Tucked away on page 1,617 of the health care bill that passed Congress this month is a cost cutting provision that the Obama Administration hopes will save Americans $700 billion a year in medical expenses. It's called comparative effectiveness research. It didn't receive much attention in the legislative process. How will it impact the medical industry?
Comparative effectiveness research is the process of comparing the costs and the results of various treatments to decide whether the more expensive treatments actually yield better results. And of course if the answer is no, the more expensive treatments stop being used (for the most part).
The new legislation requires the US to set aside half a billion dollars each year to do the required research, and it creates a nonprofit Patient-Centered Outcomes Research Institute charged with setting a national agenda for those studies. One likely result is that newer "trendy" treatments (that patients ask for by name because the learned about them on TV) will be shown to be no more effective than older, less expensive treatments. As an example of the affect, BusinessWeek speculates that drugs like Lipitor and Remicade "could be in the crosshairs" because they aren't that much more effective than similar cheaper drugs.
In an America where people are used to being able to demand the specific drug or treatment they want, some people will see that as good management and others will see it as a form of health care rationing that confirms the worst of what Glenn Beck and Rush Limbaugh them about…
BusinessWeek has an informative piece on what the new bill will mean for you.