Efficacy and cost: A balancing act

HealthTrust and innovative technology


Journal of Healthcare Contracting: Can you name two or three ways in which the process of evaluating new medical technology differs today from, say, 10 or 15 years ago? What accounts for those differences?


Matthew Willis

Matthew Willis, M.D., orthopedic surgeon practicing in Nashville, Tenn., who serves as a HealthTrust physician advisor: One of the main differences today from 10 to 15 years ago is that efficacy relative to cost is much more important. It used to be that efficacy was the only real consideration. If a product even marginally improved efficacy versus another product, it would be utilized despite doubling or tripling costs. Today, facilities, purchasing groups and even physicians expect added cost to equal added value.

Another big change is that physicians are much more often expected to work closely with organizations to decide which medical technologies work best – and to provide the data that supports their decision-making. Previously, physicians had carte blanche to just pick what they wanted, no questions asked.

A third difference is that capital equipment life-cycle costs, including training and disposables cost, are more often factored into decisions about whether or not a product is worthwhile.


JHC: When your sourcing team hears a vendor (or end user, such as a physician or surgeon) call a new device or technology “innovative,” what should their expectations be of that device or technology?

Matthew Willis, M.D.: To me, an “innovative” product solves a problem – it improves either safety or clinical outcomes, or both, and does so at a justifiable cost increase, or it provides the same outcomes and safety profile at a lower cost – in a way that has never been done before.

For some newly introduced products, the jury is still out on whether or not they’re “faux” innovations. A number of polyethylene additives for total joint replacement may provide superior wear characteristics in a lab, but that doesn’t necessarily equate to improved clinical outcomes and lower revision rates. For the added cost, we’re offered a theoretical rather than a proven in vivo benefit. How innovative these additives are is “to be determined” once better data comes out.


JHC: Can a GPO do anything more than introduce its members to new technologies from early-stage or startup medical device firms? In other words, can a national GPO sign agreements with companies such as these, which tend to be small?

Matthew Willis, M.D.: That’s a tricky question because an early-stage technology has to prove itself before it gets adopted by large organizations, but startup firms also need their technology to be tested by those organizations to acquire sufficient numbers for that proof. However, if you give access to every startup product that comes to market, then you run the risk of accumulating a number of unnecessary costs. The majority of products new to market I would not consider innovative but “me-too” products or ones that flat out don’t work.

I think providers need a systematic, repeatable way to evaluate new products rather than taking a haphazard “try-it-and-see” approach. Establishing hospitals or clinics as trial sites for early-stage products is a good idea because it builds familiarity, and thus efficiency, of the evaluation process.


JHC: What are the challenges in evaluating clinical evidence about a newly introduced product/device, which probably lacks a track record in the field? How should the provider (GPO, IDN, hospital, etc) deal with those difficulties?

Matthew Willis, M.D.: One of main challenges in evaluating new devices is that the initial studies either published or presented at meetings are frequently conducted by parties with financial ties to those products, so they sometimes can’t be taken at face value. Oftentimes the results obtained in these pilot studies aren’t achievable by a general population of physicians or in repeat studies.


JHC: To what extent can the healthcare provider hold the vendor accountable for the performance of a newly introduced device after it is in use in the healthcare facility?

Matthew Willis, M.D.: Healthcare providers, particularly large health systems and GPOs, can hold vendors accountable with outcomes reporting on a quarterly or annual basis. But outcomes tracking can be difficult, at least without a system such as the InVivoLink implant and patient-reported outcomes registry for total joint patients. A number of standardized scoring systems, unique to subspecialties as well as individual body parts and procedures, are referenced in the medical literature. On a regular basis, providers should also be meeting with vendors to review and discuss product performance. Currently, this only happens when individual physicians informally offer their opinions on what’s working and what’s not to mid- and upper-level administrators.

Nothing talks like data with vendors, and clearly demonstrated inferior outcomes in a sufficiently powered number of patients would warrant a change. There is always a learning curve with a new device when operative times are longer and complication rates higher than you’d like them to be, but ideally, that learning curve is really, really quick.


JHC: On the HealthTrust website, a blog by Dr. David Alfery, says, “HealthTrust’s Physician Advisors Program puts thought leaders together to help ascertain which new technologies are truly innovative in advancing care.” Can you talk about the program?

Matthew Willis, M.D.: HealthTrust launched the program early in 2015 and it already includes 133 physician advisors (myself included) across 24 specialties. These physicians provide advice and counsel to HealthTrust clinical advisory boards on relevant technology and product-related topics, as well as review and provide input on evidence-based toolkits developed by HealthTrust. They’re also engaged as thought leaders in their specialty and for best-practice sharing with members making the shift from fee-for-service to value-based payment models

The program actively solicits the feedback of physician advisors on clinical evidence reviews in product categories that have a significant impact on patient care, specifically physician preference items, such as stents and peripheral angioplasty balloons. This includes review of new technologies as they come to market and are approved by the U.S. Food and Drug Administration.

I think it is enormously useful to bring together a diverse group of physicians to discuss and evaluate products. We’re frequently on conference calls, sharing our opinions – which can vary by physician and geography. We’re accountable on multiple fronts; we have to support our clinical decision-making with HealthTrust, as well as to our peers. Our input gets incorporated into contracting decisions made by the GPO that can have ripple effects on many hundreds of health systems nationwide, so it’s also very rewarding work.


JHC: Any final thoughts on the challenges and/or opportunities associated with evaluating new medical technologies?

Matthew Willis, M.D.: As efforts to decrease costs intensify, adoption of any new medical technology will depend on outcomes justifying the expense. Consequently, companies are going to be forced to lower their prices to stay competitive, and a number of products are going to get squeezed out entirely.

1 Comment on "Efficacy and cost: A balancing act"

  1. Fred Pane R.Ph., FASHP, FABC | October 27, 2016 at 10:03 am |

    I would like to mention that discussion supports where a Clinical Supply Chain is moving to. When I was chairperson of P and T Committee at a large hospital/IDN we applied the principles of Efficacy/Clinical Outcomes with Cost of drugs. We were fortunate to have a Clinical and Financial Information System in the 1990’s to allow us to measure in a Balanced Scorecard model and dial in clinicians, finance, and performance improvement/quality to all help and report back to P and T/Med Exec/Dept or Division our findings. We were prepared for the Bundled Payment and VBP reimbursement model. It was a priority to get as many clinicians involved in the process as we could, with the goal if always improving our outcomes. Was a device, surgical procedure, drug, the best treatment for a particular disease or condition. Every treatment option needs to be reviewed in a Comparative Effectiveness Model. Some Value Based Insurance models have already been doing this.

Comments are closed.

safe online pharmacy for viagra cheap kamagra oral jelly online