Researching ‘Comparative Effectiveness’ of Treatments

By Jeremy Smerd

Apr. 10, 2009

Tucked inside the recently signed economic stimulus package is a line item that is much smaller than the $19 billion slated to bring doctors into the information age. But the provision could go a long way toward helping employers spend their health care dollars more wisely.

The federal government has committed $1.1 billion to compare the effectiveness of different drugs, medical devices and surgeries to treat the same illness.

This “comparative effectiveness” research could eventually help employers identify the most cost-effective and beneficial health care treatments, and then steer patients toward them. Employers could save money and improve the health of patients by paying for procedures that are considered to be of great benefit while not covering treatments that have proved to be of little value.

Without comparative effectiveness research, decisions about what treatments to use often “depend on anecdotal evidence, conjecture and the experience and judgment of the individual physicians involved,” according to a policy paper published by the Congressional Budget Office in 2007.

For example: Which is the more cost-effective and better treatment for a patient suffering from acid reflux disease, one of the most common conditions affecting older Americans? Is it medicine or surgery? In 2005, the federal Agency for Healthcare Research and Quality, in its first comparative effectiveness review, said drugs can be as effective as surgery in preventing stomach acid from being regurgitated.

The agency continues to review the effectiveness of treatments for other diseases or conditions, such as the use of noninvasive procedures to detect breast cancer. In 2006, the agency reported that four types of tests—magnetic resonance imaging being one of them—were not accurate enough to replace biopsies.

“The research could lead to objective criteria that says these treatments work and these do not,” says Jim Winkler, a health care consultant with Hewitt Associates. The lack of comparative effectiveness research helps explain why the quality and cost of care varies drastically across the country, the CBO report said. Higher spending does not necessarily lead to improved patient health.

Differences in health care costs across the nation are based not on differences in quality, but in large part on a payment system that rewards doctors for using health care treatments, irrespective of whether they work or are appropriate, according to a report published in February by the Dartmouth Atlas, a health research organization affiliated with Dartmouth Medical School. Comparative effectiveness could lead to payment reforms that reward doctors for following national guidelines on the most effective treatment options.

The $1.1 billion for the research in the economic stimulus package represents a significant jump in funding. In 2006, the federal government appropriated $319 million for comparative effectiveness research. The increased funding has been lauded by those paying for health care: employer groups and health insurance companies.

“Currently, patients and their physicians have little, if any, independent, reliable information comparing the efficacy of various procedures, therapies or devices,” says Helen Darling, president of the National Business Group on Health, in a statement.

Conservatives—including the American Enterprise Institute, Rush Limbaugh and Betsy McCaughey, a former lieutenant governor of New York who galvanized opposition to the Clinton health plan in 1994—have opposed the research, saying it will insert the government into decisions made by doctors and their patients.

Biotechnology and medical device makers, which could stand to lose money if their technology is deemed less effective, have teamed up with the Alliance for Aging Research, Friends of Cancer Research and minority and women’s groups to form the Partnership to Improve Patient Care to ensure the legislation does not keep patients from getting the care they need.

National effectiveness guidelines could empower patients who use personal health records. Through software tied to their records, they could learn of best treatment options for their health needs, says Jay Sanders, a doctor and president and CEO of the Global Telemedicine Group in McLean, Virginia.

“A patient needs something more foolproof than what’s between their physician’s ears,” he says.

Workforce Management, April 6, 2009, p. 26Subscribe Now!

Jeremy Smerd writes for Crain’s New York Business, a sister publication of Workforce Management.

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