The federal government has committed $1.1 billion to fund comparative effectiveness research. Some of this money will be used to fund studies that will examine the effectiveness between drugs, medical devices and procedures for the same condition. Learn why the supply chain will benefit.
The American Recovery and Reinvestment Act of 2009 provided $1.1 billion to help fund comparative effectiveness research. Some of this money will be used to fund studies that will examine the effectiveness between drugs, medical devices and/or procedures for the same condition. The findings from this research may eventually provide materials managers with information on how products such as knee, hip and spinal implants perform. What follows is a look at the comparative effectiveness movement and what it may mean to the health care supply chain.
The federal push to generate more comparative effectiveness research is expected to provide hospital materials managers with a new tool in their efforts to determine which medical devices and pharmaceuticals offer the best value. Comparative effectiveness studies examine differences in clinical effectiveness between drugs, medical devices and/or procedures for the same condition, as opposed to research that compares products to placebo. The American Recovery and Reinvestment Act of 2009 (ARRA) provided $1.1 billion for this research, with
$300 million going to the Agency for Healthcare Research and Quality (AHRQ).
President Obama's fiscal year 2011 budget request, released in February, calls for $286 million for AHRQ's comparative effectiveness efforts.
The missing data link
The findings that will result from this research are much needed, many materials management experts say. Supply chain professionals know how much they're spending on medical devices and what the reimbursement is, but information on how products perform is hard to come by, says William Stitt, corporate director for materials management at University Community Health (UCH) in Tampa, Fla. "Sometimes the clinical aspect of this stuff can be a mystery. We don't want there to be any mystery. We want to make good, fact-based decisions on a variety of factors, and this is the piece that we're missing."
The hope is that the federally funded comparative effectiveness research will be a new source for independent data that materials managers could use to evaluate the products in their hospitals and to look for opportunities to improve value.
Today's dearth of clinical outcomes information means manufacturers can charge a premium for their products, says Blair Childs, senior vice president for public affairs at hospital alliance Premier. Comparative effectiveness findings will bridge the gap between a product's claimed clinical benefit and actual value, notes Stitt, who is president-elect of the Association for Healthcare Resource & Materials Management (AHRMM).
In some cases, the research could find that two competing medical devices have the same clinical value, and price could be the deciding factor. However, in other cases a higher-priced product could be the best choice because it is found to have superior outcomes or produce other efficiencies, such as shorter patient lengths of stay or quicker operating room turnaround time, several materials management experts say.
Materials managers could fold the comparative effectiveness findings into their existing drug and device analysis processes. For example, at UCH the information will be shared with the system's four value analysis teams "to really let them use that along with the financial data that we provide to make a true evidence-based decision," Stitt says.
The findings also will give materials managers and value analysis teams a tool to communicate with and inform physicians and other clinicians, several supply chain experts say. "When we're talking about supply chain initiatives, clinicians want more science," says Ray Moore, system contracts manager for PeaceHealth in Bellevue, Wash., and AHRMM president. "They're used to evidence-based medicine."
The prospect of comparative clinical effectiveness data reinforces the importance of including physicians in supply chain initiatives, says Patricia Tyson, R.N., MSA, vice president of performance services for the hospital alliance VHA. "The role of the materials management or supply chain executive is to lay out the data, lay out the products and then the physicians have that clinical discussion."
Targeting preference items
In addition, Tyson and others anticipate that when it comes to studying devices, the federal government largely will target physician preference items because they are the most expensive. This would make involving physicians in product analysis even more important, she says.
Already AHRQ has issued a request for applications for an organization to develop a prospective clinical registry study of orthopedic devices, drugs and procedures. The four-year, $12 million comparative effectiveness project will concentrate on hip and knee replacements. It will track patients from at least five high-volume clinical centers.
Implants and other physician preference items are an area on which many supply chain professionals are focused. For example, nearly 75 percent of the 570 hospitals responding to a June 2009 survey by Materials Management in Health Care and AHRMM either have a strategy for standardizing physician preference items in place or are working on one. These products represent about 60 percent of a hospital's total spend on materials, Tyson notes.
Since passage of the $1.1 billion in comparative effectiveness research funding last year, the federal entities handling the effort have made it clear that their priority is studies that involve "real people" in "real settings." This is meant to differentiate the effort from tightly controlled clinical trials in academic medical centers. The AHRQ-funded orthopedic project exemplifies this practice-based research approach.
The focus on practice-based research is a positive development, several materials management experts say. "How things work in a controlled environment is very important," Moore says. "But then sometimes when you get it out into the real world, there are some outside influences and processes that have a huge impact on the real results. Real-world measurements are an important supplement."
Need for more comparison
Although the national reviews would be helpful, materials managers still would have to evaluate them just like any other study to make sure the findings apply to their institutions, Tyson says. "Are we seeing the same types of patients? Are we seeing the same types of results and outcomes?" This local crosscheck would be particularly important for implants or any other products that go into a patient's body, Moore says. "We have to respect a clinician's comfort level. They still need to find out if it works in their environment with the organization's or their processes."
This local crosscheck would be particularly important for implants or any other products that go into a patient's body, Moore says. "You still need your comfort level, and you still need to find out if it would fit in your culture and your environment with your processes."
For the comparative effectiveness research push to succeed, it requires a steady funding stream. However, the initiative faces criticism from some conservative politicians who argue that it is a guise for rationing health care. Several materials management experts say that is an extreme view. "If it's used as information to inform decision-making, then that's not rationing care. That's rational care," Childs says.
