National Academies Press: OpenBook

Adopting New Medical Technology (1994)

Chapter: FRONT MATTER

Suggested Citation:"FRONT MATTER." Institute of Medicine. 1994. Adopting New Medical Technology. Washington, DC: The National Academies Press. doi: 10.17226/4417.
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Suggested Citation:"FRONT MATTER." Institute of Medicine. 1994. Adopting New Medical Technology. Washington, DC: The National Academies Press. doi: 10.17226/4417.
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MEDICAL INNOVATION AT THE CROSSROADS VOLUME IV Adopting New Medical Technology Annetine C. Gelijns and Holly V. Dawkins, Editors Committee on Technological Innovation in Medicine INSTITUTE OF MEDICINE NATIONAL ACADEMY PRESS Washington, D.C. 1994

NATIONAL ACADEMY PRESS · 2101 Constitution Avenue, N.W. · Washington, D.C. 20418 The Institute of Medicine was chartered in 1970 by the National Academy of Sciences to enlist distinguished members of the appropriate professions in the examination of policy matters pertaining to the health of the public. In this the Institute acts under both the Academy's 1863 congressional charter responsibility to be an advisor to the federal government and its own initiative in identifying issues of medical care, research, and education. Dr. Kenneth I. Shine is president of the Institute of Medicine. The Committee on Technological Innovation in Medicine was established in 1988 by the Institute of Medicine to design a series of workshops that would (a) provide more fundamental knowledge of the process by which biomedical research findings are translated into clinical practice and (b) address opportunities for improving the rationality and efficiency of the process. This volume consists of the proceedings of the fourth workshop in the series, "Examining Coverage and Adoption Decisions About Medical Technologies," held in Washington, D.C., on September 18-19, 1992. This workshop and its proceedings were supported by Abbott Laboratories, JEtna, Blue Cross and Blue Shield Asso- ciation, the Health Industry Manufacturers Association, the Howard Hu`ghes Medical Institute, and Pfizer. The opinions and conclusions expressed here are those of the authors and do not necessarily represent the views of the National Academy of Sciences, any of its constituent parts, or the organiza- tions providing support. Library of Congress Cataloging-in-Publication Data Adopting new medical technology / Committee on Technological Innovation in Medicine, Institute of Medicine; Annetine C. Gelijns and Holly V. Dawkins, editors. p. cm.-(Medical innovation at the crossroads; v. 4) "Proceedings of the fourth workshop in the series 'Examining coverage and adoption decisions about medical technologies,' held in Washington, D.C., on September 18-19, 1992"-T.p. verve. Includes bibliographical references and index. ISBN 0-309-05035-9 1. Medical innovations-Congresses. 2. Insurance, Health-United States-Congresses. 3. Social medicine-United States-Congresses. 4. Health care reform-United States-Congresses. I. Gelijns, Annetine C. II. Dawkins, Holly V. III. Institute of Medicine (U.S.). Committee on Technological Innovation in Medicine. IV. Series. [DNLM: 1. Technology Assessment, Biomedical~ongresses. 2. Diffusion of Innovation~ongresses. 3. Technology, Medical- economics-United States-congresses. 4. Technology, Medical- trends-United States~ongresses. 5. Insurance, Health, Reimbursement-United States-congresses. 6. Health Policy-United States~ongresses. W1 ME342F v.4 1994 / W 74 A239 1994] R855.2.A36 1994 610-dc20 DNLM/DLC for Library of Congress 94-7852 CIP Copynght 1994 by the National Academy of Sciences. All rights reserved Printed in the United States of America The serpent has been a symbol of long life, healing, and knowledge among almost all cultures and religions since the beginning, of recorded history. The image adopted as a logotype by the Institute of Medicine is based on a relief carving from ancient Greece, now held at the Staatlichemuseen in Berlin.

