Healthcare costs have reached crisis proportions and are coming under increasing scrutiny from providers, insurers, employers, government and consumers. Efforts to contain these costs, or at least slow their growth, have been unsuccessful, and costs continue to outpace gross domestic product (GDP) growth by more than 4 percent. Increasing at a rate of $200 billion a year, the nation’s annual healthcare bill—the largest of any developed country—now stands at $1.8 trillion, which accounts for nearly 16 percent of GDP and is projected to reach 19 percent by 2014, according to Mike Leavitt, secretary of the U.S. Department of Health and Human Services
Hayes Inc.
Wendy L. Schneider, M.Sc., is director of education programs, Hayes Inc., Buffalo, N.Y. Contact them through Rosemarie Jennings, manager, Corporate Communications,
Hayes Inc., [email protected].
Healthcare costs have reached crisis proportions and are coming under increasing scrutiny from providers, insurers, employers, government and consumers. Efforts to contain these costs, or at least slow their growth, have been unsuccessful, and costs continue to outpace gross domestic product (GDP) growth by more than 4 percent. Increasing at a rate of $200 billion a year, the nation’s annual healthcare bill—the largest of any developed country—now stands at $1.8 trillion, which accounts for nearly 16 percent of GDP and is projected to reach 19 percent by 2014, according to Mike Leavitt, secretary of the U.S. Department of Health and Human Services.
More than 20 percent of the increase is attributable to spending on medical technologies. In spite of this enormous investment, our healthcare system continues to be plagued by quality problems from underuse, overuse and misuse of services. Millions of people do not receive necessary healthcare and suffer needless complications that add costs and, more importantly, reduce their quality of life and productivity. Sadly, an estimated 18,000 people die each year because of underuse of services.
Sources of Spiraling Healthcare Costs
Examples of healthcare technologies that may be unnecessary or inappropriately applied include hysterectomies, caesarian sections, high-dose chemotherapy with autologous stem cell support or bone marrow transplant for breast cancer, electronic fetal monitoring during low-risk uncomplicated labor, gastric bubble for morbid obesity, gastric freezing for peptic ulcers, intradiscal electrothermal therapy and whole-body computed tomography scanning. Use of these therapies not only increases costs but also may endanger health in some cases.
Conversely, there are a number of underused but cost-effective technologies, including angiotensin-converting enzyme inhibitors for treatment of heart failure, antibiotics for gastrointestinal ulcers, beta-blockers for survivors of acute myocardial infarction and perioperative use for patients with coronary artery disease, colorectal cancer screening, glucose monitoring for diabetes, intraocular pressure screening for glaucoma, and pneumococcal vaccine for high-risk patients. Many injuries, permanent disabilities and deaths can result from inappropriate use of certain therapies.
Moreover, there is disparity in quality of care among ethnic and racial minorities. For example, use of thrombolytics for patients following a heart attack, while underused by all, has been markedly underused for African American Medicare beneficiaries. For all of these reasons, it is important to perform evidence-based assessments of new, emerging and even established healthcare technologies to prevent premature dissemination of inappropriate technologies and avoid the use of ineffective and potentially harmful ones.
Transparency in Healthcare Decision Making
Many healthcare decision makers have begun using a more rigorous approach to address their concerns about new and emerging healthcare technologies. To facilitate evidence-based decision-making, they have implemented a process called Health Technology Assessment (HTA), which involves identification and analysis of the current best evidence from research studies and clinical trials, and synthesis of these data into a report.
More support for implementing an evidence-based approach to healthcare decision making comes from the pay-for-performance efforts under way in health plans, large employers and other purchasers of healthcare services in the U.S. For example, the Centers for Medicare & Medicaid Services seeks evidence on what works and what does not work in pay for performance, including what benchmarks to use and how to structure incentives to promote and sustain quality improvement. Moreover, financial incentives may be offered to providers for the achievement of a range of payer objectives, which might include delivery efficiencies, submission of data and measures to payers, and improved quality and patient safety.
By utilizing information supplied in an HTA report, informed decisions can be made about medical technology acquisitions, technology adoption and dissemination, coverage and reimbursement policies, usage levels of health technologies and associated costs, potential impact on revenue, best practices and clinical outcomes. Its application can help healthcare decision makers identify indirect and unintended consequences, as well as direct and intended consequences of new and emerging healthcare technologies. Because the process is transparent, the results are repeatable and resultant decisions stand up to scrutiny.
