Wii Balance Board Gives $18,000 Medical Device a Run For Its Money

Gizmodo highlights a very cool repurposing effort for the Wii's Balance Board accessory. Rather than the specialized force platforms used to quantify patients' ability to balance after a trauma like stroke, doctors at the University of Melbourne thought that a Balance Board might serve as well. Says the article: "When doctors disassembled the board, they found the accelerometers and strain gauges to be of 'excellent' quality. 'I was shocked given the price: it was an extremely impressive strain gauge set-up.'" Games controllers you'd expect to be durable and at least fairly accurate; what's surprising is just how much comparable, purpose-built devices cost. In this case, the Balance Board (just under $100) was compared favorably with a test platform that costs just a shade less than $18,000.

Comments

"Not for ________ use"

[LostCluster]

What determines the price of a scale is not just its equipment or accuracy.. but also the insurance the manufacturer has to carry in case something goes wrong. That's why medical devices are more expensive... you're also paying for the liability of somebody being misdiagnosed by a technical malfunction. Highly unlikely, but the money that has to be paid when that happens and gets proven is huge.

Re:"Not for ________ use"

[Anonymous Coward]

Not only that but Nintendo probably doesn't have a 4-hour on-site response time if something goes wrong with your Wii. (then again, at $100 a pop, you could probably afford to stockpile a few)

Re:"Not for ________ use"

[Anonymous Coward]

What determinds the price is production, and demand. The wiimote is mass produced, which makes the price even less. And its in high demand.
Medical equipment? There is a certain number of hospitals involved ordering X amount of copies, and the demand is static. They will also pay for it. Basically its overpriced, but the question is how much its overpriced.

Re:"Not for ________ use"

[Anonymous Coward]

Actually, you're forgetting the "there's only 2 companies on the planet that build this particular specialist piece of equipment so we're going to charge you through the nose for it" surcharge. Let's face it, medical appliances are outrageously expensive because they can get away with it, not because they actually "cost" that much.

Re:"Not for ________ use"

[MightyMartian]

What determined the price was the word "medical". It's a word, like "marine" which denotes adding zeros to the price of an item that costs only a moderate amount to actually manufacture.

Re:"Not for ________ use"

[Jhon]

Another question to ask is exactly how much time/effort/money Nintendo went through to get this controller FDA approved. What? It's not FDA approved?

Re:"Not for ________ use"

[LostCluster]

Tell Washington, DC about that. If companies are charging a monopoly rent, they should be regulated.

Re:"Not for ________ use"

[Spaham]

or audiophile, then you can add as many zeroes as you'd divide to make homeopathy tablets :)

Re:"Not for ________ use"

[Anonymous Coward]

Like sub sandwiches and submarines. Right?

Re:"Not for ________ use"

[Hadlock]

exactly. the FDA requires significant documentation of the hardware and software along all lines of the R&D, and manufacturing process. which are actively audited by the FDA. documentation, and documentation compliance is a huge chunk (not the largest, but definitely a line item on their accounting paperwork) of their budget.

Re:"Not for ________ use"

[Jeff DeMaagd]

How about the testing to get approved for medical use? Validation that it actually produces results good enough to base a medical diagnosis or treatment on? And the limited market that the medical devices get? When you get specialized, niche devices, the cost to get one is going to be high.

Re:"Not for ________ use"

[LostCluster]

Yep. The word "medical" means lots of requirements for the device on it's way to being used... Nintendo gets around those by saying they're not selling a medical device.

Re:"Not for ________ use"

[mysidia]

And there's only 1 company on the planet that builds the wiimote balance board....

The difference is the average gamer doesn't have the budget or the desire to spend $18,000 for a game controller. It has to be cheap, and there are certain compliance processes they don't need to deal with that a medical manufacturer does.

Moreover, with the high sales volume of a commodity game platform, they will make up Research and development costs easily, even though the price is less, the profit margin can be much greater than with the $18,000 device, which is still very expensive to originally research, design, test, qualify, and ultimately produce and support.

Re:"Not for ________ use"

[Anonymous Coward]

Hmm? High demand for the wii balance board would have the effect producing a higher price.

Re:"Not for ________ use"

[Ethanol-fueled]

Also, I believe there's a law that requires support for discontinued products (class I and II devices?) for something like 3 years. Couldn't find it on Google. Anybody in the know?

Re:"Not for ________ use"

[mikael]

It used to be the same with "unix" hardware in the 1980's/1990's, particularly with commodity components like mice, printer and scanner cables. An RS232 cable for an Apple Mac or PC clone that cost around $20, would be marked up for $200 for a UNIX workstation. To make sure that only the official cable was used, there would be loop-back configurations built into unused pins at each end of the cable, so that a connector patched up from twenty-five core cable and a couple of RS232 snap connectors wouldn't work.

Re:"Not for ________ use"

[Anonymous Coward]

First, can we start questioning whether these things, the medical balance board type things, actually do require such a stringent qualification before we nod our heads in agreement? Sure it sounds right, but that doesn't mean this piece of equipment in AUSTRALIA needs to follow FDA standards. Or any ridiculous standards in AUSTRALIA

If it is true, quite possibly some pieces of equipment shouldn't be on these ridiculous bullshit standards then. Do those medical scales or height measuring things need to go through bullshit levels of qualification? Does a stethoscope need to be approved by 15 different institutions with an A+ rating before it can be made? Hell, do those coats need to go through fireproofing and the ability to hold 400 pounds of weight?

I understand that some tools need a certain amount of study before being manufactured. You don't want stethoscopes with sharp edges or doctor's coats made of some nonhypoallergenic material. That's just carelessness. But the moment we start taking it too far in a knee jerk reaction after hearing that "Our safety's in danger!" is the path to $18,000 balance boards.

Re:"Not for ________ use"

[plover]

There's another way to keep them cheaper for clinical use. Create an approved testing regimen, and certify each one that's going into a clinic. For those prices you could afford to perform $9,000 worth of tests on each and every board, and they'd still be half the price.

Re:"Not for ________ use"

[ThogScully]

Those companies are only abusing their monopoly if someone new comes in and is pressured out of the market by anti-competitive tactics. If no one else wants to take advantage of the opportunity to compete in a market, you're looking for a different reason why. Off the top of my head, perhaps there's too much government regulation making it too difficult to get into that field. Too much insurance costs because of liability concerns in an overly litigious society. Perhaps just no one realized how much of an opportunity there was here because no one really has a clue how much healthcare costs these days since no one using it looks at the bills anymore - they just have their insurance cover it and complain when there's a problem. How do you expect competition in a market to lower prices when the consumer doesn't decide what features to invest in and compare based on price?

In other words, the answer you're looking for is not "more government" - that is the problem.
-N

Re:"Not for ________ use"

[Anonymous Coward]

Not really, demand is a curve, not a point. The difference is that the demand curve for medical devices is fairly steep relative to consumer electronics - the change in price needed to cause an appreciable change in demand is fairly drastic since the amount hospitals want is fairly fixed, where a small price changes would cause large changes in demand for consumer electronics. It thus makes more sense to move further "right" along the demand curve (p = D(x) - price at which x units are demanded) and make up the smaller profit margin with larger volume. You also have a market that warrants mass production rather than small scale - think handcrafted furniture vs IKEA.

Re:"Not for ________ use"

[Anonymous Coward]

Let's say company A spends $1 Million developing a medical device. Production costs are $50 per device and the expect 1000 sales. To break even, they need to sell it for $1050.

Now company B has the same expenses but a different market. They sell 100,000 of them, which puts their break even point at $60. Or less since they'll have economies of scales pushing the $50 marginal cost down.

Re:"Not for ________ use"

[Max Littlemore]

Yeah, well if you believe that, I've got a marine bridge to sell you...

..hang on

Re:"Not for ________ use"

[vlm]

What determines the price of a scale is not just its equipment or accuracy.. but also the insurance the manufacturer has to carry in case something goes wrong. That's why medical devices are more expensive...

You're missing a couple other issues:

1) Provably sterile out of the box. If the patient has an open foot ulcer, and some Chinese dude sneezed on the board before he wrapped it up, and then the patient dies of infection...

2) Bodily fluid proof, if not disposable or autoclave-able. The board is too expensive to toss and too weak to autoclave, furthermore god only knows what it'll do electrically when a patient pees on it. Or if not pee, some highly conductive cleaning fluid. Or blood.

3) Intrinsically safe. In the unlikely event of using or storing the board in an atmosphere contaminated by flammable anesthetics, it won't blow up. Closely related to oxygen proof plastics. No great achievement to make a plastic that does not support combustion in plain ole air, but I have no idea what plastics (if any) will not continue to burn in pure oxygen. And you know some heart patient is going to drop their oxy mask on the wii board and the batteries will spark at the same time. Also if the patient collapses and you need to use the crash cart, you don't want the electronics inside to catch fire. Would be unfortunate to restart a patients heart only to have the patient die of infected burns.

4) Proven EMC/EMI compatibility. Last thing you want is for the board to interfere with the patients portable EKG machine or whatever.

5) There are all kinds of allergen related issues. For example, no latex (rubber bands) used internally for any part at any time during construction. Peanut oil sounds like a "green" lubricant for metal machining, etc, until you run into someone with an allergy.

6) Connected. It needs to be sold by the current collection of booth-babe saleswomen with open purchase order accounts at the hospital. Its possible the hospital has no pre-existing relationship with any place that sells wii balance boards... Literally no way for purchasing to buy one...

7) Software licensing which probably prohibits this kind of activity, along with controlling nuclear power plants and air traffic control. "Lean forward to lower the control rods, lean back to raise the control rods. Lean left and right to control primary circulation pumps. Walk in place as if running away to declare a SCRAM."

Theres a bunch of other "EE" related medical device rules that are pretty interesting, especially as regards AC power supplies, until it gets too creepy realizing a bunch of folks died before they figured the rules out.

Its not so hard to follow the rules, its just HARDER to prove someone in China followed the rules...

Re:"Not for ________ use"

[obarthelemy]

depends:
- some costs are fixed: design, overheads
- some costs are linearly progressive: materials, though may be degressive w/ volume discounts
- some costs are degressive : marketing, certification and legal (if applicable), maintenance infrastructure (if any)...

so as a general rules, the more you sell, the cheaper it is to make. The exceptions are capacity constraints, either materials or manufacturing capacity.

now, price != cost, and prices may rise even though your costs fall:
- limited market: no point cutting prices if you end up selling as much, not more, as with higher prices
- capacity constraints: if you can't make more, even though your costs are going down, there's no point
- unelastic demand: if demand does not react to price changes, no point to lowering prices
- luxury market: it has been proven that demand for some items actually falls when prices fall, because people are buying an image of exclusivity, quality... rather than a product.

Re:"Not for ________ use"

[DJRumpy]

There is no justification for an $18,000 price difference for what amounts to the same fundamental technology. I don't need a formula, or theories as to why this is. The medical industry is full of a bunch of crooked greedy bastards. They use the same basic technology to accomplish the same result, probably with the very same components, all of which can obviously be had for very cheap. Costs are applied at the component level. If you can buy the same components for a Wii as in this other piece of equipment, their prices should be a bit closer. Our medical system has been gamed so badly for so many years, that a hospital doesn't even blink when they see $18,000 for a piece of equipment. They will happily pass the costs on to the patient, and the patients health insurance.

If this isn't a case of price fixing then I don't know what is.

What we really need is transparency is pricing for all medical costs. Force manufacturer's to provide their component costs for everything like eqiupment, drugs, and consumables, so that the consumer can see exactly what kind of markup their paying for.

Re:"Not for ________ use"

[Anonymous Coward]

Not really. I think what's happening with consumer gear becoming more and more complex and "agile" is that the whole concept of expensive custom hardware is becoming obsolete.

While some devices (MRIs, x-rays machines, ultrasound imagers) are legitimately expensive, other gear, such as the one in the article, are being revealed to be extremely simple devices that are simple marked up due to the OEM knowing that their target market has deep pockets.

In some ways, it's analogous to the software movement in the late 80s where software engineers and their tools were in such shortage that they were only found in high budget corporate and government settings. The commodification of computers led to computer programmers becoming commonplace, allowing the development of cheap software development on consumer grade computers and paving the way for the open source movement where programmers' time is in such supply that they can afford to give it away for free(tm).

The mass production and wide availability of advanced components such as accelerometers, GPS chips, DSPs and other previously prohibitively expensive items are bringing highly sophisticated applications into the realms of the consumer where novel ideas are being explored and old expensive ideas are being redone with a Made In China label on them.

Finally, I could maybe buy the insurance line if we were talking perhaps even a few multiples, but a $100 device to $18k? That's one hell of an insurance policy.

Re:"Not for ________ use"

[LostCluster]

That's a theory that's debated in college, and I take the opposite side. Proof that somebody was hurt shouldn't be needed to prove monopoly abuse. What about the company that was never founded because somebody told the would-be founder that it wasn't worth doing? If nobody's willing to extend you credit because the monopoly exists, then that's a barrier to entry.

Re:"Not for ________ use"

[snowgirl]

What determines the price of a scale is not just its equipment or accuracy.. but also the insurance the manufacturer has to carry in case something goes wrong. That's why medical devices are more expensive... you're also paying for the liability of somebody being misdiagnosed by a technical malfunction. Highly unlikely, but the money that has to be paid when that happens and gets proven is huge.

There's a lot of stuff that goes into a device to "certify it for blah blah use". Like you said, liability insurance. There's also a lot more stuff. Like the fact that doctors can expect to recoup greater amounts of the price of the unit than a gamer is likely to.

Take the same device, everything the exact same. Sell it to people who are paying out of pocket, and sell it to people who have insurance to cover it, and the people who are paying out of pocket are going to spend a lot more time assessing the value of the device, and if they need it. Thus, the economic model for them requires pushing affordability to ensure that the out-of-pocket person will actually pay.

This is equally visible in the medical fields actually. Cosmetic breast augmentation costs about $8,000 in my area, while just an x-ray and CT-scan at an ER is about $5,000. Compare that. Full general anesthesia, operating room, surgical expertise, and recovery costs as much as two tests with medical equipment, and comparatively little expertise. Why such a little price difference between the two, considering the vast gap in service? The cosmetic surgeon has to get patients to pay out-of-pocket... thus, the cost has to be something someone can generally afford, or they would never get business.

The important thing to remember here is that the people building these medical devices, by free market factors are charging as much as they can get away with charging. If medical facilities pay $18,000 for these items, then that is what they're going to charge, regardless of the costs put into it.

Re:"Not for ________ use"

[mysidia]

Let's just say for the sake of argument the Wii balance board, and the medical device both cost $10 million to research and design.

Ignoring the additional compliance, insurance, and qualification a medical device VS a toy has to go through to be produced.

Let's just say nintendo or their insurer was really concerned about safety, and perfect operation of the debe no complaints.

Further, let's say once all the preliminary work was done, the Wii board cost $75 per unit in materials and labor to manufacturer, and the medical force board cost exactly the same $75.

If Nintendo sells 5 million BBs to retailers at the price of $85 per unit, their net revnue is: ($85 - $75) * 5E6 - $10 mil = $40 million dollars revenue from the sale of BBs,

The sales proceeds were: $425 million dollars.
Their cost of sales were: $75 * 5E6 + $10 million = $385 million dollars.
$425 - $375 = $40 million

A very slim profit margin of 10%, but still not bad. Usually game consoles / accessories are sold at a loss anyways, the money is in the software, which can be updated at much lower cost.

Now... as for the medical device... we know there won't be demand for $5 million. Let's be conservative, and say the medical device manufacturer's market research tells them they can expect to sell 1,000,000 units, it is an innovative device at all, and there are thousands of hospitals all over the country.. What should the price be?

If they make it $85 bucks, even... their revenue will be:

($85 - $75) * 1million - $10 mil = $0

What? They spent $10 million to develop this, they sold 1 million units, and no revenue to show for it? Just taxable business operations? (By the time other costs are considered, this is actually a net loss of money)

Here's why: Sales proceeds: $85 * 1 million = $85 million in sales
Cost of sales: ( $75 * 1 million + 10 million = $85 million )

$85 - $75 = $0

So they have two options... go after a larger market that will buy more units, or raise the price.

Their product is only of interest to hospitals really, so the only option is to raise the price.

How much does the price need to be for there to be a 10% profit?

Sales proceeds need to be: $93.5 million.

That means, the price for each unit needs to be: $93.50 per unit.

What if they want a healthier profit margin? Their sole purpose in life is to manufacture medical devices, they don't sell software -- they need a good profit margin from selling their product.

A fair profit margin is 100% or more.

To achieve that, the minimum price is $930.50 per unit.

At a higher price, two things will happen (1) they will sell fewer units, and (2) their support costs per unit will be higher -- better warranty and service will be expected.

Also, 1 million sales is unrealistic for a niche product, it will probably be more like 200,000 sales.

To maintain a healthy product with 1/20 of 1 million, the actual price needed will be 20x that, or $18,610.00

Holy smokes.. that's awfully close to the '$18,000 medical device' price.

I wasn't planning on that, it was really a coincidence, honest..

I'm sure insurance is a consideration, but I think it pales into comparison to the small sales volume, and the high initial costs to design and manufacture any electronics good.

Re:"Not for ________ use"

[LtGordon]

To make sure that only the official cable was used, there would be loop-back configurations built into unused pins at each end of the cable, so that a connector patched up from twenty-five core cable and a couple of RS232 snap connectors wouldn't work.

Kind of like how Apple charges $35 for an iPod USB wall charger, and makes sure that my generic USB wall chargers / powered USB hub won't work.

Re:"Not for ________ use"

[dwarfsoft]

This is Australia, so the FDA means nothing over here :).

I'm pretty sure for things like Physio work there is an openness for individual Physios to use whatever tools they have available to assist. Not saying that they don't use tested devices over here, but perhaps for limited applications as were listed above this controller can be used instead of the more expensive device.

Having worked in the Healthcare system over here I have seen how some of the "Medical Devices" are put together. Usually the programming for the interface is so shoddy that it would not pass the QA that even most Commercial (yeah shoddy too) applications/devices do. Gaming devices, due to the nature of their use, are more likely to be thoroughly bug tested and more frequently used than most medical devices anyway. If there is an issue it will be found by the multitudes of users out there. Quite frankly, as was said earlier, Medical Devices are always overpriced with usually very little benefit gained for the price. If proper testing of all devices was done beforehand most of it would be denied installation, if the companies ever provided for testing before purchase in the first place (a lot gets sold on the spec sheet of what its supposed to provide, not on what it actually DOES provide).

Which comes to another thing about Medical personnel. If it breaks they don't report the issue because their time is "too important". This is an issue for the expensive medical devices which then fall outside of warranty or support contracts. Having cheaper alternatives that can be stockpiled is most definitely a step forward IMHO.

Re:"Not for ________ use"

[Ephemeriis]

exactly. the FDA requires significant documentation of the hardware and software along all lines of the R&D, and manufacturing process. which are actively audited by the FDA. documentation, and documentation compliance is a huge chunk (not the largest, but definitely a line item on their accounting paperwork) of their budget.

Seems to me that all this documentation and testing is perhaps not all that necessary for some "medical" devices.

Sure, something that's going to irradiate me to kill tumors or check for broken bones? Go ahead and get it all kinds of FDA tested. Pills? Drugs? Implants? Yeah, let's get those tested too.

A balance board or a scale? I'm thinking it's probably good enough to make sure they read accurately and then call it done. What's the worst that's going to happen if a scale malfunctions? Is anybody going to be killed in a freak balance board accident?

Re:"Not for ________ use"

[NonSequor]

What determines the price of a scale is not just its equipment or accuracy.. but also the insurance the manufacturer has to carry in case something goes wrong. That's why medical devices are more expensive... you're also paying for the liability of somebody being misdiagnosed by a technical malfunction. Highly unlikely, but the money that has to be paid when that happens and gets proven is huge.

The ideal solution to that would be for a company to get a special development license where they agree to indemnify Nintendo against medical liability for the use of the device and they write the software while making use of Nintendo's hardware.

The software would likely still carry a heavy price tag for the testing and insurance cost, but it would be much cheaper than the $18,000 which includes likely includes large fixed development costs spread over a smaller number of units.

Re:"Not for ________ use"

[Anonymous Coward]

You have obviously never worked in an industry with high quality control standards. The price of some product isn't the sum of its individual components. You have to pay people to design it, and people to test it, and then pay insurance on it. For small markets, this means that the price is very steep for even simple things. What would you price this device if the parts cost $100 per unit, but the R&D cost (2 doctors and 2 engineers for 1 year) was $1 million, the insurance cost was $500,000/yr, the customer support cost was $100,000/yr, and the market size was 100/yr?

Re:"Not for ________ use"

[Z34107]

Anon was right. Higher demand given the same supply raises prices.

Think about it logically: If nobody wants it (i.e., no demand) you can't charge much for it. Obviously you can't enter mass production if your market is for a total of five units, but that's a separate issue entirely.

Though my post sounds kind of like a Yahoo! Answers answer to a question nobody asked. Source: Econ major.

Re:"Not for ________ use"

[budgenator]

Another huge cost is Good manufacturing practice, I looked into making medical devices in my dental lab and the effort involved in just the paperwork was 3 times the effort to actually make the device. Everything has to be documented, every lot number, every expiration date for the materials used and which went into which device, who did what and how, what their training was and the documentation had to be maintained for 2 years or the expected life of the device. This is a killer for small facilities.

Re:"Not for ________ use"

[Hadlock]

What about the software that interprets the data? The driver to connect the scale to the software? Yeah I bet you could slap together some code in python in a day or two, but it still has to be documented, and verified by the FDA. I'd rather they be too careful, and have a device they can trust, rather than look at some data, notice an anomaly, and dismiss it because "the software is buggy", when in fact it might be significant in that you had a minor stroke and they didn't catch it due to crappy data collection. And then you die. Or are paralyzed. No, I'd rather have the correctly build, specified, and documented devices used on me, thanks. Medical care (quality, not cost/availability)in the US is top notch due to all the checks the FDA has.

Re:"Not for ________ use"

[Anonymous Coward]

So the "Government" is the problem. Who'd a think?

Re:"Not for ________ use"

[jmauro]

The justification is they got someone to pay $18,000 for it without any sort of fraud. In a market economy that's really all you need. It's not the companies fault the people who buy their equipment are dumb.

Re:"Not for ________ use"

[budgenator]

There's another way to keep them cheaper for clinical use. Create an approved testing regimen, and certify each one that's going into a clinic. For those prices you could afford to perform $9,000 worth of tests on each and every board, and they'd still be half the price.

Manufactured for $ 100,00 ,
certified for $91000.00,
wholesaler' markup 40% $12740.00,
Retailer's markup 100% $25,480,
I'd say your over-budget

Re:"Not for ________ use"

[jo_ham]

What's wrong with your powered USB hub? I charge my iPhone and my iPod (4G) off a non-Apple generic USB hub that I bought for £10. After all, it's just 5V on one pin, ground on the other.

How are they "making sure" that it won't work? Or are you just making shit up. I suspect the latter. If your iPod doesn't work on a standard USB port I suggest you return it to Apple as faulty.

Re:"Not for ________ use"

[zippthorne]

They don't care because there is often only one or two payers: they're not competing for customers - the insurance companies are their customers and the barriers to entry are so high that some states only have one.

There doesn't need to be transparency in pricing in med. equipment any more than in the grocery store. There just needs to be a real marketplace. Diversity of vendors is not enough. "did you get the contract with THE insurance company Mr. Loman?" is not a sign of a healthy marketplace in any sense of the word.

Re:"Not for ________ use"

[mirix]

AKA "Evil".

Re:"Not for ________ use"

[Anonymous Coward]

Uh, no. The path to 18,000$ balance boards was paved by the fact that doctors figured out that using a balance board to measure balance was an accurate way to screen for certain diseases. Mind you, this happened before the Wii appeared. Doctors, patients, and hospitals collectively created a demand for balance boards, and the medical balance board companies sold as many as they could at a price that maximizes their profits.

Now, the situation will either remain the same -- that is, the quantity supplied to the medical industry will remain the same, or Nintendo will enter the market in earnest. (I guess this is rather doubtful, but I would consider it strongly if I was management at Nintendo) If Nintendo enters the market, the quantity supplied to the medical industry will increase, and prices will fall for the medical industry.

Re:"Not for ________ use"

[Ephemeriis]

What about the software that interprets the data? The driver to connect the scale to the software? Yeah I bet you could slap together some code in python in a day or two, but it still has to be documented, and verified by the FDA. I'd rather they be too careful, and have a device they can trust, rather than look at some data, notice an anomaly, and dismiss it because "the software is buggy", when in fact it might be significant in that you had a minor stroke and they didn't catch it due to crappy data collection. And then you die. Or are paralyzed. No, I'd rather have the correctly build, specified, and documented devices used on me, thanks. Medical care (quality, not cost/availability)in the US is top notch due to all the checks the FDA has.

You them to be careful, and create a device that they can trust... With FDA oversight and whatnot. Which is, in the case of this article, raising the price from $100 to $18,000.

I understand that you want reliable software and hardware... Usable results...

But I'm suggesting that "good enough" may very well be good enough. If we're talking about a scale, do we really need to spend $10,000 for FDA testing and approval? It measures weight... Can't you pretty much verify that with another scale or two? And if it isn't 100% accurate, is the difference of a half pound here or there going to make that big of a difference?

Re:"Not for ________ use"

[nedlohs]

You charge whatever the market will bear, maybe a lower price makes it up on volume so there's some art to it.

It's only price fixing if multiple manufacturers colluded, for which the fact that the device costs way more than the component parts isn't evidence.

How do you measure the "component" cost for a drug? Is it the 50c worth of chemicals in it? Or does it also include the millions of dollars spent on clinical trials? Or does it also include the millions more dollars spent on clinical trials in the same domain by the same company of compounds which failed the trial at some step? What about failed trials of other drugs for unrelated indications? Failed trials of that drug for other indications? Insurance against the product being found to cause cancer in the future? etc, etc...

If the government wasn't pouring money into insurance companies, via stupid tax incentives, then insurance companies wouldn't be pouring it into medical care, who wouldn't be pouring it into pharmaceuticals and medical devices.

Why not stop it at the first step instead of the last? Especially since it's orders of magnitude simpler - remove one stupid tax rule as opposed to trying to define and enforce some labeling regime.

Re:"Not for ________ use"

[warrior389]

A fair profit margin is 100% or more.

I don't know what business *you're* in, but 100% is ridiculous. It looks like the average US corporate profit margin in 2006 was 8.5%.

I'm in a government regulated business and Washington sets our profit at 8% or even 4% sometimes. No reason health care shouldn't get fixed at 4% profit margin too.

Re:"Not for ________ use"

[nedlohs]

Yes, because medical devices aren't regulated at all at the moment.

