Demystifying Spinal Products, Procedures and …...2015/10/21 · Bone Grafts and Bone Graft...

© 2015, MedAssets, Inc. All rights reserved. MedAssets®. Not to be reprinted without permission. For non-commercial use ONLY.© 2015, MedAssets, Inc. All rights reserved. MedAssets®. Not to be reprinted without permission. For non-commercial use ONLY.

Demystifying Spinal Products, Procedures and Contracting Strategy Cindy Jones, Vice President

MedAssets, Advisory Solutions

2

© 2015, MedAssets, Inc. All rights reserved. MedAssets®. Not to be reprinted without permission. For non-commercial use ONLY.

Agenda

•The Spine Industry: Current State and Trends

•Plan Your Strategy: Tidbits from the Trenches

•Speak the Language: Spinal Implants and

Procedures

–Cervical

–Lumbar

–Newer Technology

–Osteobiologics


The Spine Industry

Current State and Trends

4Confidential and Proprietary © 2015 Sg2

Sg2 ANALYTICS

400

450

500

550

2015 2020 2025

Inpatient Spine Volumes are Threatened

Note: Analysis excludes ages 0–17 and includes Spine service line only. Inpatient includes discharges; outpatient includes volumes.

Sources: Impact of Change® v15.0; NIS; PharMetrics; CMS; Sg2 Analysis, 2015.

+19%

+11%

+12%

+6%

Inpatient Spine Discharges

US Market, 2015–2025

Outpatient Spine Volumes

US Market, 2015–2025

Sg2 IP Forecast Population-Based Forecast Sg2 OP Forecast

Discharges

Millions 5-Year 10-Year

Volumes

Millions 10-Year5-Year

0.65

0.73

0.80

0.88

0.95

2015 2020 2025

–7%

+17%+8%

–6%

5Confidential and Proprietary © 2015 Sg2

Sg2 ANALYTICS

Inpatient Spine Volumes are Threatened

7


Growth in US Spine Sales

8


Market Share of Top 5 Manufacturers in Orthopedic Segments

2004-2014

Source: Orthopedic Network News , 2004-2013.

86%

93%

90%

65%

87%

93%

60%

65%

70%

75%

80%

85%

90%

95%

100%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Spine

Trauma

Joints

Source: Orthopedic Network News, October 2014

9


Analysis of the 5 Largest Spine Companies’ Operating

Revenue

29%

7%

42%

22%

100%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Cost of GoodsSold

Research &Development

Sales, General,& Administrative

EBITDA Total OperatingRevenue

1

2

Source: FY 2013 figures are from www.medtronic.com, www.stryker.com,

www.jnj.com, www.nuvasive.com, and www.zimmer.com.

10


8.9%

9.8%

15.9%

16.4%

23.0%

23.1%

25.1%

26.2%

37.5%

40.0%

42.0%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

ENERGY

MATERIALS

UTILITIES

INDUSTRIALS

CONSUMER STAPLES

CONSUMER DISC

TELECOMMUNICATIONS

ALL SECTORS

INFORMATION TECHNOLOGY

FINANCIAL SERVICES

HEALTHCARE

Healthcare Sector has the Highest SG&A Ratio

of any Industry Sector in S&P 500

Schonfeld & Associates Analysis 2014

11


Medical Devices and Pharmaceuticals are one of the

Most Profitable Industry Sectors in the S&P 500

RBC Capital Markets Research Analysis

12


Hospital Operating Margin TrendsCA vs. US

3.6% 3.7%

4.0%

4.3%

3.3%

4.4%

5.5% 5.9%

6.5%

0.9%1.4%

3.0%

4.3%

1.7%

2.6%

4.1%

5.4%

4.9%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

2004 2005 2006 2007 2008 2009 2010 2011 2012

All US Hospitals CA

2014 American Hospital Association Hospital Statistics. 349 Hospitals in reporting.


Plan Your Strategy

Tidbits from the Trenches

14


What Are the Drivers of PPI Contracting Success? Indicators that have been proven to achieve full savings

DRIVERS

1. Executives engaged in entire process

2. Physicians engaged in the process

3. Physicians incented to participate (not necessarily financial)

4. Full set of clinical, financial and cost data shared with stakeholders

5. Hospital willingness to remove non compliant vendors / make tough

decisions

Other contributing factors: Adhering to an aggressive timeline,

communication with physicians throughout process, history of project

implementation and culture

# of Drivers

Implemented

Savings Potential

Achieved

5 121%

4 91%

3 85%

< 3 59%Study from 19 facilities

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Physician Engagement is Vital

• Establish credibility by sharing accurate data relevant to physicians

• Use physician input to develop strategies

• Foster a collaborative environment, making physicians part of the process

• Various physician alignment strategies can be deployed

–Physician employment

–Co-management

–Bundled payments

–Gainsharing

–Joint ventures

–Professional service agreements

*Source: Healthcare Advisory Board

79% of physician do not know what things cost

80% of physicians want to know what things cost*

16


Implant Strategy Continuum

Traditional cost negotiation

Vendor consolidation

Technology selection

“Repless” model

Increased physician engagement required

Increased implant savings potential

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17

Like Products Can Vary in PriceBe Wary of List Prices

Source: Orthopedic Network News Oct 2014

18



Speak the Language

Spinal Implants, Anatomy and Procedures

20


Spine Anatomy

20

Normal Disc

Spinous Process

Body of Vertebra

AnteriorPosterior

21


21

Source: www.orthopedicnetworknews.com

Cervical Fusion


• Common procedures• Anterior cervical discectomy

and fusion (ACDF)

