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Medtronic CEO Welcomes Outcomes-Based Reimbursement

Medtronic CEO Welcomes Outcomes-Based Reimbursement
Medtronic CEO Omar Ishrak says medical device reimbursement should be tied to clinical outcomes to facilitate the move to value-based care. 

Arundhati Parmar

Starting in April, hospitals in 67 geographic areas will receive bundled payments for any hip and knee replacements they do. If the outcomes are good, these hospitals can receive additional payments. If not, those hospitals will have to repay Medicare a portion of the costs to treat the patient.

To phase in the new payment system, hospitals won't have to pay back Medicare for poor outcomes in the first year of the program, but the intent is clear: to move to a system that rewards good outcomes instead of paying for care in an episodic manner without looking at results.

One person cheering this move is Medtronic CEO Omar Ishrak. Ishrak, who is medtech's own Mr. Accountability, spoke to MD+DI in August before the Centers for Medicare and Medicaid finalized the Comprehensive Care for Joint Replacement (CJR) model. Back then the proposal still in comment phase. Ishrak not only welcomed the proposal as a rational basis for a move to value-based care, but also hoped that such bundled payments be introduced in other procedures involving devices.

Here is what he said. The August interview was part of a wide-ranging discussion on innovation, Medtronic's hospital services approach, the hope for the diabetes business and 

Arundhati Parmar is senior editor at MD+DI. Reach her at [email protected] and on Twitter @aparmarbb

Learn more about the medtech industry trends at MD&M West, Feb. 9-11, at the Anahein Convention Center, Anaheim, California.
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