Committee on Technological Innovation in Medicine GERALD D. LAUBACH, Chair, Former President, Pfizer, Inc. SUSAN BARTLETT FOOTE, Health Advisor, Office of Senator Dave Durenberger, U.S. Senate BEN L. HOLMES, Vice President and General Manager, Medical Products Group, Hewlett-Packard Company WILLIAM N. HUBBARD, JR., Former President, the Upjohn Company LUCIAN L. LEAPE, Lecturer on Health Policy, Harvard School of Public Health KENNETH L. MELMON, Professor of Medicine and of Pharmacology, Department of Medicine, Stanford University School of Medicine H. RICHARD NESSON, President, Brigham and Womens Hospital UWE E. REINHARDT, James Madison Professor of Political Economy, Woodrow Wilson School of Public and International Affairs, Princeton University NATHAN ROSENBERG, Professor of Economics, Stanford University MICHAEL R. SOPER, Former National Medical Director, CIGNA JOHN E. WENNBERG, Professor of Epidemiology, Department of Community and Family Medicine, Dartmouth Medical School Project Stay Program on Technological Innovation in Medicine ANNETINE C. GELIJNS, Program Director (until February, 1993) HOLLY V. DAWKINS, Research Assistant HELEN C. ROGERS, Senior Project Assistant . . . zll

Division of Health Care Services KARL D. YORDY, Director (until October, 1993) KATHLEEN N. LOHR, Director (from October, 1993) and Deputy Director (until October, 1993) Workshop Organizing Committee A. MARK FENDRICK, Robert Wood Johnson Clinical Scholar, University of Pennsylvania SUSAN BARTLETT FOOTE, Health Legislative Assistant, Office of Senator Dave Durenberger, U.S. Senate MICHAEL SOPER, Former National Medical Director, CIGNA IV

Acknowledgments The Committee on Technological Innovation in Medicine wishes to ac- knowledge the many individuals and organizations who contributed to this vol- ume. These papers were originally presented at the Institute of Medicine work- shop, "Examining Coverage and Adoption Decisions About Medical Technolo- gies" (see appendix A for the agenda). Undoubtedly first among those to be thanked are the authors of these papers. The committee thanks them profoundly for the sustained effort and time that went into preparing their presentations and writing their chapters. It also acknowledges the significant contributions of the workshop organizing committee and the workshop moderators, discussants, and participants. The committee notes with appreciation that support for the workshop or the proceedings came from several organizations. This volume would not have been possible without the support of Abbott Laboratories, Aetna, Blue Cross and Blue Shield Association, the Health Industry Manufacturers Association, the Howard Hughes Medical Institute, and Pfizer. The committee would also like to express its gratitude to the Institute of Medicine staff who facilitated the committee's work. Annetine Gelijns, then director of the program on technological innovation in medicine and now at the College of Physicians and Surgeons, Columbia University, was both the concep- tual and editorial foundation of this volume. Holly Dawkins shepherded the volume through innumerable drafts and revisions. Helen Rogers was invaluable as both a keen commentator on substantive aspects and as the logistical maven of all the committee's undertakings. Finally, the committee is deeply appreciative of the support of four individuals: Kathleen N. Lohr, director of the Division of v

Vl ACKNOWLEDGMENTS Health Care Services, Karl D. Yordy, former director of the Division of Health Care Services, Enriqueta Bond, executive officer of the Institute of- Medicine, and Kenneth I. Shine, president of the Institute of Medicine. Gerald D. Laubach Chair Committee on Technological Innovation in Medicine

Contents LIST OF TABLES AND FIGURES LIST OF ABBREVIATIONS PART I: SETTING THE STAGE 1. INTRODUCTION . . . X111 Gerald D. Laubach, Annetine C. Gelijns, and Holly V. Dawkins 3 2. THE NATURE OF TECHNOLOGICAL CHANGE: INCENTIVES MATTER! Burton A. Weisbrod................................................. 3. THE IMPACT OF TECHNOLOGY ASSESSMENT ON DECISIONS BY HEALTH CARE PROVIDERS AND PAYERS Bryan R. Luce and Ruth E. Brown..................................................... PART II: PROVIDER DECISIONMAKING 4. ROLE OF THE HOSPITAL IN THE ACQUISITION OF TECHNOLOGY Gerard F. Anderson and Earl P. Steinberg v'' 49 61