Re:"Not for ________ use"

[sugarmatic]

I call BS. I have been involved in medical device development and licensing for some time. I can ballpark what the liability for a device such as this would be, and it is pretty small. The reality of the medical device industry is that it is a bubble that is largely propped up by low expectations, high regulatory barrier to entry, and other inherent consequences of our current medical device market system.

Take, for example, a glucose monitor (specifically, the most widely used system on the market in the US). The consequences of a technical failure are relatively high, including severe injury to the user. However, the insurance coverage for this type of device is barely 5% of the total retail cost of the sensor unit, and just over 8% of the retail cost of the disposable strips. The majority of the cost is from development overhead and ongoing quality assurance. The margins are still huge- fine. Here is the problem: independent testing results bear little in common with the reports filed with the FDA regarding accuracy and precision of the units. In fact, using their own test strips with calibrated samples of human plasma, the units only had a 60% confidence interval of indicating blood sugar to within within 15 points and the precision was not believable to within 20 points. Subsequent anecdotal testing by coworkers was consistent with our lab results (we were making an Iphone wart to to perform glucose management well before it seemed everyone wanted to do the same thing). One person saw blood sugar go from 70 to 110 to 87 within 10 minutes just because he tested with three different monitors with the same lot of strips. Our monitor was within a few points over 95% of the time, with about 3-point tall error bars.

The rub in this is that our device was going to sell for $12 versus $75, give superior results, and link to a wealth of online management tools. We couldn't do it because of the regulatory barriers, and even more because insurance companies would be slow to adopt a new device.

There are other examples in every doctor office. Hand/eye coordination test software that has less sophistication than PONG, or the first interactive app your kids ever wrote, yet the software costs $4200 plus annual licensing fees and docs bill it at $220 per use. This one is a doozy because I know the guy who wrote it and HE fully acknowledges this from the left seat of his sports car and life that has no other discernible source of income.

While I cannot offer a solution (that would be palatable to the majority of Americans with a shriveled connection to the inner and outer workings of their own lives), this example is not a new thing, but is is an example of something I have a great deal more respect for: innovation linked to something we quaintly used to call value.

As for the actual application, I cannot fathom that the same functionality could not be achieved for far less.

Re:"Not for ________ use"

[RobVB]

Nice post with a nice result, although you used some mystery maths to get there.

Sales proceeds need to be: $93.5 million. That means, the price for each unit needs to be: $93.50 per unit. What if they want a healthier profit margin? Their sole purpose in life is to manufacture medical devices, they don't sell software -- they need a good profit margin from selling their product. A fair profit margin is 100% or more. To achieve that, the minimum price is $930.50 per unit.

First you say 85 bucks is their break-even point, which means they have to sell it at 93.50 for a 10% profit margin (1.1 times 85). Then you somehow (almost) multiplied by 10 to get 930.50 bucks?

If 85 bucks is break-even, then they'll have a 100% profit margin selling at twice that, or 170 bucks. Not 930.50.

Also, 1 million sales is unrealistic for a niche product, it will probably be more like 200,000 sales. To maintain a healthy product with 1/20 of 1 million, the actual price needed will be 20x that, or $18,610.00

200,000 is 1/5 of 1 million. So following your line of thought, the actual price would be 5 times 170, or 850 bucks.

You did, however, say they produced 1 million of them, costing them 75 million in parts and labor. If they're only making 200,000 those costs would only be 15 million. Adding 10 million research costs to that makes a total of 25 million in production costs. To get that 100% profit margin, they'd need to earn 50 million in sales, meaning 50 million bucks/ 200,000 units = 250 bucks per unit.

Holy smokes, that's nowhere near the "$18,000 medical device" price.

Re:"Not for ________ use"

[NewbieProgrammerMan]

You have obviously never worked in an industry with high quality control standards.

I worked at a nuclear power plant that happened to be on a Navy ship. One of our supply guys had to order some simple part (a resistor or something) that was categorized as part of the nuclear plant, and it was maybe $100 through the supply system. He took the part number home, called the supplier from his home phone presenting himself as a hobbyist. It was about $1 for the same part. I guess we were paying $99 for the QC sticker they put on it before they sent it off through the supply system.

Disclaimer (because /. has taught me I need one): I'm not saying all QCed stuff is expensive for no reason. Just that sometimes people really are getting ripped off in the name of QC.

Re:"Not for ________ use"

[Opportunist]

What you fail to see, and what the GP identified successfully, is risk. Now, with average consumer equipment the risk is very close to zero. If it doesn't work, no biggie. Get the customer to return it and 2-4 weeks later he'll get a replacement. If he gets hurt in the process of using it, no biggie either. We just told him we're not responsible for any dumb accident he might run into. If that can't be excluded, the price goes up.

I hate car analogies like anyone, but in this case it's one of the things where liability is part of the price. Faulty cars can result in incredible cost, and that is reflected in the price. You get the same with dangerous work and the compensation you get for it. And illegal drugs are not really expensive due to high manufacturing costs either, or an insane demand compared to the supply (you'd be surprised how high the supply for some drugs really is...). It's the risk involved.

You can actually get medical equipment very cheaply, provided you declare that you will not use it for human use. What else you could use a heart monitor for is beyond me, but when they can strip liability from the price tag, the price goes down. Considerably down. Think 1/10th of the "all warranties included" price tag. It's probably easier to see for the everyday user with consumables. Syringes can be used for more than injecting something into a living body, thus you can get the same syringes with or without "medical" quality. Both kinds are essentially the same syringes. One kind is "certified" and thus with all liability and warranty attached, one isn't. Both are equally sterile, simply because the manufacturing process is the same, they roll off the same presses. Now compare the price.

Re:"Not for ________ use"

[michael_cain]

Create an approved testing regimen, and certify each one that's going into a clinic.

Develop the specification. Implement the test harness. Hire permanent staff to manage the testing, maintain the harness, etc. If any of the specification requires testing a component to destruction, you have to sample the production in order to derive the statistics and then certify the design, not the individual devices. Post the necessary performance bonds assuring the quality of your work. Who pays for periodic recertification?

Certification can be very expensive unless it can be spread across a lot of units.

Re:"Not for ________ use"

[fuzzyfuzzyfungus]

There is also the fact that, as with enterprise hardware pricing, a lot of the ostensible prices for medical services are largely fictional. Insurance companies often have various agreements with medical providers about the rates at which they will reimburse various services, and those rates generally aren't retail. In the case of uninsured patients, charges often end up going uncollected, modified, or kicked into various repayment plans. The poor bastard holding the bill may well be dragged through financial hell on the way; but if you've already done the procedure and they don't have the money, you can only squeeze so much out of them.

It's barely a "market" in any terribly useful sense.

Re:"Not for ________ use"

[JWW]

Risk makes health care expensive? I though that including malpractice reform in health care reform wouldn't really matter with respect to cost......

Note as shown very directly by this article, the cost of malpractice insurance at every level of healthcare is a major driver of the enormous cost and leaving tort reform out of the current health care "reform" was unacceptable.

Re:"Not for ________ use"

[swillden]

Moreover, even when there are multiple insurance companies, it's generally very costly for them to send people around checking out all of the different options for all of the different hospitals to determine what they'll pay for what.

The competition needs to be pushed out a level: to the patient. Patients need to have a stake in the cost of their own treatment, and they need to have the ability to easily compare prices between competing providers (hospitals/physicians). It's the decentralization of choice that makes markets work well. Centralized choice is better than no choice, but not nearly as efficient as decentralized choice.

This, in fact, is the core problem with our healthcare system, and every other, including the centralized ones. Everyone is experiencing massive cost inflation, and it's precisely because the end-customers are insulated from the cost of their own health care decisions. All patients want the most effective test/treatment available, regardless of whether it's only 10% better than another option that costs a third as much. Providers, for their part, are both morally and financially motivated to go for the better and more expensive approach. Morally because it's the best treatment for the patient and financially for obvious reasons. The only one who has any incentive to keep costs down is the insurance company. And if they're actually competing for customers, then they have a counter-incentive to keep the patient happy, which means ever-increasing costs.

A national, single-payer system as envisioned by the left just exacerbates this problem because it even further separates the patients from any concern about the costs of their care. It must, therefore, replace patient-driven cost-control with centrally-managed cost control, a.k.a. rationing. But that runs into the same problem the insurance companies have with their cost-control efforts: It makes the customer mad. In the case of a private insurer, that anger may lead to lost business. In the case of a nationalized system it's even worse, because it leads to votes to "expand and improve" healthcare... and we'll figure out how to pay for it later.

What we need is to get patients back in the loop. High-deductible health insurance so that routine expenses are paid out of pocket should be the norm, not the exception. For more expensive treatment, the patient should still have to pay a portion, though obviously it has to decline fairly quickly as costs rise.

When patients routinely ask the doctor "Okay, what will that cost?", then we'll start to see some significant downward pressure that begins to at least contain the growth of health care spending, and perhaps even starts to reduce costs.

How to reconcile that with the desire to make health care more widely accessible is a challenge, but not an insuperable one. But that's for another post.

Re:"Not for ________ use"

[hack slash]

Not really. I think what's happening with consumer gear becoming more and more complex and "agile" is that the whole concept of expensive custom hardware is becoming obsolete.

I wish that were true with all electronic gizmos, for example I see there's now a real cheap Hotwheels Radar Gun which I even saw being used on Mythbusters to test a scale bus for the Speed bridge gap jump, but the one gadget I would love to add to my ever-growing collection is a thermal imaging device, unfortunately I don't have several thousand to fork out on such a device.

Re:"Not for ________ use"

[mjpaci]

Manufacturers are required to provide support for Class I & II devices at least until the shelf life of the product passes.

Source: wife works in Regulatory Affairs pertaining to medical devices.

Re:"Not for ________ use"

[tftp]

Holy smokes, that's nowhere near the "$18,000 medical device" price.

There are other issues that the manufacturer has to deal with For example:

The demand for the product will be very low - nowhere like 200,000. I'd say, 20,000 over the whole life of the product. That could be a few thousand units per year. You incur costs during this time, so your meager sales must bring enough cash to keep the lights on.

Small demand also implies multiple, small production runs. Rarely you order 20,000 units, pay for them up front and then sell them for 10 years. But if you order 2,000 per year then your manufacturing costs go up.

You can't sit on your design for 10 years and sell one or two per day. You need to do R&D and produce a newer, better product. You need money for that.

Even though your sales are low, your sales expenses are high. You need to fly sales reps to all hospitals, demo the thing and wine & dine doctors, preferrably at strip clubs. This costs a lot of money. You can't sell such a thing through Amazon.

Re:"Not for ________ use"

[Civil_Disobedient]

I believe you are confusing the words "price" and "cost." It would be laughable to suggest the cost of such an item was anywhere near $18,000.

But the price of something has very little to do with its cost. The price of something--anything--is very quickly and easily determined using the following formula:

Whatever someone will pay.

If someone wants to have their wallet fleeced to the tune of ~$17,500, I sure as hell wouldn't try to stop them.

Re:"Not for ________ use"

[feepness]

I guess we were paying $99 for the QC sticker they put on it before they sent it off through the supply system.

Again, you're paying for the sticker and the insurance that covers the lawsuit should that piece break and irradiate an entire shipyard.

Re:"Not for ________ use"

[tftp]

But I'm suggesting that "good enough" may very well be good enough.

It depends on what you are measuring. A scale is indeed measuring only one parameter, but a balance board can easily measure several. You need syncronized access to all sensors to recreate your movements on the board, you can't just poll them one at a time.

If we're talking about a scale, do we really need to spend $10,000 for FDA testing and approval? It measures weight... Can't you pretty much verify that with another scale or two?

Doctors who treat people with excessive weight need to know the exact numbers, especially as the readings are taken mid-course. They tell the doctor how effective the drugs and methods are. Half a pound is probably an unacceptable and unjustifiable error. And you can't use "another scale or two" because they can be also wrong. Here is something to read about it. A proper multi-device setup would be great, but it would cost more than one device that is accurate enough.

Also the cost of the equipment is spread among many patients who use it over years. Let's say the balance board costs $20K and it is used for 10 years and then written off. Every day one measurement is taken. $20K / 3600 days = $5 per patient. Is this something to lose sleep over?

Re:"Not for ________ use"

[eharvill]

Maybe they should and diversify their business. They've already sunk the majority of the R&D cost, how much extra would it cost them to certify and insure it as a "medical" grade product?

Re:"Not for ________ use"

[pnewhook]

What you are paying for is the certification that the part is exactly what you ordered. You order a resistor for hobbyist, and it will most likely be what you want, and what it says, but sometimes the resistor will be out of spec, and sometimes it will have a defect and fail. You order a part specifically for nuclear or medical, and you (should) get exactly what you want, with a certificate stating it is guaranteed to be what you want, and test records proving it.

For the Wii board, no one cares if the gauges read 10% off, but for a medical device they would, and there has been a lot of testing to guarantee that it is within spec.

Re:"Not for ________ use"

[Anonymous Coward]

The companies charge that price because the market will bear them. This article gives a good example of the free market in action discovering solutions to issues of cost. In other words we don't need to regulate anything because people in charge of ordering will always look for a cheap but comparable solution.

Re:"Not for ________ use"

[KarrdeSW]

it's generally very costly for them to send people around checking out all of the different options for all of the different hospitals to determine what they'll pay for what.

That's why there's email. It's not difficult for a hospital to send a list of numbers that they would bill an insurance company for. If the price is unacceptable and the doctors at that hospital are in high demand then they can actually send someone out to negotiate a better rate.

And if they're actually competing for customers, then they have a counter-incentive to keep the patient happy, which means ever-increasing costs.

This might make sense if insurance companies were the ones actually treating patients, because it would mean that keeping the patient happy would be providing good treatment. However, keeping the patient 'happy' from the perspective of the insurance company simply means paying up when billed. Insurers competing for customers means paying for more procedures and doing so with a lower premium, which means an incentive to keep the cost of each procedure down.

When patients routinely ask the doctor "Okay, what will that cost?", then we'll start to see some significant downward pressure that begins to at least contain the growth of health care spending, and perhaps even starts to reduce costs.

This makes absolutely no sense. People with insurance, high deductible or not, generally do not question the costs of remaining in good health. They sign consent forms for procedures and deal with the bills after the fact. This is why bankruptcy rates from health care bills are so high. The people who do not seek treatment based on costs are almost exclusively the uninsured. If the internal link to your argument is seriously that patient will start haggling with the people responsible for keeping them alive, you might want to rethink your position.

Re:"Not for ________ use"

[BronsCon]

Sony had it in a $500 camcorder for a few months before being forced to take it off the market because people were using it to film their neighbors screwing... through their neighbor's walls...

So you'll still need to pony up a few grand for that, sorry.

Re:"Not for ________ use"

[hairyfeet]

Yeah they may give you great response time, but they totally bone you on the parts! A buddy of mine works IT for a hospital. One of their imaging machines had a HDD die, so he looks and it is a standard IDE HDD. He calls the company to see if he can just change it out, as they need that machine ASAP. "No, it'll void your warranty if you touch it! We'll send someone right over!"

Well apparently "right over = next day" and when the guy shows up he just pulls out a bog standard WD retail box and slips it in. Cost to the hospital (and of course I mean passed on tou you?)? $6000! That is right, they charged 6k for an $80 WD HDD. So if you want to know why your medical bill is so high? Well there is part of it right there. And according to him 2000%+ markups really ain't uncommon with the bunches making medical equipment. damn I wish I could get away with 2000% markup!

Re:"Not for ________ use"

[Anonymous Coward]

And yet the damage is already done, in enumerable bills to patients insurance, rising costs, and the perception that all health care equipment is justifiably expensive.

Re:"Not for ________ use"

[sjames]

Sure, but at $100 for the device and $17,900 for insurance, it's just a WEE bit out of balance, don't you think?

Even the fabled $8 aspirin isn't inflated THAT much. At the same rate, the room would cost $120,000/night.

If anyone wonders why Americans can't afford health care, TFA is a good place to start looking.

Re:"Not for ________ use"

[LostCluster]

If somebody detects that a Wii Fit is 10% wrong... the liability is limited to the cost of a replacement unit. If it's used at a hospital, the liability can go through the roof.

Re:"Not for ________ use"

[TheRon6]

What we really need is transparency is pricing for all medical costs. Force manufacturer's to provide their component costs for everything like eqiupment, drugs, and consumables, so that the consumer can see exactly what kind of markup their paying for.

I agree with the spirit behind this idea in that companies should be required to justify costs to prevent price fixing but I'm sorry, this just wouldn't work in the real world. The companies would make the cost breakdowns nearly impossible to reasonably interpret to hide the $10,000,000 worth of "consultant fees". (For people not familiar with business, a "consultant fee" is the cash that goes into the pockets of the CEOs and their buddies who come and hang out at the office for a few days a year.)

I really don't think we're going to fix problems like this until there's no such thing as greed in society anymore... which isn't going to happen until we achieve a perfect utopia where money is no longer really required anyways.

Re:"Not for ________ use"

[Mortaegus]

Profit margin is the percent of the whole that is profit, not the amount that you multiply by to reach the sell price of something. So a CD spool that costs $5 and sells at $10 has a profit margin of 50%. It is NOT POSSIBLE to have a 100% profit margin on anything that costs money to make.

Like the speed of light, you can approach it but not achieve it.

Also, the link in the parent is calculated after costs. I have never managed a brick and mortar store that had an average margin of less than 40%. In my current location, 37% is the break even point to cover fixed costs. Rent alone is $13700 a month, and we have to cover all maintenance inside the building as well as HVAC. Still, my store averages close to a million dollars a year, with about $350000 in profit. About half of that will pay for corporate costs incurred from our store, from human resources to customer service calls. But that cost varies. Then figure that our over-glorified executive gives himself a big bonus.

Re:"Not for ________ use"

[Miamicanes]

> I guess we were paying $99 for the QC sticker they put on it before they sent it off through the supply system.

Actually, there's a very good real-world example of a cheap electronic component that nevertheless can be very expensive when its quality is absolutely certified: electrolytic capacitors. Today, in 2010, brand new devices are STILL being manufactured with electrolytic capacitors that have substandard electrolyte. This is a problem that was supposed to have gone away YEARS ago. Why is it still around? Because the bad electrolyte is a tiny, tiny bit cheaper to make... and the capacitors tend to work just fine for at least a few months. In other words, they fail prematurely... but not immediately.

If you're building something that absolutely, positively, must NEVER use an electrolytic capacitor with bad electrolyte, you have no real option besides buying only capacitors that are certified (and can be audited) all the way from you (the company building the device that uses them) to the chemicals used to make the electrolyte itself. It's not enough to buy "a good brand". To get that level of certification, every party along the way -- distributor, wholesaler, supplier -- has to be certified capable of keeping them secure and properly stored. Otherwise, an employee (or manager, or higher) at the supplier could substitute counterfeit capacitors, then sell the genuine ones elsewhere.

The point is, that degree of auditing and handling is insanely expensive, because it involves SO MANY different parties (all of whom want to be reimbursed for the extra trouble). It's made more expensive by the fact that there are (fortunately) very few things that really NEED that kind of quality control. Life support equipment and nuclear power plant control systems are obvious excamples where it's justified, costs be damned.

That said, this particular device isn't life support equipment, regardless of how hard someone might try to make it sound like the tiniest malfunction would lead to death or injury. I think it's safe to say that this particular device's price is all but guaranteed to come down a few thousand dollars if they want to keep selling it.

Re:"Not for ________ use"

[turbidostato]

"What determines the price of a scale is not just its equipment or accuracy.. but also the insurance the manufacturer has to carry in case something goes wrong."

What determines the price of any gizmo is a lot of a helluva of things but mainly what the consumer is wanting to pay. Medical systems are expected to be expensive so why charge less?

Re:"Not for ________ use"

[Anonymous Coward]

"Sterile out of the box" is such a stupid fucking point I can't believe you typed it without your brain dribbling out of your nose and short-circuiting your keyboard. If a guy with an open foot ulcer catches an infection from standing on the scales, it's the doctor's fault for a) not sterilising the scales b) not ensuring the open foot ulcer is bandaged like it ought to be. Hey, if a scalpel packer sneezes on a scalpel being packed, then the surgeon takes the scalpel and sticks it in somebody's liver without cleaning it, who's at fault? The scalpel packer according to your retard logic!

Most of your other points are pretty decent, I just can't believe you decided to lead with such a non sequitur.

Re:"Not for ________ use"

[Anonymous Coward]

So you are suggesting that $17,900 is due to insurance cost? Per unit? Wow if this isn't another example of companies bilking the healthcare system I don't know what is. Oh wait yeah drug compounds that are easy to produce costing Thousands of dollars per ounce, and then the FDA approving extensions to prevent generics of those compounds. Yeah the whole system is screwed.

Re:"Not for ________ use"

[LostCluster]

See, the 8x price difference on aspirin is okay because giving the an aspirin tablet to the wrong person usually doesn't mean much. Not much liability = not much risk = cheaper insurance.

Meanwhile, the balance board is an electronic device which because it isn't certified could cause all sorts of problems that have been outlined elsewhere in this thread, possibly leading to injury or death. All Nintendo's willing to do is give them another Wii Fit... so a Wii Fit: Hospital Edition would need much much more insurance, and since it's so cheap to begin with that's where your 180x insurance multiple.

Even if you drive a cheap car that you could afford to replace... you still carry insurance based on the risk that you might hit an expensive car, or two, or even worse, a house. That's almost limitless.

Re:"Not for ________ use"

[LostCluster]

The threat of competition is enough to keep a natural monopoly competitive. If said company becomes too abusive, new businesses will be profitable regardless of entry barriers.

Citation needed that a natural monopoly that isn't abusive exists.

Re:"Not for ________ use"

[sjames]

You don't autoclave a balance board, you use disinfectant wipes. As for spills, do you imagine the Wii balance board never gets played with by a toddler? Never gets crawled over by a baby?

The balance board is not used in surgery. Do you imagine that the doctor's pager or cell phone is approved for those environments? How about his calculator?

Portable EKGs are used all the time by paramedics in far more difficult environments.

Allergies are a big problem for products used in the home as well. It was evidently solvable at $100/unit.

As for sales channels, that's only true if the hospital doesn't give a crap how much it costs as long as they don't have to fill out a form.

The licensing isn't an absolute prohibition, just a disclaimer. It's there so someone won't use it where millions could die and then hold the manufacturer responsible if it's not up to that.

I'll bet if you showed patients the difference on their bills, most would choose to take their chances and pay the smaller bill. I'll bet there would be no additional deaths as a result. There would probably be LESS deaths since more people could afford medical care.

Re:"Not for ________ use"

[Skuld-Chan]

Again, you're paying for the sticker and the insurance that covers the lawsuit should that piece break and irradiate an entire shipyard.

Are you though? Because I bet if that did happen they still wouldn't assume liability.

Re:"Not for ________ use"

[sjames]

That and nobody ever died because they decided against breast augmentation. As many an armed robber has discovered, threatening your "customer"'s life often convinces them to fork over more readily than saying please.

Re:"Not for ________ use"

[feepness]

Are you though? Because I bet if that did happen they still wouldn't assume liability.

Probably. Of course that's the insurer's lawyers coming in and getting their freak on.

Thinking about it you're probably also paying for the fact that the part works EXACTLY to a certain tolerance and won't be replaced by something different as well. This would be more important in a nuclear reactor and not so big a deal to a hobbyist.

Re:"Not for ________ use"

[mysidia]

If 85 bucks is break-even, then they'll have a 100% profit margin selling at twice that, or 170 bucks.

In the example above, 85 bucks is only break-even if they make a certain sales number.

It's a completely unwarranted assumption to suppose you can simply change the price, and have the number of sales stay the same. In fact, when you double the price, the number of sales may go down by 20x or more: it is the job of market research people to make the proper analysis there.

They have to sell 1 million units for 85 bucks to be break-even. We're assuming the original research and development is a fixed cost that doesn't depend on the number of units (for the sake of simplicity).

If they sell only 200,000 units, the break-even price is much higher, which is the whole point of the post, and you seemed to have missed.

200,000 is 1/5 of 1 million. So following your line of thought, the actual price would be 5 times 170, or 850 bucks.

No, because in the model I was giving, support costs are 4x as much.

In particular: support costs include the additional average expenses required to obtain each sale.

Medical devices of this nature are not mass-market products, there is no benefit of a separate retailer. The manufacturer typically has to find a vendor to solicit leads and sell the product; salesmen take expensive commissions, and there are other expenses such as travel.

Nintendo doesn't have any need to send salesmen to take every Joe sixpack out to lunch and discuss the merits of their balance board product. The sales are easier to get, fewer sales staff are needed. Pre-sales support is non-existent.

Re:"Not for ________ use"

[Brandee07]

My Kindle's USB wall charger charges my iPhone (with the USB->iPod cable instead of the USB->microUSB cable) so I have no idea what you're talking about.

Re:"Not for ________ use"

[WCguru42]

Finally, I could maybe buy the insurance line if we were talking perhaps even a few multiples, but a $100 device to $18k? That's one hell of an insurance policy.

The insurance is to cover a misdiagnosis that in a worst case scenario could result in death or lifetime medical care. Do you have any idea what malpractice insurance costs? It's the same for the medical suppliers as well. Now, if it were simply insurance incase somebody fell off the balance board it would be much cheaper.

Re:"Not for ________ use"

[rtb61]

I get it. So what you are saying is that governments would be far better off manufacturing all this stuff themselves rather than contracting it out. Not only are you eliminating wasteful profits but also enormous insurance costs because the governments can readily self insure.

Now lets have a little bit of fun with the insurance lie. If insurance costs are so high, then the private medical manufacturers must really, really crap, because that is what drives high insurance premiums, lots of failures (no failures, low premiums), so get rid of the private corporations because just like insurance companies, the government should also recognise them as being high risk. The quality control systems in all medical manufacturing facilities must be so bad, that no insurance companies give any of them a discount.

I would love to see some of the warranties on medical equipment, from the sounds of the marketing trolls it must be decades but I bet a lot of that junk comes out with nothing better than 90 days (now that's a big insurance risk, ha ha). The underlying reality is that all this low manufacturing run custom equipment should be manufactured by government, because no matter how inefficient they are, it well still be way cheaper than paying for inflated profit margins at the manufacturers, oh yeah and the insurance companies. Especially the insurance companies because according the medical manufacturing trolls, the very, very expensive quality control system means absolutely no failures.

Re:"Not for ________ use"

[lewko]

There is no justification for an $18,000 price difference for what amounts to the same fundamental technology

Depends on your definition of "technology".

Sure, if you're only talking about a few bits of plastic and some gizmos, you may have a point. However the underlying R&D is a whole different story, as is the insurances and testing alluded to by other comments above.

