Health reform targets patient-centered outcomes

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Health reform has provided a significant boost to comparative effectiveness research, but experts are split on how much such research can rein in costs unless healthcare providers have incentives to curb overutilization. Section 6301 of the Patient Protection and Affordable Care Act establishes a private, nonprofit organization, called the Patient-Centered Outcomes Research Institute, to set a national agenda for identifying priorities in patient-centered outcomes research that will help healthcare providers and payers make informed decisions about how to treat patients effectively without wasteful overspending, according to a Bloomberg News report in The Star-Ledger.

The new Institute will build on the $1.1 billion that Congress budgeted for effectiveness research last year. The Institute will have a $10 million budget this year, but funding could reach $500 million or more by 2013, according to an estimate from the Washington, D.C.-based Brookings Institution.

A 19-member board of governors will run the Institute. Members will include three representatives of drug, device and diagnostic-testing companies; patient advocates; physicians; and the National Institutes of Health. The Comptroller General will name the board within six months.

This increased emphasis on comparative-effectiveness research could help ground physician decision-making in science and limit the influence of outside factors such as marketing, says Jeffrey Lerner of the nonprofit ECRI Institute. And the result could be reduced spending, says John Sullivan, an analyst at Leerink Swann & Co.

Comparative effectiveness isn't "by itself...the end-all-be-all" for creating savings, says Peter Orszag, President Obama's budget director. The Act also establishes pilot projects to examine new physician payment systems, penalizes hospitals that have high readmission rates and sets up an independent commission to determine which treatments Medicare should cover, he notes. "Together, they work to move toward a higher-quality, lower-cost system over time."

However, the widespread scope of overutilization means that Congress needed to do more to realize true savings, according to a report in the New York Times. Patients are demanding unnecessary tests, and the measures in the Act give doctors little incentive to tell them no. Congress will need to take the hard step of tying Medicare payment to medical outcomes to achieve significant savings, say physicians and economists. But that may be difficult. "The minute you attack overutilization you will be called a Nazi before the day is out," says Uwe E. Reinhardt, a health economist at Princeton.

To learn more about the impact of comparative effectiveness research:
- read The Star-Ledger article
- check out the New York Times article

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