James C . Robinson Comparative Effectiveness Research : From Clinical Information To Economic Incentives

Comparative effectiveness research has been promoted as a way to control health care costs, but there has been less discussion of the mechanisms through which new evidence actually will influence physician practice, patient preference, and manufacturer investment. Public and private insurers use conditional coverage, consumer cost sharing, provider contracting, and drug payment policies to manage and direct the flow of resources into the health care system. This paper examines how each of these approaches may be adapted to incorporate new evidence from comparative effectiveness research. S upporters of comparative effectiveness research have promoted it as a means of controlling the cost of health care. However, there has been less discussion of the mechanisms through which new evidence will influence what happens in the health care system. Simply disseminating some comparative effectiveness findings may change attitudes and behavior, with no need for economic incentives. Many results of comparative effectiveness research studies, however, will be directly counter to established patient preference and provider interest. Economic incentives will be necessary if these results are to lead to change, rather than gathering dust in the clinical research repository. Economic incentives can exert both shortand long-term effects on the use, cost, and value of health care. In the short term, incentives—such as higher reimbursements from insurers—can influence which treatments are chosen by and made available to which patients, and hence affect clinical outcomes and producers’ revenues. In the longer term, incentives can influence the direction of research and therefore which drugs, devices, tests, and procedures will be developed for which conditions. For example, high prices and generous payments for cancer drugs have encouraged pharmaceutical manufacturers to shift their development initiatives toward oncology and away from therapeutic areas where drug prices are lower. This paper focuses on the role of public and private health insurance plans and the four incentive mechanisms they use to manage their health care costs. The mechanisms are conditional coverage policy; benefit design and consumer cost sharing; provider contracting and payment; and pharmaceutical company contracting and payment. Over time these four mechanisms could exert a strong influence on how clinical practice and product development respond to new evidence from comparative effectiveness research. The Evolution Of Incentive Mechanisms Most treatments that are known to be effective for some groups of patients with some conditions in some settings are also applied in other cases where the evidence of their effectiveness is not as strong. A typical example is drugs, which go through extensive testing before the Food and Drug Administration (FDA) approves them for specific uses. After that, they are often prescribed for other uses for which no studies doi: 10.1377/hlthaff.2010.0605