IRS Issues Final Rule Implementing Medical Device Excise Tax


“The Internal Revenue Service has released its final rule  implementing a Patient Protection and Affordable Care Act provision that imposes on certain medical devices made after 2012 an excise tax equal to 2.3% of their sales price.” Reports Dennis Stewart from Streamline Savings…. Although the American Hospital Association and others urged the IRS to explicitly prohibit device companies from passing the tax on to customers, and to clarify that hospitals and other healthcare providers who package and sterilize devices for use in surgery kits should not be treated as device manufacturers or importers under the rule, the final rule does not address this issue. In addition, the final rule provides that a kit produced by a hospital for its own use would not be taxed as a medical device…  

The entire rule can be found at:

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Update: Multistate Outbreak of Meningitis and Stroke Associated with Potentially Contaminated Steroid Medication


Summary By: Dennis Stewart, Streamline Savings


The Centers for Disease Control and Prevention (CDC) and the Food and Drug Administration (FDA) continue to work closely with state public health departments on a multistate investigation of fungal meningitis among patients who received an epidural steroid injection. Some of these patients also suffered strokes that may have resulted from their infection. These cases are associated with a potentially contaminated steroid medication prepared by New England Compounding Center (NECC), located in Framingham, Mass. This HAN notice provides updated information about the investigation (including a change in the case definition*), laboratory findings, an expanded voluntary recall of products, and recommendations for clinicians

CDC, in collaboration with FDA, state public health departments, and state boards of pharmacy, has been investigating an ongoing outbreak of meningitis associated with a potentially contaminated steroid medication, preservative-free methylprednisolone acetate (80mg/ml) prepared by New England Compounding Center, located in Framingham, Mass. CDC and state public health departments are actively coordinating outreach to patients who have been exposed to this potentially contaminated medication.

As of October 8, 2012, a total of 105 cases, including 8 deaths, have been reported in 9 states: Florida (4 cases), Indiana (11 cases), Maryland (5 cases, including 1 death), Michigan (21 cases, including 2 deaths), Minnesota (3 cases), North Carolina (2 cases), Ohio (1 case), Tennessee (35 cases, including 4 deaths), and Virginia (23 cases, including 1 death). Fungus has been identified in specimens obtained from at least nine patients, one of whom also had Propionibacterium acnes,of unclear clinical significance, isolated from a post-mortem central nervous system specimen. In addition to an Aspergillus spp. isolated from a Tennessee patient, the fungus Exserohilum rostratum was identified in other patients, indicating the possibility of infections caused by multiple organisms. Fungal meningitis is not transmitted from person to person.

The clinical presentation of infected patients remains consistent with the prior report: onset of symptoms is typically 1 to 4 weeks following injection with a variety of symptoms, including fever, new or worsening headache, nausea, and new neurological deficit (consistent with deep brain stroke). Some of these patients’ symptoms were very mild in nature. Cerebrospinal fluid (CSF) obtained from these patients has typically shown elevated white cell count (with a predominance of neutrophils), low glucose, and elevated protein. As of October 8, no infections resulting from injection into a peripheral joint space have been reported.

Product Recall

On September 25, 2012, the New England Compounding Center located in Framingham, MA voluntarily recalled the following lots of methylprednisolone acetate (PF) 80mg/ml:


  • Methylprednisolone Acetate (PF) 80 mg/ml Injection, Lot #05212012@68, BUD 11/17/2012
  • Methylprednisolone Acetate (PF) 80 mg/ml Injection, Lot #06292012@26, BUD 12/26/2012
  • Methylprednisolone Acetate (PF) 80 mg/ml Injection, Lot #08102012@51, BUD 2/6/2013

All infections detected as of October 8 have occurred after injections with methylprednisolone acetate products from one of these lots. At this time, there is no evidence of infection related to other NECC products.

The FDA investigation into the NECC facility is ongoing. On October 5, FDA reported observing “fungal contamination by direct microscopic examination of foreign matter taken from a sealed vial of methylprednisolone acetate collected from the New England Compounding Center.” Further analysis is ongoing. On October 6, NECC expanded its previous recalls to include all products currently in circulation that were compounded at and distributed from its facility in Framingham, Mass. More information about this recall is available at the FDA website.


  • Physicians should contact (by phone or in person) any patient who had an injection (e.g., spinal, joint) after May 21, 2012, using any of the following three recalled lots of preservative-free methylprednisolone acetate (80mg/ml) produced by NECC, to determine if they are having symptoms:
    • Methylprednisolone Acetate (PF) 80mg/ml Injection, Lot# 05212012@68, BUD 11/17/2012
    • Methylprednisolone Acetate (PF) 80mg/ml Injection, Lot#06292012@26, BUD 12/26/2012
    • Methylprednisolone Acetate (PF) 80mg/ml Injection, Lot# 08102012@51, BUD 2/6/2013

Symptoms that should prompt diagnostic evaluation include: fever, new or worsening headache, neck stiffness, sensitivity to light, new weakness or numbness, increasing pain, redness or swelling at injection site. Some of the symptoms of patients who have ultimately been diagnosed with meningitis have been mild and not classic for meningitis (e.g., new or worsening headache without fever or neck stiffness). 

