A 21-year analysis by the Advanced Medical Technology Association (AdvaMed) found that medical devices made up a relatively small share of US health expenditures, representing only 5.9% in 2009 (1).
The medical imaging market experienced growth from 2004, with the rapid adoption of new technologies like PET/CT hybrid scanners, up until 2006. Negative growth was recorded during 2006/2007, when unit shipments declined drastically due to reimbursement cuts enforced by DRA (Deficit Reduction Act) (2). The market stabilised in 2008 with positive growth until 2010 (3) due to reimbursement cuts stabilisation and FDG coverage expansion. Positive growth is projected onward until 2014 (2).
In 2009, CMS (Centers for Medicare & Medicaid Services) expanded FDG PET coverage for initial treatment of 25 new cancer types. This decision more than triples the number of cancer types previously covered (4). PET/CT represents the highest reimbursing imaging modality and the fastest growing modality with a projected 10-year compound annual growth rate (CAGR) of 11%. Although CT and MRI experienced double digit annual growth rate over the past decade, the Health Care Advisory Board expects only PET/CT to maintain its double-digit growth over the next decade (5).
The medical imaging market has also been slowed down by the recent global economical recession. In a metaphorical style, Frost & Sullivan referred to the medical imaging market as a ‘rising phoenix‘, expected to recover starting 2010 despite the setback due to economic depression and the significant decline in reimbursement. The drivers behind this reformation would be advancements in technology and new clinical applications for imaging modalities (6).
In March 2010, President Obama signed new healthcare law. In September 2010, a number of important provisions took effect, with broader changes to come in 2014 (7). Radiology specialists claim the healthcare reform will enforce new payment models and reimbursement cuts which will hit the market again similarly to DRA in 2005 (8).
A 2010 study on top trends in medical imaging (9) concluded that ‘budgets are tight, reimbursement is shrinking, competition is fierce and the need to deliver more, faster is endemic’. However, increased R&D investment in hybrid modalities and add-on technologies (including software applications) continues to drive market forward (2).
- Health Imaging (2011) Medical devices are small part of total healthcare expenditures. http://www.healthimaging.com/index.php?option=com_articles&view=article&id=28670:medical-devices-are-small-part-of-total-healthcare-expenditures
- Frost & Sullivan (2008) U.S. and PET-CT Imaging Equipment Markets, N436-50. http://www.frost.com/prod/servlet/report-toc.pag?repid=N436-01-00-00-00
- Health Imaging (2011) Report: PET utilization nudges up. http://www.healthimaging.com/index.php?option=com_articles&view=article&id=28901:report-pet-utilization-nudges-up
- Ivy Ventures (2009) PET/CT market grows with CMS decision to expand coverage for cancer patients. http://www.ivyventures.com/documents/PETCTCoverageExpansion.pdf
- Health Care Advisory Board, Innovation Center (2008) Radiology. Future of Diagnostic Imaging. http://www.advisory.com/Research/Health-Care-Advisory-Board/Studies/2008/~/media/Advisory-com/Research/HCAB/Research-Study/2008/Future-of-Diagnostic-Imaging/Future-of-Diagnostic-Imaging-HCAB.pdf
- Frost & Sullivan (2010) Medical imaging Industry 2010 – A phoenix rising?. http://www.frost.com/prod/servlet/market-insight-top.pag?docid=189150885
- The New York Times (2011) Health Care Reform. http://topics.nytimes.com/top/news/health/diseasesconditionsandhealthtopics/health_insurance_and_managed_care/health_care_reform/index.html
- RSNA (2010) Healthcare reform deals new blow with reimbursement cuts. http://www.rsna.org/Publications/rsnanews/July-2010/healthcare_reform_feature.cfm
- Health Imaging (2010) 2010 Top Trends in Health Imaging & IT: The Refining of Radiology. http://www.healthimaging.com/index.php?option=com_articles&view=article&id=24072:2010-top-trends-in-health-imaging-a-it-the-refining-of-radiology
About the Author
Simona Maria Nita is the Digital Marketing Manager at Mirada Medical Ltd. Simona has over 10 years of professional experience and a strong academic background in Marketing.
About Mirada Medical
Mirada Medical is an internationally recognised brand in advanced medical imaging. The company develops high value clinical software applications, which are used across diagnostic radiology, nuclear medicine, radiation oncology, tumour board and elsewhere.
The opinions expressed in this blog represent the views of the author and not necessarily those of Mirada Medical Limited.
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