Medical Technology in the Fast Lane
RFID Is Making Rapid Inroads in the Healthcare and Medical Device Markets
Anyone who recently has driven the various (and many) turnpikes or toll roads that wind and intersect their ways through the eastern United States undoubtedly has seen cars zip through toll booths in the fast lane while fellow highway warriors sit in long lines, frantically searching for bits of change in cup holders, under seats or in the glove compartment. If this sounds familiar, then you’ve seen radio frequency identification (RFID) technology in action.
The automobiles breezing effortlessly through tolls are equipped with small box sensors, usually placed on the inside of the windshield behind the rearview mirror. These tags—often called E-Z Pass, Smart Tag or Fast Lane—are RFID transponders that communicate with equipment built into the toll collection lanes, which, in turn, subtracts the total of the incurred toll from a pre-registered account set up by the driver.
This kind of technology has been around for many years and used by various industries, particularly for inventory tracking. But until recently, the healthcare sector has been a slow adopter of RFID. Hospitals are beginning to realize the cost savings, improvement in patient care and procedural benefits of using this technology, but according to industry experts, it is still in its infancy. As healthcare facilities evaluate the rate of return for investment in RFID and technology vendors roll out smaller and less-expensive components and systems, medical device manufacturers will have to evaluate the roll they play and how they’ll be affected by RFID trends.
How RFID Works
By definition, RFID chips are tiny radio-frequency transmitters that broadcast data to receivers, which can be local or even satellite-based. Chips inside RFID “tags” provide a unique signal so that location and other data can be captured and processed. The tag can be attached to or incorporated into a product, placed on a person’s clothing or accessories, or even implanted in the body. Key components of a system include the chips and receivers, as well as software that captures and processes the signals and applications using the information for business support.
The RFID tags themselves are either “passive” or “active.”
CardioMEMS employs implantable radio frequency technology to help
doctors treat abdominal aortic aneurysm. Photo courtesy of CardioMEMS.
Active tags are battery powered and incorporate an intelligence component. Some active tags send out a signal only when activated. Other, more expensive tags transmit information continuously, are used in conjunction with other sensing devices and allow for longer-range scanning.
In the hospital setting, active tags most commonly are used for locating portable equipment (eg, infusion pumps, blood pressure monitors, wheelchairs) to help ensure that caregivers and other hospital staff aren’t taking time away from patient care by chasing down devices. Active tags also can be used to locate staff or patients. Passive tags, however, typically are used on fixed assets or at the point of care when close-proximity scanning and data delivery are needed, such as scanning a wristband tag for a patient’s medication information. Passive RFID tags also could be attached to incoming hospital supplies, which would immediately be scanned as they enter the facility while still in containers. Tags also can be used to track the use of devices such as catheters, stents and other implants.
While passive RFID tags and barcodes are similar, the read rate for RFID tags is much better,” said Tim Gee, principal of Medical Connectivity Consulting in Beaverton, OR. “There are too many variables that affect a barcode being read properly, such as how they’re printed, their position when scanned, if they’re worn out or obscured.”
Today’s RFID technology also can be used to ensure the proper identification of laboratory specimens, including biopsy samples and containers of blood or urine, to reduce medical errors. Other opportunities for RFID include managing controlled substances, pathogens or other materials that could pose a public health risk. Furthermore, the technology can be employed to track pharmaceuticals from the manufacturer, distributor and pharmacy to the point of administering medication to the patient
But RFID does have limitations, such as interference from metals, liquids and other radio devices. Various RFID frequencies also may interfere with other radio-frequency-emitting devices commonly found in the healthcare environment.
A Growing Market
The development of RFID technology standards and a reduction in price have helped drive an increase in its use within the healthcare sector. Increased demand to reign in rapidly escalating healthcare costs also has led to more widespread implementation of RFID systems.
“We’re really still entering the early phase of RFID adoption,” Gee said.
According to the Centers for Medicare and Medicaid Services, total healthcare costs in the United States reached $2.2 trillion in 2006 (that’s more than $7,100 for every man, woman and child). Thirty percent of healthcare expenditures came from hospital costs, with another 21% stemming from physician and clinical services.
