Growth in overall prices in the medical technology sector is sluggish in the U.S., according to a new study conducted by Advanced Medical Technology Association (AdvaMed), the largest trade association representing the medical devices industry.
Study author Roland Guy King, former chief actuary for Medicare and Medicaid, found that medical technology is a relatively small and constant share of total U.S. health expenditures.
In 2004, the latest year studied, spending on medical devices and in vitro diagnostics totaled $112 billion, or 6% of total U.S. health expenditures, and has stayed fairly constant at that proportion for the last 15 years, the report said. During that same period, overall medical device prices grew far more slowly than either the Consumer Price Index (CPI) for medical services or the CPI overall.
The report also found that during the 15-year period studied, medical device prices have increased at an average annual rate of only 1.2%, compared to 5% for the Medical Consumer Price Index (MCPI) and 2.8% for the CPI.
The slow rate of price growth suggests that the industry is highly competitive, according to AdvaMed of Washington, DC.
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