That's why patents are important, to give someone who has invested in developing something, time to make their money back before others simply copy the idea.

Re:"Not for ________ use"

[Anonymous Coward]

Also, Nintendo ordering 5 million parts will get a much better price from the supplier than smalltime medical company ordering a few thousand at a time.

As well, the small medical device company would probably have half or more of their staff being specialists demanding a high salary, and as you mention targeting advertising to doctors probably isn't cheap.

With low sales per month combined with high salary and advertising costs and no bulk discount on parts it's no wonder they charge a large premium on their product.

Re:"Not for ________ use"

[lewko]

This would be more important in a nuclear reactor and not so big a deal to a hobbyist.

Depends what his hobby was. Muhahahahah....

Re:"Not for ________ use"

[drinkypoo]

Doctors who treat people with excessive weight need to know the exact numbers, especially as the readings are taken mid-course.

No, they don't.

Half a pound is probably an unacceptable and unjustifiable error.

No, it isn't. Your weight will change more than that during the course of the average day just by gaining and losing water, or taking a shit.

Also the cost of the equipment is spread among many patients who use it over years.

That doesn't make the cost seem any less ridiculous. The only "good" reason for it is liability, and the involved requisite testing.

You have little to no idea what you are talking about. Stop before you sprain your brain.

Re:"Not for ________ use"

[drinkypoo]

So they have two options... go after a larger market that will buy more units, or raise the price.

Their product is only of interest to hospitals really, so the only option is to raise the price.

You have committed the logical fallacy of: False Dichotomy.

There is a third option in some cases, especially this one; make a device which is sufficient for use both as a toy and a medical device.

Re:"Not for ________ use"

[Nazlfrag]

Someone could be misdiagnosed and sue is what could happen.

Re:"Not for ________ use"

[gak001]

Your conclusion emphasizes a minor aside in your argument. The whole post reads like you think overly-litigious people who aren't interested in educating themselves are the problem and then you conclude that "more government" is the problem. Sounds like someone has an ax to grind. As for government regulation, I'd rather have too much than too little when it comes to my body and diagnosing and treating illnesses/injuries, as opposed to having to sift through various Dr. Crackpot's Magical Curative Diagnostical Boards.

Re:"Not for ________ use"

[Anonymous Coward]

Didn't the Wii folks go through the same R&D, yet theirs only costs $100.

Re:"Not for ________ use"

[ceoyoyo]

"What else you could use a heart monitor for is beyond me."

Animals.

Veterinary equipment, drugs, whatever, is often a fraction of the price for human rated equipment.

Re:"Not for ________ use"

[RobVB]

It's a completely unwarranted assumption to suppose you can simply change the price, and have the number of sales stay the same. In fact, when you double the price, the number of sales may go down by 20x or more: it is the job of market research people to make the proper analysis there.

I'm not discussing your economical hypothesis, just pointing out some math mistakes, or maybe they were points where you didn't mention a few steps in your line of thought.

No, because in the model I was giving, support costs are 4x as much.

And how was I, as a simple math nazi, supposed to know this? You didn't mention the Magical Factor of Four anywhere in your original post.

I know it's no use trying to explain the market of medical technology in a Slashdot post of a few hundred words. There are so many factors at play that we can't even think of half of them, and most of us don't even understand the half that we can think of. All I'm saying is, if you're making a concrete mathematical hypothesis on something, make sure the math is solid. Don't worry, people will always find something about your post to whine about.

Sort of relevant and always entertaining: xkcd.

Re:"Not for ________ use"

[chentiangemalc]

However if the company knows in advance that demand is low, but that the few people that do want it have a significant need for it, then higher prices can be charged, and are necessary to cover cost of design, development, production and support staff, running the company, for a product that won't sell a lot. When there is a low demand for a product that has low prices this is usually because company THOUGHT people would want it, but nobody did, and now they've produced a lot and have to get rid of it at a cheap price. 951,045 hospital beds in US vs Wii Fit: 22.5 millions copies(worldwide) sold since oct 30th 2009 http://www.nintendo.co.jp/ir/pdf/2009/091030e.pdf#page=6 http://www.aha.org/aha/resource-center/Statistics-and-Studies/fast-facts.html

Re:"Not for ________ use"

[Lisk]

Sony had it in a $500 camcorder for a few months before being forced to take it off the market because people were using it to film their neighbors screwing... through their neighbor's walls...

That's a myth actually. You can't use IR to see anything you can't see with vis (the only difference is that your body glows in the IR, not in the vis, so if you're in a dark room you can see someone with an IR camera, but only if you could have seen them normally if there was enough light) IR can't penetrate walls or even stuff like glass. To take an IR spectra of a chemical (I'm a chemist) you have to put it in a salt container because IR doesn't go through lab glassware.

Re:"Not for ________ use"

[mgblst]

Your comment is so fucking ignorant, that I hope you are either a 12yo, or have never held a job outside of fast food.

There are many problems with our Health system, agreed, but maybe you should learn the difference between a mass produced item, and one that is not.

Re:"Not for ________ use"

[LingNoi]

Thinking about it you're probably also paying for the fact that the part works EXACTLY to a certain tolerance and won't be replaced by something different as well.

If we're going with the example given above by the GGGP then its exactly the same part which makes that irrelevant.

The simple fact is people will justify anything to make themselves feel like they're not being ripped off. Just look at bottled water as a simple example. People come up with all sorts of excuses as to why they think it's better then tap water then someone like penn & teller come along with their "Bullshit!" show and rip all the excuses to shreds.

I don't buy the whole insurance nonsense either when it comes to common parts which can be bought anywhere. When it comes to paying, companies will be the first in line trying to claim it wasn't their fault. Trying to claim money back would probably cost you more in legal fees then you'd get back.. There's always an exception however it's simple to see that most of the time you're probably being ripped off.

Re:"Not for ________ use"

[Anonymous Coward]

Production and demand are sufficient to determine price only when the market is perfect.

This is not true for medical equipment, because the market is highly regulated.

I work in the field of medical devices, so I see this every day. We have to keep copious records of the design process of the hardware, the testing to validate and demonstrate perormance, and each device has a record kept of every periodic maintenance call and every service call for a performance problem (e.g. breakdown).

All this adds to the cost to bring a product to market, and then adds to the cost of keeping a device running.

And on top of all that, the health "systems" that provide patient care in the USA are an extemely imperfect market...

I have seen many instances in the North Eastern states of extreme over-capacity. Great, in that if you need an X-Ray or an MRI you can get it done within fifteen minutes (which is three sets of paperwork to prove you can pay). But that means that a device is sitting around 80% of its time unused. But other posters will point out, "you can't put a price on your health", so people will cough up to $3200 for a simple abdominal X-Ray that takes, literally, 45 seconds of device time. The same X-Ray costs (I'm told) around $800 in Japan, and less in France or the UK. But in France and the UK, you turn up for your appointment, fill out no extra paperwork, but wait for maybe 90 to 120 minutes to go under the device, because it is utilised at 90% to 100% of the time.

Finally, even though you state that "demand is static", this is not quite true. There is relatively little growth in the number of hospital beds places in the USA,Europe and Japan, but the demand for every increasing resolution in imaging, ever faster turnaround, every simpler interfaces so that less qualified (i.e., cheaper) staff can operate the device for more qualified staff (i.e. doctors) to spend more time doing diagnoses... And that is in the mature, saturated markets of the world... then we can talk about BRICS...

AC

Re:"Not for ________ use"

[BronsCon]

I'm not talking about IR. Hell, I have a $90 vid cam that does IR imaging. The Sony cam had a thermal imaging mode and yes, if aimed at a window, it would fail; but if aimed at a poorly insulated wall, you could make out the outlines of your neighbors.

People were worried about being recorded doin' the naughty, when it was easily foiled by properly insulating your walls. Not to mention that the quality was... well... quality isn't the right word for the image it would give through even the thinnest of drywall, let alone studs and siding...

Re:"Not for ________ use"

[Attila Dimedici]

In the example you are also paying for the cost of being certified as an approved vendor for the U.S. Navy. There are expenses for selling a product as medical equipment. In addition to the costs of insurance against liability, there are also costs of meeting government regulations. Finally, a large factor effecting the cost of medical equipment is the fact that the ultimate decision maker as to whether or not to make use of a particular device (the patient) rarely pays the cost of said device.

Re:"Not for ________ use"

[Z34107]

In your niche market example, both demand and supply are low. The one firm you describe can price gouge because they're the only supplier in a theoretical market that doesn't seem large enough to serve multiple firms.

The reason the medical balance boards cost more is probably somewhere between "lawyers," "medical device regulation," and "lack of other competitors."

Re:"Not for ________ use"

[Fjandr]

Well, specifically in regards to the military, this is not true. Since you cannot, generally, sue the US government because of sovereign immunity, they don't care about insurance to cover failure. All those components they buy, with few exceptions, don't come with additional guarantees unavailable through standard retail or wholesale channels. The price is because of vendor contract lock-in in this case.

Re:"Not for ________ use"

[Mr. Suck]

It is wrong to assume that price needs to be tied to cost. What determines the price is what your customer is willing pay for it. The question is not why the medical device company charges $18,000 for the device. The question is why are hospitals willing to pay this much.

Re:"Not for ________ use"

[Anonymous Coward]

Horseshit. My Belkin powered USB hub at home charges my iPhone 3GS and iPod Touch 2G; my D-Link hub at work and two non-Apple car chargers do the same.

It's able to charge because it's a standard pinout. Go back to Best Buy or whatever it is you do that doesn't require you to know basic stuff like that. A real geek would be ashamed.

Re:"Not for ________ use"

[germansausage]

Here's another example. Back a long time ago (late 70s) when I was at university we had a professor doing "Aids for the Blind". He was working on a computer system that could synthesize human speech. He had about $50,000 of DEC minicomputers plus another $20,000 of hand-built D-A converter boards in the lab, and was able to successfully read individual words from text files and convert them to almost recognizable speech. That summer TI released the Speak and Spell, which did better speech synthesis for $29.

Re:"Not for ________ use"

[Attila Dimedici]

As for government regulation, I'd rather have too much than too little when it comes to my body and diagnosing and treating illnesses/injuries, as opposed to having to sift through various Dr. Crackpot's Magical Curative Diagnostical Boards.

Then don't complain when prices for medical equipment are much higher than they would be for the same product not used as medical equipment. There is a place for some government regulation when it comes to medical equipment, but when you have too much prices are higher than they need to be. You explicitly expressed a preference for excessive government regulation.
The people on this board who are pointing out the role of government regulation on the cost of medical equipment are responding to people who think that medical equipment prices are high simply because of greed. There are two ways that government regulation increases the cost of a medical device (and many other products). First is straightforward, government regulations will increase the cost to produce a device, the amount varying according to the complexity of the regulations. The second is indirect and less easily predicted, government regulations introduce a barrier to entry to the market, reducing the amount of competition in a particular market.

Re:"Not for ________ use"

[LtGordon]

The hub is powered and without a data connection. USB is supposed to be just 5+V, 5-V, D+, D-. The hub runs the powered half with more than enough power on tap, but no data signal.

Apple apparently decided that they don't like the idea of using a "dumb" USB port to draw power as it's been disabled on my [wife's] 5G iPod Nano. Unfortunately, vendors have caught on and now charge $20+ for "iPod-compatible" chargers.

Re:"Not for ________ use"

[ThunderThor53]

I guess we were paying $99 for the QC sticker they put on it before they sent it off through the supply system.

In the case of electronics for use in a nuclear reactor, the cost premium is for the testing and the paperwork documenting the tests. Using your example of a resistor, the test for each resistor include: burn-in (100 to 10,000 hours), thermal shock, short-term overload, dielectric withstand voltage, DC resistance, x-ray inspection, and visual inspection. Furthermore, each lot is sample tested for solderability (destructive), and a physical destructive analysis. The costs for performing all these tests, documenting it, and storing the data (2 years minimum, 7 years is commonly required on government procurements) all has to be included in the price!

So yes, you can get a resistor that rolled off the same exact line for a significantly lower price, but for the higher price you get a product guaranteed and verified to work - not to mention one known not to be a counterfeit.

Re:"Not for ________ use"

[jhol13]

So the problem is the "liability".

What would happen if the liability was removed or limited? Getting several million "liability" for essentially nothing is insane.

Re:"Not for ________ use"

[mysidia]

In this case it's a real dichotomy.

The device alone is not useful as a toy, or able to be made useful as a toy, without incurring much larger expenses.

Without owning something like the 'wii' platform and undertaking a major software development effort, there's no way to make a force board that's both a medical device and a toy.

Of course it's conceivable that Nintendo could make a medical device now. They were fortunate to have already done all the research and development work to market a gaming console widely enough to use the BB with.

Re:"Not for ________ use"

[zippthorne]

Not everything is life-or-death, and if the patient is in control, even the life-or-death stuff can be shopped around. Hell, even under the current system, you're a fool not to get a extra opinions when serious procedures are on the table.

There are plenty of things that can easily be haggled. Routine care for one thing, a number of life-improving elective procedures can be shopped around (Lasik for instance is one of the few medical procedures that has declined in cost over the past decade. Guess why.).

Testing. MRI is basically a fancy name for RADAR. You're telling me that it can't be made so common that people without piercings can just get one for fun, analogous to supermarket blood pressure screenings? What's so expensive about it? The superconductor? Certainly not operations. LN2 is cheaper than milk.

Flu shots aren't covered by insurance, but you can buy 'em for thirty bucks at walgreens, and there's almost never any waiting. How much is that MMR series again?

Re:"Not for ________ use"

[demonlapin]

wine & dine doctors, preferrably at strip clubs

I invite you to come sell me equipment any time you like. Hell, I'd settle for a decent lunch.

Re:"Not for ________ use"

[snl2587]

You could probably eliminate portions of points 1,2, and 5 by simply wrapping the thing in airtight plastic during use and/or just giving the thing to the patient after use. The latter would probably make sense if the particular practice did this less than 180 times in the same period as the specialty board is built to last, and would probably make it cheaper for the patient, too. Plus they get a balance board.

And no, giving the board to the patient would not present an additional problem, or at least no more so than the boots and oral syringes doctors give out to patients already.

Re:"Not for ________ use"

[harlows_monkeys]

Part of that $99 was the assurance that they will keep the same part available, with the exact same specifications and characteristics, for some ridiculously long time.

Re:"Not for ________ use"

[LostCluster]

And people are telling me elsewhere that tort reform and health care are not the same thing. I disagree with that. If hospitals were allowed to post a sign saying "We'll do our best to help you, but if we fail or make it worse we're not responsible." then health care would cost a whole lot less.

Re:"Not for ________ use"

[jhol13]

Last time I was in hospital none of the computers I saw passed any of the tests you gave.

Something wrong somewhere?

Re:"Not for ________ use"

[LostCluster]

Price has a lower bound related to cost. If cost > price... nobody's going to make the widget.

Re:"Not for ________ use"

[PingPongBoy]

You can actually get medical equipment very cheaply, provided you declare that you will not use it for human use. What else you could use a heart monitor for is beyond me, but when they can strip liability from the price tag, the price goes down. Considerably down. Think 1/10th of the "all warranties included" price tag

So the doctors knowing all this are effecting what? Complaining, and making suppliers lower prices? Forcing Nintendo to slap on a non-medical label?

Do doctors try to get away by substituting with ordinary household appliances in the clinic? It all comes down to the interface. If Nintendo can be expected not to rethink their parts given the low price they're charging, then why not? Save money, and all that.

The doctors actually dismantled the mechanism. I suppose that's par for the course. Dr. MacGyver out in the sticks should know how to make do with all that is at hand.

Herald a great new age for medicine. As devices mature, the competitive environment forces them to become more multifunctional, and hence more adaptable to new purposes. Farewell to the days when a computer merely doubles as a doorstop. Third world medicine advances all the more due to the evolution of gadgets.

Re:"Not for ________ use"

[demonlapin]

Do you still design for flammable anesthetics? I didn't think they were used anywhere that there was electricity.

Re:"Not for ________ use"

[Anonymous Coward]

What determines the price of a scale is not just its equipment or accuracy.. but also the insurance the manufacturer has to carry in case something goes wrong.

Let's not forget all those scale-related medical disasters.

Re:"Not for ________ use"

[Xeno man]

Thermal Imaging is IR! Unless you got her up against the wall and you get her really hot, you not going to see anything and even then your just going to get a blob. Thermal Cameras record surface temperatures like the wall you are trying to see through.

Re:"Not for ________ use"

[BronsCon]

Then I'm not sure WTF Sony had, but it could make out shapes pretty clearly on the other side of a sheet and vaguely through a hollow wall.

Re:"Not for ________ use"

[swillden]

This makes absolutely no sense. People with insurance, high deductible or not, generally do not question the costs of remaining in good health.

I sure as hell do, ever since I switched to a high-deductible plan. And the doctors really go out of their way to find the most cost-effective approaches when the patient is worried about the bill.

Re:"Not for ________ use"

[Anonymous Coward]

Wrong on so many levels...

  "because that is what drives high insurance premiums, lots of failures (no failures, low premiums)" ... You are full of shit. If you're talking about malpractice insurance, we're talking huge compensation for an uncommon event (in an industry that deals with a large number of people ... like, everyone. Unless you don't vaccinate your kids or take them to the doctor. In which case I think you should be held criminally negligent.) If you're talking general purpose medical insurance, the big cost is in paperwork. Administrative overhead for private insurance companies is "“approximately 11 percent of spending by private plans under Medicare Advantage." That's huge. And the part that doesn't mention is that the hospitals need to run just as many paper pushers to deal with the insurance companies. The Cleveland Clinic (arguably one of the top 5 hospitals in the country) has about as many people working purely with paper as it does doctors. And this cost manifests ... in the bills they send to the insurers.

And,... dude. Insurance companies often pay less than 50% of "list price". It's those without insurance that get SEVERELY screwed.

I'm not smart enough to really talk about why insurance costs are high, but it has a lot to do with negative feedback loops.

You are ABSOLUTELY full of shit in regards to the "warranty" ... It's not about warranty. It's about liability. Which lasts forever (with highly diminishing chances of fault being proven, over long periods of time).

These machines a) are of very high quality, and b) the manufacturer is ENTIRELY liable (assuming it's their fault). Basically the manufacturer is liable forever. (But if the hospital is using a 75 year-old defunct machine, chances are it'll be hard to demonstrate fault.)

And.... Holy fuck. I am a staunch liberal, but do you go outside? The private sector is often MUCH more efficient than the government. (It can also be much more exploitative, of course.)

Re:"Not for ________ use"

[pnewhook]

It's got noithing to do with insuran ce. It's got a lot to do with requirements.

You make something for the medical market, you got a thousand additional requirements and regulations and testing you also have to pass. This takes a LOT of money. Bringing a complex piece of equipment to the hospital takes about $400 million including about 10 years of development and patient trials. The whole point of which is when it is done it is a reliable piece of equipment, reliable enough\ to stake someones life on.

If the sensor in a game craps out, who cares. If the sensor in a device to deliver medication goes bad, or a piece of life monitoring equipment goes flaky and displays to the doctor the wrong information, someone can die. THAT'S the difference.

Re:"Not for ________ use"

[pnewhook]

Not so much liability, more so requirements for reliability and testing placed on a medical device.

Re:"Not for ________ use"

[Xeno man]

This makes absolutely no sense. People with insurance, high deductible or not, generally do not question the costs of remaining in good health. They sign consent forms for procedures and deal with the bills after the fact. This is why bankruptcy rates from health care bills are so high. The people who do not seek treatment based on costs are almost exclusively the uninsured. If the internal link to your argument is seriously that patient will start haggling with the people responsible for keeping them alive, you might want to rethink your position.

People don't question the costs because they are not paying it. The insurance usually does. It's all the insurance plans that drive prices up. If you got full coverage, what do you care what the doctors charge and how much drugs are. If you actually look at what is available you will find that doctors are prescribing drugs that are $50 a pill when there are generic brands that are the same thing for $5 a pill. The thing is no one is asking why the price difference because the default attitude is "Insurance is paying for it", doctors and patients alike.

Re:"Not for ________ use"

[JWSmythe]

    There are different levels of IR.

    The IR that most people are familiar with is just below the visible spectrum, which lets stuff like the Sony camera shoot in the dark, with an IR emitter. Basically, a light that it can see by.

    Thermal imaging IR is "long IR", which shows heat. Anyone above 0 degrees kelvin puts off light at very low frequencies that we can't see. And no, there's no such animal as a $500 thermal imaging camera. You're looking at a starting price of about $3K. If Sony, or anyone else, were to produce a camera that retails at $500, they'd definitely do it. It's not a privacy concern that keeps the price high, it's the simple fact that the components are still very expensive.

    Seeing through walls is pure scifi. You'd see the temperature of the wall. You may (just may) see something through a wall, if it's hot or cold enough to change the temperature of the wall. Like, you could see the general shape of a fire through a wall, because it's heating the wall. In scifi it works through "suspension of reality". You believe what you're shown, because it's necessary to the plot. Some people don't understand an impossible technology used in a movie, so they assume that it's real.

    You'd be able to see through a glass window though, assuming nothing pesky like blinds are in the way. So, a couple having sex in a dark room, seen through an open window, is perfectly possible. Either IR would work, but that isn't quite what was suggested.

Re:"Not for ________ use"

[pem]

Yeah, but why would I want to buy exactly the same part as the one that just went bad? Maybe I can get a better one from a different manufacturer...

Re:"Not for ________ use"

[jo_ham]

Then that is crazy. My iPhone does work this way though, on a powered "dumb" port, as does my 4G iPod. If this is the case it is new on the 5G and I don't like it one bit. Bah.

Re:"Not for ________ use"

[Xeno man]

What dangers? Just because it uses power it's now a potentially dangerous device? You fucking stand on it!

Re:"Not for ________ use"

[timonak]

I can honestly tell you that you have no idea of what you are speaking. I work for a small medical device manufacture as a software architect/engineer. There are many reasons why a medical device is expensive. I'll enumerate the two that I have experience with. The first, and biggest is the FDA. We are a class 2 medical device, much like the piece of equipment mentioned in the article. So what does this mean? It means reams and reams of paperwork. Not nearly as much paperwork his required for a class 2 as a class 3 (pace maker and other implantable devices) device, but still reams of paper. We sent almost a WHOLE box of paper to the FDA when we submitted our paperwork. If I had to add up the cost to produce the paperwork, given the cost of lawyers, and staff time, my guess would be >$250k. Thats just the initial cost. We now have to get ready for an FDA compliance audit in the next few months. We have also have to overhaul how we develop the software. We have to be able to trace every line of code back to reams of paperwork, that adds an additional burden to the bottom line. Next are lawyers. We spent a TON of money on lawyers while doing our FDA 510K. Competent lawyers who are also knowledgable about the FDA 510K process are NOT cheap. ONE of the lawyers we used cost $600/hr. You also have to remember that the medical market is quiet limited. How is a small medical device company supposed to survive if they sell the device for a couple of hundred dollars into a very limited market? When you see our product, you might be tempted to think $5000? I'm not paying that much for a metal frame, a hardened PC w/ a touch screen and some software. Its not worth that much. And when you do, I want you to tell that to me personally, to my face. I also want you to tell me that my family doesn't deserve to eat.

Re:"Not for ________ use"

[drinkypoo]

Without owning something like the 'wii' platform and undertaking a major software development effort, there's no way to make a force board that's both a medical device and a toy.

It's called partnering. Hope this helps you reset your imagination to a state in which it is useful.

Re:"Not for ________ use"

[sjames]

Actually, the balance board is incredibly unlikely to cause any harm. It's less likely than an aspirin.

You make it sound like the thing is packed with explosives, sharp knives, and a million volts. Millions are used perfectly safely every day all over the world.

Even if you drive a cheap car that you could afford to replace... you still carry insurance based on the risk that you might hit an expensive car, or two, or even worse, a house. That's almost limitless.

Sure, just like the doctor. The manufacturer of the car doesn't jack the price up to 2 million dollars to cover more insurance however.

These sorts of crazy markups are the difference between ubiquitous healthcare in the U.S. and people routinely dying early due to the lack of it.

Re:"Not for ________ use"

[Anonymous Coward]

HP lists a common coin cell battery for the real time clock in my laptop at over $40 on their web site. The price of the same battery on amazon is $1.
People will charge a price that the traffic will bear.

Re:"Not for ________ use"

[Anonymous Coward]

Price fixing will just make it impossible for the market to discover the right price. You don't need price fixing, you just need a real free market.

If you didn't catch the bulletin, we DON'T have one in healthcare, but we DO have one in video games.

This is the result. See the difference?

Re:"Not for ________ use"

[roju]

Technically I think there's no room in the USB spec for drawing more than minimal power without a proper controller.

Re:"Not for ________ use"

[mjwx]

In other words, the answer you're looking for is not "more government" - that is the problem.

So less government is the answer. Lets strip away all the medical regulations shall we, the ones that govern safe use, the ones that govern responsibility.

You should try going to get medical care in the third world, like the philipines where there is "less government" in health care, there is also less survival, more infections, lower quality of service and more deaths. The barriers to entry into the western system is to ensure that there is a minimum standard of care. I know that /. has a love affair with libertarianism but you really need to get over it. The cost is not the end of the story, many industries have higher priorities then "lowest possible cost" such as maintaining a standard so that lives aren't lost.

If you buy a $18,000 medical instrument you are paying for:
- a crapload of R&D.
- a guarantee that instruments will work for it's entire lifetime.
- a guarantee to that instruments accuracy
- 24x7 service if that instrument breaks, I think the turn around time will be well under 4 hours for most things.
- liability.
The cost of manufacturing the instrument is the lowest cost, go and compare a 24x7 4 hour replacement warranty for a server, this is what costs money.

Perhaps just no one realized how much of an opportunity there was here because no one really has a clue how much healthcare costs these days since no one using it looks at the bills anymore

No, people are checking the costs, just because you don't know how much health care costs doesn't mean others don't. But those checking the bills are also checking the other important factors like lives lost/saved, successfully/failed procedures, patients in/out and secondary effects (return patients). The US healthcare system my actively work to hide costs but many out here have real accountability (and complete lack of a profit motive).

So please, let me fix this one for you In other words, the answer you're looking for is not "less government" - that is the problem.
Take away needed health care regulation and you end up with a third world health care system, you know like in nations that do not have health care regulations.

Re:"Not for ________ use"

[Laser Dan]

Sony had it in a $500 camcorder for a few months before being forced to take it off the market because people were using it to film their neighbors screwing... through their neighbor's walls...

No they didn't.

I believe you are thinking of nightshot, which has an IR illuminator for night filming. The "issue" is that some types of clothing that look opaque under normal light are considerably more transparent to IR...

