Managed Care and the Evaluation and Adoption of Emerging Medical Technologies

Steven Garber

Jan 2000 · Rand Corporation

About this eBook

New medical technologies--pharmaceuticals, medical devices, and procedures--often allow great improvements in the outcomes of medical care, but they are also widely believed to be a major cause of increasing costs. Selective adoption of new technologies is crucial in the quest to control health care costs while preserving or enhancing quality of care. This Executive Summary presents findings from a study focused on adoption of innovative medical technologies by managed care organizations (MCOs). The project had two primary objectives: (1) to understand how MCOs make coverage, medical-necessity, and payment decisions involving emerging medical technologies, and how device developers and manufacturers prepare for and participate in these processes; and (2) to identify ways that private, voluntary action by the managed-care and medical-device industries might improve (for the benefit of society) these processes. The analysis is based on confidential interviews with eight companies that develop and manufacture medical devices and medical directors of nine MCOs. A major impediment to socially appropriate adoption of emerging medical technologies is limited information about how these technologies perform in day-to-day medical practice. The authors discuss prospects for improving four elements of information availability: Developing better information before market introduction; learning more from experience after market introduction; evaluating and synthesizing clinical information; disseminating information. The authors also discuss several other issues that warrant consideration: Aligning private incentives of MCOs and payers with social values; enhancing MCO capabilities to evaluate technologies and make decisions; improving decisions by physicians; reducing use of inappropriate or obsolete technologies; reducing costs of decisionmaking for manufacturers and MCOs; improving manufacturer understanding of the market environment; helping MCOs and employers anticipate what is in the pipeline. This Executive Summary will be of interest to medical-device developers and manufacturers, managed care organizations, public-policy makers, and researchers and analysts. See also Steven Garber, M. Susan Ridgely, Roger S. Taylor and Robin Meili, Managed Care and the Evaluation and Adoption of Emerging Medical Technologies, MR-1195-HIMA, RAND, 2000.