Technology and Health Care Costs

Peter Orszag, the Director of the Congressional Budget Office (CBO), recently testified before the Senate Budget Committee about increasing health care costs. One of his conclusions was that “the most important factor driving the long-term growth of health care costs has been the emergence, adoption, and widespread diffusion of new medical technologies and services by the U.S. health care system.”

His testimony concludes that by using “comparative effectiveness” research to “generate more information about the relative effectiveness of medical treatments and changing the incentives for providers and consumers,” would create a situation where “savings are possible without a substantial loss of clinical value.”

While this all sounds good in principle, the challenge obviously is to make the information useful, reliable and accessible. And, of course, as the testimony notes, “To affect medical treatment and reduce health care spending, the result of comparative effectiveness analyses would ultimately have to change the behavior of doctors and patients — that is, to get them to use fewer services or less intensive and less expensive services…”

CBO has been greatly increased their health care staff, created a Panel of Health Advisers last fall, and the comparative effectiveness issue was not a tossed-in part of the CBO testimony — CBO had a separate report on this topic last fall, and Director Orszag will be part of a panel on the topic at the Institute of Medicine on February 21st.

Comparative effectiveness seems to be the latest in a series of attempts at transforming health care operations in the US that can be traced back several decades, and includes: Consumer Directed Health Plans, Managed Competition, and Managed Care – particularly HMOs.

The question is, will comparative effectiveness really change clinical practice to alter the course of expected increases in health care spending without sacrificing quality?

What do you think?

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