Physicians today rely heavily on reps to ensure good surgical outcomes for patients, but the cost to hospitals is skyrocketing prices on a growing collection of implantable pieces and parts—many of which have yet to be proven superior to tried-and-true alternatives. Here are five steps facilities can take to move closer to a ‘sales-less’ service delivery model that limits reps’ role primarily to the technical aspects of a procedure.
Two decades ago, hospitals relinquished ownership of operating room (OR) duties—including implant and instrumentation logistics, management and training on clinically sensitive items, and intraoperative troubleshooting—to the reps of medical device companies. Physicians and staff now take it for granted that the concierge-style support of these reps will always be there to not only lighten their workload but also guide them through some technical aspects of a procedure.
Reps have unique experience and insight as they literally watch and participate in procedures sometimes dozens of times a week. They often end up bailing surgeons out of tricky situations—e.g., a vital device component drops to the floor and can’t be re-sterilized or they make a cut but then can’t proceed in the normal fashion—making themselves seemingly irreplaceable in the surgical suite. They function much like set designers for a play, helping to ensure an all-around seamless performance in the OR.
They are effectively hospital FTEs without the direct cost.
But the perk comes with a price. Because of their cozy relationship with surgeons, reps hold considerable sway over physician purchasing preferences without ever having to delve into the repercussions for hospital budgets or patient care outcomes. Unlike in the automotive world where “new” might mean a lower cost or improved efficiency, in the medical device industry it almost always means sticker shock and possibly nothing more.
It is no coincidence that the price of reconstructive joints, cardiac defibrillators and other implantable technology have skyrocketed since the 1990s, along with the sheer volume of surgical pieces and parts of which they’re comprised. Much of it has yet to be proven superior to tried-and-true alternatives—the device choices more often made in Europe, where reps earn mediocre salaries rather than lucrative sales commissions.
Reps can’t simply be eliminated from the equation, because without them case costs may well escalate. Plus, there is likely to be a ton of pushback—and not just from physicians. The supply chain receiving dock may not have the capacity to receive and ship products that companies are unwilling to put on consignment. And central sterile may not be able to keep up with the demand in OR for disinfected surgical instruments. Despite the popularity of the so-called “rep-less model” as a topic of conversation, to date only one facility is known to have actually adopted it—Loma Linda University Medical Center—to cut out the “selling, general and administrative” costs that can account for up to 40 percent of a device’s sticker price.
So what to do? Here are a few sensible ideas:
- Take stock of what services reps are currently providing in the OR. For many healthcare executives, this is a black hole. They are generally very surprised to learn reps are in the OR at all—let alone all of the responsibilities they might be fulfilling before and after a surgery, particularly for complex reconstruction surgeries and spinal fusions. And at some busy hospitals, as many as 15 reps may be quietly roaming the hallways on any given day.
- Train staff to help set up the OR and assist surgeons. If reps are fixtures in the OR, they’re upselling physicians. Minimize those opportunities by taking an inventory of all procedures being done to identify those on the low end of the clinical effort index, where staff might be able to take ownership of the service component (e.g., grabbing and restocking boxes on a shelf) in exchange for a proportionately lower implant price. Staff will not be able to completely replace reps as the technical expert in the OR, because that would require them to attend national meetings and cadaver lab intensives every few months (as reps currently do).
- Establish ground rules with reps. This should be a formal, written policy covering everything from where reps are allowed to park and restricted from being inside the hospital to how they will be identified as a rep (e.g., yellow badge or red bouffant scrub hat), who will keep track of their whereabouts and, if allowed in the OR at all, the sterile techniques they must follow. Your contract with suppliers might even cover your service expectations of suppliers, and the allowable times and places where new products can be introduced to physicians.
- Let physicians know you will not drop the ball. This is one reason they started relying on reps in the first place. Create a process for ensuring surgeons have everything available that they might potentially need at all times. If your surgeons don’t have a dedicated team in the OR, at minimum align procedure and staff scheduling so a rep doesn’t become the only other constant in the room. And make it a priority to find solutions to any turnover problems you may be having.
- Stop reps from selling in the OR. At HCA’s TriStar Centennial Medical Center in Nashville, Tennessee, a Surgery Advisory Committee passed a policy to this effect. Reps are allowed in the OR only to support a case—meaning no loitering to catch surgeons at the scrub sink for some other purpose. It was a minor change that had a meaningful impact on the culture in the OR.
Moving forward, it’s likely the role of the rep will diminish to make a truly “sales-less” model possible. We suspect value-based reimbursement models will eventually have physicians rethinking their relationship with reps, and demanding clinical proof before adopting anything new they might be selling. Bundles of the future may also be defined not as 90-day care episodes but disease states that need managing, making implants a minor piece of the discussion and downsizing the rep’s role to what is clinically imperative.