Despite this astronomical commitment of resources, the average life expectancy in the United States is shorter than in countries spending less than half as much per capita, including Canada, France, Germany, Italy, Japan, New Zealand and Sweden, World Health Organization statistics have shown.
The problem is not with the skills of healthcare professionals, or facilities, and equipment in the United States, according to Bill Crounse, MD, global healthcare industry manager for Seattle-based software giant Microsoft. “The challenge is efficient service delivery,” he wrote in a recent report on RFID. “For this reason, improving the productivity and efficiency of healthcare must be a critical priority for patients, providers and payers.”
Crounse cited current research by the Boston University School of Public Health that reported up to 50% of US healthcare expenditures are lost to waste, excessive pricing and fraud. Statistics such as these have led to an increased focus on stricter controls of assets and inventory in the hospital setting as a means to significantly reduce costs, which, in turn, has made RFID an important piece of the cost-saving puzzle.
Fast Track Technologies, a Chicago, IL-based consulting firm focused on the convergence of medical device connectivity, wireless and RFID technologies within the healthcare industry, recently released results of a study that showed the use of RFID and related technologies will reach $8.8 billion by 2010. Hardware and software integration will account for $1.3 billion, while infrastructure support will account for $2.7 billion (split between wireless networks and enterprise-related software). The remaining $4.8 billion will be spent on hospital connectivity.
Another recent report also predicts significant growth for the global RFID market in healthcare—albeit not as aggressive as the surge predicted by Fast Track. The market for RFID tags and systems in healthcare will rise rapidly from $90 million in 2006 to $2.1 billion in 2016, according to IDTechEx, a United Kingdom-based consulting company providing research and analysis on RFID.
Regardless of whose estimates you use, significant growth is predicted and hospitals and RFID suppliers have a lot of work to do before widespread implementation of RFID can be realized on the billion-dollar scale. According to yet more research released on the topic, a survey by BearingPoint and the National Alliance for Healthcare Technology showed that fewer than 10% of hospitals they contacted have actually deployed RFID. However, more than 27% have started a pilot project or currently are testing the technology, and 55% recently have investigated using RFID in some part of their facility.
Vendor Solutions for Hospitals
The experience of PanGo Networks, a three-year-old, venture-backed RFID software firm in Framingham, MA, seems to support BearingPoint’s findings for RFID.
“I think there is still an education process,” said Mike Braatz, PanGo’s vice president of marketing. “For most hospitals today, RFID is somewhere on their radar screen, but they are at varying levels of education of exactly what RFID is and what it can do for them. What types of problems or needs do they have that RFID can be applied to? Are they looking for dollars saved or efficiencies gained?”
PanGo’s niche in the RFID market is as a tracking solutions company. Braatz said that most RFID technology companies provide customers with a vertically integrated system, complete with tags, readers and software. PanGo provides an application platform that can work with a variety of RFID infrastructures.
“We can help the customer pick the appropriate technology based on their needs and budget,” Braatz explained. “We are not beholden to our own reader technology. Customers can use standalone RFID infrastructure or use a Wi-Fi network and access points as an RFID network, so all they need to buy is tags and software, which can be more cost-effective.”
Braatz also said hospital biomedical engineering departments that are responsible for managing and maintaining all the hospital’s equipment can use PanGo’s system to track devices when it’s time for them to be maintained or repaired, which additionally helps to keep facilities compliant with standards and regulations from the Joint Commission on Accreditation of Healthcare Organizations.
“Now [staff] spend a lot of wasted time wandering around their facilities looking for that equipment,” he explained. “With our software, they can pull up a floor plan and run a search for a particular piece of equipment—beds, wheelchairs, heart monitors, any type of mobile equipment. Nurses also spend too much time away from their patients and units looking for equipment. We want to help them eliminate that search time. In addition to asset tracking, it’s also a patient care and safety issue.”
Dan Neuwirth, chief operating officer of Glen Allen, VA-based Agility Healthcare Solutions, which offers a turnkey solution—including installation, asset tagging, software installation, staff training and ongoing account management—describes a similar usage scenario.
