Here’s a likely scenario. Medicare currently covers any treatment that is reasonable and necessary for the diagnosis of illness or injury. It cannot legally factor in treatment costs when deciding whether or not to cover a particular item. That could change if CER identifies higher-value care and promotes certain drugs, devices, and procedures throughout the health system via financial incentives-the payment doctors receive and/or the cost sharing that patients face. Would legislators dare to incense elderly constituents by enacting laws eliminating payments for popular treatments endorsed by their physicians? Most Americans have never faced health care rationing, and politicians’ soothing bromides about CER will meet fierce resistance if payment for popular treatments is denied.
Explore This IssueApril 2009
The British Template
Some US politicians eye Britain’s National Institute of Clinical Excellence (NICE), which issues guidance on procedures, drugs, and medical devices for a CER model. Its Web site (www.nice.org.uk ) says: In order to make sure our standards represent good value for money, we use the best evidence to weigh up benefits and costs. Following this series of steps-fielding a request from the Department of Health to investigate a topic, gathering evidence, committee considering evidence, drafting guidance on the Web site for comment, committee considering comments and amending guidance, and publishing final guidance-defines clinical practice (see Balloon catheter dilation of paranasal sinus ostia for chronic sinusitis on NICE’s Web site). It does not perform CER, but instead issues guidance on treatment efficacy.
So far, so good. But NICE gets less nice when a separate unit calculates a treatment by quality-adjusted life years (QALYs), refusing to pay for any treatment costing more than $29,050 (£20,000) that doesn’t extend a patient’s life by at least one year. For example, on August 12, NICE’s preliminary guidance denied access to Sutent, Avastin, Nexavar, and Tarisil to patients with advanced metastatic kidney cancer, leaving those patients to die months earlier than those whose treatment is paid for privately in the UK or publicly in other European countries.
Lori-Ann Rickard, JD, a Michigan attorney specializing in health care, said that while the US Joint Conference Report specifically denies the intent to mandate coverage or reimbursement, it would not be surprising for Medicare policies to be revised based on the findings and for private insurers to follow. CER could be used to both eliminate coverage for certain items and add coverage for other items.
Jason Hwang, MD, MBA, co-author of The Innovator’s Prescription, argued that flooding the health care system with money to upgrade information technology (IT), as the stimulus package and CER will do, is throwing money at existing institutions that don’t want competition. Until we move data into the hands of patients and find new venues of care we’re only maintaining the status quo, he said. Dr. Hwang also pointed out that IT, whether in the form of electronic medical records or heftier databases, will not cut costs unless government entities such as the FDA and CMS have the political will to use cost-effectiveness data.