The federal government should provide incentives for pharmaceutical companies and device makers to produce products that help cut spending and ensure that the benefits of costlier advances justify their added expense, according to a new Rand Corp. report.
"We spend more than $2 trillion a year on healthcare in the U.S.--more per capita than any other nation--and the financial incentives for innovators, investors, physicians, hospitals and patients often lead to decisions that increase spending with little payback in terms of health improvement," Steven Garber, a Rand senior economist and principal investigator of the study, says in an announcement.
The study, "Redirecting Innovation to Decrease Spending and Increase Value in U.S. Health Care," urges the National Institutes for Health to encourage more creativity and risk-taking to promote major scientific breakthroughs. Drugs and devices that help decrease spending could receive expedited but still rigorous review through the U.S. Food and Drug Administration, it says.
It also urges coordination between FDA approval and Medicare and Medicaid coverage processes; increasing demand for technologies that decrease spending; and producing more and more timely tech assessments.
Meanwhile, the FDA is proposing a new program that would speed access to high-risk medical devices intended to treat or diagnose patients with serious conditions whose needs are unmet by current technology.
In addition to reducing the time for the premarket review, the program seeks to reduce the time associated with product development.
Eligible devices must be intended to treat or diagnose a life-threatening or irreversibly debilitating disease or condition and meet one of the following criteria:
- No approved alternative treatment/diagnostic exists
- It is a breakthrough technology that provides a clinically meaningful advantage over existing technology
- It offers a significant, clinically meaningful advantage over existing approved alternatives
- Its availability is in the patient's best interest
The device must also have an acceptable data development plan that has been approved by the FDA.
Most devices entering this program are expected be in the pre-clinical trial phase, Jeffrey Shuren, director of the FDA's Center for Devices and Radiological Health, said in announcement.
The FDA in March proposed simplifying the way it classifies and reclassifies medical devices, opting to do so by administrative order rather the cumbersome rulemaking process.
It reported that recalls of medical devices have doubled in the past decade, though it says the rate actually lags the rate of growth in the med tech market overall.