Data Dampen Enthusiasm for Effectiveness Research

Will vastly expanding research to determine the most effective treatments for various ailments produce big health care cost savings? Many proponents of health care reform claim it will, but a recent analysis raises serious doubts.

An analysis released in September by the Rand Corporation, an independent health policy research group, examined the likely cost savings from nationwide use of comparative effectiveness research (CER), which examines health outcomes from alternative treatments for the same health problem. CER can be used in several ways, such as providing information on treatment options to physicians and patients and helping to design insurance benefits, determine coverage, and decide on payments.

The researchers found that the voluntary use of CER findings won't necessarily lead to reductions in spending and waste or improvements in health.

“While increasing research aimed at determining the most effective treatments for a wide array of diseases should have benefits, there is not enough evidence at this point to predict exactly what the result might be for the cost of the nation's health care system,” said Elizabeth McGlynn, co-director of Rand Compare, a subsidiary of Rand.

The conclusions of the analysis were based on an examination of the existing body of data on CER, as well as how CER is used both in the United States and internationally. It is particularly significant in some other countries where it is used to determine whether certain types of treatment should be covered and, if so, at what amount.

The conclusion is at sharp odds with the position of many advocates of health care reform. The various health care reform bills have included massive expansions in CER as a way to help hold down future health care spending and improve patient health outcomes.

“Investing in research on best practices will drive down health care costs over the long run and will be an essential part of our effort to overhaul the health care system this year,” said Sen. Max Baucus (D-Mont.), chair of the Senate Finance Committee and a major player in health care reform, in a statement in June.

Baucus's $829 billion health care reform bill, approved by the Finance Committee in October, included major expansions in funding for conducting and disseminating CER (Psychiatric News, October 16). However, the Congressional Budget Office (CBO) estimated that the implementation of CER would cost private insurers a net $2.6 billion over savings and produce net cuts of only $300 million in Medicare costs over the next 10 years.

That estimate fit with the Rand conclusion that in the near term, any reduction in spending created from CER would be offset by the upfront costs associated with generating, coordinating, and disseminating the research findings.

Congress made the down payment for an expanded federal role in this area earlier this year when $1.1 billion was included for CER in the $787 billion economic stimulus package that President Obama signed into law in February.

The Rand researchers found CER programs can have benefits. For instance, they provide better information for doctors and patients about what works best in treating different health problems. The researchers also concluded that under some circumstances, CER might reduce spending for certain diseases by producing clear guidelines that point to superior and potentially less costly medical treatments.

However, the researchers said CER's effectiveness is limited by the extent to which it encourages both clinicians and patients to change their behavior. Previous successful efforts showed that incentives or “other mechanisms” were needed to change behavior. For instance, CER cost-saving studies by the CBO and the Commonwealth Fund in recent years concluded that billions of dollars in annual savings could result if public and private insurers used the research findings to make payment decisions.

However, the stimulus bill specifically prohibited the use of CER results to guide payment policy or benefit design, and the final health care reform measure is expected to include a similar caveat. The result is that it is “considerably less likely” that federal health officials will develop strong incentives to implement CER results and drive down spending, according to the Rand authors.

The fear of mandatory use of CER to determine coverage and payments has made it highly controversial. Critics of CER, including many physicians, worry that it could eventually be used by policymakers, insurers, or hospital administrators to limit options for patients and their physicians.

“Making a blanket coverage denial based on comparative effectiveness studies if the two treatments are safe and effective—I think it's wrong,” said David Nexon, a vice president of the Advanced Medical Technology Association and a longtime congressional health care expert. “It's wrong for patients. It's wrong for doctors. It's wrong for our health care system.”

Further information on the analysis is posted at <www.randcompare.org>.