This is completely different to thermal imaging, which is expensive due to the exotic materials required for the lenses and detector.

Re:"Not for ________ use"

[Anonymous Coward]

I get it. So what you are saying is that governments would be far better off manufacturing all this stuff themselves rather than contracting it out. Not only are you eliminating wasteful profits but also enormous insurance costs because the governments can readily self insure.

It doesn't matter whether a business or a government does it, it still takes the same amount of resources to do the quality control and thus costs money.

The difference is that when businesses do it, they actually have to compete with other manufacturers. Thus, they'll tend to create better products at lower prices in order to get business, and those "wasteful profits" are their reward for that.

For god's sake, take an economics class.

Re:"Not for ________ use"

[Tekfactory]

The guy Parent was arguing with was probably thinking of this link, scroll down to "See through clothing"

http://www.kenrockwell.com/tech/ir.htm

The link specifically states what the camera sees through is cotton, at the time this camera was released I believe swimsuits got all the attention.

Re:"Not for ________ use"

[Anonymous Coward]

I get it. So what you are saying is that governments would be far better off manufacturing all this stuff themselves rather than contracting it out.

That is not at all what he said; not even remotely close. GP said that the government is paying $100 for the same thing that costs the hobbyist $1, and that he did not believe QC markups could add $99 to the cost of the product.

I think you need to see a psychiatrist; you might have a mental illness.

Re:"Not for ________ use"

[Anonymous Coward]

My point is that expensive certification could still prove to be substantially cheaper than a purpose-built medical device.

There's another alternative, too. It could be very successfully used in developing countries, where certification is a luxury they literally can't afford, in places where results matter more than fear of lawsuits.

Re:"Not for ________ use"

[BronsCon]

No, I'm pretty sure the IR-lit nightshot mode on my current camcorder is NOTHING like that I'm talking about.

The Sony model in question (again, only on the market for a few months, and this was, I wanna say, back in '99) was something entirely different. It sure looked and acted a LOT like the thermal imaging cameras I've used in recent years.

Keep telling me I'm talking about nightshot, though. I find it rather amusing that you choose to ignore that I've already told you my current cam has that and it's different than the Sony cam I'm talking about.

Re:"Not for ________ use"

[Sulphur]

About that time, there was a speech recognition thing for the TI-99/4A baseball game and another for the TI Professional that cost quite a bit more, but was not any far cry more functional.

Re:"Not for ________ use"

[Opportunist]

Not gonna happen. Again, liability. Should the shit hit the fan and someone get hurt from a faulty device (or malpractice), you may rest assured that all insurances will painstakingly test what equipment was used. And should they only be able to find a single one that isn't FDA approved and certified "for medical use", they will start their happy dance because they don't have to pay and the doc has to see how to get out of that shit.

No doctor will take that risk. Well, at least none that I'd willingly go to, because the only reason to do that would be that no insurance is willing to take the risk to insure that quack.

Re:"Not for ________ use"

[poopdeville]

You're comparing apples and oranges. A product should not be launched unless you can make between 8-12 times the cost to manufacture. You have to find products like that, and do market research to figure out their demand curves. That costs money. If one in ten products is a success, you just about break even. That's 0% profit, despite selling at 8-12x markup over manufacturing costs.

Re:"Not for ________ use"

[JWSmythe]

    Now that, I do remember. There were web sites that were specializing in showing those pictures. It wasn't just swimsuits, but quite many different thin cloths worked.

    As I recall, they weren't released to market as such, but they were a pretty easy hardware hack. After it became a problem, I do recall that they made it a harder hack, but it is still perfectly possible. Just google "xray cam". I know, it's not xray, but that's what folks started calling it.

Re:"Not for ________ use"

[Opportunist]

You are aware that we're still before the reform, yes?

I wonder why so many US people are against nationalized healthcare. Seriously, I do. We in Europe consider it one of the main wellfare achivements of the last century, and it's considered for many close to how a lot of US people think of their 2nd amendment: You can take it from me from my cold, dead hands. Any politician even dreaming of thinking he might say something like getting rid of it would probably not only have to clean his desk by noon, he'd be the new enemy of the state. At least the people of the state.

So why? I don't get it.

Re:"Not for ________ use"

[LurkerXXX]

Well, you might be stupid enough to not want to hear any formula's, theories or reasoning, but for the non-daft folks out there...

R&D, building of templates and other things for manufacture are going to cost a fixed amount of money.

When you build a specialty device and sell 1000 of them, you can spread the cost out over those 1000 units.

When someone else makes a general use device using the same technology and sells 10,000,000 units, they can spread the R&D and manufacturing setup over 10,000,000 units.

A jump of 1000x in price suddenly isn't out of the realm of possibilities when you take logic into account rather than just saying 'there is no justification and I'm not listening to logic, formulas or theories' like the parent moron.

Re:"Not for ________ use"

[hack slash]

After your reply I did do a bit of googling to see if I could find the camera you were talking about in the hope that it does exist, but couldn't find anything and neither during my several searches for information at various times on DIY thermal imaging never really turned up much more than people on forums confusing PIR (motion sensors), IR (remote controls/nightvision etc.) & IR long (thermal).

I've wanted to make my own using a readily available & interfacable thermopile array mounted on a couple of servos sat upon a tripod to take thermal image photos but after seeing someone have a go at this - http://hackaday.com/2009/09/25/arduino-thermoscanner/ - it looks like I'd have to source a very good thermopile with a very narrow FOV to get more detail, or save up a few thousand for a proper unit...

Re:"Not for ________ use"

[Eivind]

No you're not. Seriously. No company in this world will sell you a resistor and say: "if this breaks, and makes a nuclear reactor go down in flames, we assume liability", not for $1, not for $100, not for ANY price.

Such devices need to be, an ideally are, constructed so that there's a tolerance for error -- a single broken resistor shouldn't be able to cause a danger.

Re:"Not for ________ use"

[Anonymous Coward]

The FDA requires that to justify the huge price mark-up in the first place. The FDA too often works hand in hand with the medical industry to rip off consumers.

And who leads the FDA? A one time big pharma lobbyist.

It is unfortunate that such well educated people, like yourself are complicit in ripping off the public.

Re:"Not for ________ use"

[Anonymous Coward]

Really? I charge my wife's iPhone from my droid USB supply just fine.

Re:"Not for ________ use"

[poopdeville]

So why? I don't get it.

Because Americans don't understand how insurance companies work. Insurance agencies broker risk, and they do that most cheaply with an economy of scale: the larger the pool of risk, the more predictable (cheaper to manage) it becomes. But the insurance market is (rightfully) regulated. An important example is a capitalization requirement, which limits the number of clients an insurance company can take on. In order to "get around" this requirement, insurance companies by and sell risk with other companies, through the use of "swaps". This is perfectly legal, and is in fact a VERY smart move.

But there are two negative consequences for the rest of us: using swaps to settle debts -- instead of itemized bills -- incentivizes fraud, which puts strong upwards pressure on prices. The insurance companies don't care that they're being overcharged, because they're overcharging each other by similarly inflated prices. Secondly, the use of swaps to settle debts is a de facto price fixing mechanism. Honestly, I see this as a benign consequence. The insurance companies are all getting similar actuarial data, and it is based on this actuarial data that they set their prices and negotiate swap contracts. So, in the end, a national-scale insurance company or cooperative would be compiling this same data, and fixing their prices in the same way.

Competition does not enter into the insurance industry, with mathematical force.

Re:"Not for ________ use"

[Boronx]

Demand curves probably look like this:

Demand for a medical balance board @ $18000, maybe 1000

Demand for a wii fit @ $18,000 maybe 100

Demand for a medical balance board @ $100, maybe 10,000

Demand for a wii fit @ $100, maybe 10,000,000

Engineering cost for both, probably $1,000,000

Re:"Not for ________ use"

[RockDoctor]

How do you get from

"there's only 2 companies on the planet that build this particular specialist piece of equipment"

to

"Tell Washington, DC about that. [...] they should be regulated."

without passing through one of "Washington rules the world", "America is the world" or such-like parochialism?
The inclusion of the "on the planet" phrase is a pretty clear flag to me that the two companies in question are in widely separated locations.

Re:"Not for ________ use"

[Ihlosi]

My point is that expensive certification could still prove to be substantially cheaper than a purpose-built medical device.

No toy company wants to deal with the shit that medical device regulating agencies (not the plural) can and will send their way. Not for any amount of money.

(Medical device engineer here, with a crapload of shit from $THREE_LETTER_AGENCY coming his way.)

Re:"Not for ________ use"

[that this is not und]

If you're building something that absolutely, positively, must NEVER use an electrolytic capacitor with bad electrolyte, you have no real option besides buying only capacitors that are certified

You don't know much about electronics or capacitors.

If you need that reliability, you use a tantalum capacitor. They're not that expensive.

Re:"Not for ________ use"

[Toonol]

Maybe you're paying for the lawyers that will weasel out of the liability charges?

Re:"Not for ________ use"

[that this is not und]

I did what you're doing for a living awhile back.

The 510K is an absolute joke. What you're doing when you claim a 510K exemption, is you're claiming your new medical device is 'substantially equivalent' to a device already approved. Saves you the astronomical cost of Clinical Trials. So you have your Regulatory Staff out working on that. Meanwhile your Marketing Staff is working double time to convince the customers that your produce is a new, exciting, innovative product.

Re:"Not for ________ use"

[Ihlosi]

Hey, if a scalpel packer sneezes on a scalpel being packed, then the surgeon takes the scalpel and sticks it in somebody's liver without cleaning it, who's at fault? The scalpel packer according to your retard logic!

Yes. Do you really think that disposable scalpels/needles/etc are disinfected by the hospital before they're used? No, they're disinfected before they're packaged and/or disinfected after they're packaged, but before they're sold.

If you don't understand the processes involved in making and selling a medical product, you just sound ridiculous when you're claiming that they are stupid.

Re:"Not for ________ use"

[that this is not und]

The answer is 'less government' and 'more competition.'

The Medical Device manufacturers in general have a sweetheart deal going with the FDA. They know the ropes, they have their captive market. The barrier to entry for new companies is staggering. And the big medical device makers love it that way.

There's one heck of a lot of collusion between Industry Organizations (i.e. AAMI) and the FDA.

Re:"Not for ________ use"

[that this is not und]

That's why the Buyer for 'Consolidated Health Care Clinics' goes down the street to your competitor. Who works out a reasonable deal with them. Gets the sale.

Sux to be you. Oh well.

Re:"Not for ________ use"

[JunkmanUK]

Of course, if the component had been manufactured properly in the first place it wouldn't need replacing. Which then brings into question all this quality assurance and 'approved supplier' malarky...

Re:"Not for ________ use"

[that this is not und]

The word Medical means a lot of parasites jump on board to get their knick out of the biz.

Re:"Not for ________ use"

[Anonymous Coward]

I seem to remember a similar story. It was the USS Iwo Jima (LPH-2) back in 1990. In this case it wasn't a resister, it was a fastener. And all 10 men in the compartment were killed when the boiler blew.

Imagine how worse this could be on a nuke ship.

Re:"Not for ________ use"

[jonr]

Probably true, but the cynic in me tells me that the real reason for the $18.000 price is "What will the market bear?" type of pricing....

Re:"Not for ________ use"

[Anonymous Coward]

Tantalum capacitors belong in the trashcan. Those things are unreliable as hell and have a spectacular failure mode. Which gets triggered if you as much as look at them funny.

Get them to hot: they explode. Overvolt them by even a tiny amount: then explode. Reverse potential at any level: kaboom.

Don't use tantalums. Ever. They suck and blow at the same time.

Re:"Not for ________ use"

[wisty]

Google manages to get high reliability at a low cost by using redundancy. Medical devices be set up the same way. Not always (you can't cut with two scalpels), but in a lot of cases it could be done.

Imaging software could run on three independently developed code paths (on separate machines) to check that the results are processed correctly.

Three separate actuators could maintain gas pressure.

You get the picture.

Re:"Not for ________ use"

[Anonymous Coward]

They tell the doctor how effective the drugs and methods are. Half a pound is probably an unacceptable and unjustifiable error.

Half a pound? Have you ever actively measured your weight? Even if you always measure under the same circumstances (morning, after going to the bathroom and taking a shower, etc), your weight will easily vary significantly more than that (a kilo or two for me), depending on what you had for dinner, whether you worked out yesterday, you donated blood recently, or whatever.

Re:"Not for ________ use"

[wvmarle]

We're talking about a diagnostic device. Not a life saving device. Not even for internal use. It is quantifying balance: we know the patient has balance, we just want to know how much of it. It is not even diagnosing whether a patient has a disease or not, or what disease a patient has.

If it is faulty, the doctors will know. Either it doesn't work, or the values do not make sense. A doctor with a little bit of experience will know from looking at the test about where the number should end up, and if out of expectations can take another device to test again. They're cheap, so you can have more than one on hand.

Sterility is not even an issue here (beyond basic cleanliness of course), it is not for use in an OR.

The main reason these things are/were so expensive I think is because of the very small product runs. Really small: hundreds, maybe a few thousand. There was no other use for these sensors, so development cost has to be shared over a few thousand pieces at most. Come the Wii with its gadges using basically the same tech, and both production cost and development cost per unit drop enormously. It matters a lot if you share costs between 1000 or 100,000 units.

Then probably the medical version is much stronger and sturdier, lasting longer, but the price difference is too big to make up for that.

Re:"Not for ________ use"

[mpe]

And should they only be able to find a single one that isn't FDA approved and certified "for medical use", they will start their happy dance because they don't have to pay and the doc has to see how to get out of that shit.

Would this "FDA" be the "Food and Drug Administration" in the USA? When the article mentions the "University of Melbourne", the only such university I am aware of is in Victoria, Australia. Australia does healthcare very differently from the US.

Re:"Not for ________ use"

[mpe]

Doctors who treat people with excessive weight need to know the exact numbers, especially as the readings are taken mid-course. They tell the doctor how effective the drugs and methods are. Half a pound is probably an unacceptable and unjustifiable error.

Only for people who drink or excrete less than 200ml at a time :)

Re:"Not for ________ use"

[jisatsusha]

"charging is not supported with this accessory".

Re:"Not for ________ use"

[Anonymous Coward]

like the other poster your math is a bit wrong.. i can see how you would have made the mistake a quick glance but 200k/1mil isnt 1/20 ... its 1/5

Re:"Not for ________ use"

[div_2n]

Everyone here is just wrong. The biggest reason medical devices like the one mentioned cost so much is because of government regulations that must be followed (think FDA). WRT the FDA, it is part 11 compliance.

The extra effort you have to go through to ensure your devices meet these standards is a _major_ PITA. If you also sell the same part in a non-medical capacity, you can easily make manufacturing runs using the same equipment, materials and everything else but you just don't have to document the piss out of everything, have parts and equipment sitting waiting to be passed by QA before being used and also finished goods waiting for QA to be inspected before being shipped.

Essentially, your manufacturing costs at least double when following these regulations. Does that justify $18,000? I don't know. But I guarantee you their manufacturing costs dwarf that of the Wii device.

Re:"Not for ________ use"

[Anonymous Coward]

They did not charge 6k for the HDD.

They charged 6k for the fact that the hospital can KNOW that all machines area as they should be as people who KNOW what they do echanged parts. Not people who CLAIM to know.

This is a) to prevent people dieing and b) to be on the safe side of the law SHOULD someone die.

Re:"Not for ________ use"

[Anonymous Coward]

The reality of this is that it's not greed, it's the potential for losing everything in our age of comically frivolous lawsuits. People are suing McDonald's because their coffee is hot. They're suing banks that don't loan them money because their credit is next to worthless. They're suing the makers of junk food because they're fat. They're suing the makers of tires because they had a blowout. There's a lot of liability that needs to be paid for to allow the makers of purpose-built medical diagnostic equipment to operate, because of the ever-present risk of meteoric lawsuits.
        Regardless, if a company were to begin offering the same equipment on that market at a fraction of the current price, you can rest assured our highly conscientious and results-based government would get someone on the scene, fast, and get the pricing balanced out across the market. That is, of course, what's in the best interest of the American consumer, right?

Right?

Re:"Not for ________ use"

[Anonymous Coward]

Disclaimer (because /. has taught me I need one): I'm not saying all QCed stuff is expensive for no reason. Just that sometimes people really are getting ripped off in the name of QC.

I don't think so. I used to do QC for a timber mill producing structural timber. Industry practice accepted < 5% defect rate at wholesale production. It was not to hard to get to < 3% if you were good at motivating the grading team, had good auditing and prompt error correction. To get consistently below 1% defect would at least double the price of production. If lives depended on every board leaving our site without defect, the cost of production would skyrocket.

If you do honest audits, that last few percent of defect is very difficult to get rid of in mass production systems. I wouldn't want to depend on a wii instead of a rigorously build medical device if I could help it. A hospital that couldn't afford an $18,000 device could provide a lot of benefit by using cheaper devices though. It could drastically reduce the cost of health care but I have no doubt whatsoever that part of the price paid would be loss of consistent quality health care. For assessing balance, as in this application, you can probably tolerate the defect rate in a wii. For monitors used in intensive care or complex surgery etc, you want the QC'd stuff.

Re:"Not for ________ use"

[Anonymous Coward]

im cool with the fail part, but if they cause me to get worse, then i expect them to at least make me better. Im not concerend with the money, im concerned with them cutting off perfectly good body parts.

Re:"Not for ________ use"

[peragrin]

Whileyour correct the fact is thermal imaging camera price has been halved in the last 6 years. While they are still thousands of dollars they are no longer ten thousand dollars. In another five years you should be able to buy one under a grand.

Re:"Not for ________ use"

[Dominic]

"A national, single-payer system as envisioned by the left just exacerbates this problem because it even further separates the patients from any concern about the costs of their care"

Well, I can't speak about the single-payer systems of other countries, but here in the UK the NHS is acutely aware of costs and returns. Patients *do not* usually get treatment that costs three times as much if they're only 10% more likely to survive. Occasionally this makes the news as some cancer sufferer is denied some new-fangled drug that hasn't been extensively trialled and proved to be better than the current first choice, but in reality this is a sensible decision. Some drugs can cost hundreds of thousands of pounds to perhaps prolong life by a month or two. That money could maybe prolong someone else's life for far longer, or provide a much better quality of life. There is no gain in prolonging someone's painfil few months of cancer for the same cost of a life-saving liver transplant or something. Drug companies know this, so they sell drugs to the NHS for far less than they would to a system like the US where private insurance will pay whatever they ask for.

Patients know little about medicine. The absolute worst scenerio is something like the US where there are even adverts on TV that say 'ask your doctor for Drug X'. That such adverts are even allowed is madness, but then I suppose if you have to pay to see a doctor, maybe people feel they have the right to demand certain drugs? This is one of the many problems with private healthcare that make is so much less efficient.

Re:"Not for ________ use"

[Anonymous Coward]

How about you get a real job doing some good in the world rather than masturbate bureaucrats. Fucking pig dog.

Re:"Not for ________ use"

[Anonymous Coward]

The part you purchased probably isn't rated explosion proof. It may look the same, be used the same, but if an explosion were to happen, well... They make things like that for a reason.

Re:"Not for ________ use"

[dimeglio]

Nonsense, for the difference in price, a hospital could easily purchase extra insurance. Better yet, have a third party apply its label on the wii balance board and sell it as medically approved OEM for just a few dollars more.

Re:"Not for ________ use"

[jplopez]

If they were going to charge you 6k, why even bother about the warranty? From my point of view, if the machine was under warranty, the repair should have been free of charge.

Re:"Not for ________ use"

[Anonymous Coward]

No, the hospital wasn't charged $6K for the hard disk - it was charged $6K for keeping the warranty intact, which in turn means it was paying for the vendor to preserve the audit trail for each and every component in the device. Not having that audit trail intact could cost the hospital a *lot* of money if that machine was in any way involved in a lawsuit.

Re:"Not for ________ use"

[Anonymous Coward]

What about the software development?
What about the documentation?
What about the marketing and sales?
Who develops the procedures for using the device?

The liability insurance cost is probably not really there. They probably waive liability and keep a lawyer on retainer as part of the normal business dealings anyway.

I would like to encourage anyone who thinks that the Wii Balance Board can do the job at less cost than traditional medical instrumentation to use their entrepreneurial spirit for the advantage of themselves and the world by basing a medical instrument business on it.

Re:"Not for ________ use"

[Anonymous Coward]

Seeing through walls is pure scifi.

No it's not. The military has it and I've seen it in operation.

Re:"Not for ________ use"

[hairyfeet]

Uhhhh...I might believe that maybe, if they had sent out their own man who brought in the part from their warehouse or something, but how exactly is their gonna be a verifiable audit trail when they subcontracted to some guy with a Best Buy retail drive exactly? Hell for all they know it was a classic "we'll take this used POS drive and rewrap it in the back" Best Buy drive half filled with porno!

Sorry, but I have to go with my buddy's thinking on this, these medical contractors have a nice little racket going and know they can just pass the FU on to everyone else. Like I said just one reason why we pay the most for health care but rank something like 37th on quality of care.

Re:"Not for ________ use"

[Anonymous Coward]

I work in QC and third party testing. It's a fact that in this industry two of the "same" product can be made differently.

One product will be made with inferior components and sold only to certain retailers. The more expensive one will go elsewhere. Usually the retailers or manufacturers put a "made exclusively for X" on the product, but it's not required.

The inverse is also true. My previous company sold items to the military. The MIL-SPEC products had the same numbers externally, but different internal build numbers because certain components needed to be exchanged for higher quality ones to meet the standard.

They don't bother changing the item number because it is easier for sales to simply differentiate by buyer than to create hundreds of numbers for each product.

If you have ever built anything with resistors you've seen this process out in the open Due to the nature of the business, these suppliers won't usually hide the % deviation. Most of the time the process used to make them is the same, they just charge more to presort them. You pay more so you don't have to check each one to see if it's within tolerance.

Re:"Not for ________ use"

[Anonymous Coward]

When patients routinely ask the doctor "Okay, what will that cost?", then we'll start to see some significant downward pressure that begins to at least contain the growth of health care spending, and perhaps even starts to reduce costs.

Go ask a doctor "Okay, what will that cost?" and then get back to us.

Re:"Not for ________ use"

[dkleinsc]

Those companies are only abusing their monopoly if someone new comes in and is pressured out of the market by anti-competitive tactics.

Not necessarily true. It depends on the economies of scale that can be realized by the dominant manufacturer. There are markets in which the most efficient producer (in terms of lowest cost to the manufacturer) is a monopoly, and that throws a big wrench into the idea that markets always produce the lowest possible price.

For instance, assume that there are 10,000 people who need widgets. The monopoly "M" can produce 10,000 widgets at a cost of $2 apiece. A potential competitor "C" can initially produce 500 widgets for $5 apiece. Allowing for a rather tidy profit of 50% for M, the price of a widget ought to be $3, but the only check on M's price is C, so M charges $4.99 when C starts up, and $10 when it doesn't. C is kept out of the market (because it can't compete), M always remains profitable (so it can legitimately argue that all it's doing is competing with C), but the price of a widget is still way higher than it would be in an efficient marketplace.

It's worth noting that the existence of competitors would help consumers considerably, but because it's a losing proposition for any competitor the competitor either won't exist or drop out rather quickly. And the losers in this scenario are the 10,000 customers, who end up paying a higher price than they should.

Re:"Not for ________ use"

[L4t3r4lu5]

Rubbish. My HTC Diamond 2 came with a USB charger which you plug in the appropriate A type male - Mini-B type male cable into. Plug in a standard iPod cable and it works fine.

If it didn't, it wouldn't charge from your computer either.

Re:"Not for ________ use"

[Anonymous Coward]

Your an idiot, who makes a point while ignoring the parents point. The point is they can produce them for much less then the medical suppliers, and if you put them through the same testing youd save a lot of money. What happens if the tests only cost 1000 dollars:

Manufactured: 100

Tested: 1000

Wholsale markup 40%: 1540

Retail Markup 100%: $3080

Competitors price $18000

You save $14920

Id say you are so under budget you deserve a raise.

Re:"Not for ________ use"

[Anonymous Coward]

What determines the price of a scale is not just its equipment or accuracy.. but also the insurance the manufacturer has to carry in case something goes wrong. That's why medical devices are more expensive... you're also paying for the liability of somebody being misdiagnosed by a technical malfunction. Highly unlikely, but the money that has to be paid when that happens and gets proven is huge.

Two words:

TORT REFORM!!

Something useless democrats don't want to do because they are too busy lining their pockets with donations from the lawyers. Not saying republicans are innocent, but its the dems that are doing it blatantly and causing the most damage.....

Re:"Not for ________ use"

[Anonymous Coward]

Yeah, but a Wii fit board would be more of a durable piece of medical equipment rather than disposable I would think (but hey its an f'd up world). So that said, I think the procedure would be to sterilize/sanitize the unit before each procedure.

Re:"Not for ________ use"

[jo_ham]

From your links:

“We have seen a brand-new iPhone 3GS that was plugged in an AT&T store demo Apple iPhone Dock and the 3GS screen shows that the accessory(Apple Charging Dock) is not an authorized Work with iPhone accessory,”

Clearly this is some sort of bug. I'm sure Apple wants to lock out people using third party USB devices like.... the Apple dock.

Looks like it needs a software update - perhaps the phone/pod is being too picky about exact voltage/current or the power fluctuation from the port and is chucking up errors, or the phone itself is faulty.

Re:"Not for ________ use"

[Doghouse Riley]

"I also want you to tell me that my family doesn't deserve to eat."

It sounds to me as if -you- are earning your family's keep - your family deserves to eat.

However, the battalions of lawyers that get involved in the process (on your side, and on the government side) are doing nothing but adding cost to the system. They provide not one iota of patient care. Their families don't deserve to eat the fruits of this parasitism.

And I would hazard a guess that the CEO and board of your employer are more than willing to go along with all the FDA bullshit because it provides a very high barrier against the entry of competitors into the field. This is called "rent seeking" - look it up. Their families don't deserve to eat either.

Re:"Not for ________ use"

[gak001]

I wasn't complaining; I was merely pointing out that if the choices are too much or too little regulation, I'd rather err on the side of too much. Naturally, I'd prefer that we find some happy medium. As things stand, those medical devices reflect more than the simple cost of manufacture, (they also reflect the costs of research and development, marketing, profit, insurance, etc.) as is the case with most things medical. Someone brought up an excellent point that the high price may be due to economies of scale - much like textbooks, if they're only producing a limited run, then the fixed costs are distributed over very few products.

Re:"Not for ________ use"

[jisatsusha]

I'm sure it's not intended to work like that, but it does show that they can and do block accessories from being used as chargers when they want to.