“In a typical 200-bed facility, we typically track about 3,000 items that would cover most mobile assets, which have a tendency to disappear,” Neuwirth said, adding that most of Agility’s clients are hospital networks rather than individual facilities.
“Most hospitals evaluating this type of technology will view the decision as an infrastructure decision and the challenge with that is there is no return on investment for infrastructure,” he explained. “But there is a return on applications that are being deployed using the technology. We would recommend that hospitals look at the business and patient care issues where they can use RFID as an enabler. That’s what should drive the decision. ROI [return on investment] comes from the solutions layer, not the data capture by itself.”
Neuwirth said that hospitals look to one another to see if the technology has been beneficial. And as more hospitals that implement RFID are able to report success, other facilities quickly will follow suit.
“One catalyst for adoption can be hospitals that are looking to do major device conversions,” he said. “If a facility or network is going to replace a fleet of a particular device and it’s a huge investment, they’ll want to know how many fewer devices could they actually buy if they had this type of system.”
Both Braatz and Neuwirth agreed that an RFID asset tracking system could save hospitals at least 30% on their budgets for core devices, which hospitals tend to over-procure to ensure the correct equipment is always at hand.
“Having the appropriate inventory controls in place can save hospitals hundreds of thousands or even millions of dollars a year,” said Brad Sokol, managing partner of Fast Track Technologies. “Proper asset management and inventory control, along with improved infection control measures, would be a significant cost-saving combination.”
While Sokol said RFID technology itself “is not a silver bullet,” it can be an important way for hospitals to pass savings on to the patient. “The ROI [return on investment] has been proven time and time again with asset tracking systems, and it works for hospitals, too,” Sokol said, adding that the patient safety component is an important part of the equation that must not be overlooked in the discussion of technology and assets.
“When you’re talking about patient safety, it’s a question of getting the right piece of equipment to the right patient in enough time to save a life,” he said.
Neuwirth said facilities are beginning to see the “big picture” of a fully integrated RFID system. “RFID can be used to track patients in and out of the emergency department, which can be fairly dysfunctional from a flow standpoint,” he said. “So you’re tracking patients, equipment, devices and staff to make sure they’re all where they need to be for efficient workflow. It can provide full visibility for everything that’s going on in the hospital.”
The Device Perspective
While the thought of networks of hospitals ordering fewer devices could make manufacturers nervous, it also presents an opportunity to play along with the “if you can’t beat ’em, join ’em” philosophy.
According to Braatz, device manufacturers already are preparing for a fully wireless workplace.
“Some infusion pump companies, for example, are putting Wi-Fi chips in their devices to allow them to be tracked [without the hospital having to apply an external RFID tag] as well as receive and transmit information,” he said. “This saves time and money.”
Sokol also noted that radio-frequency technology is finding its way into more direct patient care—blood glucose monitors, for example, that attach to the skin with a transdermal patch and transmit blood glucose readings to a remote monitor. He also said the growth of the home care and long-term care markets will lead to more RFID-enabled devices. “RFID technology can be used for remote monitoring to remind patients to take medication or to alert caregivers that there is a problem at a patient’s home,” Sokol said. “There is already technology like this on the market.”
The Office of Device Evaluation (ODE) within the FDA’s Center for Devices and Radiological Health (CDRH) has seen growth in the number of new product applications that employ an RFID component, according to Ann Ferriter, the RFID point of contact within the ODE.
Some of the technology the ODE has seen recently includes orthopedic surgical instruments that communicate with a navigation system; devices that prevent the reuse of components; surgical markers for patient identification; implanted identification; and wireless physiologic monitors.
Ferriter also mentioned a few trends that the CDRH has taken note of, such as wristbands or identification tags for patient/caregiver tracking; disposable tracking; blood bag tagging; and tags for patient safety, matching the correct patient with the correct device.
