Healthcare Reform Proposals Challenge Manufacturers - Pharmaceutical Technology

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Healthcare Reform Proposals Challenge Manufacturers
Comparative-effectiveness analysis aims to promote appropriate pharmaceutical spending.


Pharmaceutical Technology


Comparing effectiveness

A related strategy is to steer healthcare spending to medical treatments and products that demonstrate effectiveness. Mounting evidence shows that medical treatment varies considerably across the nation, resulting in wasted resources and ineffective care that can harm patients. As US healthcare spending continues to soar, and quality pales in comparison to other industrialized nations, support has grown for establishing an entity to independently analyze the quality and effectiveness of healthcare products and procedures. Comparative-effectiveness (CE) research promises to provide information that will help patients and their doctors choose the most appropriate care options, which ideally will include high-cost treatments that have data indicating higher benefits.

CE research has broad support from healthcare experts. The Medicare Payment Advisory Commission recommended in its June 2007 annual report that Congress establish an independent entity to sponsor "credible research on comparative effectiveness of healthcare services." In a January 2008 study, an Institute of Medicine (IOM) committee recommended establishing a national CE research program with "sufficient resources, authority, and capacity" to develop research standards and processes. The IOM Roundtable on Evidence-Based Medicine provides a forum for ongoing discussion of ways to improve and use medical evidence.

Not surprisingly, the presidential candidates have jumped on the CE bandwagon. McCain says that publicizing information about treatment options and developing national standards for measuring and recording outcomes can address the rapidly rising cost of US healthcare. Clinton wants to establish an independent "best practices" institute to provide better information about what works in healthcare and "how treatments compare to one another." She believes that such research is needed to address the huge growth in prescription-drug use. Obama wants CE research on which drugs, devices, and procedures are the best for individual patients as one way to reduce the "considerable waste in our healthcare system."

Enthusiasm for CE research is boosting support in Congress to establish a quasigovernmental CE research organization. Senate Finance Committee Chairman Max Baucus (D-MT) is looking to authorize such an entity as part of must-pass Medicare legislation needed to block a cut in payments to physicians that otherwise would occur this summer.

One benefit of a federal CE research organization would be to reduce duplicative analysis by insurers and private groups developing their own CE data. Oregon's Drug Effectiveness Review Project (DERP) assesses clinical-trial data about drug therapeutic groups to inform coverage decisions by managed-care plans and state Medicaid programs. Consumer's Union uses the DERP assessments for its BestBuyDrugs program, which considers drug cost along with effectiveness factors. Major insurers such as UnitedHealthcare, Kaiser Permanente, WellPoint, and BlueCross BlueShield have programs to evaluate new technology and health services. Unfortunately, many of these assessments are hard to compare because they are based on differing methods and standards.

Some CE advocates talk about building on the CE program at the Agency for Health Research and Quality (AHRQ), which has expanded its research portfolio in this area during the last five years to support coverage and treatment decisions for Medicare and other government health programs. But the current thinking is that an independent research entity will be immune from political control and direct government oversight. A Congressional backlash against health-technology assessment in the 1980s eliminated Congress's Office of Technology Assessment and nearly defunded the predecessor to AHRQ.

The envisioned CE operation would accept funding from private organizations as well as the federal government. This arrangement is an important consideration for raising the $200 million or so needed to start such an operation. Any legislation adopted this year, however, is likely to establish only a "placeholder" to launch a CE program and not provide much more than the paltry $15 million that currently supports the AHRQ program.

Insurers and payers point out that the US is virtually alone among developed nations in its lack of an entity that compares the effectiveness and value of new drugs, devices, and medical procedures. They and other CE enthusiasts see a model for an expanded CE research program in the United Kingdom's National Institute for Health and Clinical Excellence (NICE), which reviews clinical and outcomes data to evaluate new medical technologies. NICE's cost-effectiveness assessments help national health officials establish clinical guidelines and make coverage decisions. But NICE analyses often take more than a year and can delay patient access to new treatments.


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