Re:"Not for ________ use"

[Anonymous Coward]

And all you have for that price is an expensive Wii balance board. No warranty. No service. No required re-calibrations. No software to make it do anything useful. No liability insurance. I'd say you have done such a poor job understanding requirements you deserve to be fired.

Re:"Not for ________ use"

[Anonymous Coward]

Everything you wrote sounds like a reason to dissolve the FDA (and perhaps a chunk of the legal system) and start over.

Your product isn't worth $5000. Why? Your lawyer isn't worth $600/hr. Your $250k+ paperwork is overpriced, so your final product is overpriced.

If I go buy $500/lb coffee beans and make coffee out of it, even if I charge at a rate of just $50/cup, I'm still overpriced. You're getting shafted on one end, so you're shafting your customers.

Re:"Not for ________ use"

[FooAtWFU]

If insurance costs are so high, then the private medical manufacturers must really, really crap

Or malpractice lawsuits are completely out of control.

Re:"Not for ________ use"

[Anonymous Coward]

If insurance costs are so high, then the private medical manufacturers must really, really crap, because that is what drives high insurance premiums, lots of failures (no failures, low premiums), so get rid of the private corporations because just like insurance companies, the government should also recognise them as being high risk.

Insurance costs are high either because there are a lot of failure or because the cost of failure is very high. eg: if the probability of $BAD_EVENT is 1e-6, but the cost of failure is $1e7, then your insurance cost has to be $10 to break even. If grandma falls off a balance board and breaks her hip, is she not due $1e7 for being made a cripple?

I would love to see some of the warranties on medical equipment, from the sounds of the marketing trolls it must be decades but I bet a lot of that junk comes out with nothing better than 90 days (now that's a big insurance risk, ha ha).

Warranty and liability are very different. My toaster has a 1 year warranty, and that's good for replacing the $20 toaster. If faulty design or substandard wiring causes it to set my house on fire, it doesn't matter whether my house burns during the warranty period or not, the toaster company will owe me a new, $200,000 house.

Re:"Not for ________ use"

[jo_ham]

Oh I'm sure they do - I think it was originally put into the code at around the time they removed the firewire chips from iPods. You can still plug a firewire cable into a newer iPod, but it will pop up a message on the screen either stating that the attached cable won;t be able to sync and can charge only, or that it will simply refuse to charge if it can't deal with the higher voltage on the firewire bus.

If you connect my 4G into a FW port on my machine it tells you this, but it still charges from the "dumb" wall adapter that has a firewire port built into it.

I think the code is designed to separate out different devices designed for different models (like the two different versions of the TomTom dock for the Touch vs iPhone) rather than preventing the use of third party (or their own!) charging devices. If they are actively preventing use of third party chargers though, like I said earlier, I would find that distasteful since there is no real reason to, assuming the iPod/Phone has protection circuits in it to handle potentially faulty power bricks (or any origin).

Re:"Not for ________ use"

[Ihlosi]

Everything you wrote sounds like a reason to dissolve the FDA (and perhaps a chunk of the legal system) and start over.

You mean "Start over with snake oil, patent medicines, radioactive sports drinks and toothpaste, miracle healers and other kinds of quackery, plus a couple deaths due to drugs that have been tampered with, and a whole new bunch of thalidomide cripples just to be sure"?

No thanks, I'll pass.

Re:"Not for ________ use"

[eth1]

It's not the manufacturer's liability insurance that causes those high prices, it's the patients' medical insurance. The only reason they can set the price that high is because it just gets billed to the insurance. Then they inflate the MSRP even more so that they can still bilk the insurance companies even after a "discount."

When my mom was shopping for hearing aids, a particularly honest sales droid told her that the "MSRP" (which no one ever pays) was $12k for a certain model. They discounted it to $8k when they billed insurance companies, but if you didn't have insurance, they'd sell it to you for $3k. So basically they get an extra $5k profit if you happen to have insurance.

Re:"Not for ________ use"

[Anonymous Coward]

Knee replacement kits come with a pre-sterilized, one-time use power drill. It's hard to sterilize a drill (and keep it in working condition), so it ends up being cheaper, or easier, to include $100 of throwaway electronics in every kit. Besides, if you're already spending $5k on the hardware, an extra $100 is hardly anything.

Re:"Not for ________ use"

[Ihlosi]

They discounted it to $8k when they billed insurance companies, but if you didn't have insurance, they'd sell it to you for $3k. So basically they get an extra $5k profit if you happen to have insurance. Hm, isn't that supposed to be the other way round? I'd argue that an insurance company has much more motivation and leverage to get the price down than an individual. That's why for most medical services, you pay twice (or more) as much out of pocket than the insurance company would if you were insured.

Re:"Not for ________ use"

[Anonymous Coward]

Ok Stalin.

So much for free market. Everyone disclose your costs and let the gov't bureaucrats decide what things are worth. That'd be interesting especially in Sports, Music and Hollywood.

That's why we live in America, its what the market will bear. If 18K is too much, you do the product research and show them why your $100 Wii Board, with your $200 Wii and whatever customized app you come up with costs, and why the hospitals should go with your system instead. Its how the free market works.

Re:"Not for ________ use"

[Ihlosi]

That's why we live in America, its what the market will bear. If 18K is too much, you do the product research and show them why your $100 Wii Board, with your $200 Wii and whatever customized app you come up with costs, and why the hospitals should go with your system instead. Its how the free market works.

What, no ranting against the FDA? The medical devices market isn't all that free to begin with, remember?

Re:"Not for ________ use"

[Anonymous Coward]

"I guess we were paying $99 for the QC sticker they put on it before they sent it off through the supply system."

How do you know they weren't paying for the capital costs of the LCR meter and the tech to run it and people to verify the paperwork of the product?

If it was a hobbiest, they grab the part, pack it, ship it.

For the nuclear power plant, they grab the part, have a tech test it, verify the inventory tag and check they have certification for the lot they are shipping and probably even document and provide it for insurance reasons on their end. Big difference.

Didn't we in the US have a death in the last few years due to Boston's Big Dig where concrete fell and killed a woman because the jackasses didn't verify the product claims of the epoxy and/or bolts they were using? The stuff held, after all...for a time. No one said _for how long_.

Re:"Not for ________ use"

[MillenneumMan]

Well obviously the GP was a sales exec at the medical supply company.

Re:"Not for ________ use"

[slmdmd]

So what you mean is that if we get rid of insurance then price should be 100 usd. I was rasied outside usa in another country, so as an outsiders perspective, what I observed here is that people are very very afraid of everything here. From Insurance to Pharma companies, are ripping out money using that fear. When a robber holds a gun and takes away money, people complain immediately. But people are willingly opting for getting robbed by the Insurance industry.

I had employer provided insurance for one year and withdrew once I realized that 1/4th of my salary was being paid by my employer for Insurance. Medical Science can't cure infectious diseases. You would be asking for a very miserable death if you opt for treating infectious diseases other than cuts/bruises from accidents. And penicillin is the medicine for cuts. Medical Science is very good at treating injuries or at surgery. They don't have a cure for anything else. Cuts etc treatment doesn't cost much out of pocket. Surgery is normally a planned activity, so one can always go to another country and get it done for less than 10k. There is no gurantee that one won't die from a car accident today, but we don't worry about it. Similarly there is no need to worry about death from infections. Insurance or no-insurance it does not matter in case of infectious diseases like malaria or TB. There are two outcomes, either you die in couple of months among loved ones or die a very very miserable death in hospital and after bankrupting your loved ones for one or two years.

One more important point is never to take any medication for fever. Fever is our own army, we should not kill fever. I am 36 years old and have been to the dirtiest countries in my life. I know I got infections too because I got fever, and fever has always cured the infection and me without any medication. Taking medication for fever is the worst thing one can do to himself. Taking medicines is equivalent to drinking dishwasher detergents. You are a big colony of bacteria too, so it will kill the bad bacteria in you and half of your good colony inside you. Body's immune system is far superior beyond anyone's imagination, help it and help yourself.

Re:"Not for ________ use"

[Anonymous Coward]

Another thing. Nintendo doesn't have to pay the FDA. To give you an idea how pricey this is we once changed a battery on one of our computers and had to pay *up front* $50,000 for testing and hope everything passed. That's just a safety certification. Throw in the word "patients" and the FDA automatically gets involved and things get a lot more expensive. Throw in malpractice lawyers and record breaking settlements and already sky high costs go up even more.

Re:"Not for ________ use"

[HeckRuler]

1) Provably sterile out of the box. If the patient has an open foot ulcer, and some Chinese dude sneezed on the board before he wrapped it up, and then the patient dies of infection...

So spray it down the first time you use it. Just like you're supposed to spray it down every time you use it.

2) Bodily fluid proof, if not disposable or autoclave-able. The board is too expensive to toss and too weak to autoclave, furthermore god only knows what it'll do electrically when a patient pees on it. Or if not pee, some highly conductive cleaning fluid. Or blood.

Too expensive to toss? You can get 180 wii boards for the price of a medical one. If the things gets doused in bodily fluid, sure, toss it. If someone just pisses on it, I suggest you spray it down. I imagine the worst that will happen electrically will be that it stops working.

It's not that I want to promote an unsterilized hospital, but take a dose of practicality. If there are biological organisms in the same air-space as the device, it's no longer perfectly sterile. So just clean the damn thing.

3) Intrinsically safe. In the unlikely event of using or storing the board in an atmosphere contaminated by flammable anesthetics, it won't blow up. Closely related to oxygen proof plastics. No great achievement to make a plastic that does not support combustion in plain ole air, but I have no idea what plastics (if any) will not continue to burn in pure oxygen. And you know some heart patient is going to drop their oxy mask on the wii board and the batteries will spark at the same time. Also if the patient collapses and you need to use the crash cart, you don't want the electronics inside to catch fire. Would be unfortunate to restart a patients heart only to have the patient die of infected burns.

uh..... yeah. If you've got a room filling with explosive anesthetics you've got bigger problems. As for oxygen proof plastics, sure, that could be bad, I guess. But it's kind of an example of "medical" quality being impractical. Yes, there will be a few fires for every million times this device is used. Deal with it.

4) Proven EMC/EMI compatibility. Last thing you want is for the board to interfere with the patients portable EKG machine or whatever.

Well, getting some buggy readings on an EKG machine wouldn't kill them. At worse, you'd have some false alarms with the nurses. Interfering with their pacemaker would suck, but if it's that the case then they're doomed anyway when little billy visits with a cell phone or ds or whatever.

5) There are all kinds of allergen related issues. For example, no latex (rubber bands) used internally for any part at any time during construction. Peanut oil sounds like a "green" lubricant for metal machining, etc, until you run into someone with an allergy.

The board is plastic. That's the part patients stand on. Tell your patients with peanut allergies to stop putting their penis into the internal gears of the wii board.

6) Connected. It needs to be sold by the current collection of booth-babe saleswomen with open purchase order accounts at the hospital. Its possible the hospital has no pre-existing relationship with any place that sells wii balance boards... Literally no way for purchasing to buy one...

Literally, they will drive to the game store, put some cash on the counter, and walk away with a $100 alternative to a $18,000 medical device. Point out the fact that they don't have the bureaucratic process for buying it is a really piss-poor argument. It just highlights the level of stubbornness in the medical industry. You do not need to buy it from booth babes at a convention. If any part of you believes this to be true, then kindly GTFO of any sort of purchasing authority position.

7) Software licensing which probably prohibits this kind of activity, al

Re:"Not for ________ use"

[Beezlebub33]

There is a long history of US 'independence', until people are actually provided with a service. Then, and only then, the people will support it. Just think if people try to cut other socialist programs like Social Security, or welfare, or Medicaid. Social security has the nickname of 'The Third Rail of Politics' because it is political suicide to try to touch it.

Wait 5 years after it gets implemented, and people will wonder what the hell people were such in arms about. I can't wait until Fox News starts running stories about the evil democrats that are trying to touch that most American of established services, universal health care. Actually, I can wait.

Re:"Not for ________ use"

[swillden]

When patients routinely ask the doctor "Okay, what will that cost?", then we'll start to see some significant downward pressure that begins to at least contain the growth of health care spending, and perhaps even starts to reduce costs.

Go ask a doctor "Okay, what will that cost?" and then get back to us.

Been doing it a lot for the last two years, through my daughter's two hospitalizations, and my wife's diagnosis of chronic kidney disease. It works well.

Re:"Not for ________ use"

[Bluesman]

It's great if it works for you, but we in the U.S. have a long history of disasterous social programs, social security being a prime example. Our country in the coming decade will have to make a choice between cutting benefits of these programs (which many of us have been paying for all of our working lives with a negative expected return), ridiculously high inflation that will drastically affect living standards, or defaulting on the national debt.

Thinking about adding ANOTHER social program at this time is nothing short of insanity.

Re:"Not for ________ use"

[Shotgun]

Everyone is experiencing massive cost inflation, and it's precisely because the end-customers are insulated from the cost of their own health care decisions.

Is this the reason, or is it because:

1) In the past, the surgeon would wipe the knife clean on his pants leg between patients. Today, the surgeon wears a spacesuit in a sterile room.

2) In the past, the doctor told you that you had a growth, and you died at home 3mos later. Today, the growth is a highly specialized cancer that requires monthly injections of an extremely expensive to manufacture drug. The patient drags on in a sterilized hospital room for 8mos.

3) In the past, you died at home of "old age". Today, it is unconsionable to not have a team of doctors on call to usher the octogenarian over to the other side.

Re:"Not for ________ use"

[Shotgun]

My doctor has always told me. He will often tell me before I ask.

Yours doesn't? Maybe you should change doctors. Something else that would be difficult to do with a single payer system.

Re:"Not for ________ use"

[Anonymous Coward]

We have also have to overhaul how we develop the software. We have to be able to trace every line of code back to reams of paperwork,

So you need start using source-control and bug-tracking? Oh, noes!!!

Re:"Not for ________ use"

[Opportunist]

Actually, NOT adding it would be insane.

The interesting part is that affordable healthcare saves money. When someone can actually go to a doc when he has a minor disease instead of trying to fix it himself (often by simply dumping antibiotics into his body, which can make it worse over time), he will get well again faster. Worse yet, if he decides to ignore it (because he simply cannot afford fixing a minor, non crippling problem with his body), in the long run he might end up as a cripple, unable to work anymore and relying on that social security that already costs more and more by the minute.

Our healthcare system started cutting cost by a quite interesting system: Free checkups. People can go and get a complete testing every other year (every year after you get to 50 years of age), free of charge. And they did, after all, a problem diagnosed early is a problem you can cure with less pain. And less cost. Identifying cancer early often makes it curable, results in a quite cheap operation and a productive member of the workforce instead of someone who gets heavy doses of expensive medication for a few years 'til his death (not to mention that he will probably not be too productive during this time). In general, they actually saved money that way.

Re:"Not for ________ use"

[Anonymous Coward]

I understand exactly what you're talking about, but I disagree. I work for a company that makes class 3 medical devices, and some of them cost about as much as the balance board mentioned in this article. How does that make sense?

Re:"Not for ________ use"

[stinkytoe]

nothing better than 90 days

I forget the actual details, as i've been out of the medical equipment repair business for years, but depending on the class of equipment, med. equipment manufacturers are required to support equipment for a decent amount of time. Defibrillators and phys. monitors, for example, both require ten years of support from the manufacturer. This is due to F.D.A. regulation.

Re:"Not for ________ use"

[Winter]

Which is why, when you do use tantalums, you use ones that are specced at twice the voltage you expect over them.

We've used tantalums in some telecom equipment we make, and except for about 5 spectacular failures (explosions, fireballs) on some early prototypes (because of wrong part numbers and such), we've never seen a failure in almost 7 years.

We could not have used electrolytic caps as they would not have survived as long.

BTW: reverse voltage an electrolyte, and witness the explosion (and foul smell) also.... Used to do that to scare people in electronics class.....
Of course, if we redesigned now, I'd probably change out some of the tantalums with ceramic caps.

Re:"Not for ________ use"

[swillden]

You're right that a lot of the issue is the progress in medicine's ability to care for health conditions that previously would have simply been fatal. What's strange is that in every other area of technology, progress leads not only to increased capability, but also to decreased price. The latter hasn't happened with medicine. Why not?

You're also right that in many cases we indulge in long, expensive palliative care that doesn't ultimately improve the patient's life or reduce morbidity. In fact, a lot of times they just die more slowly and have a choice between doing it in a drugged stupor or doing it more painfully. That's another reason why the separation between patient (or family) and bills is so bad. Painful as it is, the fiscal cost of extending grandpa's life for another agonizing eight months needs to be considered alongside the other issues.

Re:"Not for ________ use"

[Life2Death]

Obviously its a common thing I see today - over-engineering. When you have unlimited resources (or something like that) and customers who are forced into buying whatever you make, you have no limits or reason to do "real" engineering.

Re:"Not for ________ use"

[Life2Death]

Where I work apparently we have or do or will or can (one of those) make electronics parts for the medical industry. They seem to have higher standards than military even - and if one part of the lot fails, goodbye everything, it all fails, even if its one person dropping one part of a few hundred.

Re:"Not for ________ use"

[Anonymous Coward]

7) Software licensing which probably prohibits this kind of activity, along with controlling nuclear power plants and air traffic control. "Lean forward to lower the control rods, lean back to raise the control rods. Lean left and right to control primary circulation pumps. Walk in place as if running away to declare a SCRAM."

And what if it's a nuclear-powered jet fighter piloted by someone with a pacemaker?

Re:"Not for ________ use"

[toddestan]

Horseshit. My Belkin powered USB hub at home charges my iPhone 3GS and iPod Touch 2G; my D-Link hub at work and two non-Apple car chargers do the same.

It's able to charge because it's a standard pinout. Go back to Best Buy or whatever it is you do that doesn't require you to know basic stuff like that. A real geek would be ashamed.

Perhaps you should educate yourself before spouting out a bunch of nonsense and insults, because you clearly don't know what you're talking about. The USB standard only allows for a device to draw a nominal amount of power unless the port tells the device it can draw more. Or in other words, a device can't just start charging because it sees 5V across the power pins if it wants to adhere to the specification. Now this presents a problem for a "dumb" charger, which was not considered when the standard was drawn up. The solution that many manufacturers use is to play various tricks with the unused pins in the charger, like put a resistor across them, so the device knows it's hooked up to the dumb charger and can draw more current. Of course, since this is not part of the standard, everyone does it differently, so you can't just pair up any old dumb charger with any old device and expect it to work. Especially when you have companies like Apple who realize that they can sell overpriced chargers this way.

Re:"Not for ________ use"

[Aklyon]

you mean that thing for blowing a hole in the wall to see through it?

Re:"Not for ________ use"

[zippthorne]

Patients *do not* usually get treatment that costs three times as much if they're only 10% more likely to survive

So.. you have rationing....

There is no gain in prolonging someone's painfil few months of cancer for the same cost of a life-saving liver transplant or something.

With that attitude, you're going to have "end-of-life counseling," if you don't already.

Re:"Not for ________ use"

[Anonymous Coward]

Yeah, but why would I want to buy exactly the same part as the one that just went bad? Maybe I can get a better one from a different manufacturer...

Because the odds of a Mil-Spec part, or part with a similarly rigorous verification and certification regimen, going bad before the majority of its expected life-span has elapsed are on the same order being as someone being struck by lightning with a winning lottery ticket in their pocket.* One of the primary reasons for Mil-Specs is as exact as physically possible replication of known-good-parts!

*At least that is the case with parts being used in anything close to their intended use. I remember a conversation I once had with an engineer from the US Army Missile Command and his story on how they had redesign a set of carbon fiber missile fins because they were unexpectedly malfunctioning, but only in combat. The cause of the malfunction was eventually traced to the fins being deformed and or fractured during storage "in theater". This was very unexpected because the missiles are delivered in storage containers designed to prevent this sort of thing from happening. However, some bright young grunts decided that a better use for these storage containers would be to remove the missiles, fill them with sand, and strap them to the outsides of their vehicles to provide additional blast protection. While this did seem increase survivability from explosives, stacking the missiles sans containers caused damage to the fins that made them wildly inaccurate. The Army decided that it would be easier to just redesign the missile fins to withstand being stacked denuded rather than to try to forbid the behavior of the that caused the malfunctions.

Re:"Not for ________ use"

[Anonymous Coward]

Patients *do not* usually get treatment that costs three times as much if they're only 10% more likely to survive

So.. you have rationing....

And we don't have rationing in the US for these types of cases already? Most treatments like this are significantly expensive and not fully covered by any insurance policy (if they are covered at all), and the cost has to be paid regardless of if it works or not. This effectively limits the people that such a procedure is actually an option to those that can either afford to pay mostly out-of-pocket or have someone they know that can afford it and are willing to pay for them. Which is no different than the situation would be in the UK and other countries which have public health care but you can also pay out-of-pocket for medical procedures not paid for/reimbursed by the government!

There is no gain in prolonging someone's painfil few months of cancer for the same cost of a life-saving liver transplant or something.

With that attitude, you're going to have "end-of-life counseling," if you don't already.

And if it's truly counseling, i.e. well-informed advice that a person can take or leave, what is wrong with that? In most cases of terminal disease spending your last weeks in a hospice controlling the pain and other symptoms is better for the patients and their loved ones than one last intensive and expensive procedure that has only a 10% chance of success and even then is usually only postponing the inevitable by a few years. IMHO, if I was in my mid-60's and had a terminal disease with little hope for a cure I'd rather spend my last days on earth spending as much time with my friends and family as comfortably as possible than spend what little time I have left on a procedure that had less than 25% percent odds of success. With real "end-of-life counseling" a person is made aware of all their options and their most probable outcomes, no one decides anything for someone else. I think that if patients were more informed about the realities enough people would voluntarily choose hospice care over chasing down every last long-shot and possible "miracle cure" it would dramatically lower the average end-of-life medical costs.

Re:"Not for ________ use"

[Anonymous Coward]

Price of production has nothing to do with what you are being charged in hospital. As a small example - we got charged 8 US dollars for single tylenol pill in a hospital (this charge of course did not include other doctor's and hospital fee - which were charged separatly). Financially - being treated by US healtcare system is about the same as being finacially raped.

Re:"Not for ________ use"

[Dominic]

And you honestly think that a private system doesn't have 'rationing'? I'm pretty sure that I've heard people in the US talking about conditions where their insurance only covers treatment for the first X years. That would never happen here - you'd always get the treatment you need forever, you just *might* not get unproven drugs. And not just you, but anyone, without having to give payment, ID or whatever. Big difference.

In the end the stats speak for themselves. For less money we cover more people and have a greater life expectancy, less infant mortality, and better results for just about any measurable outcome. Yeah, you might early access to some whizzy new drug in the US if you can afford it. If it's that or what we have already, fine.

Re:"Not for ________ use"

[b4dc0d3r]

I was right with you until

I also want you to tell me that my family doesn't deserve to eat.

If you can't produce a marketable product at a price people will pay, and you have no other source of income, you need to find a way to cut costs or find a new profession. No one is forcing you to make these things. If you stop making them, demand will back up and someone else will step in and make the product at a higher price, and your family gets to eat.

It's almost magical how that works. If you argue that you are staying in business because the price will go up if a new company has to start over from scratch, you're volunteering to be the martyr and you are deciding whether your family eats.

As a customer, I would decide whether to buy your product based on a cost/benefit ratio, and whether I could find another supplier cheaper. Not whether your family gets to eat - that's a terrible way to make buying decisions.

Re:"Not for ________ use"

[Shotgun]

You're right that a lot of the issue is the progress in medicine's ability to care for health conditions that previously would have simply been fatal. What's strange is that in every other area of technology, progress leads not only to increased capability, but also to decreased price. The latter hasn't happened with medicine. Why not?

In many cases, it most definitely has. Just make sure you're comparing apples to apples.

Consider the removal of an appendix. 20 years ago, it was a major surgery with a few weeks in the hospital. Today, it is a small slit for the telescopic viewer and you're home in a couple of days. My father's drugs for Parkinson's Disease have plummeted in cost over the years while improving miraculously.

You're also right that in many cases we indulge in long, expensive palliative care that doesn't ultimately improve the patient's life or reduce morbidity. In fact, a lot of times they just die more slowly and have a choice between doing it in a drugged stupor or doing it more painfully. That's another reason why the separation between patient (or family) and bills is so bad. Painful as it is, the fiscal cost of extending grandpa's life for another agonizing eight months needs to be considered alongside the other issues.

Hear! Hear! I think the overall picture is that you can't blame the cost increase solely on "greedy insurance companies" or "greedy drug companies". It many cases, the drugs and devices being delivered today are not equivalent to what was delivered a decade ago. How can you then compare the cost as if they are?

Re:"Not for ________ use"

[swillden]

Consider the removal of an appendix. 20 years ago, it was a major surgery with a few weeks in the hospital. Today, it is a small slit for the telescopic viewer and you're home in a couple of days.

Not generally disagreeing with your point, but I don't think that's accurate. I just asked my mom, who is in her 60s and had her appendix out when she was about 10, so 50 years ago. She was in the hospital for less than a week.

Also, you have to look at the cost of those shorter stays. My daughter had to go to the ER last year and was released less than 24 hours later (6 hours in the ER, most of a day in a regular room) -- the cost was over $6000. Even after adjusting for inflation, the cost of spending a night in a hospital room has increased dramatically in the last few decades, in many cases more than erasing any savings from lower-impact surgery.

Re:"Not for ________ use"

[Anonymous Coward]

andy zebrowitz

Surfy

[Juln]

It says a lot about the wastefulness of institutions when it comes to buying hardware. I bet you the Defense Department could find lots of savings by sourcing their parts from Nintendo, too!

Re:Surfy

[MichaelSmith]

It says a lot about the wastefulness of institutions when it comes to buying hardware. I bet you the Defense Department could find lots of savings by sourcing their parts from Nintendo, too!

Wasn't there something recently about PS3s being used for a high performance computing setup by the US airforce?

Re:Surfy

[couchslug]

"I bet you the Defense Department could find lots of savings by sourcing their parts from Nintendo, too!"

Until the system fails because it wasn't built the have the shit beaten out of it in daily use. Military gear resembles professional construction equipment and is usually made in smaller quantities. While COTS solutions are attractive, they don't always suit the tasking.

Re:Surfy

[Amorymeltzer]

Yup.

http://games.slashdot.org/story/09/11/25/0527205/US-Air-Force-Buying-Another-2200-PS3s

Re:Surfy

[VJ42]

"I bet you the Defense Department could find lots of savings by sourcing their parts from Nintendo, too!"

Until the system fails because it wasn't built the have the shit beaten out of it in daily use. Military gear resembles professional construction equipment and is usually made in smaller quantities. While COTS solutions are attractive, they don't always suit the tasking.

Nintendo's systems are designed to resist small children; a force far more dangerous than anything the military can come up with ;p

What have we here?