In the aforementioned area of patient safety tags, the FDA cleared a product called SurgiChip for marketing in November 2004. Manufactured by a company of the same name, based in Palm Beach Gardens, FL, SurgiChip is an external surgical marker that is intended to minimize the likelihood of wrong-site, wrong-procedure and wrong-patient surgeries. The tag consists of a label with a passive transponder, along with a printer, an encoder and a RFID reader. The tag is labeled and encoded with the patient's name and the details of the planned surgery, and then placed in the patient's chart. On the day of surgery, the adhesive-backed tag is placed on the patient's body near the surgical site. In the operating room, the tag is scanned and the information is verified with the patient's chart. Just before surgery, the tag is removed and placed back in the chart.
Another company employing radio-frequency technology in its device is CardioMEMS in Atlanta, GA. The company’s EndoSure Wireless AAA Pressure Measurement System is used for the endovascular repair of abdominal aortic aneurysms.
The system is composed of an implanted sensor and external monitoring electronics. The sensor is inserted during the procedure to repair an aortic aneurysm with a stent graft. The sensor then measures the pressure in the aneurysm sac, which enables physicians to verify the success of the implant by simply holding the company’s antenna over the patient’s chest, much like passive RFID. It also would allow a physician to monitor the patient’s progress following the procedure.
“With this condition, there is a need to continuously monitor, and our solution allows you to do that using RF,” said Angad Singh, director of operations for CardioMEMS. “The only other way to assess the health of the aneurism was to do a CT scan, which is time consuming and expensive.”
CardioMEMS currently is exploring other indications for the technology, Singh added.
When companies are considering whether RFID integration into their devices would make sense, Fast Track’s Sokol recommends five points to consider:
• Would it improve workflow and process?
• Would it increase the quality of care and the efficiency of a process or device?
• Would it simplify regulatory compliance?
• Would it require FDA clearance, or is it part of an existing 510(k)?
• Do your market research and be familiar with regulations.
According to Dan Sands, CEO of Fort Wayne, IN-based Solstice Medical, medical device manufactures, particularly orthopedic implant manufactures, can benefit from the asset tracking capabilities of RFID the same way hospitals do.
Solstice develops device-level embedded RFID engineering, bio-engineered RFID tags, site and enterprise tracking software, hardware, integration, maintenance and support for total supply chain integration.
He said device manufacturers could realize significantly improved product management and supply chain logistics, which will provide value not only for manufacturers but, in turn, for healthcare providers and patients.
“Right now, manufacturers don’t have a really effective way to track the location of their products once they’ve left their facility,” Sands said. “This gives manufacturers a better picture of how their product is being used from the earliest point of manufacture through to the point of care, and even after. This technology can provide post-market connectivity for manufacturers.”
Sands said the need, from his perspective, is pretty basic. “This is the reason we started Solstice Medical,” he explained. “This technology can drive ways to improve surgical efficiency, reduce costs at the manufacturing and hospital level, and then pass those savings on to patients.”
At present, the FDA is evaluating the development of a mandatory unique device identification (UDI) system for medical products—using RFID and/or barcodes (similar to the National Drug Code passed for the pharmaceutical industry)—which could force the industry’s adoption of RFID technology. The FDA cites improved information for recalls, product tracking for adverse events and the incorporation into electronic health records as the primary drivers of its proposal. The agency has held a series of meetings, with the most recent held in October 2006.
While the device industry seems supportive of a voluntary process for device identification, it is wary of a compulsory system.
“Existing labeling and reporting regulations for medical devices provide the necessary level of control to ensure patient safety. Significant patient safety issues due to a lack of a mandatory UDI system are not apparent,” Washington, DC-based industry trade association AdvaMed wrote in its response to the FDA’s request for comments on a UDI program. “While there are theoretical benefits related to improved traceability resulting from reduced recordkeeping errors, we have not seen significant use errors or patient safety concerns associated with medical device identification as has been the case with pharmaceuticals. Due to the diverse size, materials, and configuration of medical devices, we believe that a UDI affixed to all unpackaged devices is neither currently economically practical nor technologically feasible.”
AdvaMed recommended that studies be conducted to accurately assess whether medical device misidentification contributes to clinical error and to what extent a mandated UDI system would enhance patient safety. The FDA currently is reviewing the industry’s feedback.
Whether mandated in some form by government regulations, employed by hospitals or incorporated as a value-add into new device design, it is clear RFID will be a critical component of medical device technology sooner rather than later.