufacturers, and when they are likely to receive ‘older’ (albeit ‘proven’) technology, based on a cost control strategy put in place by the hospital in which they are being cared for?
Do you believe there is a future in rep-less devices?
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Make it a great week.
If the Americans think their healthcare system is difficult to effect change, they should look at the NHS!
It’s taken me 5 months to get agreement for a Trust just to start a trial (FOC of course after I inveigled my way in with lies…), the product will reduce patient harm by around 50% (Falls, proven with evidence) and reduce 1:1 nursing (or specializing as it’s called here in the UK) by up to 59% (again proven with evidence to be published shortly).
In that 5 months of protracted decision making, how many patients have fallen and been injured (human costs?) and that Trust will have spent around £250k on agency nursing!
During the last 3 weeks, we have had trained personnel on site for approx. 73 hours covering all shift patterns (not including traveling time) and all at no cost to the Trust.
Many individuals within the NHS do not see or understand the value healthcare companies deliver pre, during & post the protracted sales cycle within can last for up to 18 months.
Both sides need to be realistic and not let their personal views whether politically motivated or otherwise cloud the real picture emerging, yes the supply industry does need to change (and soon!), but so does the healthcare industry and in our case here in the UK work out how to manage the cost always remembering it is tax payer driven and therefore accountable…
Etc etc etc
Yes, there are companies that use ‘methods’ to sell products & devices, unfortunately, the small number spoil it for the rest.
However, if we are to introduce the rep-less model, can we invoice the hospital for ‘service’ calls such as;
The system isn’t working? – okay, let me have a look at it (after driving for 1 hour to get there, pay for parking etc), oh, can you remember how to turn it on?
Well over 50% of panic calls from hospital staff telling us the new system isn’t working is down to user error, who pays for that? certainly NOT the hospital!
Happy to look at rep-less if I can invoice the hospital for the visits we have to make which are due to user error…
Specifically to your point, I don’t disagree with the case you make about the rep you know who spent his time selling lies and acting unprofessionally. That type of rep, in that area of the industry can be more of an annoyance than help. The “reps” that are the subject of this discussion are a completely different type of rep. These reps are clinicians themselves, nurses and physicians assistants who have been very carefully trained on the use of a particular set of instruments and implants. They are not selling “machines.” Yes, they do their fair share of selling the products they represent, but the reps Joe Hage has started this discussion about are relied upon by surgeons to be there for every surgery. The reps don’t request to be in the surgery, the surgeons request that the reps be there. They are often in the OR by 5:00 or 6:00 AM and often don’t go home until 10:00 PM. They are committed assistants in orthopedic and spinal operating rooms.
I have spent my career in many different mini-industries of the medical device industry, including eyeglass frames, dental, urological, interventional cardiology, pharmaceuticals, contact lenses, spinal and orthopedics. Spinal and orthopedics have a very different operational model than any of the other “mini-industries” in which I have worked, both in manufacturing the devices and in how the hospitals and surgeons operate. Please re-read the third and fourth paragraphs of my previous post. Those two paragraphs describe this different mode of operation. This problem needs to be solved. Just kicking these “reps” out of the OR for this part of the industry will create a risk to patients and could potentially raise the cost of healthcare due to the demand for a different kind of buying. The risk cannot be understood unless you have been in a hip, knee, or spinal surgery case. I am not a rep myself, but I have been in surgeries observing how this is done. The function they serve must be replaced with something, and I don’t think iPads are the answer.
The different kind of buying I am talking about is due to the fact the these “reps” also frequently coordinate where kits and instrument set are shipped. If this person goes away, then hospitals may be forced to buy them for themselves, creating the need for more product to be in distribution at the same time. Great for the manufacturers, in this case, but this would ultimately cost more for the hospitals. The immediate reaction in the industry is short sighted. The questions about how much product that will be needed in the field under this new model have not been answered. The hospitals do not understand how the supply works. Because they don’t know how the supply works, the manufacturers don’t know how to determine the demand over the long haul. Mark my words, this will be an issue over the next few years, as it gets sorted out.
I have also within the last two months had to have official words with a rep who came in ostensibly to sell his equipment. What he did was to insist that a straightforward patient monitoring device could not be used on trial without him being constantly present for a whole week, during which he spent the time not promoting his product, but telling the clinicians a whole load of lies about the competition. That is totally unprofessional. What is more, the product he was selling is obsolete.
The rep for the competition has a much better device, with better safety features, it is a current model and is far more user friendly. However the damage has been done; the clinicians now believe the lies that it is unsafe and not suitable for their purposes, so they are ignoring it out-of-hand. That is not good representation, that is a disgrace. They are now committing themselves to buy a machine that up to press is not even released to the market yet from the first rep, on the basis of the trial of the obsolete machine, even though it will cost the better part of double the amount of a perfectly good machine on the market.
When I see stuff like this, I have no trust in sales representatives at all, and I believe that most clinicians ought to demonstrate a far healthier distrust of them too.
The industry doesn’t need reps who are just salespeople who happen to be selling a medical device this week, it needs reps who are genuinely medically knowledgeable – preferably surgically trained – who respect the surgeons’ expertise and who stick to one product (or product type) and don’t move from one company to another every other year as so many do.
What is a problem that needs discussion to improve, is that the entire industry does not fit in one box. (This is one reason why I say that the new regulations considered the industry to all behave the same, when it actually does not.) Clare describes situations where a medical sales person approaches hospitals with the intent to sell the next “electronic” widget. They are not there to use it while it is being used on patients. Many of these devices are used throughout the day from patient to patient or over a long period of time monitoring one patient. No one healthcare practitioner watches over the device the entire time it is used. This is one scenario that is very real both in Europe and the U.S. (and elsewhere.) These “reps” are not the reps describe in the article and they are certainly not healthcare professionals.
However, in the U.S., orthopedic and spinal surgeries are often performed using instrument sets and implant kits that are not owned by the hospital, they are owned by the medical device companies and provided on consignment to the hospitals and doctors. Hospitals are not charged for the instruments they use, because they are returned and reused. Hospitals are only charged for the implants consumed. In the kits there will be many implants from which the surgeon chooses the correct size and configuration during the surgery itself. These kits contain more implants than they will need and the unused implants go back to the medical device company with the instruments. The medical device company replenishes the consumed implants, inspects, adjusts and repairs/replaces the instruments; and the kits are sent to another surgery, typically in a completely different location.
These kits are complex and require a company representative to assist the surgeon, during surgery, to choose the correct parts and use them properly. These company representatives are the “Reps” being described in the subject article. These reps are not just salespeople off the street. They are typically RNs or Physicians Assistants, trained in orthopedic procedures; and trained specifically on the kits being used from the orthopedic medical device companies.
This does not “fit in the box” that the general public understands about the industry. Can the industry go to a “rep-less” model? Yes, but it will take time for the medical device companies and the surgeons to adapt. Will it be cheaper in the end? Only time will tell. This new model may drive the need for hospitals to buy more instrument sets, instead of borrowing them at no cost like today. That may prove to be more expensive. The new model may also lead to more malpractice cases, because a surgeon did not use the product correctly and the patient gets hurt. This again could raise the cost of healthcare.
There are other misconceptions about what the Affordable Healthcare Act will do to the cost of healthcare, globally, yes globally, but they do not fit within the scope of this discussion, so I will refrain.
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