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CT industry prepares for 2008 rebound after last year's rout: Page 2 of 3

CT industry prepares for 2008 rebound after last year's rout: Page 2 of 3

In mid-March the Centers for Medicare and Medicaid Services backed away from its proposal to unwind the current reimbursement approach for coronary CT angiography, allowing local coverage decisions. This removed the uncertainty that had helped crush the market for CT last year after CMS noted in summer that it was considering a change in the way coronary CTA was reimbursed.

Now that the coronary CTA scare is over and money is easier to borrow, demand for 64-slice CTs should return. Providers still have a substantial unmet need for these systems, said Gene Saragnese, vice president and general manager of global molecular imaging and CT at GE healthcare.

"Most of the academics have moved into this space, but quite a few of the general-type hospitals have not yet moved to 64," Saragnese said.

The rise in demand is not, however, expected to boost prices. The erosion in pricing for 64-slice scanners seen last year will continue this year, as a new generation of CT scanners prepares to take the field.

Along with hospitals, imaging centers are expected to snap up bargains. The Deficit Reduction Act, which wreaked havoc on imaging center budgets in 2007, should have less effect this year. Centers have now factored in these reimbursement cuts and they have moved on, said Peter Kingma, vice president of Siemens CT, who noted the chilling effect on sales was as much from fear as it was the actual cuts.

"It was the perception that the DRA was not a 'one-off' event," Kingma said.

He believes this perception took root last summer when CMS first raised the possibility of CCTA reimbursement changes.

But just as the 64-slice scanners rebound, their 16-slice brethren are likely in for a drop. These less powerful scanners enjoyed a resurgence in popularity last year in what Philips executive John Steidley called a "flight to value."

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