[tonycheese]

Wii parts replacing 18,000 dollar medical equipment... PS3s replacing 10,000 dollar supercomputers... clearly the video game industry knows something we don't.

Re:What have we here?

[LostCluster]

Closed consoles can buy parts in bulk. There's only one SKU of the Wii... you either get the default hardware or you can't call it a Wii. This makes programming a whole lot easier, because you know exactly what hardware your program is going to be running on.

Re:What have we here?

[chuckymonkey]

Video games: Why waste good technology on science and medicine? Kidding aside, I think that it's a good thing that these machines are being re-purposed. I wish that we could do it for a lot more equipment and drive down the cost of health care a little.

Re:What have we here?

[Anonymous Coward]

As a guy who designs electronics for load transducers for living, I can tell ya that a balance board equivalent platform won't run you anywhere near $18,000. Probably more like $4k. One thing that makes the Wii device cheap is the mass production. Try selling a 100 of those a year for $100 apiece -- it's impossible. The tooling for plastic injection molding will cost you more than $18k alone. As for electronics themselves, they are not really a factor in the supposed $18k, er, $4k, price. I admit I haven't checked how accurate the balance board is. All I know is that $4k buys you a platform that has ~0.5mm accuracy for center of pressure across its surface of roughly 1/4 m^2. The resolution is better than that, of course.

OTOH, I'm going out and buying the darn balance board right about now :)

Re:What have we here?

[Anonymous Coward]

This just in: economies of scale not a myth.

Re:What have we here?

[Kjella]

And that something is producing 65 million units, and selling only a slight profit because it also sells game licenses, accessories and so on. I don't recall ever standing on a balance board at any doctor or hospital I've been to, and lots of people can probably use that one board, so I'm guessing the market is tiny.

P.S. It's not that solid. My pad has gotten to the point where the standing on one foot exercises will make the board black out. I use it as a weight with tracking these days, I was getting tired of the same old things anyway and it was well worth the money as long as it lasted.

Re:What have we here?

[tenverras]

The Wii Balance Board is the Canada of medical devices. Cheap, but just as effective as its expensive counterparts

Re:What have we here?

[lanner]

It's all BS. Forget all of the posts regarding FDA, documentation, testing, and that crap.

It's just a matter of how many units get sold, like microprocessors.

If you design, make, and sell one, it's $500 million. If you design one, make 500 million, and sell 500 million, they cost $1 each. Profit is the same either way.

Not a lot of people buy medical devices, with some exceptions.

Nintendo can't make them and start with high prices, then drop them later. They have to assume how many they will make, sell, and guess a good price before their first unit is sold.

And yes, I have worked in medical device manufacturing, and I currently work in non-profit cancer research. We have numerous genetic sequencers around, like ones from Illumina. They cost like $750K each, but it's really surprising how little materials is actually in them. A $500 laptop is technologically 10,000 times more advanced than one of those Illumina boxes.

It's true that medical devices are more expensive, and I'd be the first person crying foul about it, but they often really really do have good reasons to justify the higher costs... usually.

If you want to talk about price rape, look no further than Cisco.

$2000 card
http://www.cdw.com/shop/products/default.aspx?EDC=1352161

$13,0000 card
http://www.cdw.com/shop/products/default.aspx?edc=1424619

They are the SAME EXACT CARD, with a little tiny firmware tweak. We have a couple of these in the 5580 series firewalls.

Re:What have we here?

[Anonymous Coward]

>Video games: Why waste good technology on science and medicine?

http://video.google.ch/videoplay?docid=9097376684805873187&ei=FqRTS86uGpnk2gL-6MTEBg&q=3dfx+spot&hl=de#
http://video.google.ch/videoplay?docid=2541946034993106617&hl=de&emb=1#

Re:What have we here?

[bipbop]

Actually, MythBusters busted that one. They build one building out of marshmallows and toothpicks, then they built ten. It took them ten times as long!

Re:What have we here?

[Fujisawa Sensei]

Actually, MythBusters busted that one. They build one building out of marshmallows and toothpicks, then they built ten. It took them ten times as long!

They weren't building computer chips either.

Also did they factor the R&D time into the first one?

Re:What have we here?

[dbIII]

With the PS3 it's simply the only thing you can get with a cell processor unless you have a military budget (priced way out of the medical and oil exploration markets). You can buy a cell server or for the same price you can buy the six xeon based servers that can do the same number of raw floating point operations per second. They'll be slower individually at some things with arrays, but you've got a lot more of them for the money.
It's a pity the PS3 has so little memory otherwise I'd have a server room full of them.

Re:What have we here?

[Anonymous Coward]

Begin out-of-date joke.

The Wii balance board is the Canada of medical devices. Cheap and effective, but darned if you can actually get your hands on it when you'd like.

End out-of-date joke.

Re:What have we here?

[91degrees]

I think part of what they know is that per-unit R&D costs are a lot lower when you have thousands of customers than when you have dozens...

And the other part is that users will not pay as much as hospitals.

Re:What have we here?

[Anonymous Coward]

He lies, they never did that.

Re:What have we here?

[Niartov]

Why forget the FDA. I used to work with Radiology systems. The minimum for our vendors the minimum they ever got charged for qualifying a medical device was $20,000. It is also at a very low level. When certification was complete a Bill of materials was setup and the computers systems are not supposed to deviate at all from them. This has to be done EVERY time you make a change to anything dealing with medical data.

Re:What have we here?

[Anonymous Coward]

It's cheaper to make one piece of hardware and cripple it for the "low end" market. The board itself costs nothing to make, but developing it...

Its the same where I work, make one piece of hardware that can do all, cripple firmware wise for the "masses" and put the bill for developing the highend options on the highend buyers.

Obligatory

[Naurgrim]

Ah, I see you have the machine that goes ping. This is my favorite. You see we lease it back from the company we sold it to and that way it comes under the monthly current budget and not the capital account.

No wonder

[ArchieBunker]

Hospitals charge so much. Someone along the way decided to jack up a price and its been flowing downhill to the consumers ever since.

Re:No wonder

[LostCluster]

People have been clamoring for years about "Health Reform" and "Tort Reform" without realizing those issues are linked.

Re:No wonder

[ArmagedionTime]

Keep in mind that medical devices must pass through a stringent approval process. The time and effort needed to be approved have to be factored into the price.

Re:No wonder

[arb phd slp]

Hospitals charge so much. Someone along the way decided to jack up a price and its been flowing downhill to the consumers ever since.

Why not? Your health is the most valuable thing you have. As long as it is a commodity that you have to buy from someone, what price wouldn't you pay for it? So far, the market will bear health being a sixth of the entire economy. Shall we try for a fifth?

Re:No wonder

[jedidiah]

They actually have squat to do with each other.

"Tort reform" is the rich scaring the poor and stupid into absolving them
of any real responsibility for when something goes wrong. Not only do you
have to be stupid and careless in order to be sued, but you also have to
be a total jerk about taking responsibility for your actions.

Big scary verdicts only occur when perpetrators and insurance companies try
to blow off their victims. Then equally ignorant saps in the jury add zeros
with no real understanding of the numbers they're creating.

Education reform would be more effective really.

"Health Reform" and "Tort Reform" are not really related. Although both are
portrayed as a solution to a problem that neither directly addresses.

Letting insurance companies off the hook hasn't lowered prices. Neither does
turning insulating the customer from the cost of health care. Ads that tell
selfish old geezers that they can get an overpriced motorized wheelchair
"for free" is what keeps health care costs high. Young kids being duped into
thinking that their doctor visits are "for free" is what keeps health costs
high.

So does ensuring that devices are adequately tested.

The LOC price for something used in air traffic control or avionics is probably similarly expensive.

Re:No wonder

[amRadioHed]

Since when do juries get to determine penalties? I thought they were just charged with determining guilt.

Re:No wonder

[LostCluster]

Medical malpractice lawsuits are tort cases... and we know how much testing is only done because of fear of the lawsuits. Limit the liability, and there would be much less wasted medicine being practiced.

Re:No wonder

[Anonymous Coward]

Oh ,there is much more to it than that...

A friend of mine recently had to wear a device that helps bones knit faster by using electromagnetic fields. The device cost (his insurance) $5000. I am an electrical engineer, so I couldn't resist tearing it apart to see what it was. Maybe, maybe, $20 worth of electronics. More likely $5 when manufactured with coolie labor in China.

And the reason my friend was willing to let me tear it apart? It can only be used once! It is designed to permanently disable itself after one period of treatment.

What a waste of time and resources. What a gouge to the medical consumer. You wanna talk about controlling health cost? Start here.

Re:No wonder

[maxume]

I don't have any problems with rationalizing medical liability, but the savings aren't all that likely to amount to much (the article references a CBO study):

http://www.factcheck.org/2009/10/malpractice-savings-reconsidered/

Now, find 20 ways to save 0.5% of medical costs and you are getting somewhere, but this single issue isn't going to solve the whole thing.

Re:No wonder

[Jah-Wren Ryel]

Medical malpractice lawsuits are tort cases... and we know how much testing is only done because of fear of the lawsuits. Limit the liability, and there would be much less wasted medicine being practiced.

Hasn't seemed to make much difference in Texas - the state with so much tort reform that the Governor likes to brag that malpractice insurance rates have come down - but no metric that measure the quality of healthcare has improved, for example:

• The percentage of uninsured people in Texas has increased, remaining the highest in the country with a quarter of Texans now uninsured;
• The cost of health insurance in the state has more than doubled;
• The cost of health care in Texas (measured by per patient Medicare reimbursements) has increased at nearly double the national average; and
• Spending increases for diagnostic testing (measured by per patient Medicare reimbursements) have far exceeded the national average.

Even worse - most of the malpractice savings have gone to the insurance companies, because malpractice payments have gone 67% but malpractice insurance premiums have only gone down 27%.

Public Citizen, Dec 17th, 2009

Re:No wonder

[Anonymous Coward]

I'd agree with you to an extent if the only issue in tort was verdicts directly. The problem is the secondary issue of the rare insane verdict scaring those sued into settling cases they would likely win, or that the legal process becomes so protracted that it is not financially viable to fight the suit, prompting people to settle. While this is a rational decision in isolation, the broader pattern of this encourages marginal lawsuits. That also leaves aside the court of public opinion which can just as easily ruin your business - who wants to go to a doctor that is under malpractice litigation? How much income is lost by being on leave during the lawsuit?

Tort transfers wealth, it does not create it and should be reformed. Not necessarily restrictions on standing/rewards, but simply modernizing it so that it is more efficient in carrying out justice.

Re:No wonder

[maxume]

How do you propose to make health care anything other than "a commodity that you have to buy from someone"?

Even countries with guaranteed health care pay the people who work in health facilities and the companies that produce health products.

Re:No wonder

[tomhath]

"Tort reform" is the rich scaring the poor and stupid into absolving them of any real responsibility for when something goes wrong.

That doesn't seem to be the case in the UK; if you have a legitimate case you can sue, but you risk incurring big costs if you lose. In the US it's "free" to sue, the plaintiff might win but almost never loses; the defendant loses no matter what the verdict.

Re:No wonder

[snowgirl]

I don't have any problems with rationalizing medical liability, but the savings aren't all that likely to amount to much (the article references a CBO study):

http://www.factcheck.org/2009/10/malpractice-savings-reconsidered/

Now, find 20 ways to save 0.5% of medical costs and you are getting somewhere, but this single issue isn't going to solve the whole thing.

It can vary some based on the field the doctor is practicing. There are some surgeries, where malpractice is so crazy high, because the insurance companies are afraid to defend the people performing the surgery. (This sentence should be read: the insurance companies anticipate big losses by covering the surgeons.)

"Tort reform" covers only one part of the hysterical increase in malpractice insurance. That insurance companies see it as a non-lucrative business to be in, means that they demand higher premiums to ensure that they meet their desired profit margins. If these insurance companies were run as co-ops where the premiums were collectively held as a non-profit to pay out for doctors without generating a profit for shareholders, then the malpractice premiums would not exceed what is actually paid out.

If you think medical insurance for the consumer sucks, the malpractice insurance does the same exact stuff. Insurance companies want to shaft everyone in the equation. If they mark a particular surgery as "experimental" then not only does the medical insurance for the patient not have to pay, but the malpractice insurance doesn't have to cover it... or the malpractice premium for it goes up, and the doctor has to replace the cost by putting the cost onto the consumer, thus raising the price.

I think any insurance company running for-profit is a generally bad idea... they will always be driven to deny claims, raise rates, and add no real to the benefit of the consumer (beyond what a non-profit insurance company would provide) except an extra middle-man, or two, or three.

Re:No wonder

[maxume]

If they aren't providing value beyond what a not for profit provides, the latter's tax advantages should allow them to put the for profit out of business (that's in theory land, but the point is that the for profit company may be bringing something that you aren't accounting for).

If you look at a big insurer like Wellpoint (which is probably middle of the road as far as behavior goes, maybe a bit towards the nasty), they are still only scraping ~6% off the top (That is operating margin, profit margin is just under 4%). So it isn't obvious to me that the profit motive of the insurance companies is responsible for that big a chunk of the costs (again, 6% is substantial, but getting rid of it isn't going to revolutionize anything).

I suspect the core issues are that people are disconnected from the costs and that medical care is simply expensive. The U.S. often gets compared to countries with socialized medicine, those countries deal with the disconnection from costs either by placing small fees on services, or by establishing standards to deliver care where it is 'most needed', so they get better results per dollar than the U.S., where care is delivered to anybody able to pay for it, with only some regard for whether it is needed.

Re:No wonder

[RobertLTux]

a jury may not have the input of Guilty of %charges% and the fine is US$XXX,0000 but
the judge who does determine the fine has to take the guilty verdicts and then total up a list
primary charges: X,000 each
with will full rider: Y,000 each
secondary charges: Z,000 each
with will full rider: W,000 each

then you get into bonus money for conduct during the trial and the judge being in a bad mood (or just not liking your lawyer) but before that step the judge is totalling up what the jury says

Re:No wonder

[RyuuzakiTetsuya]

I think it was Blanche Lincoln who made a similar observation about Nebraska. They brought in Tort Reform, and nothing changed for the price of medical.

Quite frankly, i don't think that this is where entrepreneurs should be trying to find profits. If it's illegal for the Mob to extort you for "protection" money, because you know, this is a good lookin' house you got here and it'd be a same if anything happened to it, it should be illegal for the medical system to do the exact same thing. Except I trust the mobsters not to shiv me in the ribs if I play nice and make payments, Aetna? not so much.

Re:No wonder

[Anonymous Coward]

I suspect the core issues are that people are disconnected from the costs and that medical care is simply expensive.

I worked as a research analyst in the medical insurance field...

Yes, and no. Current medical and medical insurance industry practices incentivize insurance fraud. Insurance companies have certain capitalization requirements. And are bound to work in a certain market. In order to make brokering risk cheaper, they buy and sell risk with other insurance companies, and settle debts with each other, with "swaps". Despite the bad rap swaps have gotten in the last few years, this is a GOOD IDEA. It basically allows insurance companies to share their clients, for the purposes of computing risk.

But there's a problem. Insurance companies use these swaps to pay each other, for example when a hospital affiliated with insurance company A deals with insurance company B's patient. The hospital knows nobody is ever going to go through the patient's file, because company B is going to pay with a swap.

These same hospitals rape Medicare and Medicaid. No joke. Something like 30% of all Medicare and Medicaid transactions are at least partially fraudulent. The government programs don't have the infrastructure to deal with massive private sector corruption. Heck, even the insurance companies don't. They compute their cash flows between companies in terms of statistical distributions instead of itemized bills.

. The U.S. often gets compared to countries with socialized medicine, those countries deal with the disconnection from costs either by placing small fees on services,

"Socialized" health care has one big benefit over lots of small insurance companies: an insurance company brokers risk, and the bigger its population, the cheaper it becomes. Which is why insurance companies issue swaps with each other. The "National" pool of risk is the biggest one can get without crossing borders.

Re:No wonder

[feepness]

More likely $5 when manufactured with coolie labor in China.

Would you trust the strength of your bones to something manufacture by coolie labor in China?

Re:No wonder

[ducomputergeek]

But the cost of malpractice insurance has gone down? When I was living in Illinois, a lot of doctors were leaving the state, especially specialists because the state is particularly lawsuit friendly and the price of malpractice insurance was driving most to either work at hospitals or leave. Most doctors I know would love to see their malpractice insurance rates drop by 25%.

Re:No wonder

[Jah-Wren Ryel]

The cost of malpractice insurance is a bogus metric. What really matters is cost and availability of healthcare. Cost of malpractice insurance is just one factor, and given the results in Texas, apparently an insignificant one.

Re:No wonder

[sowth]

Medical supply companies use Chinese manufacturers all the time. Take this instance where heparin was contaminated with melamine.

Re:No wonder

[feepness]

My point exactly.

Re:No wonder

[chrysrobyn]

The cost of malpractice insurance is a bogus metric. What really matters is cost and availability of healthcare. Cost of malpractice insurance is just one factor, and given the results in Texas, apparently an insignificant one.

What I don't understand is why we're all guessing. I think we should have one CPA (or a firm, as long as methodologies are identical) go and audit 100 general practitioners. We should be able to see some remarkable trends, like malpractice insurance is 10-13% of income for 70% of the firms, nurse salaries are 25-30% of income for 90% of firms, rent is 10% for 60% of firms, equipment is ...

Obviously, someone has done the work. It's not a complicated plan, and it's entirely obvious. At the same time, the ammunition from such an anonymous survey would be very useful.

Re:No wonder

[Jah-Wren Ryel]

I don't think it would be so obvious. For example - lots of complaints about malpractice say that the costs are not just in the price of the insurance but in the price of performing a bunch of extra tests in order to provide legal cover. Nobody is tagging those extra tests as "defensive medicine" - on paper they look just the same as all the other tests.

Re:No wonder

[RyuuzakiTetsuya]

how about also regulating the price of malpractice insurance in addition to regulating the price of payouts in a malpractice case?

Re:No wonder

[Madcow256]

His point is that there's a good chance this $5000 device was manufactured in China anyway. It's not like paying a lot for medical equipment guarantees it was made with care by American workers.

Re:No wonder

[jwhitener]

Hey, stop confusing the right wing fox watchers with facts. It hurts their brains.

Re:No wonder

[feepness]

No, it doesn't. But paying very little for it does.

False comparisons

[Anonymous Coward]

These "test platforms" are not just a slab of plastic a few inches in size: they are usually about two feet or more square, can handle up to 400 pounds of static force (and often a ton or more impact for jumping), and more importantly, come with a full diagnostic software package that can track patient history and results. Show me ANY medical office outfit that can develop this level of software for $18,000 or less, let alone support it, and hack up the proper interface to the WII board.

Re:False comparisons

[jedidiah]

Tracking patient history and results?

Sounds like the sort of thing a beginning PHP programmer can knock out in a few hours.

Re:False comparisons

[LostCluster]

Yep... but what PHP programmer will actually take the job when legal tells them of the risk if their program has a simple bug?

Re:False comparisons

[FrancoisHarvey]

Yep, but beginner coder don't know a thing about HIPPA and how to deal with auditing and storing confidential patient history.

Re:False comparisons

[oji-sama]

I believe it has to be $18,000 or less only in the case that they make and use (+sell?) only a single unit...

Price-gouging

[GreatBunzinni]

Is it due to the Wii's balance board being terribly cheap or is it due to the the price of the "medical-grade" device being extremely over-inflated? Some of the prices practised by medical equipment and even drug distributors are insane and they always hide behind the mysterious "it's fantastic, medical-grade stuff" and that quite possibly is plain bullshit to increase their profit.

Re:Price-gouging

[LostCluster]

What separates the medicine you get at the corner store and the medicine you get at a hospital is the fact you find it yourself on the store shelf rather than a highly trained pharmacist finding it, and passing it on to a highly trained nurse to give it to you and make sure you are the right person, because the liability of delivering the wrong medication to the wrong patient is huge.

Re:Price-gouging

[Theodore]

STOP!

Medical/Hospital grade equipment is tested, and logged, and tested, and logged, and probably tested again just for logging purposes.

Look at a mobile computer unit in an ER and chances are the chassis alone cost at least $5K, just due to certifications.

Ever been in a hospital bed?
And then used the remote to raise the head? lower the feet? call the nurse?
I've seen records going back to the mid-seventies on some units, where they measure down to the milliamp along various points on the chassis; all to ensure patient safety.
It is not bullshit, it's just that the medical community has certain standards that we MUST adhere to, and console makers don't.

Re:Price-gouging

[Quantumstate]

Surely their systems aren't so bad as to deliver the wrong medicine to the wrong patient. I can understand the odd slip up leading to the wrong medicine for the right patient or the right medicine for the wrong patient but getting both wrong at once must happen far less frequently.

Re:Price-gouging

[shaggykl]

Another factor is the volume of products produced and sold. Nintendo probably spent as much or more to design their product than the medical device company. But they are able to divide that cost by 10s of thousands (or more) of products sold as opposed to several hundred of the high-priced systems.

Re:Price-gouging

[LostCluster]

It's an infrequent event, but the result if it happens can be a wrongful death... and nobody wants that to happen.

Re:Price-gouging

[ColdWetDog]

Medical/Hospital grade equipment is tested, and logged, and tested, and logged, and probably tested again just for logging purposes.

True enough, it doesn't cause $18,000 to log things. Not every device used in patient care needs to be tested to the extent that 'medical devices' do. Mostly, it's simple patient safety stuff (no current leakage, etc.)

Look at a mobile computer unit in an ER and chances are the chassis alone cost at least $5K, just due to certifications.

BS. The one I just used is a stock Dell POS on a home made COW cart (Computer on Wheels). The laptop has a little sticker stating it passed biomed's safety test. That's it. But it's not a medical device. Just a laptop.

Ever been in a hospital bed?

And then used the remote to raise the head? lower the feet? call the nurse?

I've seen records going back to the mid-seventies on some units, where they measure down to the milliamp along various points on the chassis; all to ensure patient safety.

If you actually disassemble those things you find a bunch of switches and a PCB board. Made to reasonable specs (essentially has to be waterproof and have a decent level of physical construction) but nothing as well made, as say, avionics. Remember, these devices don't GO INSIDE people, nor are they intended to cure or diagnose. Therefore, they don't have to be particularly sophisticated or well made.

Stuff that goes inside you (implantable things), diagnostic gear, radiation stuff - all that has to undergo much more rigorous testing which does cost more. Not nearly as much as the vendors charge - there is quite a bit of inflation surrounding medical grade gear, but it's pretty clearly a rip off in order to make as much money as fast as possible. It's a business and pretty much bullshit, but there you have it. The American Way.

Re:Price-gouging

[cptdondo]

28 years ago I built a 75' extension cord with medial grade stuff. Both plugs and the wire in between are "medical grade". That extension cord is still sitting out side in the weather to this day, as good as the day it was build. It's been run over by cars, left in the sun for years, left in the rain and snow and ice, been salted and painted.

It still works.

Now you can tell me that "medical grade stuff" is overpriced, but I'll stack up my extension cord with anything you can buy from Wall Mart and I bet you mine will come out on top.

Sometimes more expensive is better.

Price has a psychological impact too.

[Anonymous Coward]

With price comes respectability. That's why Christian Science practitioners always make a point of charging for their prayers roughly as much as a real doctor would charge for treatment: They know that something given away will not be percieved as effective.

Same thing here. Stick a patient on a wii board, and they'll regard it as quack rubbish. Stick them on an $18,000 purpose-built and impressive piece of diagnostic equipment with the logo of a respected medical equipment manufacturer (ie, not nintendo) and they'll feel far more confident, even if they do exactly the same thing equally well.

Customers who feel they arn't being given an expensive enough service are more likely to sue the hospital.

Re:Price has a psychological impact too.

[Anonymous Coward]

Then just charge them $600 and hour to stand on the Wii board and tell them its just as good as real medical equipment.

Perception

[jlb.think]

It is all just people's perception. A videogame can't be too expensive, but it damn well better work so the market pushes high quality at low prices. In the medical world we expect devices to cost out of the ass and be complex. That is the exact opposite of the videogame, or rather, the general technology world. It is about time there is direct market competition with the medical device manufactures who rip us off and overcharge for clunky hard to use equipment that doesn't work that well in the first place.

This is not a shock...

[Anonymous Coward]

I had been prescribed a medical device to assist in night time breathing... after asking the clinic person to show me an itemized list of parts and costs, I was shocked at the bill - over $2,200 (USD). She was annoyed that I wanted this list printed out because my insurance was "going to pay for it anyway..."

A few months later, my insurance no longer wishes to pay the rental costs - so I have to return it or pay $250/month. Found online for $700 new and delivered with three years of support.

Only when you put medical care in a truly competitive market is when you'll actually see competitive prices.

Re:This is not a shock...

[Big Boss]

I've started purchasing my own CPAP machine and accessories as well. Far cheaper than dealing with the home medical place locally (owned by my insurance company no less), even with insurance coverage picking up part of the bill. For less money, I get a better machine and direct support. And I can run the purchase through my FSA, so it's tax free. :)

FWIW, nebulizers are the same way. I bought a very nice machine online for about half the cost of the local place, and the local place wanted to give me a gigantic POS. I bought a very compact unit that has much nicer features.

Re:This is not a shock...

[tresho]

I've seen similar price differences in the same retail outlet, the only difference being whether or not an item was covered by Medicare. I needed to buy a portable wheelchair for my mother to use occasionally. The store marketed chairs for $120 to people whose chairs were not paid for by Medicare, and then chairs for $500 for people whose chairs were paid for by Medicare. The more expensive chairs looked better, but were not functionally different.

Re:This is not a shock...

[binaryspiral]

I've seen similar price differences in the same retail outlet, the only difference being whether or not an item was covered by Medicare. I needed to buy a portable wheelchair for my mother to use occasionally. The store marketed chairs for $120 to people whose chairs were not paid for by Medicare, and then chairs for $500 for people whose chairs were paid for by Medicare. The more expensive chairs looked better, but were not functionally different.

There is actually a justifiable reason for this... but I'm only going by what I hear from people I know who work in the medical field.

Medicare pays pennies on the dollar for most medical treatments, but are much more accommodating in hardware or support devices that get people out of hospitals. So, to recoup some of the money hospitals (and insurance companies) are losing to medicare patients - they farm the markets they can harvest.

Re:This is not a shock...

[dunkelfalke]

My CPAP machine was nearly completely covered by the insurance - I had to pay 10 euros co-payment and about 50 euros for a used humidifier. The actual device costs about 1000 Euros. I will have to give it back when I don't need it anymore - fat chance :-(

Volume manufacturing

[KingSkippus]

Actually, it's more a matter of volume manufacturing. If you have to spread out your fixed manufacturing costs among only a few hundred of something for some hospitals, they're going to be very high per item, thus resulting in a very high price. If you mass market millions of them, those same costs might only be a few pennies per item.

