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Research revolution

Eye on the US: The US healthcare system is likely to undergo some significant changes due to recent legislation that will make comparative-effectiveness data on treatments more widely available

USAComparative-effectiveness research might not have a very exciting ring to it, but two major pieces of recent US legislation have made it a hot topic not only for American pharmaceutical companies, but also for politicians, journalists and the public.

The research, to use the broadest definition, compares two or more therapies to each other through clinical trials, analyses of claims records, computer modelling, and/or literature reviews. Such data is relatively scarce in the US, because companies are not generally required to conduct the studies in order to have products approved, instead being permitted to use clinical trials that compare their new products only to a placebo.

Some academic centres sponsor comparative-effectiveness  research on a relatively small scale, as do some government bodies and some private insurers looking for information to help them make coverage decisions. In contrast to the UK, where the National Institute for Health and Clinical Excellence (NICE) makes recommendations using comparative effectiveness and cost-effectiveness data, the research does not yet play a major part in informing decisions in the American healthcare system.

In an effort to redress the lack of comparative-effectiveness data in the US, lawmakers included $1.1bn in the American Recovery and Reinvestment Act of 2009 (better known as the Economic Stimulus Bill) to be spent over two years to significantly ramp up the comparative-effectiveness research being conducted by the National Institutes of Health (NIH) and the Agency for Healthcare Research and Quality (AHRQ).

Building on that base, President Obama's healthcare reform bill, the Patient Protection and Affordable Care Act of 2010, established the Patient-Centered Outcomes Research Institute (PCORI), which will focus on comparative effectiveness research and will have total annual funding of nearly $500m by 2015. PCORI is structured as a non-profit organisation whose 21 board members represent all facets of the healthcare system, including an industry voice, Freda Lewis-Hall, Pfizer's chief medical officer.

Some politicians and voters worry that federally run comparative-effectiveness research could put the government in the business of making healthcare decisions that are better left to doctors. However, supporters say the data could simultaneously reduce costs and improve patient care. Speaking at a recent forum sponsored by the Brookings Institution, Mark McClellan, who has served as both commissioner of the Food and Drug Administration and administrator of the Centers for Medicare & Medicaid Services, said the research could be 'a game-changer [and] a key part of bending the healthcare cost curve'.

In fact, neither the stimulus legislation nor the healthcare reform law allows the government to dictate doctors' decisions. Rather, the legislation is intended to make more information available to doctors and patients, allowing them to act on it as they see fit.

The terms comparative-effectiveness research and cost-effectiveness research are sometimes used interchangeably, but there is a significant difference between the two. Namely, comparative-effectiveness research, the kind of research that is funded under the new legislation, does not take cost into account. Comparative-effectiveness research can of course have economic implications, and supporters believe it could significantly cut healthcare costs by making it less likely that money will be wasted on treatments that don't work well. However, the data itself does not reflect the expense of the treatments, whereas cost-effectiveness data does.

Legislation governing PCORI specifically forbids the Institute from using 'dollars per quality adjusted life year' (which takes into account a person's disability in determining the value of a year of life) as part of its recommendations, marking a key point of difference between PCORI and the UK's NICE.

Initial versions of the health reform legislation did in fact refer to comparative cost-effectiveness analysis, but the language was changed to comparative-effectiveness research in response to perceptions that the government was trying to put a price tag on human life, which many thought leaders agree is a hard pill to get Americans to swallow.

"The Century Foundation's Working Group on Medicare Reform agrees that most Americans are not yet ready to make decisions about whether a treatment is cost-effective," according to Maggie Mahar, a healthcare fellow at the Foundation and an author of books on the economics of medicine. "But the legislation just passed does not ask anyone to make these decisions. Instead, it simply sets up a new federal agency… to conduct and support research that would assess the benefits of competing treatments. The winner would be the treatment that offers greater benefits for particular patients, whatever the cost."

However, not everyone is satisfied with the compromise. The high-profile health economist Uwe Reinhardt, for example, has been vocal about the need for the government to fund cost-effectiveness research even if it is a hard sell politically.

Reinhardt argues that the opposition to cost-effectiveness analysis in the US is largely fuelled by pharmaceutical and medical device makers worried about what the research might reveal about the value of their products compared to their cost. However, 'in some instances the greater economic transparency provided by cost-effectiveness analysis might help them market their health products or health services', he argued in a recent editorial in the New York Times.

Reinhardt acknowledged in the piece that some opposition also comes from citizens 'who sincerely believe that health and life are 'priceless' – for them, cost should never be allowed to enter clinical decisions'. However, he calls such a stance 'an utterly romantic notion', maintaining that 'no society could ever act consistently on such a credo'.

In 'Legislating against Use of Cost-Effectiveness Information' for the New England Journal of Medicine, Peter J Neumann and his colleagues at Tufts Medical Center also recently took issue with Americans' resistance to cost-effectiveness analysis and suggested that it may even 'reflect a certain xenophobia toward the kinds of approaches used in Britain'.

The resistance 'also suggests a bit of magical thinking – the notion that the country can avoid the difficult trade-offs that cost-utility analysis helps to illuminate', the Tufts researchers wrote. 'It pretends that we can avert our eyes from such choices, and it kicks the can of cost-consciousness further down the road. It represents another example of our country's avoidance of unpleasant truths about our resource constraints.'

For now, however – due in part to the drug industry's lobbying efforts – the government may have put itself in the business of comparative-effectiveness research, but it is avoiding the thornier moral and political territory of cost-effectiveness research.

Medicare muddle
The legislation is clear that the government may not use comparative-effectiveness data to dictate the decisions that doctors make. But can the government use the data it generates to guide its own decisions?  That is, can Medicare, which is funded and run by the government, determine which treatments to cover based on the new data?

The law does not in fact allow Medicare to base decisions about which treatments to cover on comparative-effectiveness data. However, that does not mean the Medicare programme will be unaffected by the data.

"It may well be that creative bureaucrats…will be able to use the results to encourage certain types of treatment while discouraging others; to require physicians requesting approval for procedures lacking justification provide support for their request to use those procedures, while approving procedures immediately that comply with research recommendations," according to Joe Padua, a principal at the consulting firm Health Strategy Associates.

The Century Foundation's Mahar believes that Medicare will find a way to use financial incentives to encourage patients and doctors to make decisions based on comparative-effectiveness data. 'Moreover, I believe that the public is ready – even eager – for solid, unbiased information about the effectiveness of various medical products and procedures,' Mahar recently wrote on her blog.  

Disseminating information
As all of the above makes clear, those hoping that comparative-effectiveness research will help guide more sensible decisions will have to rely on persuasion rather than force, whether they are trying to sway private physicians or government-run health programmes. Therefore, how and to whom the data is disseminated is key.

The healthcare reform legislation calls for the data to be disseminated to healthcare providers, patients, private and public health plans, vendors of health information technology, professional associations and other relevant stakeholders. In addition, research findings must be released to the general public within 90 days after they are available. The law calls for the Office of Communications and Knowledge Transfer at the federal AHRQ to facilitate dissemination of the data with assistance from the NIH. 

However, just making the information available is unlikely to be enough to radically change the way medicine is practised in the US.

'Simple dissemination of educational materials has often been found to be ineffective in changing physicians' habits,' a report from the Kaiser Family Foundation points out, concluding that 'More active (and costly) methods, such as one-to-one education and incorporating research findings into clinical guideline development tend to be more effective.'


Kate Fodor


Contact Kate Fodor at

To comment on this article, email

11th April 2011


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