*Case Definition (note: the initial date for an epidural/joint steroid injection has been revised from July 1, 2012, to May 21, 2012).  
1. A person with meningitis1 of sub-acute onset (1-4 weeks) following epidural injection after May 21, 2012.
2. A person with basilar stroke 1-4 weeks following epidural injection after May 21, 20122, who has not received a diagnostic lumbar puncture.
3. A person with evidence of spinal osteomyelitis or epidural abscess at the site of an epidural injection diagnosed 1-4 weeks after epidural injection after May 21, 2012.
4. A person with septic arthritis3 diagnosed 1-4 weeks following steroid joint injection after May 21, 2012.
1Clinically diagnosed meningitis meaning one or more of the following symptoms: headache, fever, stiff neck, or photophobia and a CSF profile consistent with meningitis (pleocytosis +/-  low glucose, elevated protein).
2These people, if possible, should have a lumbar puncture.
3Clinically diagnosed septic arthritis meaning new or worsening pain with presence of effusion or new or worsening effusion.

Additional Information

The Centers for Disease Control and Prevention (CDC) protects people’s health and safety by preventing and controlling diseases and injuries; enhances health decisions by providing credible information on critical health issues; and promotes healthy living through strong partnerships with local, national, and international organizations.


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Hospital News: 1 year delay on ICD-10 to October 2014

Hospital News: 1 year delay on ICD-10 to October 2014.

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The Bottom Line in Cutting Costs for Hospital Materials Managers


By: Dennis Stewart, Streamline Savings, Florida

In today’s environment, Hospital Materials Managers need to achieve more than ever before. The bottom line is that either supply costs, or salaries/jobs need to be cut. The following is a summary of  the status of Materials Management initiatives:

  • Medical Supplies are the second leading cost to hospitals and medical centers, second only to  labor in providing quality patient care. Until Recently, managing supply chain costs in healthcare has  been  neglected in efforts to improve medical efficiency and save costs.
  • The major items that Materials Management experts agree can targets are Physician Preference Items (PPI) which are  typically orthopedic or cardiac procedures involving artificial joints, implants and stents. Most experts agree that the standardization of  some of these supplies should result in substantial savings for hospitals.
  • The key to negotiating with suppliers is cost transparency. Materials Management  experts agree that hospitals need to know the true cost of items, and compare apples to apples.
  • Improving health sector supply chains requires physicians, clinicians, executives, and the hospital materials management departments, to reassess their  roles and develop initiatives  with the intent to  collaborate,  having a goal of lower costs and quality service.
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Medicare News: Republican (Romney) Medicare Plan to have Increased Costs

Medicare News: Republican (Romney) Medicare Plan to have Increased Costs.

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Medicare News: Republican (Romney) Medicare Plan to have Increased Costs

The Center for American Progress Action Fund is reporting that Mitt Romney  wants  to convert our nation’s Medicare program into a voucher system for people who are under 55 years of age. Under the Romney plan seniors (beginning in 2023) would receive vouchers to purchase health insurance from private insurance companies or from traditional Medicare. If premiums for traditional Medicare or the private plan they choose cost more than the voucher amount, then seniors would have to pay the difference themselves.

The report continues by stating that the Romney plan would hurt current seniors in two important ways:

  • Increased drug costs and higher Medicare premiums. By repealing the Affordable Care Act, the Romney-Ryan plan would raise health care costs in retirement by $11,000 for the average person who is 65 years old today.
  • Increased long-term care costs, including increased costs for nursing home care, because of cuts to Medicaid. A substantial share of Medicaid spending pays for health care costs for Medicare beneficiaries. The Romney-Ryan Medicaid cuts mean a loss of over $2,500 annually for seniors currently on Medicare who also rely on Medicaid. Unlike the Medicare voucher system that would begin in 2023 the cuts to Medicaid would begin almost immediately.

For seniors who will become eligible for Medicare after 2022, the financial harm would be even worse.

  • Increasingly unaffordable costs for all seniors who qualify for Medicare after 2022. For seniors turning 65 in 2023, Medicare costs during retirement would increase by $59,500 in 2012 dollars under the Romney-Ryan plan. Because under the Romney-Ryan plan the amount of seniors’ vouchers will not keep pace with rising health care costs, these numbers are even worse for future generations. In today’s dollars seniors who qualify for Medicare in 2030 would see an increase of $124,600 in Medicare costs over their retirement. Seniors who qualify for Medicare in 2040 will see an increase of $216,600. And by 2050 newly eligible seniors will pay $331,200 more in Medicare costs over their retirement.
  • Additional costs from private plans cherry picking healthier patients. Three-fourths of all Medicare beneficiaries are currently in traditional Medicare. The Romney-Ryan plan would include traditional Medicare as an option in the proposed program, but the costs for seniors who choose to remain in the traditional Medicare program would likely increase even more sharply than for seniors who chose a private plan. Most analysts expect the traditional Medicare plan to attract Medicare beneficiaries with the greatest health needs. In that case, Medicare would no longer enjoy a balanced risk pool and seniors choosing traditional Medicare could wind up paying an extra $29,000 on average over their retirement lifetime above and beyond the costs described above.       The entire report can be found at:                      This article was compiled by Dennis Stewart of Streamline Savings in Florida ,
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Hospital CFO News: Future Technologies That will impact Healthcare and Medicine

Hospital CFO News: Future Technologies That will impact Healthcare and Medicine.

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