Lunar earns FDA nod for Achilles+ as HCFA sets ultrasound payment rate

Densitometry firms hope HCFA news will boost market

Lunar of Madison, WI, celebrated last month when the Food and Drug Administration approved the company’s Achilles+ ultrasonometer less than a week after the Health Care Financing Administration (HCFA) fixed an interim billing code for ultrasound bone assessment studies. Lunar executives were pleased at the confluence of the two events.

“We’re lucky (the announcements) go hand-in-hand,” said James Hanson, vice president of marketing for the company.

Weighing in at 50 lb, Achilles+ is a water-based device with stationary transducers that appraise the amount and quality of the heel bone to diagnose osteoporosis and assess a patient’s future fracture risk. The device is already installed at more than 2300 sites outside the U.S. since Lunar began marketing it internationally in 1992.

The company believes it can make a stronger claim for the unit’s effectiveness in measuring postmenopausal women because Achilles+ has been tested with women aged 45 and over, rather than women 65 and over, Hanson said. According to Lunar executives, the FDA’s labeling of the device states that Achilles+ evaluates fracture risk with comparable quality to an axial dual-energy x-ray absorptiometer (DEXA). The company has already signed distribution agreements with McKesson General Medical and Caligor in an attempt to reach the office-practice bone densitometry market. Achilles+ will list at about $29,000.

On the reimbursement side, HCFA’s G0133 code became effective July 1 and provides for a preliminary ultrasound peripheral test, a baseline DEXA exam, and additional DEXA exams every two years or as indicated. Depending on the location of the provider, the 1998 national average Medicare payment for G0133 is $40.

The rate bolsters a market that has struggled in the last year, due in part to a decline in international demand for densitometers as well as the increased productivity of physicians using the devices (SCAN 4/1/98). But the market has also suffered because of HCFA’s conflicting announcements regarding reimbursement for peripheral and axial bone densitometry tests. HCFA released more than one set of numbers in error over the last year before establishing corrected payment rates in March of $131 for axial scans and $40 for peripherals.

Ultrasound bone densitometry offers a new growth market for the industry because it targets the individual and group practices of primary-care physicians. Because ultrasonometers are lighter, cheaper, and require less regulation, they bring particular benefits to users as compared to DEXA systems. Bone densitometry firms like Lunar and Hologic of Waltham, MA, as well as Norland of Fort Atkinson, WI, Myriad Ultrasound Systems of Rehovot, Israel, Diagnostic Medical Systems (DMS) of Montpellier, France, and Metra Biosystems of Mountain View, CA, hope to gain from the increased interest in ultrasound bone densitometry that HCFA’s announcement may produce. Hologic’s ultrasonometer, Sahara, received FDA clearance in March of this year (SCAN 4/1/98), while Myriad’s SoundScan Compact and SoundScan 2000 systems won the FDA’s nod in May.

In other Lunar news, the company announced this month an agreement with Philips Medical Systems North America of Shelton, CT, in which the companies will jointly market each other’s fluoroscopic C-arm imagers.