Provisions to organize and fund a sustained comparative effectiveness research effort are included in the health system reform bill. The measure states that the research findings should not be construed as coverage or reimbursement mandates. Regardless of how health system reform legislation looks in its final form, Childs predicts, the national comparative effectiveness initiative would prevail because it has garnered significant bipartisan support.
Payers' views of effectiveness
Some experts believe the research could affect public and private payers' coverage and reimbursement decisions. When it comes to devices, payers might not be willing to pay a premium for a new or modified product if it's found to be less effective than another, says Gail Wilensky, Ph.D., senior fellow at Project Hope, an international health education organization, and former head of Medicare. "Every other place in the economy, you don't get brownie points because you have something new," she says. "Either it does it cheaper or it does it better, and the people who have to pay for it think that's worth paying the additional cost. So this is basically putting health care on a more similar state relative to innovation in the rest of the U.S. economy."
This could be a positive development, several materials management experts say. Today, medical device manufacturers are under pressure to continually come out with products they can market as new and improved, Moore says. "Accelerating measurements on what really makes a difference will be a tremendous benefit to the quality of our patient care and the communities that we're serving, and actually helping us manage the real value of something."
The pressure on manufacturers would shift to differentiating themselves based on true value, Childs says. Products found to be superior would have a marketplace advantage.
The prospect of a mass purchasing shift based on comparative effectiveness research results would encourage those on the losing end to share any counter findings they have or to invest in other studies, Moore says. "There will be this domino effect of more information coming out to double-check, to look at different scenarios. The more information we have, the better off we are."
Moore foresees that because of this information sharing, it would be unlikely that patients would be denied a clinically valuable drug or device.
The creation of a centralized body to document and communicate results to the entire health care industry could mean that more health system study data on drugs and devices would make its way into the shared resource channels, Moore says. Many providers are conducting outcomes research in their institutions now, he notes, but it's not being broadly shared.
The ultimate impact comparative effectiveness research has on the hospital supply chain depends on which studies get done, Childs notes. It's too early to tell what share of the research will focus on medical devices and pharmaceuticals versus medical procedures. As required by the ARRA, the Institute of Medicine (IOM) in June 2009 issued a report laying out its views on what the top research topics should be. Of those 100 priorities, the IOM categorizes 13 as pertaining to devices and 36 as relating to pharmacological treatment.
In addition, AHRQ has identified 14 medical condition categories on which it plans to focus comparative effectiveness research. Several of them are device-intensive areas, including arthritis and non-traumatic joint disorders, cardiovascular disease, functional limitations and disability, and infectious disease.
To reap the benefits of whatever findings pertain to the supply chain, materials managers will have to stay connected, Moore says. That means maintaining a keen eye on the literature and keeping up with developments through involvement in professional associations.
AHRQ and the Federal Coordinating Council for Comparative Effectiveness Research have emphasized the importance of quickly and clearly disseminating comparative effectiveness research results to providers, the public and policymakers. Of the $300 million AHRQ received in the ARRA, it plans on spending $34.5 million on expanding its efforts to translate and circulate the findings to the various audiences.
However, some materials management experts worry that the government doesn't have outreach to supply chain professionals on its radar. This audience should be included in the flow of data once the research produces findings, Tyson says. However, she adds, "I don't quite know how that will work."
Materials managers shouldn't expect a flood of findings right away. Although AHRQ has been involved in comparative effectiveness research for years, lack of funding limited its scope and the effort is still in its nascent stage. While the new funding is a boon, it might take years for the findings, especially those from original research, to come out. The other avenue of comparative effectiveness research—systematic reviews of existing evidence—will have a quicker turnaround, Childs notes.
Once the findings do begin to filter out, materials managers could quickly benefit, Moore says. "Potentially from the very first study results that get publicly released, that could have an impact on us."
Geri Aston is a freelance health care writer based in Chicago and a frequent contributor to MMHC
Sidebar - Possible priorities for research projects
|In its list of comparative effectiveness research priorities, the Institute of Medicine includes several topics that involve medical devices or other supply chain products. Among the suggestions are:
•COMPARE the effectiveness of formulary management practices and usual practices in controlling hospital expenditures for products other than drugs, such as medical devices.
•COMPARE the effectiveness of various screening, prophylaxis and treatment interventions in eradicating methicillin-resistant Staphylococcus aureus in communities, institutions and hospitals.
•COMPARE the effectiveness of such treatment strategies as artificial cervical discs, spinal fusion, pharmacologic treatment and physical therapy for cervical disc and neck pain.
•COMPARE the effectiveness of strategies for reducing health care-associated infections, including biopatches, reducing central-line entry, chlorhexidine for all line entries, antibiotic-impregnated catheters and treating all line entries via a sterile field.
•COMPARE the effectiveness of different treatments, including assistive listening devices, cochlear implants, electric-acoustic devices, habilitation and rehabilitation methods, for hearing loss in children and adults.
Sidebar - Have a research project idea?
The Agency for Healthcare Research and Quality (AHRQ) is seeking ideas for comparative effectiveness research. AHRQ evaluates every suggestion it receives, says Jean R. Slutsky, director of the agency's Center for Outcomes and Evidence. Ideas can be submitted online at www.effectivehealthcare.ahrq.gov/index.cfm/submit-a-suggestion-for-research.
This article first appeared in the April 2010 issue of H&HN magazine.