Price Disparity of Medical Devices in Japan and Overseas
10.14442/general2000.5.27
- Author:
Yoshio Uetsuka
;
Saichi Hosoda
- Publication Type:Journal Article
- Keywords:
medical devices;
PTCA balloon catheter;
stent;
price disparity;
Distribution channel;
approval number system;
price negotiation power
- From:General Medicine
2004;5(1):27-35
- CountryJapan
- Language:English
-
Abstract:
Despite large revenues in terms of reimbursement from health insurance, many cardiovascular centers in Japan are losing money. On the other hand, manufacturers of cardiac interventional devices are making money in Japan. A big price disparity exists in the field of cardiac interventions between Japan and the West according to many surveys, the first among them being published by JETRO (Japan External Trade Commission) in 1996. Since then, the Central Social Insurance Medical Council has been discussing this issue, but the gap has not been dissolved. The IHEP (Institute for Health Economics and Policy) report on the actual condition of distribution channels for medical devices in 1997, describes several reasons for the high prices of medical equipment and devices in Japan. Among them, the high prices are best explained for by well-acknowledged fact that the sole importing distributors, which are often subsidiaries of the US manufacturers, set high prices (70% of the purchase price of hospitals) when the devices reach Japan. While we proposed several practical approaches to address this problem, we consider the high government-set prices of the devices must be dealt with first. Why is it bad to leave the government-set reimbursement price of medical devices so high, given the fact that hospitals are able to earn the margin profit because the actual price that they pay to distributors is significantly lower than the reimbursement price ? Because, if the total health expenditure of Japan can not be increased in amount due to the government budgetary problems, then the remaining budget left over to cover physician fees will likely be decreased and will eventually hurt the hospitals financial state. The government should take quick action to eliminate the existing price disparity.