Before the Wii, there wasn't much demand for mass producing these kinds of components.

Re:Volume manufacturing

[Anonymous Coward]

The volume manufacturing that you mention only affect two parts of the cost of goods sold: the fixed costs of R&D and tooling up.

With a medical device, you need to provide record keeping for the service history of each device sold, and then you need to make regular, scheduled preventive maintenance visits to that device. This adds a "per device" cost just like the cost of raw materials and assembly time, multiplied by the number of visits during the devices life!

So while Nintendo can divide $10E6 by 5 million units, and add $75 per unit of manufacturing cost,each device accounts for $2 of R&D so the total is $77 per unit.

On the other hand, the medical device manufacturer has $10E6 / 200,000 units, plus $75 per unit, plus maybe $600 per unit per year. If a device is expected to perform for three years, this means that each device now costs $1875 to manufacture, plus $50 in R&D. Total is $1925.

AC.

Re:Volume manufacturing

[bws111]

There's more to it than that. Nintendo doesn't have a 'Wii balance board' division, who's sole job is to make a profit on Wii balance board hardware. Instead, they get to look at the big picture. They don't necessarily need to make ANY profit on the balance board hardware. They can make their profit from game sales and licensing. Having the balance board may drive additional console sales. More console sales may mean more non-balance board game sales. They can make even more profit selling other related stuff like mats and water bottles. The medical device however is pretty much a stand-alone item. All development expenses, manufacturing costs, and profit must be made on the sale of that single item.

Eyetoy

[Anonymous Coward]

The eyetoy from the PS3 is also de best camera in the market and it costs less than 40€. It has 75 degree wide lenses and can reach 125 fps. This is much more than what most cameras do. Even the 200€ ones.

accelerometers?

[edelbrp]

"When doctors disassembled the board, they found the accelerometers..."

They did? I couldn't find any information stating that the balance board had motion sensing. Everything I've read says it just has four pressure sensors, one for each corner and that's it.

Re:accelerometers?

[Anonymous Coward]

New Scientist may have made that up. The actual journal article on ScienceDirect only discusses a black-box approach: i.e., putting patients on the board and seeing what happens. The procedure doesn't mention disassembling the device whatsoever!

Re:accelerometers?

[LostCluster]

"Accelerometer" is a big word that means "a scale". See, pounds are not units of mass, they're units of force. Go to the top of a mountain and bring a scale. Everything will "weigh" less because you're further from the center of the earth's mass. You'll have less effect of gravity up there than you do at a lower altitude. There is no "standard" unit of mass... when they were defining "12 inches" to mean "1 foot" they didn't know there was a difference in weights of things of the same mass.

Re:accelerometers?

[dbIII]

It's really measuring strain - as in how much the sensors stretch. Force can be derived from that and if you compare the output over time so can acceleration. Using a few oriented in different directions gives you the direction the force is applies in.

Re:accelerometers?

[Brandee07]

Here's the abstract. Disassembling, yes. Accelerometers, not so much.

Re:accelerometers?

[JohnFluxx]

It's really measuring current - as in how much current flows through a piece of metal. Strain can be derived from that, as the resistance depends on the strain the metal is under.

Wii Fit vs Wii Fit Plus

[LostCluster]

When the Wii Fit first came out... there were several modes of operation that the experts thought should be in the software. Nintendo's first response was to say such people were welcome to develop their own games, then when realizing they were so simple to program the $20 new disk called "Wii Fit Plus" (which now replaces the original disk in the new package for new users) was Nintendo's make good.

Because they can.

[Anonymous Coward]

That's part of it, but much of the "cost" is the fact that they can charge that much because it's medical. In other words, they charge that much because they can.

duh...

[Anonymous Coward]

I can build you 100 medical test platforms at 18000 a piece or 18000 wii balance boards at a 100 a piece...

Medical insanity

[syousef]

What determines the price of a scale is not just its equipment or accuracy.. but also the insurance the manufacturer has to carry in case something goes wrong. That's why medical devices are more expensive... you're also paying for the liability of somebody being misdiagnosed by a technical malfunction. Highly unlikely, but the money that has to be paid when that happens and gets proven is huge.

So they system is "protecting" patients right out of being able to afford treatment, and people are still willing to stand up and defend this insanity. With these sorts of controls, many, many patients go without treatment, or worse go for alternative Voodoo treatment that do harm because they simply can't afford the real thing. It's a sure sign that the medical system is itself quite ill and probably clinically insane.

What needs to happen is companies need to be held accountable for gross negligence and willful malice, but permitted to release a medical device with a disclaimer about the level of testing that has been done. If the overhead for adhering to medical standards is literally an 180 fold increase in the price, clearly there is something very wrong with the efficiency of the system.

Re:Medical insanity

[tftp]

So they system is "protecting" patients right out of being able to afford treatment [...] It's a sure sign that the medical system is itself quite ill

Not as much medical system as legal. The doctor won't take a guess at your problem and give you pills that probably will help. This is because if he is wrong you will sue him for $1M, his insurance will pay, and you buy a nice house on proceeds. The doctor, of course, is ruined.

Because of that every doctor practices CYA. He doesn't need your $50 (vs. regular $500 with full tests) if those $50 can destroy him. If you follow the line, the worst case is when a doctor gives advices for free, with hardly any look at the patient. He'll earn nothing, and will lose his license as soon as the lawyers reach the courthouse.

Re:Medical insanity

[T Murphy]

The problem isn't the suppliers- it's the insurance companies. They control the costs and they have clout and know how to use it. Fix insurance and everything else should be easy.

A plan to cheapen health care...

[marciot]

Nintendo should work on a fMRI-based game interface that can translate your thoughts into game actions. That should get the price of fMRI scanners down to a few hundred dollars each and immensely benefit medical research.

Once they are done with that, they can work on a DNA sequencing controller that customizes your on-screen avatar to look and act like you based on your genetic sequence.

And so forth, until all medical equipment and tests costs a few hundred dollars each.

Re:A plan to cheapen health care...

[Anonymous Coward]

I'm going to go on a limb here and say that measuring blood vein activity in the brain with fMRI is still a far cry from reading thoughts.

Re:A plan to cheapen health care...

[sugarmatic]

I know you were intending to be funny, but who needs fMRI? Regular MRI is NOT expensive to achieve. GE strategically declines to manufacture low cost MRI equipment because it has established a north american market based on a very high priced, very lucrative business model. The installation of less expensive equipment that provides 80% to 90% of the capabilities of the most cutting edge products would inevitably diffuse into the north american market model. This is their own rationale, not mine.

The real hurdle in the MRI game is the data acquisition and processing, not the hardware. It's very specialized. Experts go from one MRI giant to the other and back again over their careers. It would be a bubble that would utterly collapse should someone with enough chutzpah arrive on the scene...

Price is in the "too small for insurance" range

[RobertLTux]

I could see some folks using this a first stage "cut out" instrument sort of like the difference between
most road side BAC tests and a real live blood test or as a "backup" device.

When your time comes

[westlake]

Ads that tell selfish old geezers that they can get an overpriced motorized wheelchair "for free" is what keeps health care costs high.

That selfish old geezer who now has mobility can continue to live at home.

Where he will remain more active and engaged. Healthier. Less dependent on others.

That saves the system a lot of money.

Have you priced the nursing home bed or "assisted living" for your parents or grandparents?

Young kids being duped into thinking that their doctor visits are "for free" is what keeps health costs high.

Keeping kids healthy keeps health costs low.

Re:When your time comes

[Anonymous Coward]

If the motorized wheelchair is cheaper than assisted living, then the family should be able to do a simple cost-benefit analysis and make that decision without government getting involved at all.

Otherwise, how do you even know that it's saving "the system" any money? Perhaps the scooter is a less efficient use of resources. The only way to know for sure is for the market to price it.

Economies of Scale

[burritozine]

Everyone has rightly pointed out that the cost of this sort of device is inflated by regulatory headaches and liability concerns. Let's not forget simple economies of scale here. A video game controller will likely sell millions if not tens of millions of units before it's eventually retired from the market. A medical balance board, on the other hand, is at best a niche device whose sales will likely be at least an order of magnitude (or two!) smaller. The costs of designing, testing and building this device are borne by a comparatively tiny number of sales, hence the higher price.

Re:Economies of Scale

[mjwx]

Everyone has rightly pointed out that the cost of this sort of device is inflated by regulatory headaches and liability concerns. Let's not forget simple economies of scale here. A video game controller will likely sell millions if not tens of millions of units before it's eventually retired from the market. A medical balance board, on the other hand, is at best a niche device whose sales will likely be at least an order of magnitude (or two!) smaller. The costs of designing, testing and building this device are borne by a comparatively tiny number of sales, hence the higher price.

True but there is about six or seven orders of magnitude between them. Wii Fit measures units sold in millions, MRI scanners measure units sold in hundreds.

Medicare won't pay for Wii because of dual purpose

[aspelling]

Medicare and many insurance companies won't pay for Wii because it is dual-purpose device
NYTimes had a story when they refused to pay for iPhone-based speech synthesizer for a paralyzed patient but had no problems paying $5000 for a desktop based one because the desktop-based device was not able to do anything but synthesize voice
 

But can they use it?

[POds]

I know in my professional industry, there may be many a cool technology or device that i want to use, but may not be able to, despite the fact it looks good and can handle what i throw at it. However, i may not technically be able to use it because it has not been tested against specific guidelines or a part of the product was not tested against particular standards with the right amount of traceability.

I believe that’s why some particular product may cost more than any other. I.e a device to be used in a medical institute for diagnosis of any kind would probably require quite a lot of process in it's accreditation that the Wii probably didn't have to go through to be used as a game machine.

the true test of your talents

[RobertLTux]

did you figure out what frys itself after one use so that you could maybe replace it??

Re:the true test of your talents

[Anonymous Coward]

Hehe...

Actually that is part of what brought this all on. He wondered if maybe the unit could be re-enabled and he could sell it on e-bay or something to recoup some of the money he lost being laid up.

The circuitry is simple (way simple!) and I am familiar with the uC used... it may be possible. Since the device is throwaway now, what's the risk? DCMA? Don't make me laugh!

rubbish

[retchdog]

If they did something like that, they wouldn't be allowed to call their stuff USB (which they do), since it's a trademark held by USB Implementers Forum Inc. and licensed only under agreement of compatibility.

Apple makes bank from people who don't know any better. Scrounging a few bucks from geeks isn't worth this kind of danger.

Re:rubbish

[tftp]

If they did something like that, they wouldn't be allowed to call their stuff USB (which they do)

This is not a problem. USB standard does not specify charging. It only requires that the [self-powered] hub can source up to 500 mA at 5V. Nowhere it says what the device should do with this power.

Specifically, I had a cell phone (Sanyo PM-xxxx IIRC) that won't charge over USB until a *driver* was loaded onto the PC. The driver sent a small command over the USB, and that command opened the switch and started charging. This can be easily implemented in any device if the manufacturer wants it.

This approach is not common, though. My current cell phone (LG CU515) charges without a driver (and it connects as a mass storage device anyway) and my cheap photo camera does the same.

Re:rubbish

[drinkypoo]

This approach is not common, though.

Yeah, you know, Motorola has only made one or two cellphones anyway.

Re:rubbish

[LtGordon]

Specifically, I had a cell phone (Sanyo PM-xxxx IIRC) that won't charge over USB until a *driver* was loaded onto the PC. The driver sent a small command over the USB, and that command opened the switch and started charging. This can be easily implemented in any device if the manufacturer wants it.

I've run into quite a few devices that are designed to act in similar [stupid] ways. I'm a firm believer in the Unix design philosophy. For example, only recently have digital camera manufacturers loosened their grip on software interaction. Certain brands are/were especially bad. I'm looking at you, Kodak. They would refuse to function in USB mass transfer mode and would only let you upload photos via a proprietary (read: ridiculous and bloated) software suite.

Anonymous Coward

[Anonymous Coward]

What the heck do (medical) doctors know about quality of accelerometers and strain gauges? Thats why health care cost are so damn high because doctors and hospitals pay $18000 for things that should cost $100. (Remind you of the military?) Of course there is economy in scale but not 18000%.

Been there.

[VertigoMan]

I lost all the balance function in my ears more than 5 years ago. At that time only one center in the Phoenix area had the testing equipment. It took me 3 months to get in for testing and the testing ended up costing me close to $500. Oh and that was out of pocket as the testing center wasn't covered on my insurance plan. I would love to see something as inexpensive as this as a first round of testing. Would have saved me months of stress over not knowing what the hell was going on.

Dysfunctional

[omb]

1. The US legal system and congress are hopelessly broken, see SCO v IBM ... and the Health Care Debate, which gave no account od single payer or honest insurance.

2. You are dimwits who have regulated yourself in to the worst mobile phone system and 37th in the Western World, just above Cuba; and failed to regulate your Financial System into the 2008 Drepresion.

3. You need, urgently, to get a grip, and grow some common sense, the $18000 is blatant price gauging, nothing else.

Just more evidence that the Wii

[lena_10326]

.... is the most awesomist console ever. :D

I have Wii Fit and board. When you do the balance test and balance games you can tell it's a very sensitive and accurate board. It's also an accurate weight scale. It's also very heavy and dense for its dimensions. Much stronger than you think a chunk of plastic would be.

Has Little to Do with Lawsuits

[Comatose51]

The reason medical devices are so expensive has little to do with lawsuits when compared with the number one reason: the market for health care is distorted because the decision maker (doctor) is not the person paying for the decision (the patient or insurance). Medical device companies just market directly to doctors. Medical conferences are like industry paid vacations for doctors. Even if you tell your doctor that your Wii balance board does the same thing as the $18,000 device, he's still not going to prescribe it because he has no incentive to. He doesn't bear the cost of paying for it. You do or most likely your insurance do. You see the exact same thing in the textbook industry. The professors make the decision and the students pay for it. When the two entities are not the same, you have a market that's distorted and normal mechanisms of capitalism don't lead to lower costs and greater efficiency like they do in other areas. Of course FDA approval definitely plays into this by making it easier for doctors to have support for their decisions.

Re:Has Little to Do with Lawsuits

[Anonymous Coward]

This.

Exactly

BTW, the problem is the same in all countries, this is not US specific (though US patients may ahve deeper pockets).

There are very few ways out of this, and een fewer solutions that do not require authoritarian measures. But allowing the medical sector to freely decide the price of medical stuff, just like we allow the law sector decide the price of legal stuff (through punitive damage) is a recipe for disaster.

Self Serving Nonsense

[omb]

If the price difference was 500 to 100, there would not be too much spleen, even if they made 200% profit. $18000 is an obvious obscene rip off and is indefensible.

As to sterile, pee blood ... and all the other nonsense the could simply tie it inside a stout sterile plastic bag, cost $0.05, or in your mad world $50 at a 17850 saving.

sounds familiar

[sneakyimp]

This reminds me of the $800 hammer that defense contractors sold to the US government back in the 80's. It was an ordinary hammer.

Re:sounds familiar

[amiga500]

Do you know how much it costs to sell an $800 hammer? It's easy to sell a $10 hammer. For the $800 one, you need to hire a sales staff and lobbyists getting government contracts. You need to entertain your buyers, you may have to do trial runs, POC, RFP, provide 'free' training etc.. These things are all must be added into the cost of the product. I doubt Nintendo has sent salespeople to visit the doctors in the Melbourne, nor have they likely taken them out for dinner, provided them with equipment leasing options, or guaranteed a service and replacement contract. When I sent my Wii in for repair, it took six weeks and I lost all my data. You can't expect hospitals to get the same level of service as consumers.

Re:sounds familiar

[sneakyimp]

So basically you're telling me that as a taxpayer, I'm paying an extra $790 for a hammer just so a bunch of sales people and lobbyists can schmooze with politicians? That sounds like a really lean operation.

Re:sounds familiar

[defireman]

I'm sure they can afford to throw out their broken wii balance board and buy a new on the event that one breaks down.
All they really need to do is to make sure the electronics does not interfere with the patients or any other critical equipment, it using Bluetooth and all.

Re:sounds familiar

[IHC Navistar]

Where can I find articles on that? I want to read more about it, but can't find anything on it!!!

Re:sounds familiar

[sneakyimp]

http://books.google.com/books?id=0-UCAAAAMBAJ&lpg=PA41&ots=yXVIUB8FhT&dq=reagan%20overpriced%20hammer%20%2Bdefense&pg=PA41#v=onepage&q=reagan%20overpriced%20hammer%20+defense&f=false

Re:sounds familiar

[spokedoke]

This parent should not be a troll, I think that defense equipment costs and medical equipment costs have a lot in common. For instance, my company is a defense contractor that makes a 'special' version of a commodity item. Meaning that we take a $4 dollar part and put in $1000 worth of non-standard testing and QC (advanced reliability, radiation, zero-failure, blah, blah, blah), then sell it to the government for $2000. It takes millions of dollars in research for a commodity part to become something that has zero-failures in a lot (by space qualified mil-spec standards), somehow that doesn't change the fact that a $4 part looks the same as a $2000 part.

Regarding the infamous hammer, this link (thefreelibrary.com) suggests that the cited cost of the hammer was the line item (proposed) cost, not the purchase order cost. Up front only the total amount of our contract is scrutinized, after an amount is agreed upon we fill in the line items in pseudo-random fashion. A 'best guess' at the overhead and supply costs is done knowing that on the back-end of the contract the actual cost of items will be scrutinized, both by our contracting agency and the DCAA. So there is some incentive to pad your guess, not that this particular guess was a good one. It seems that someone who didn't care was asked to fill out the budget.

Re:sounds familiar

[b4dc0d3r]

Pretty sure this has been debunked, because the $800 hammer has to be tested to withstand zero-pressure, frozen environments without breaking or becoming useless. Even if it requires no modifications, someone smart (meaning lots of $$$ per hour) has to test it completely to make sure it doesn't fail. You can't just send up a normal hammer and hope it works, and you can't send up 10 of everything because each ounce of payload adds to the fuel costs. You certainly can't afford to hope your environment doesn't become depressurized instead of doing actual testing, because one tiny hole renders your equipment unusable until a supply mission comes back up.

Plus, it has to probably work outside, and you don't just set stuff down outside - it has to be tethered. And you don't want it flinging around on a bit of string... I'd google it for you but I have more pressing issues. Don't look for rhetoric like "$800 hammer" - try searching for the opposite of what you believe like "why is military hardware overpriced" or "explanations for $800 hammer". you'll be surprised.

Re:sounds familiar

[sneakyimp]

Since when did anyone say anything about the hammer going into space? Answer me honestly. Have you been smoking weed?

Crooks

[FShort]

More evidence health care costs are through the roof for no good reason. $18K for a board that is no better than one I'd get with my kids gaming system?? Next time my doc wants to send me for physical therapy, I'm going to say "No thanks, I have Tony Hawk's Downhill Jam at home. Thats just as good".

You miss the point here - cost is irrelevant

[tg123]

There is no justification for an $18,000 price difference for what amounts to the same fundamental technology. I don't need a formula, or theories as to why this is. The medical industry is full of a bunch of crooked greedy bastards........

I think your missing the point here.

It's not how much it costs or if there ripping us off .

"The how much it costs" argument is irrelevant.

Its the fact that we are now getting devices, which are used to play games, in our homes which are comparable to highly sensitive medical devices.

WOW !!!

The doctors in this melbourne hospital should also be congratulated for looking at alternative ways of doing things.

Re:You miss the point here - cost is irrelevant

[JambisJubilee]

The cost is relevant, because we are getting ripped off by medical suppliers (even if indirectly). My girlfriend just broke her leg and here's what we saw at the medical supply store:

• aluminum crutches - $150
• folding wheelchair - $500
• plastic arm brace - $95
• compression sock $30

It's completely a case of price fixing.

Re:You miss the point here - cost is irrelevant

[tg123]

The cost is relevant, because we are getting ripped off by medical suppliers (even if indirectly). My girlfriend just broke her leg and here's what we saw at the medical supply store:

• aluminum crutches - $150
• folding wheelchair - $500
• plastic arm brace - $95
• compression sock $30

It's completely a case of price fixing.

Holy heck,

Shows the difference a government healthcare scheme makes I guess.

You do not get any rebates on that?

I dislocated my knee cap a few years ago and while I had to pay out about $1000 in medical fees I received about $900 back in government healthcare rebates.

The crutches I had to rent for $50 was one of the few things I could not claim.

Re:You miss the point here - cost is irrelevant

[CorporateSuit]

Not entirely. Medical costs were going to cause a recession if the banks did not. Very few of those issues are being resolved, and more are being created. Calling attention to this gouging, and finding ways around the ridiculous pricing of equipment that hospitals are forced to deal with will be critical to many of the largest national economies in the next 10 years. Hospitals are constantly going bankrupt, doctors are all quitting (you can make more money as an unaccreditted investor, with less stress and less risk than practicing surgery) and the definition of malpractice is being warped to include any risk as unnacceptable -- which, in medicine, means every case you take, you CAN be sued for -- so only a masochist will want to be a doctor.

The cost difference is incredibly important.

Re:You miss the point here - cost is irrelevant

[Anonymous Coward]

Exactly. And lets be real here, the medical device came first. Sony saw the balance technology that exists in the medical arena and thought "Hey, that would be cool for a game controller". Then they mass produced it at a lower cost.

What DIDNT happen is that some medical device manufacturer thought "hey, lets knock off a Wii controller and charge people $18,000 for a $100 device"

Reason is very simple

[Improv]

Behold: economies of scale.

in other news...

[mestar]

...medical hardware manufactures charge $18,000 for a piece of hardware worth about $100.

"what the market will bear"

[nsayer]

Want to make a mint selling ordinary hardware?

All you need to do is either

A. Get it FDA certified for use in medicine.

Or

B. Get it FAA approved for use in aviation.

You can pretty much guarantee a 100x price premium in the former case or perhaps 10-20x in the latter case.

Of course, requiring government certification for things upon which the general public relies for life safety is not necessarily a bad thing, but the price premium that comes from the certification requirement probably is proportional to the square of the cost of doing whatever is necessary to obtain said certification.

Re:"what the market will bear"

[tg123]

Want to make a mint selling ordinary hardware?

All you need to do is either

A. Get it FDA certified for use in medicine.

Or

B. Get it FAA approved for use in aviation.

You can pretty much guarantee a 100x price premium in the former case or perhaps 10-20x in the latter case.

Of course, requiring government certification for things upon which the general public relies for life safety is not necessarily a bad thing, but the price premium that comes from the certification requirement probably is proportional to the square of the cost of doing whatever is necessary to obtain said certification.

Premium?

To me anything that keeps me healthy and assures me that the plane I am flying in will not drop out of the sky can not have a value put on it.

Re:"what the market will bear"

[nsayer]

Premium?

Yes. Look it up in the dictionary. Specifically, where it says "a sum added to an ordinary price or charge."

To me anything that keeps me healthy and assures me that the plane I am flying in will not drop out of the sky can not have a value put on it.

Actually, it, like every physical object in the world and some that aren't, can, in fact, have a value put on it.

Re:"what the market will bear"

[tg123]

I do apologise for this reply avid slashdot readers but this person is just so rude.

Premium?

Yes. Look it up in the dictionary. Specifically, where it says "a sum added to an ordinary price or charge."

Thank you for the definition , oh look at that it also says
quoted from http://www.thefreedictionary.com/premium

"An unusual or high value" for example ":Employers put a premium on honesty and hard work."

who would have thought that Premium could have a meaning not related to money? That must have been the message I was trying to convey.

To me anything that keeps me healthy and assures me that the plane I am flying in will not drop out of the sky can not have a value put on it.

yes , If you read though it again I appear to be saying that not everything should carry a value.

Actually, it, like every physical object in the world and some that aren't, can, in fact, have a value put on it.

Theres a book I think you should read its called

Priceless: On Knowing the Price of Everything and the Value of Nothing.

http://www.amazon.co.uk/Priceless-Knowing-Price-Everything-Nothing/dp/1565849817

Anon

[Anonymous Coward]

I have worked for both doctors and surgeons, and currently work for a work insurance company and the main reason behind the costs of these equipments is support and insurance. Like people have stated, if someone gets mis-diagnosed then that patient can sure them for a lot more then what they could sue Nintendo because they hurt themselves playing on their wii fit board. If someone gets wrongly diagnosed then the doctor can be looking at $100k's of thousands of dollars of damages alone, and then there is the private practise/ hospital that would also then be sued for a shitload. The device most probably links in with some set of software applications that will then let the doctor send it off to a specialist to look at who can then send it back to the doctor. If something malfunctions with the device or of the doctor has any questions, then they can get support for it straight away.

Do we need any more evidence than this that there

[Anonymous Coward]

Do we need any more evidence than this that there isn't a free market in medical care... and that there should be?

No wonder: Art degree.

[Anonymous Coward]

"And the reason my friend was willing to let me tear it apart? It can only be used once! It is designed to permanently disable itself after one period of treatment."

An electrical engineer who's stymied by $5 worth of parts. Macgyver could bring it back.

NOT SO !

[Anonymous Coward]

What determinds the price is production, and demand.

The principle of economics doesn't apply when it comes to medical equipments.

The jack up the price so high ($18K) simply because they CAN !

Now you know why they charge patients hundreds of dollars for a painkiller?

Not a problem

[Wrexs0ul]

Depending on the client you most certainly could the first time, it's the next time it breaks they'll go somewhere else. And with any luck they'll tell their friends :)

-Matt

Robert Ebert

[10Ghz]

This reminds me of what happened to Rober Ebert. He lost his voice, and this is what happened:

"I am one of those you write about who uses a computer voice after losing the power of speech as a result of cancer surgery. After trying an $8,000 custom device with little computing power and a small, dim screen, I tried the built-in speech software on my MacBook and found it much more practical.".

http://www.nytimes.com/2009/09/19/opinion/l19speech.html?_r=3

Not only was the "official" solution crap, it was also a lot more expensive than the consumer-device was, which was not even designed for this particular task.

Nail on the Head...

[tehdaemon]

"Everyone is experiencing massive cost inflation, and it's precisely because the end-customers are insulated from the cost of their own health care decisions. All patients want the most effective test/treatment available, regardless of whether it's only 10% better than another option that costs a third as much. Providers, for their part, are both morally and financially motivated to go for the better and more expensive approach. Morally because it's the best treatment for the patient and financially for obvious reasons. The only one who has any incentive to keep costs down is the insurance company. And if they're actually competing for customers, then they have a counter-incentive to keep the patient happy, which means ever-increasing costs. "

Well said. Any health reform that does not change this won't contain costs. What you are wrong about is the idea that a one-payer system can't change this. It may not - I can think of several plausible national health care systems that wouldn't - but some in Europe do. That said, I am not in favor of a national health care system.

