A Backdoor Plan for Rationing

Imagine you’re sick. You find out there’s only one drug that can cure you, but your insurance company won’t pay for it because it’s too expensive.
Remarkably, such a scenario may soon become a reality in this country. The stimulus bill that President Obama just signed contains $1.1 billion for research into the “comparative effectiveness” of various medical treatments.

It’s unclear how the government would use the findings from such research — whether to provide doctors and patients with more information, as lawmakers have promised, or to prohibit certain treatments, as some European nations have done.

But it’s crystal-clear that government has a vested interest in the findings. If newer, expensive treatments are discovered to be little better than older, cheaper ones, then the feds stand to save a great deal of money. Patients could find themselves in an era of one-size-fits-all health care as government cites the research as justification for cuts in health spending.

Of the $1.1 billion, the stimulus package will distribute $300 million to the Agency for Healthcare Research and Quality, an existing research organization within the Department of Health and Human Services, and $400 million to the National Institutes of Health. Another $400 million is to be spent at the discretion of the Health Secretary.

With cost pressures weighing heavily on our health care system, Congress hopes that one of those three entities will find a way to make comparative effectiveness work.

The feds already spend more than $700 billion on just Medicare and Medicaid, the government health care programs for the elderly and the poor, respectively. By 2019, according to a recent report from the Congressional Budget Office (CBO), spending on the two programs is projected to double, to $1.4 trillion.

The CBO has called this growth “unsustainable.” And its estimates don’t include President Obama’s plans to expand Medicare and Medicaid in an effort to achieve universal coverage. At that point, health care would be on its way to consuming half the federal budget.

Some lawmakers see comparative effectiveness as an easy way to rein in health spending without sacrificing health care quality. If research shows that cheaper treatments work just as well as expensive ones, the government could justifiably cover only the cheap options.

Because of cost pressures, though, other countries have used comparative-effectiveness research to ration care. Consider the track record of the United Kingdom’s National Institute for Health and Clinical Effectiveness (NICE).

NICE looks at data from clinical trials of drugs to determine whether newer medical treatments are more effective than older, cheaper alternatives. It then makes recommendations to Britain’s state-run National Health Service (NHS) about which treatments are worth paying for.

In 2006, NICE ruled that the lung-cancer drug Tarceva was too expensive to cover, despite studies showing that it was effective in prolonging the lives of cancer patients.

Even if a British doctor believed that Tarceva offered the best chance of keeping a patient alive, he was forced to prescribe an inferior product — unless the patient paid for Tarceva himself. Facing public pressure, NICE overturned its determination late last year. By that point, though, the drug had been available in the United States for more than three years.

British patients with kidney cancer were met with similar denials for four lifesaving drugs last summer. NICE’s clinical and public health director said of the drug at the time, “Although these treatments are clinically effective, regrettably the cost to the NHS is such that they are not a cost-effective use of NHS resources.”

In other words, the British government acknowledged that cancer patients could die without the treatments — but refused to pay for them anyway.

In response to a public outcry, NICE officials announced in February that they would urge the NHS to begin covering one of the drugs, Sutent, this spring. But while the government officials dither over a final decision over the next few weeks, many patients will suffer needlessly or die.

Americans expect top-quality medical care that’s tailored to their personal needs, free from outside interference. Government-sponsored comparative-effectiveness research virtually guarantees that such individualized care will vanish. Doctors and patients alike should be alarmed.

Sally C. Pipes is president and CEO of the Pacific Research Institute. Her latest book is The Top Ten Myths of American Health Care.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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