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March 13, 2006
Vol. 2, No. 5

to Medical Device Reimbursement & Compliance Alert



Christopher Gray
Global Pharmaceutical Analyst
Ernst & Young, New York, NY

Michael Manthei
Holland & Knight LLP, Boston, MA

Randel Richner
Vice President for Government Affairs and Reimbursement and Outcomes Planning
Boston Scientific Corporation, Natick, MA

Monica Schultz
Director Of Health Economics And Outcomes Research
Regulatory and Clinical Research Institute, Minneapolis, MN

Compliance Q&A

GPOs and Kickbacks


March 29 - 31, 2006, Harvard University, Cambridge, MA.

Sponsored by AdvaMed, Harvard Health Policy Review and Health Affairs.


Scott Gottlieb, MD, FDA Deputy Commissioner for Medical and Scientific Affairs

Carol Kelly, CMS Director of the Office of Policy

Michael K. Loucks, Esq. First Assistant U.S. Attorney

Jim Sheehan, Esq. Assistant US Attorney

Nancy Singer, Esq., President, Compliance-Alliance, Former Special Counsel, AdvaMed, Founder, AdvaMed Medical Technology Learning

Stephen J. Ubl President and Chief Executive Officer, AdvaMed.

For more information, go to, call 800-684-4549 or email


"The logo is intended to represent an immediately recognizable symbol that a company can post and use to demonstrate its commitment, not only to the AdvaMed code, but to an effective compliance infrastructure."

-- AdvaMed Executive Vice-President and General Counsel, Christopher White.

1. AdvaMed Launches Compliance Self-Certification Program

AdvaMed will roll-out its new Code of Ethics self-certification program sometime within the next month.

The program will begin with the release of an eight-point "Conditions of Use" agreement allowing consenting firms to display the organizations new AdvaMed Code Logo on their corporate website, business cards, displays and other marketing materials. Display of the logo indicates the company adheres to AdvaMed's Code Of Ethics On Interactions With Health Care Professionals.

"To reinforce that a company's commitment to ethical practices must originate at the highest levels, AdvaMed will require that the Conditions of Use certification be signed by a high-ranking corporate executive," the organization explains in a March 3 release.

"The logo is intended to represent an immediately recognizable symbol that a company can post and use to demonstrate its commitment, not only to the AdvaMed code, but to an effective compliance infrastructure," according to AdvaMed Executive Vice-President and General Counsel, Christopher White.

"A company can use the logo pursuant to a license from this organization to signal to physicians, customers and the health care industry overall that the company has a serious, top-down commitment to compliance that aligns with the OIG expectations, as they've been published, on the effectiveness of health care compliance programs," he explained in a March 9 interview. White became AdvaMed's first general counsel on February 1.

AdvaMed's board of directors approved the self-certification program during the group's annual meeting in Naples, FL, March 1-4.

AdvaMed's code was originally approved by the Board of Directors in September 2003 and became effective January 1, 2004. According to White, the establishment of the AdvaMed code was a "real achievement of this association." A subcommittee of the board of directors is charged with administrating the code program and leading efforts to expand the code as necessary to address new compliance issues.

The code is also overseen by the Legal Committee, composed of general counsels from member companies, the various product-area committees within AdvaMed and the AdvaMed Code Working Group. The working group is composed of member companies' compliance officers, "the folks who are in the trenches, struggling with operationalzing compliance policies in an era of rigorous enforcement and relatively murky legal standards." Compliance issues are becoming a more prominent part of AdvaMed's mission in recent years, "as government has made it very clear that it's interested in pursuing relationships among medical device manufacturers and physicians," according to White.

The HHS Office of the Inspector General and the Centers for Medicare and Medicaid Services are increasingly scrutinizing device manufacturers' marketing, research and physician education practices to uncover any relationships that may improperly influence a physician to use one company's technology over another for a service that the government will ultimately pay for through Medicare or Medicaid.

AdvaMed is always trying to inform and educate its members about the importance of maintaining a robust compliance program. "There's always room for additional education, in part because government enforcement theories are always changing. Education is a constant in the industry," he said.

Education is especially important for smaller companies who may not have a dedicated compliance officer. Even for small companies, who may only market one product, "a compliance program needs to be tailored to the activities of the company, and as a company grows, its compliance capacity needs to grow to address new risks the company encounters as it grows," White observed.

However, while AdvaMed is working to help its members steer clear of improper relationships with physicians, it is also trying to educate government on the important legitimate role industry-provider relationships play in the creation of life-saving technology. "Physicians play a critical role in the development of new medical technologies, so there are more numerous collaborations, a greater range of collaborations and the scope of those collaborations is deeper than what you see in other industries. This collaboration is necessary to the development of new technologies and to the testing and the refinement of those technologies," White explained.

White believes "the government needs to have a better understanding of the nature of physician and medical device company interactions. My sense is that the government has historically brought a perspectives learned over its experience with enforcement with other areas where those relationships are very different" such as the pharmaceutical industry.

"To the extent that the government brings a pharma mindset to its enforcement in this area, that's misplaced. Its enforcement policies need to be tailored to and reflect the necessity of medical device company/physician collaboration, and the government needs to have a clear understanding of the benefits of that collaboration."

Prior to joining the AdvaMed, White was a partner at the Washington, DC office of Morgan, Lewis & Bockius. Before joining Morgan Lewis in 2001, White was an associate and then partner with Gardner, Carton & Douglas, also in Washington, beginning in 1988.

Coding Q&A

Pacemaker Out, ICD In

Q: A physician removed an existing pacemaker and replaced it with a device that is both a pacemaker and a cardiac defibrillator (ICD), Medtronic's InSync Maximo, for a Medicare patient. The physician sated that the removed the existing pacemaker and capped the leads, but did not remove them. Should the provider bill 33235 (removal of dual transvenous pacemaker leads) even though the physician capped the leads? CMS provides two device codes - C1721 and C1882 - in its latest memorandum. Which code should be used for the implant?

A: Do not report 33235 because the code specifically references a removal of the dual lead system. Report 33233 for the removal of the pacemaker generator because the physician replaced it with an ICD generator.

Medtronic advises reporting C1721 for an ICD device without pacing capabilities and C1882 for the ICD-plus-pacer device.

Source: March APC Answer Letter

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