Medicare Approves National Payment Policy Decision for Remote Monitoring of Implantable Cardiac Devices.

MINNEAPOLIS -- Medtronic Commends Agency's Validation of Remote Monitoring in the Patient Care Continuum

Medtronic Inc., (NYSE:MDT) commends the recent national payment policy decision by the United States Centers for Medicare and Medicaid Services (CMS) for implantable cardiac device evaluations using remote monitoring technology. This decision simplifies physician billing for remote monitoring technologies that benefit thousands of cardiac patients across the U.S. Remote device monitoring systems, such as the Medtronic CareLink(R) Network, provide information that may allow physicians to monitor their patients and make important treatment decisions without the need for an office visit.

"Medtronic initiated discussions with CMS about remote monitoring technology years ago to establish consistent reporting of these services for all Medicare providers and beneficiaries," said Steve Mahle, president of the Cardiac Rhythm Disease Management business at Medtronic. "We're proud to have led the way to a decision that allows physicians to maximize efficiency in their practices while continuing to provide a high level of patient care. We will continue our efforts to eliminate barriers for patient access to innovative therapies, and provide inventive systems for patient follow up, to aid physicians in treating the full spectrum of patients' chronic cardiac conditions."

In the cardiac device industry, Medtronic pioneered remote device monitoring using the Internet with the introduction of the Medtronic CareLink Network in 2002. Since its introduction, the Medtronic CareLink Network has facilitated the transmission of nearly 200,000 device interrogations, allowing physicians to perform a complete analysis of all the device- and patient-specific cardiac data stored within its implantable cardioverter-defibrillators (ICDs), pacemakers and cardiac resynchronization therapy (CRT) devices. CMS used frequency data provided by Medtronic as part of its decision-making process to approve its payment policy decision.

This new CMS payment policy decision coincides with recommendations issued in May 2006 by the Heart Rhythm Society on how the medical device industry and government oversee implanted cardiac devices. Among its recommendations to improve communication between industry, physicians and heart device patients, the Society encouraged manufacturers to expand use of wireless and remote monitoring technologies that can track the implants on a daily basis. It also encouraged better adoption of remote monitoring systems by physicians.

"Guarding patient safety while providing effective therapy is Medtronic's number one priority," said Mahle. "In light of the latest recommendations issued by the Heart Rhythm Society, along with the CMS payment policy decision, we urge physicians to consider remote monitoring therapies for their heart rhythm patients."

The CMS payment policy decision applies to the transmission of data from all Medtronic devices that operate on the Medtronic CareLink Network platform, of which 95 percent of the company's current pacemakers, ICDs and cardiac resynchronization therapy (CRT) devices are compatible. This will include the Concerto(TM) CRT-D and Virtuoso(TM) ICDs, the company's recently approved devices with Conexus(TM) Wireless Telemetry for automatic, remote patient monitoring.

The CMS National Payment Policy Decision

The CMS payment policy for remote device interrogations is effective July 10, 2006. At that time, physicians should report the electronic analysis of implanted cardiac complete device evaluations of data remotely obtained using CPT(R)(1) codes 93731, 93734, 93741 or 93743, depending on the type of pacemaker, ICD or CRT device implanted in the patient.

Medtronic met with senior level personnel in CMS' Payment Policy Division to request that they consider standardizing the reporting and payment process for remote device evaluations to provide consistent reporting throughout the country. Medtronic's request followed a November 2004 American Medical Association (AMA) CPT Editorial Panel decision on remote ICD device evaluations. Both the American College of Cardiology and the Heart Rhythm Society published the panel decision in their respective 2005 coding guidelines. The AMA also published its November 2004 decision in its September 2005 "CPT Assistant" newsletter (Vol. 15, Issue 9).

About Medtronic

Medtronic, Inc. (www.medtronic.com) (NYSE:MDT), headquartered in Minneapolis, is the global leader in medical technology - alleviating pain, restoring health, and extending life for millions of people around the world.

Any forward-looking statements are subject to risks and uncertainties such as those described in Medtronic's Quarterly Report on Form 10-Q for the quarter ended January 27, 2006. Actual results may differ materially from anticipated results.

(1) Current Procedural Terminology (CPT(R)) is Copyright 2005 American Medical Association. All Rights Reserved. No fee schedules, basic units, relative values, or relative listings are included in CPT. The AMA assumes no liability for the data contained herein. Applicable FARS/DFARS restrictions apply to government use.