Device Makers' Confidentiality Will Raise Costs, AHRMM Says

Medical device makers' efforts to keep their prices confidential will increase costs for hospitals and the government, according to a statement by the Association for Healthcare Resource & Materials Management.

AHRMM, part of the American Hospital Association, noted that many medical device makers have inserted confidentiality agreements, or gag clauses, into their contracts with hospitals.

"These agreements prevent hospitals from discussing the prices with any third party, such as other hospitals and even with their own physicians," the statement read. Hospitals "should be able to learn the actual cost of the medical devices, equipment and supplies that they, their insurances providers and the government will be asked to cover," it added.

"If medical device manufacturers choose not to use established distribution channels, such as group purchasing organizations (GPOs), it will exacerbate the already vexing problems created by the lack of price transparency for medical devices," the group said.

AHRMM said it strongly supports pricing transparency because it allows medical professionals to research market conditions, such as whether they are getting a fair price, the association said.

Read the AHRMM statement on medical devices.

Read more news about supply chain:

- ETHOS Founder: Don't Be Easily Allured by Medical Technology

- Advanced Orthopedic Market Projected to Be More Than $28B in 2010

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