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Three Day Congressional Hearing Series On Potential Regulations of Mobile Apps

Posted Mar 21 2013 12:15pm
Subcommittee on Communications and Technology

The House Energy and Commerce Subcommittee on Communications and Technology, chaired by Rep. Greg Walden (R-OR), Tuesday kicked off the “Health Information Technologies” hearing series to discuss the critical role of technology in the health care industry and how federal regulations and taxes could impact patients, hinder innovation, and increase costs for consumers. In July 2011, the FDA proposed regulating mobile medical apps. In early March, committee leaders wrote to FDA Commissioner Margaret Hamburg seeking more information on possible FDA regulation of smartphones, tablets, and mobile apps through Obamacare's medical device tax, which could harm the innovation and economic benefits of the U.S. mobile marketplace.

“The collision of worlds in the mobile health – or mHealth – market is a study in contrasts. The app economy is characterized by low barriers to entry, quick time to market, and the ability to adapt to quickly changing user needs,” said Subcommittee Chairman Walden. “Medical devices, on the other hand, face a long and costly pre-market approval process at the FDA. We all want to ensure patient safety, but why would we treat mobile applications the same as a dialysis machine? Wireless has and can continue to bring the mobile revolution to our nation’s health and wellness sector. But we must ensure that as we bring the innovation of the wireless economy to health and wellness that we not place unnecessary hurdles in the way of the developers and investors that are fueling mHealth.”

Energy and Commerce Committee Chairman Fred Upton (R-MI) added, “Arbitrarily applying the definition of ‘medical device’ and the medical device tax to the wireless world could prove disastrous and grind this innovation cycle to a halt. We certainly want to ensure patient safety, but the approach we take must be a smart one.”

While protecting patient safety is a universal objective, innovators today expressed concern regarding the FDA’s failure to finalize the rule, the effects that overbroad application of the arduous medical device approval process would have on the ever-changing mobile app marketplace, and the deterrent to investment that would result from applying the medical device tax created by the president’s health care law. Despite claims from some Democrats that the ground rules for FDA regulation of mobile health applications are clear and that there is no risk applications, smartphones, or tablets will be taxed, all six of the witnesses said the situation is murky at best.

Dr. George Ford, Chief Economist at the Phoenix Center for Advanced Legal and Economic Public Policy Studies, explained that regulations could raise costs and hurt innovation, stating, “An inevitable and arguably intended effect of FDA involvement is to raise the cost of innovation and to alter the trajectory of innovation. Uncertainty, delays and the fixed costs related to the regulatory process reduce expected returns, and thus discourage firms from participating in the healthcare industry. As such, we must expect FDA review of mobile applications to slow innovation and to reduce competition.”

In response to a question from Chairman Walden, Jonathan Spalter, Chairman of Mobile Future, outlined the detrimental effects the 2.3 percent medical device tax would have on the mobile health app industry. Spalter explained , “These types of taxes, if they are applied to mobile medical applications and devices, will stifle innovation, will tempt entrepreneurs to pursue as you suggested other types of innovation, and apply their genius and their efforts to other parts of the mobile ecosystem rather than efforts to make our children, our families, our parents, healthier. So there is an impact, and we need to be very, very vigilant and cautious about going down this path.”

At the conclusion of the hearing, Rep. Renee Ellmers (R-NC) asked each witness if they could rule out the possibility that the medical device tax would hamper innovation and all six said they could not. Watch the exchange here .

Full hearing:is here

Subcommittee on Health
On Wednesday, the Subcommittee on Health continued the hearing series with a look at “How Innovation Benefits Patients.” Members today focused on how innovative medical technologies can benefit American patients and discussed what steps need to be taken to foster innovation and growth. Providers and patient groups elaborated on how these technologies benefit patients and the impact FDA regulations would have on these medical advancements.

“There are now mobile medical apps for wireless thermometers, apps that calculate body mass index, apps that track the number of miles a runner has jogged and those that can wirelessly transmit data to wearable insulin pumps,” said Chairman Pitts. “These apps can range from the complex, like mobile cardiac outpatient telemetry that uses wireless sensors, to those that allow users to count calories. It has been estimated that 500 million people will be using medical apps by 2015. Therefore, it goes without saying that these technologies hold great potential for patients and providers. This hearing is an appropriate place to examine the extent to which the FDA – and other federal agencies – should be involved in regulation of health information technologies and what such a regulatory framework might look like.”
In July 2011, the Food and Drug Administration proposed regulating medical applications. This month, committee leaders wrote to FDA Commissioner Margaret Hamburg seeking more information on whether FDA intends to regulate smartphones, tablets, and mobile apps and whether it would be trigger the 2.3 percent medical device tax included in the president’s health care law.

Joseph Smith, Chief Medical and Chief Science Officer for the West Health Institute, testified before the subcommittee that the healthcare industry's innovation and experimentation requires a "clear, consistent and timely approach" to regulation. "It is an open question whether the existing medical device regulatory framework can be sufficiently modified to provide the applicability, clarity, predictability and timeliness required," Smith told lawmakers. "The FDA's draft guidance on mobile medical apps offered some improved clarity but still described significant areas of regulatory discretion, and now after lengthy delay without becoming finalized, has left an industry in limbo."