. ~ ~ V111 5. PHYSICIANS' DECISIONS REGARDING THE ACQUISITION OF TECHNOLOGY A. Mark Fendrick and J. Sanford Schwartz ........................ PART III: THIRD PARTY PAYER COVERAGE DECISIONS 6. DECISIONMAKING IN THE HEALTH CARE FINANCING ADMINISTRATION Kathleen A. Buto.............................................. 7. BLUE CROSS AND BLUE SHIELD ASSOCIATION INITIATIVES IN TECHNOLOGY ASSESSMENT Susan Gleeson.............................................................. 8. KAISER PERMANENTE'S NEW TECHNOLOGY COMMITTEE: COVERAGE DECISIONMAKING IN A GROUP MODEL HEALTH MAINTENANCE ORGANIZATION Paul D. Lairson............................................................................. 9. AUTOLOGOUS BONE MARROW TRANSPLANTATION: A MICROCOSM OF THE U.S. HEALTH CARE SYSTEM William T. McGivney ........................................................................ 10. TECHNOLOGY ASSESSMENT, BENEFIT COVERAGE, AND THE COURTS Lee N. Newcomer............................................................................... PART IV: INCREASING THE RATIONALITY OF COVERAGE DECISIONMAKING 11. STRENGTHENING THE CONNECTION BETWEEN EVALUATIVE RESEARCH AND COVERAGE DECISIONMAKING ~ 1lri~n ~ ~ PUFFS 12. MANUFACTURERS' RESPONSES TO THE INCREASED DEMAND FOR OUTCOMES RESEARCH Ann K. M. Marshall ....................................................................... CONTENTS .............. 71 87 .96 ...... 101 109 117 ....... 127 .... 152 13. PAYING FOR EVALUATIVE RESEARCH Alan M. Garber and Douglas K. Owens 172

CONTENTS 14. HEALTH CARE REFORM: SOME REFLECTIONS ON TECHNOLOGY Susan Bartlett Foote ........................................................................... APPENDIXES A. WORKSHOP AGENDA Pi CONTR TTlI JT()R ~ IX 193 .. 203 206

List of Tables and Figures TABLES 3-1 Summary of Findings by Type of Organization, 52 13-1 Sponsors of Technology Assessment, 178 13-2 Role of Health Care Organizations, 184 FIGURES 2-1 The state of technology and the incentives to use the technology determine total expenditures: The short run, 32 2-2 The health care insurance system establishes incentives for the R&D sector, 32 2-3 The technical capability for delivering health care affects the form and coverage of the health care insurance system, 32 2-4 The level of health care expenditures affects the demand for insurance, 33 2-5 The dynamic system of interaction of the health care insurance system, technological change, and health care expenditures, 33 5-1 Conceptual model of the diffusion of innovation to physicians, 73 11-1 Cumulative meta-analyses of 60 trials of intravenous thrombolytic agents, 136 Example of a decision tree. Management of a 68-year-old man with diabetes, peripheral vascular disease, and an infected foot, 139 11-3 Probability estimates of experts in colorectal cancer detection, 140 12-1 The spectrum of technology assessment, 153 11-2 Xl

List of Abbreviations ACP AHCPR AZT BCBSA BDMS CABG CEAP CMDs CRD DRG FDA GNP American College of Physicians Agency for Health Care Policy and Research zidovudine Blue Cross and Blue Shield Association Bureau of Data Management and Strategy of the Health Care Financing Administration coronary artery bypass graft Clinical Efficacy Assessment Project of the American College of Physicians carrier medical directors chronic renal disease diagnosis-related group Food and Drug Administration gross national product Health Care Financing Administration HDC-ABMT high dose chemotherapy with autologous bone marrow transplantation health maintenance organization Institute of Medicine Joint Commission on the Accreditation of Health Care Organizations HMO IOM JCAHCO MRI NCI NIH OHTA . . . magnetic resonance Imaging National Cancer Institute National Institutes of Health Office of Health Technology Assessment . . . X111

XlV PET PORTs PPOs PPS PROs QALY R&D RCT TEC :-PA VA LIST OF ABBREVIATIONS positron emission tomography patient outcomes research teams preferred provider organizations prospective payment system . . . peer review organizations quality-adjusted life year research and development randomized clinical trial Technology, Evaluation, and Coverage Program of Blue Cross and Blue Shield Association tissue plasminogen activator Department of Veterans Affairs

Adopting New Medical Technology

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What information and decision-making processes determine how and whether an experimental medical technology becomes accepted and used?

Adopting New Medical Technology reviews the strengths and weaknesses of present coverage and adoption practices, highlights opportunities for improving both the decision-making processes and the underlying information base, and considers approaches to instituting a much-needed increase in financial support for evaluative research.

Essays explore the nature of technological change; the use of technology assessment in decisions by health care providers and federal, for-profit, and not-for-profit payers; the role of the courts in determining benefits coverage; strengthening the connections between evaluative research and coverage decision-making; manufacturers' responses to the increased demand for outcomes research; and the implications of health care reform for technology policy.

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