A systen where deductibles were $10,000 minimum with 50-90% of costs (depending on price etc) were covered after that, would do wonders for keeping costs down and improving medical tech (that last bit national health care tends to be rather poor at)

T

Re:Nail on the Head...

[swillden]

Any health reform that does not change this won't contain costs. What you are wrong about is the idea that a one-payer system can't change this. It may not - I can think of several plausible national health care systems that wouldn't - but some in Europe do.

Agreed. I was speaking primarily of the approaches being bandied about for the US, all of which would strongly favor low or no-deductible coverage and trivial co-pays.

That said, I am not in favor of a national health care system.

A systen where deductibles were $10,000 minimum with 50-90% of costs (depending on price etc) were covered after that, would do wonders for keeping costs down and improving medical tech (that last bit national health care tends to be rather poor at)

T

$10K is a bit higher than I would go, especially if the deductible resets annually. For many people a $10,000 bill is a financial catastrophe. I'd start it at half that, maybe a little less. Although I'm generally quite libertarian, in this case I think I'd also like to see forced health care savings. The collection process could be handled similar to social security, with the (very important!) difference that the funds are deposited in an account owned by the individual. So any employed (or self-employed) individual would begin building a health savings account from the first day they start collecting a paycheck. Since people are generally healthy in their younger years, that should ensure that by the time they start experiencing significant medical expenses they CAN afford a $10K deductible. At retirement, any money in the health care savings account should convert to a traditional IRA. Funds withdrawn and spend on health care should be tax deductible, other withdrawals should be taxed as income.

Similarly, in order to ensure that insurers can spread risks across the broadest possible pool, I would suggest that at least a basic level of high-deductible insurance be mandatory for everyone who is employed. I'd leave it to private insurers to compete for the business, but every employed person would be required to purchase medical insurance meeting the mandated minimum standards for catastrophic coverage. Setting the standards low and requiring everyone to buy should allow premiums to be very reasonable. Making coverage mandatory would also allow us to legislate that insurers cannot decline to cover an individual without worry that it would encourage the healthy to opt out.

It should also be mandatory to purchase coverage for your dependents.

All that "mandatory" stuff really goes against my principles, but I think it's impractical to allow people opt out -- because we're too soft-hearted to TRULY allow them to opt out. As long as we don't feel comfortable refusing emergency treatment to those who can't pay, we need to focus instead on ensuring that everyone can pay because they're full participants in the system.

Even requiring everyone who is employed (and their dependents) doesn't fully resolve the issue. There are still people who are unemployed, and there are people who do get very sick while still too young to have built up significant health savings. We need to make it easy for relatives and charities to help out, and we probably need government intervention to arrange for coverage when that fails. It should be handled at the state level, though, not federal, to allow us to explore a variety of options and figure out what works well.

That's how I'd set it up, if I were in charge :) You're probably glad I'm not.

Recently considering Wii for physiotherapy

[synthespian]

Funny that I should read this today. A couple of days ago, someone told me about the Wii gadgets for balance etc.
I had a Jiu-Jitsu-related ankle injury that needs boring and expensive physiotherapy and I had pondered whether the Wii boards wouldn't allow me to ditch my sessions (basically balancing acts throughout the whole session).

Hahaha

[hesaigo999ca]

They are just now starting to realize how overpriced everything is being sold to the medical profession, on purpose....when they come out with a wii, and that same device they can use is sold at 1/1000 the price, it makes you wonder, no?

There will always be mafia types everywhere, trying to make as much money go into their own pockets, instead of letting the hospitals
be able to have more for less. Then when budget time comes, they get the government telling them they cant be given more....
and like a little kid that did not save up properly in such situations, cries that its not fair.

I hope this will shed more light on other like minded situations in the hospitals...and maybe get them to review properly what they are buying....

Profit margins

[sjbe]

They did not charge 6k for the HDD.

Yes they did. There are other things rolled into that cost to be sure (insurance, etc) but don't kid yourself. There is also a hefty profit margin there too. Medical equipment companies aren't doing this stuff out of the goodness of their hearts. If they can get away with charging $6000 to swap a hard drive, they will.

To avoid bigger payouts

[sjbe]

If they were going to charge you 6k, why even bother about the warranty?

Because this isn't the PC on your desk. If there was a lawsuit any lawyer worth his retainer would stand up and ask the defendant "why did you think it was acceptable to tinker with the equipment in a way you knew would void the warranty when your tinkering resulted in the death/injury of my client?" Shortly thereafter the lawyers for the hospital would settle for a large sum of money MUCH larger than $6000. The decimal would move three or maybe four places to the right I would guess. Never underestimate the fear of lawyers.

That's not to say the medical equipment company wasn't ripping off the purchasers of the equipment. I suspect there was a very healthy profit margin in there.

From my point of view, if the machine was under warranty, the repair should have been free of charge.

Only if you agreed to that when you purchased it. Shady I'll agree but not unusual.

Liability is very real and not always bad

[sjbe]

What would happen if the liability was removed or limited?

Then you have the problem of snake oil salesmen. Liability is not always a bad thing. It protects all of us from unscrupulous vendors every day. You can either regulate heavily or allow liability but you have to have at least one of the two and preferably some of both.

Getting several million "liability" for essentially nothing is insane.

Are you seriously claiming that a video game is the same as diagnosing a neurological condition? In medicine we are literally talking life and death. Permanent injuries can result from momentary lapses of judgment or faulty equipment. It might be that a medical equipment provider is ripping off the buyer but that doesn't mean the liability cost isn't still very real.

Re:Liability is very real and not always bad

[jhol13]

No.

Snake oil salesmen would get criminal punishment, as they do nowadays.
There would just not be lottery-kind incentive to sue anybody.

Yes, a video game can give valuable information whether someone has a neurological condition. AFAIK no equipment can do that without a doctor and no (sane) doctor would ever rely on one positive output alone.

Re:Liability is very real and not always bad

[Shotgun]

Then you have the problem of snake oil salesmen. Liability is not always a bad thing. It protects all of us from unscrupulous vendors every day. You can either regulate heavily or allow liability but you have to have at least one of the two and preferably some of both.

-OR-

You can provide education and information. The government investigates, tests and provides ratings for devices and services offered for public consumption. Then the typical "knew or should have known" can be turned against the consumer instead of just at the provider...as in, "You knew, or should have known" that this hospital used unsterilized, rusty knives. It was in the government report, but you chose to use their services because they were cheaper. Get outta here, ya' bum." I exaggerate for effect, but that's the basic idea.

Re:Liability is very real and not always bad

[Ihlosi]

Snake oil salesmen would get criminal punishment, as they do nowadays.

I'm sure all of their victims (or their survivors) will be truly _thrilled_.

Re:Liability is very real and not always bad

[jhol13]

What on earth is so difficult with this?

If the problem is snake oil salesmen, as the writer I responded said, criminal punishment does solve that.

If the problem is compensation for the victims - sure they would be compensated for their losses. But only losses, not several millions for a burned lap 'cause the coffee was a hot.

Re:Liability is very real and not always bad

[Ihlosi]

If the problem is snake oil salesmen, as the writer I responded said, criminal punishment does solve that.

No, it doesn't. It never did. It's _maybe_ going to keep one snake oil salesman from doing more damage than he already did for a while, but it won't keep the legion of others from doing their dirty business.

Besides, did you ever look at some trials and lawsuits involving snake oil? They drag out forever, and time is working for the culprit and against the victims.

If the problem is compensation for the victims - sure they would be compensated for their losses.

By whom? By the snake oil salesman with a net worth of, um, less than a hundred bucks? You can't get water from a rock. And how do compensate dead people? What's a pair of limbs or eyes worth to you?

laissez-faire FTW

[supernatendo]

Hmmm, let’s see here, one device, marketed as a medical device, is made in a heavily government controlled environment where there is much need of tort reform. The other is a repurposed game device with similar components of equal quality where tort reform is not an issue

Sure, a lot has to do with the fact that there is much more demand for the Wii balance board than the Medical Scale, but because of all the bureaucracy and litigation involved in the medical field the price of the medical scale includes not only the equipment’s accuracy and the quality of its components or the demand for such a device, but also the insurance the manufacturer has to carry in case something goes wrong. Hospitals and doctors are paying the manufacturer high prices so that the company who makes the device can cover for the likely case that somebody who may have been misdiagnosed and had used the device may try to make a case against the company based on the theory that the improper diagnosis could have been due to a “technical malfunction”. The money that has to be paid when the company gets sued all the time is huge. This cost is passed on to the doctors and hospitals and the cost that the doctors and hospitals incur for the device is passed on to the patient. This contributes to the higher cost of health care which has caused a heavy reliance on health insurance as opposed to people being able to save money for healthcare as they need it and for making health insurance much more expensive.

What is amazing to me is that people who advocate more market tampering and control would have failed to notice that the free market Gaming sector of the economy would be able to generate enough demand to bring down the price for what would otherwise be an obscure piece of medical equipment.

In a controlled market the idea of investing money and resources in gaming devices would have been deemed wasteful and there would never have been this possibility for an incredible price drop.

laissez-faire FTW.

re: FDA approval, etc.

[King_TJ]

Yes, but all of what you just said further illustrates why govt. bureaucracy is causing our medical expenses to spiral out of control. It's not sustainable. The only people who really "win" in this mess are the attorneys, and all the talk of medical reform in the USA right now conveniently skips changes in THAT area.

Not long ago, I was reading about a heart surgeon in India who among other things, got tired of the high cost of medical sutures. Apparently, the only supplier of the ones he needed was the Johnson & Johnson company, and they kept increasing prices each year. He finally got some investors together, who opened their OWN manufacturing facility to produce the sutures in India at a far lower cost, so he can now buy from them and cut at least 35% off of his annual expenses for them. (Since he's running huge clinics doing nothing but heart surgeries there, he benefits more than most would from "economy of scale".)

It seems to me, that's exactly the type of change the medical field needs to see. Unfortunately, government legislation often seems to stand in the way of progress here in America. (A doctor my friend knows heard this story about the medical sutures and angrily protested, "But I'm not even legally ALLOWED to invest in such a thing as a surgeon in the US!")

As it stands now, doesn't it bother you at least a LITTLE bit that you had to fork out upwards of $250,000 in *lawyer fees* just to prove that it was ok for a hospital to start using what's really just a touch-screen PC in a hardened metal frame?

Supply and demand aside...

[HikingStick]

Supply and demand aside, when it comes to medical devices (or any special purpose device or package, for that matter), you often pay a premium for intangible features--specific certifications or backings, regulatory approval, availability through an authorized source, etc.

A friend of a friend is in the business of selling supply packages for a specific law enforcement function via government contract. He's repackaging and selling items anyone could get at retail for a fraction of the cost. In fact, it was my friend who suggested to his associate that the supplies included in the packages not be the ones embossed the with house-brand label of the supplier from which he was getting them, since it wouldn't take too long for the end-user to realize that they could purchase the same items on their own.

Or, look at medical fast drying adhesives (e.g. "super glue"). Boxers were using glues they bought at hardware stores for years before the medical community considered a medical use. Now doctors and clinics can order supplies of "medical grade" superglue that cost many times more than their non-medical versions. According to my physician, there really was no difference between the two products. The medical one was simply something billable at a higher price, and it carried the implied benefit of being somehow more sterile than the other product. I don't know if there is any real difference in how the lots are produced, but our doctor recommended "super glue" for quick at-home fix ups of cuts and gouges that might otherwise might require a stitch (or staple) or two.

Just give it some time and you'll likely see lawyers and lobbyists from medical device manufacturers fighting to stop the practice of using "non-approved" devices for patient diagnosis, therapy, or prevention.

Re:Supply and demand aside...

[binary paladin]

"[Y]ou often pay a premium for intangible features--specific certifications or backings, regulatory approval, availability through an authorized source, etc."

To the tune of 180x the price in this case.

The problem is these "intangible features" are WHY no one can afford health care. That and the fact that the moment you get insurance and government involved as the primary parties that make payments the price goes through the roof because companies treat both entities like bottomless sacks of cash. The price gets out of reach and the citizens cry for the government to pay for it all because insurance companies are out of reach of a lot of people.

Re:Supply and demand aside...

[HikingStick]

I agree with you completely. That's why I'm sure the lawsuits are soon to commence (fighting the use of unapproved non-medical devices for medical purposes).

The Medical Malpractice Myth

[weston]

the cost of malpractice insurance at every level of healthcare is a major driver of the enormous cost

  Take a read Tom Baker's The Medical Malpractice Myth.

Ezra Klein also has a highlight/review of the book.

What would you expect?

[whitroth]

I see one idiot babbles in the comments to this article about "heavily regulated industry needing tort reform".

The reality is that the medical industry needs more regulation, since their mission statement isn't providing goods and/or services, and making a reasonable profit, it's 1. ROI, 2. ROI, 3. See #1, sell something that the customers will buy, and that we can get a deal with the health insurance companies so that we both make out like bandits, and Did I mention ROI?

Another example: why do hearing aids cost $1k and up... and a cellphone well under a hundred, or any music player under? Why can't one be produced with the sound quality of any headphone set, with microphone and one-chip amplifier, and sold at commodity prices for under $100, and cheap ones under $50?

As I said, because the REAL cause of massively rising healthcare costs is how the industry, not even necessarily doctors, can make out like bandits.

Oh, and about tort reform as some sort of answer? Go pay the $36 for the report from that company in PA that's the *ONLY* one who collects such stats. Last time that report made the news, maybe 5-6 years ago, it was a tiny amount of malpractice awards that were over $1M, and something like well under 10% of the doctors who were responsible for 90% of the malpractice awards.

But self-regulation works *so* well... that these incompetent scum stay in business after lawsuit after lawsuit.

                          mark

Lawsuits are only after the fact

[sjbe]

Snake oil salesmen would get criminal punishment, as they do nowadays.

That's quite irresponsible because someone (usually) has to get hurt before you act. Lawsuits (civil and criminal) are a useful deterrent but hardly a foolproof one especially when there is money to be made. There is a reason we have regulatory controls and approvals on dangerous medications and devices.

There would just not be lottery-kind incentive to sue anybody

I think you overestimate the actual cost and probability of success of medical tort lawsuits. Despite all the noise about them, they are nowhere near the biggest source of cost in medicine. They're a little like plane crashes - spectacular sometimes but rare and mostly not that big a deal on a day to day basis. My wife is a doctor so I'm more than a little familiar with this personally.

Yes, a video game can give valuable information whether someone has a neurological condition.

No one has claimed otherwise to my knowledge. But if the equipment is not designed and approved for that use by the FDA, the physician using it IS exposing him/herself to liability. Medications and devices get used for "off label" purposes all the time but the physician does so at their own risk, especially if there is no informed consent and/or if it is not within standard of care.

AFAIK no equipment can do that without a doctor and no (sane) doctor would ever rely on one positive output alone.

Quite right. But it does provide data and sometimes test data is misleading. Don't get me wrong, I think it is terrific that they are using cheaper technology - I'm just pointing out that there are sometimes risks in doing so.

Re:Lawsuits are only after the fact

[jhol13]

I think you overestimate the actual cost and probability of success of medical tort lawsuits.

It bloody hell is hugely bigger than in lottery.

exposing him/herself to liability.

Is this likely or not? Above you claim it is not significant - if it is that unlikely then it can be used, right, as there is no real danger of any big liability? Put a tenner in a jar every week and give the jar to the patient who gets harmed by the Wii, no?

The only risk you are able to state is "liability". If it really is the biggest risk there is something wrong - and your claim of low probability of success is bullshit.

Mod Parent Up: Malpractice not a major cost driver

[namespan]

Spot on. Most people have no idea what drives medical costs, and their experiences with the legal system are as culturally foreign as IT is to the average layman (at a minimum; it's likely enough they're gratingly adversarial as well as foreign), so it's easy to make the legal system into a bugaboo. And, bonus! The cost problem becomes simple! One easy factor you can blame!

Thing is, medical malpractice is a genuine problem, and when practitioners screw up, the resulting costs to a patient can be astounding. And as adversarial as the legal system can be, dealing with medical practitioners and organizations is often just as bad. Ever tried discussing billing mistakes with a hospital or doctor's office?

If you want a good overview of the various drivers behind medical costs, take a listen to what's available here.

Apparently not highly regulated enough

[namespan]

But other posters will point out, "you can't put a price on your health"

Seems to me this is quite probably the larger reason over regulation that prices don't behave like an efficient market. Regulatory burden may mean an upward pressure on costs, but in a competition/choice driven market, there's downward pressure on prices, which encourages participants to find more efficient ways to provide goods or services within the regulatory framework.

But consumers don't treat health care like they treat electronics or restaurants.

people will cough up to $3200 for a simple abdominal X-Ray that takes, literally, 45 seconds of device time. The same X-Ray costs (I'm told) around $800 in Japan, and less in France or the UK. But in France and the UK, you turn up for your appointment, fill out no extra paperwork, but wait for maybe 90 to 120 minutes to go under the device, because it is utilised at 90% to 100% of the time.

So unless your time is worth over $1000 an hour (and you can't find a way to gain utility out of waiting time), the French and the English have come up with a more efficient system.

Seems

Re: FDA approval, etc.

[Anonymous Coward]

I think the "IT'S DA GOBBERMENT!!"" arguments are unhelpful. It may seem unreasonable to the layperson to require entrepreneurs to spend countless thousands on documentation and quality control,but we have to remember why we have these protections in place; the drive to lower cost in order to maximize profits is exploitable by unscrupulous companies. Hucksters to this day are trying to dupe the public into buying all kinds of "medical" crap on late night teevee, and that is with "govt. bureaucracy". You have to enforce QC on anyone who makes a medical claim about their product to ensure that they are responsible for their product and don't just take you money and run... with your life.

A quick example from a non-medical industry, my friend works in the laser safety equipment industry. He was recently complaining that a batch of frames they received for protective lenses were complete crap and broke at the lightest pressure. In looking for a cheaper supplier, his company's SUPPLIER had gone to a less reputable manufacturer without telling him, and passed off the junk component as quality. Though they had no control over what manufacturers his supplier chose to use, my friend's company took the hit in the end, if they hadn't, someone could have been seriously injured. The natural drive to cut costs often leads to cutting corners, and someone is always left holding the bag.

Even if you do the right thing, there is always someone scamming, and you have to protect the public somehow. Could the regs be smarter? Probably. But because the response of anti-government forces is simply to remove protections whole cloth to "spur innovation", we get nowhere.

What would an appropriate price be?

[UBfusion]

Just imagine you are the head of the tech dept in that hospital. Given the prices of all medical grade stuff, if the guy charged say $200, you'd think that he just plugged in a consumer HD. If he asked for $1000 you'd suppose he used a non-genuine or even used HD. With $6000 you can't think of anything - you just trust the man with the additional benefit in case of a court trial (assuming that e.g. the PC caused a patient death) you'd say that you did all that was humanly possible to make sure that no consumer grade, used or non-genuine parts were used on that PC.

What's the cost?

[BadAndyJ]

The only problem with this kind of story, is the amount the end worker is payed for working for company X isn't taken into account. The company that makes that $18,000 piece of equipment probably pays their employees building the thing a lot more than Nintendo pays its line labour.

Not exactly

[dogugotw]

Medical devices, like drugs, cost money because the company has to prove to the FDA that their device does what it says it does and that the risk the device presents is less than the benefit derived from the device. It's not uncommon for a device to take up to 5 years to get through the design/validation process. If Nintendo decides to offer the Wii balance board as a medical device, you can bet your bippy it'll cost more than $100.

Re: FDA approval, etc.

[dogugotw]

So here's the rub. If 'the government' backs off and lets device and drug companies be less rigorous and more nimble in their work, whoo whoo...more change in less time, innovation, costs drop, new products stream onto the market...yeah.....happy day....
Until someone gets hurt because the company didn't do the things you should do when designing products that are supposed to save lives. A couple of years back the FDA did exactly this to a company making...ohhh flu vaccine. Seems they cut the company a bit too much slack and the entire batch was crap, had to be recalled, and people didn't get flu shots. Guess who spent time sitting in front of a congressional committee explaining what happened? YOU want to explain the congress why companies are killing people?
I work in the industry and as much as I chafe under the paperwork, I have to admit that the only thing the FDA is doing is making us do what we SHOULD be doing. Is it expensive? You betcha. But I, for one, don't want MY health damaged because someone wanted to get product x to market just a bit faster and for a lower cost.

ITIL. Configuration Management. No, you are doomed

[Anonymous Coward]

Your family does not deserve to eat.

You do not deserve to be employed.

Your company does not 'deserve' to be registered as a 'company' or be allowed to do business.

You fail.

Get used to this fact.

1. Load up Google. That's http://google.com
2. Research ITIL
3. Do some reading on ITIL
4. Book yourself on the Foundation ITIL course
5. Research Configuration Management
6. Do some reading on the subject
7. Book yourself on Configuration Management Level 1 (and, preferably Level 2 - I'm guessing from your post that you should be more than capable)
8. LEARN SOMETHING ABOUT WHY IT IS EXACTLY THAT YOUR GOVERNMENT IS DEMANDING THAT YOU PROVE THAT WHAT YOU SAY IS WHAT YOU DO

Your post pretty much says it all. You fail to see why it is that an auditor can not simply ask a question and you can provide an answer in a short amount of time with assurance that the answer matches the question.

Yes, you work in an area that can be 'highly dodgy'.
Yes, it can be very easy to disguise what has / has not been done.
Yes, your processes can be improved.
Yes, your documentation can be improved (go on, shock me, say that your documentation is 'up to scratch' and can withstand scrutiny)

Yes, and even then, when from end to end you can prove what happened when, who and what changed what and where and reality aligns with plans with documentation with change control.. even then you will still find yourself in the same position .. paying millions to prove and audit and show.. because not everyone has the same level of change control and audit systems in place.. and hence you will be tarred with the same shovel as they.

Sad, isn't it.

Where I am, if you can prove that your audit, change and control systems are on board, that release management and change management guard the gates and you can prove that your world is round.. then you don't get slugged to prove that you are not lying.

I will see you here, in heaven, when you throw off your 'oppressors' ( ha ha - yes, that is a joke ) and join us.

Until then: Pay to prove that what you say is what you have done, or get out.

Re: FDA approval, etc.

[Anonymous Coward]

Go fuck yourself and your redneck imitation.

Wii Fit helped me walk again

[Anonymous Coward]

I had back surgery about 18 months ago and the Wii Fit helped me regain my sense of balance. Two disks had intruded into the spinal column, crushing the nerves running to my feet. It had been about a decade since I had feeling in my feet, so I was extremely clumsy after the operation - The new signals just confused the heck out of me, so I was constantly off balance.

Physical therapy was slow, so we started looking for alternatives. They were just exploring the Wii for the sports modules to get folks moving in a very fun way. The Wii fit was fairly new at the time, so I bought it as well.

In less than two weeks, I was walking normally, thanks to twice daily sessions with the Fit's balance games. My physical therapist said it would have taken me about two months using traditional twice weekly visits. (Based on my progress before the Wii Fit.) They quickly added the Wii Fit to their many machines.

It truly is a powerful little gizmo!

More of the same thing...

[Anonymous Coward]

Basically I think some of the above posters have it right, I work in the medical software industry. Now unlike hardware there is absolutely no component cost to software, so why is our medical software so much more expensive then comparable non-medical software, hell why isn't it free?

Well, first of all there's the development costs. But that could be said for any other industry so we'll rule that out as a base cost for all similar software packages.
Then there's QC cost and support cost, unlike other industries if something goes wrong with our medical software someone could get seriously hurt. We have to perform a lot of QC and make sure we offer 24 hour support. The support also needs to be more trained and in some cases have a medical background, so that adds on to costs.
Then there is also liability. If our software files information into the wrong patient file someone could get seriously hurt. That means we have to assume liability for a malfunction, which is a huge incentive to buy from us despite the high costs. These things raise the price significantly. Now the software is still basically the same as it's non-medical counter part but our price tag is much higher. This means that people that don't need to worry about high QC standards and great support won't buy our product, which means we now have to target a limited marketplace. To make up for the limited market place we have to raise the price even more.

It's not that medical equipment or software manufacturers are greedy people that are trying to rip everyone off, that money that the product brings in is actually distributed amongst a lot more channels than a non-medical device. It's necessary to help assure quality and accountability.

Same thing goes for the $18,000 dollar piece of equipment vs. the $100 one. If a patient is miss-diagnosed on the $100 device, who is going to be accountable? Is it the doctor that probably should have double checked the results but didn't because he was busy with other patients? Is it Nintendo? Is it the hospital? The answer is it's sure as hell not Nintendo, they'll say they're not responsible for users miss using the device. And it probably should be the doctor but the doctor doesn't want that, nor does the hospital. In fact the doctor and the hospital would both gladly pay $18,000 dollars for the same device just so that they can off load their liabilities on someone else.

Re: FDA approval, etc.

[jwhitener]

"Yes, but all of what you just said further illustrates why govt. bureaucracy is causing our medical expenses to spiral out of control"

So you'd like us to de-regulate medical devices. How about meat as well? We can go back to eating rotten meat.... Cause hey, if only a few hundred die each year, it is well worth the 50% cheaper meat....

The regulation of the industry does add cost, but that cost is directly tied to the overall health system as a whole. And the largest factor in the cost of all aspects of health care, is insurance costs. Both for physicians and patients.

There's a reason why health care costs in the USA are more than twice any other modern nation, and it certainly isn't government regulation. Feel free to read about the health care of every modern nation on Earth (except the USA) and see how their health care is the same quality or higher while at the same time much less costly.

But hey, don't let facts get in the way of your Fox News talking point about regulation being bad....

Re: stories from the hospital

[b4dc0d3r]

In support, I offer these two anecdotes. I might be remembering wrong because of all the morphine, but I'm pretty close.

1) I was offered some chemical that takes off the gummy black stuff left behind after they take tape off you. The kind of tape that holds an IV in, or a naso-gastric tube in place. My doctor intervened and said basically: don't do that, it will charge you $40. Wait till you get home and get acetone, nail polish remover for a dollar. That's all it is, they just added on costs for profit and liability.

2) To illustrate the point, my doctor told me about the chemotherapy drug that costs $10,000 per dose. It works in horses as well. Doctors would tell their patients that they could order some, or they could provide their own, hint hint. Patients would go to the veterinary supply store and get the same thing for a few hundred dollars, claiming a sick horse, and then take the bag to the infusion clinic. The cost was because they can, and for liability and insurance due to it being a newly patented drug.

Doesn't matter if your insurance pays, your copay amount is probably going to be higher with the "for humans" version than full price "alternative" sources.