NCPA - National Center for Policy Analysis

To Cut Costs, Health Care Needs Far More Info

May 10, 2011

The 2010 Patient Protection and Affordable Care Act allocates billions of dollars over the next decade to a new organization called the Patient Centered Outcomes Research Institute, which will fund studies on which treatments work best for individual patients and large population groups -- a field of study called "comparative effectiveness research" (CER).  Patients and physicians would certainly benefit from the ability to compare the benefits and risks of, say, surgery versus physical therapy for severe back pain.  However, President Obama is focusing far too much on top-down studies from federal agencies, and all but ignoring how other powerful incentives -- from Medicare to the tax code -- encourage doctors and patients to spend more on health care, says Paul Howard, director of the Manhattan Institute's Center for Medical Progress.

According to Scott Harrington, an expert on health care insurance and financing, physicians and patients need more help sorting through potential treatments.  But he cautions that government-funded CER is unlikely to work as advertised.        

  • Public CER studies, he argues, are vulnerable to lobbying from interest groups, and are apt to be driven as much by politics as by sound science.        
  • Also, the "complexity and dynamism" of health care means that what counts as the "best" treatment one day could easily become a discarded relic by the time an extensive CER analysis is completed.        
  • Finally, CER research could actually increase health care spending if it boosts demand for some expensive treatments that provide only modest improvements in health.

On the other hand, private-sector CER is growing, and could provide a valuable supplement to government-funded efforts.  As high-deductible health plans (often linked to Health Savings Accounts) grow in popularity, patients are demanding more help identifying affordable but effective health care options.  Private CER research, by its very diversity, would be much harder for lobbyists to hijack than its public counterpart, says Howard.

Source: Paul Howard, "To Cut Costs, Health Care Needs Far More Info," Washington Examiner, May 4, 2011.


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