• Posterior cervical pedicle

screws

http://www.ispub.com/ispub/ijss/volume_1_number_2_1/anterior_plating_for_cervical_traumatic_fractures_an_analysis_of_graft_height_and_segmental_lordosis_preservation/cervical-fig1.jpg

http://www.ispub.com/ispub/ijss/volume_1_number_2_1/anterior_plating_for_cervical_traumatic_fractures_an_analysis_of_graft_height_and_segmental_lordosis_preservation/cervical-fig1.jpg

22


Anterior Cervical Discectomy & Fusion (ACDF)

• Done in conjunction with a discectomy

• Fuses two vertebral segments together

to prevent a collapsing deformity

• Autologous or allograft bone may be

used.

22

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Cervical Implants

Atlantis by Medtronic

Cornerstone PEEK

by Medtronic

Cornerstone (bone) by

Medtronic

Vectra-T Translational

Plate by DePuy

Synthes

SlimFuse by Pioneer Assure by Globus

Colonial by GlobusTM-S by Zimmer made from

Trabecular metal

Skyline by DePuy

Synthes

Endoskeleton TC by

Titan Spine

24


Interbody Material

Bone or Non-bone?


• The use of interbody made

from bone continues to

decline.

• Interbody made from bone is

less expensive than non-

bone

25


Cervical Stand Alone Devices

ROI-C by

LDR Spine

Prevail by

Medtronic

Zero-P VA by

DePuy SynthesCoalition by

Globus

Stalif-C by

Centinel Spine

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Posterior Cervical Fusion

• Common brands

• Vertex by Medtronic

• Mountaineer by DePuy Synthes

• Synapse by DePuy Synthes

• Oasys by Stryker

27


Artificial Cervical Discs

Prestige by Medtronic Bryan by Medtronic Prodisc-C by DePuy

Mobi-C by LDRSecure-C by Globus

http://chospine.com/wp-content/uploads/2011/04/NewestFigure1.jpg

http://chospine.com/wp-content/uploads/2011/04/NewestFigure1.jpg


Lumbar Fusion Procedures

29


©2007 Medtronic Spinal and Biologics Division

Posterior Lumbar, Transforaminal Lumbar,

Anterior Lumbar and Direct Lateral Interbody

Fusion Approaches

Word word

30


Anterior Lumbar Interbody Fusion (ALIF) Approaches

Retroperitoneal

Transperitoneal

Lateral

Anterior exposure of L5 – S1

31


ALIF Instrumentation and Implants

Pyramid by Medtronic

Aegis by DePuyTrinica by Zimmer

ATB (Anterior Tension Band)

by Synthes

32


Lumbar Stand Alone Devices

LDR ROI-A

Synthes Synfix-

LR

Biomet Solitaire Globus Independence

Centinel Spine STALIF-TTSpinal Elements Magnum +

33


PLIF/ TLIF – Posterior/ Transforaminal Lumbar

Interbody Fusion

•Utilize a posterior (back area

incision) approach

•Commonly utilizes pedicle

screws, rods and an interbody

device/ cage as well as some

type of bone graft

33

34


XLIF - Extreme Lateral Interbody Fusion (NuVasive)

Also Called Direct Lateral Approach

•Anterior portion of lumbar

spine is fused from the side.

• Incision in the side between

the lower ribs and the pelvis

• Instruments pass through

muscles and to the disc

–Lateral muscles are separated,

less muscle tearing or cutting

34

35


Cage Comparison

35

TLIF XLIF PLIF

36


Expandable Interbody

–Globus Caliber

–Spine Wave StaXX

–Spineology Optimesh

36

Globus CaliberSpineology Optimesh

Spine Wave StaXx

37


Interspinous Process Fixation/ Fusion Devices

LifeSpine Aileron

Biomet/ Lanx Aspen

Total Annual Spend= $691,020

38


Artificial Lumbar Discs

Charite by DePuy Prodisc-L by Synthes

39


Corpectomy

• When the surgeon removes the vertebral body as well as the disc

space.

• Could be in any portion of the spine.

39

40


Sacroiliac Joint Fusion

Zyga Simmerty Globus SI-LOK SI-Bone iFuse

41


US Osteobiologics Market

42


Bone Grafts and Bone Graft Substitutes by Procedure Type

Source:” Orthopedic Network News, October 2014

• BMP usage has dropped from 51% of lumbar cases in 2011 to 21% in 2014.

• The use of cell-based matrix products is increasing

• 90% of bone graft spend is for spine cases• Some cell-based matrix products are also marketed for trauma and foot & ankle

• Bio4 by Stryker/Osiris

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Sustainability of PPI Costs

• Data is king

–Have a consistent feedback loop

–Evaluate metrics on a regular basis

–Communicate data to physicians regularly

– Seek involvement and input

• Establish/ keep an active clinical value analysis process

–Adopt new technology based on clinical evidence

– Procured Health

–Seek continual physician involvement

• Coordinate service line management across the continuum of care

–Shared risk/ benefits are coming, if not in your facility already

–Prepare for efficiencies across service lines

– Adopt an end to end view of patient management

Demystifying Spinal Products, Procedures and …...2015/10/21 · Bone Grafts and Bone Graft...

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Transcript of Demystifying Spinal Products, Procedures and …...2015/10/21 · Bone Grafts and Bone Graft...