Witnesses discussed whether the FDA has the expertise to regulate medical applications and health information technology.The witnesses seemed to agree that under the current framework they do not have the expertise to regulate beyond medical devices. David Classen, M.D. Chief Medical Information Officer, Pascal Metrics cited the IOM report saying that "if the FDA were to get further involved in the oversight of health IT beyond medical devices a new do that should be created." Dr. Joseph Smith, Chief Medical and Chief Science Officer for West Health Institute, stated, “I think it’s quite challenging for the FDA, for many reasons, to stay as current as possible on those things which are simply just emerging.”

Also, Mr. Jim Bialick, Executive Director for the Newborn Coalition discusses the potential for additional barriers to entry for medical app developers if FDA regulates medical apps.He provided every day examples of how lives are being changed through the application of these new medical technologies. “Not everybody is born in a city center so access to some of these remote home monitoring devices is very functional. Not only that but the telemedicine capacity that we are seeing especially through some of these devices has really expanded. As someone said in the hearing yesterday, it’s the new house call.".He further raised additional concerns voiced at Tuesday’s Communications and Technology Subcommittee hearing that the uncertainty surrounding FDA’s draft guidance could stifle innovation, stating, “The threshold for a blockbuster app is gigantic now, I mean it’s millions of dollars. And so even to get the investment now to let’s say you’re going to develop it beyond just in your garage and have a large scale launch. The concern that you’ll have the potential for, or if it’s known that, you’ll have additional regulation on top of that cuts out the bottom line. So there’s an investment side to it to.” Rep. Morgan Griffith (R-VA) concluded, “So they’re more likely to try and find the next angry bird than the next angry mole.”

The full hearing is here

Subcommittee on Oversight and Investigations
On Thursday, the Subcommittee on Oversight and Investigations heard from HHS and FDA as the final heaing in the series with a look at Administration Perspectives on Innovation and Regulation.”

Dr. Farzad Mostashari, National Coordinator of Health Information Technology, gave testimony saying, "To truly transform delivery, health care providers must also redesign and reengineer workflow of care. This does not happen overnight. Health IT holds tremendous promise for delivering “smart health” to patients right at their fingertips to help all of us achieve the best possible outcome for each individual. We must carefully balance the need for the widest innovation possible, with protection of patient privacy, security, and safety."

Also providing testimony  was Ms. Christy Foreman Director, Office of Device Evaluation, Center for Devices and Radiological Health at the FDA. She said: “Just as importantly as what our policy proposes is what our policy does not propose. It would not regulate the sale or general consumer use of smartphones or tablets. It would not consider entities that exclusively distribute mobile medical apps, such as the ‘iTunes App store’ or the ‘Android market,’ to be medical device manufacturers. It would not consider mobile platform manufacturers to be medical device manufacturers just because their mobile platform could be used to run a mobile medical app regulated by FDA. It would not require mobile medical app developers to seek Agency re-evaluation for minor, iterative product changes. And, it would not apply to mobile apps that perform the functionality of an electronic health record (EHR) system or personal health record system.”

The full hearing is available here

The prepared testimony from witnesses and opening statements from each of the hearings are as follows
Health Information Technologies: Harnessing Wireless Innovation

Opening Statements: 
Communications and Technology Subcommittee Chairman Greg Walden
Energy and Commerce Committee Chairman Fred Upton
Witnesses: Robert JarrinSenior Director, Government AffairsQualcomm Witness Testimony  Bradley Merrill ThompsonmHealth Regulatory Coalition Witness Testimony  Ben ChodorCEOHapptique Witness Testimony  Jonathan SpalterChairmanMobile Future Witness Testimony  T. Forcht Dagi, MD, MPH, DmedScPartnerHLM Venture Partners Witness Testimony  Dr. George FordHealth Information Technologies: How Innovation Benefits Patients

Opening Statements:  Health Subcommittee Chairman Joe Pitts Witnesses: Joseph M. Smith, M.D., Ph.D.Chief Medical and Chief Science OfficerWest Health Institute Witness Testimomy  Jacqueline Mitus, M.D.Senior Vice President, Clinical Development and Strategy McKesson Health SolutionsMr. Jim BialickExecutive DirectorNewborn Coalition Witness Testimony  ( Truth in Testimony  and  CV )Ms. Christine BechtelVice PresidentNational Partnership for Women and Families Witness Testimony  David Classen, M.D.

Health Information Technologies: Administration Perspectives on Innovation and Regulation

Opening Statements:  Oversight and Investigations Subcommittee Chairman Tim Muprhy Witnesses: Dr. Farzad MostashariNational CoordinatorHealth Information TechnologyU.S. Department of Health and Human Services Witness Testimony  Ms. Christy Foreman
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