The HTA Process
The “AREA” acronym aptly summarizes the HTA process: Ask a well-defined question; Research and Evaluate the evidence to help inform the Answer. As a start to the HTA process, a literature search is undertaken to determine if sufficient credible data have been published to provide an evidence-based evaluation. Searches are typically conducted using bibliographic databases such as MEDLINE and EMBASE. Other information is sought from regulatory databases and other timely online sources. The scientific evidence is assessed, and all available data are summarized. If available data are limited but promising, potential clinical worth may warrant conditional approval with restricted use. So, if a hospital system is considering the acquisition of a technology, they may decide to conduct an internal health outcomes study to add to the evidence base, which, after a defined period of time, can be evaluated to determine the clinical efficacy of the technology.
HTA and evidence-based medicine are similar in that the same body of evidence is used in making decisions about the care of patients. The difference lies in the perspective: HTA applies the evidence to a population, whereas evidence-based medicine takes account of the individual patient. In both instances, it should be noted that the evidence might change over time, so it is essential that any healthcare decisions based on the evidence be updated to incorporate new information.
Combining the best available research with clinical experience and patient values, evidence-based decision making not only promotes appropriate acquisition of new technologies but also encourages broad-based buy in, so decisions are implemented via a transparent, information-based process. It should be noted that expert opinion, in the absence or incompleteness of scientific evidence, is not sufficient to justify the use of a new technology.
Acquisition of Healthcare Technology
The information provided in a well-prepared HTA report can help inform funding allocation decisions for those acquiring new healthcare technologies, which can help create a controlled medical supply formulary. Before acquiring a healthcare technology, it should be determined if there is sufficient clinical evidence to support its adoption. If not, it may be prudent to postpone the decision until further data become available. The current organizational environment, including payer mix, revenue and profit, should also be taken into account, as well as the direct and indirect costs of acquisition and maintenance, reimbursement implications and overall worth to the organization. Availability of more than one product within a particular class or category can add to the complexity of the process. The following case study describes how evidence can be applied in making a decision about an emerging healthcare technology.
Evidence-based Decision Making: Case Study
The introduction and widespread use of drug-eluting stents provides an excellent example of how a new healthcare technology was first identified by an HTA process referred to as “horizon scanning.” Horizon scanning identifies and prioritizes innovative technologies that are likely to have a significant impact on healthcare delivery, utilization and costs. In this way, drug-eluting stents were identified as a product soon to be commercially available in the United States.
The new stents were intended to treat patients whose lesions were at an increased risk for restenosis after having percutaneous transluminal coronary angioplasty (PTCA). Prior to the availability of drug-eluting stents, patients whose lesions predicted increased risk of restenosis after PTCA with bare metal stents were usually selected for coronary artery bypass grafting surgery (CABG). Drug-eluting stents offered the potential for increasing PTCA utilization, as well as increasing or shifting cost burdens. This advance knowledge allowed organizations to reduce excess inventory of bare metal stents, as well as commitments to redundant technologies such as catheter-based intracoronary radiation. In addition, they could prepare for new fixed costs from Medicare reimbursement rates, and investigate favorable pricing options to take advantage of volume discounts and exclusivity agreements for purchasing the stents, which cost two to three times that of bare metal stents.
At the same time, it enabled them to plan for the economic impact of reducing CABG and other cardiac surgeries. As a result, providers could develop programs to establish PTCA proficiency, increase procedural volume and reallocate additional space.
This is an example of a technology that may add cost to an organization rather than provide cost savings. Unfortunately, many new technologies come with the promise of being replacement therapies but end up as an add-on technology. This case presents an important example of hospitals needing a thorough review process to limit cost increases as much as possible and adopting technologies with established clinical value to minimize unnecessary cost.
Applying HTA
In creating an HTA capability, organizations must consider a variety of factors, including their rationale and value proposition, mission and goals, and available support from administrative and clinical leadership. Organizations must also decide whether the effort will be centralized or decentralized, what the reporting lines will be, and how the process will be integrated within the organization. It must then be determined how the findings of HTA reports will be used in the decision-making process.
For example, a technology assessment committee might be formed to lead the initiative. The committee will have to give consideration to membership, staffing, policies, procedures and processes, timeframes and meetings, project and topic selection, research standards, methods, resources and training. Other factors include budgeting, value analysis, privileges and credentialing, metrics and outcome measurement, risk management, planning and capital equipment.
Evidence-based decision making via an HTA process, whether conducted internally or outsourced to an independent entity, is the key to improving the quality and cost-effectiveness of healthcare. The process provides the foundation for transparent clinical review, a systematic approach to decision-making, and a sound basis for triaging requests for new technologies.
