• Hoisted from my email: What’s the barrier to diffusion of cost-effective care?

    I posted about a Fuchs and Milstein article in which they suggested physicians were the key to speeding up the diffusion of cost/comparative-effective care. Aaron responded with the idea that insurers ought to be interested in doing this too. That sparked some email with Kevin Outterson, which follows.

    Me to Kevin:

    Kevin, my question is, are insurers lacking some specific legal cover to hide behind comparative effectiveness research? Is there something about the law that isn’t helping? Is that a place to start?

    Kevin, in reply (lightly edited):

    It’s a collective action problem on creating and investing in comparative effectiveness research, especially with low beneficiary persistency over time (all the more reason to do it nationally); possible anti-trust (AT) issues if the plans adopt the same jointly created guidelines (they have a special AT waiver to collaborate on forms and data reporting); self-insured ERISA plans have tried with Leapfrog – not sure why that hasn’t worked better.

    My conclusion:

    The collective action and AT issues imply a role for government, which is another route back to politics.

    So, are docs off the hook because insurers should provide the push? Are insurers off the hook because the law is a barrier and there is a collective-action problem? Or should docs provide the political cover and external motivation to solve those? (Around and around we go.)

    • Kevin
      Why is AT in play if insurers collectively adopt findings consistent with well done, say PCORI divined, CER?

      InterQual and M&R are used universally, although the companies dont decide collectively which and how to use. Understood.

      However, if an NIH study comparing drug x and y demonstrates value using one over the other, and the companies at thier roundtable (pretend one exists) indicate a preference because of greater value, why is that AT?

      Is it the manufacturer of the “losing” Rx and lost business? Patients who may prefer y over x regardless of outcome??

      Shed some light if you would be so kind.

    • @ Brad F – as always, good questions. Without a doubt, health plans can all choose to follow the same empirical evidence. They can hire similar disease management companies. They can implement similar wellness or step-therapy programs. The AT problem is that in order to be most effective, they should do it together.

    • @Kevin- It is still an AT issue even if it does not affect how they compete with other insurance companies, ie, doesnt there have to be anti-competition part to this? If home builders all buy wood from company A because it is cheapest, but they still compete on total price, would that be an AT issue?


    • My experience is that Doctors do not spend my out of pocket money for low benefit treatments but will spend insurers money without a thought.

      • It’s been my experience that doctors will be more than happy to spend my money. It’s only if you make it very clear that it is going to cost you a lot of money do they then reconsider. And not always then.

        An excellent example is the suggestion for an MRI for a suspected small meniscus tear in the knee. It could also be diagnosed more cheaply by a steroid injection. Why one over the other? You could make the case that one is not invasive. On the other hand, if you are not going to have surgery, what’s the point of either? An x-ray has already ruled out likely arthritis.

        How many people would get an MRI and ultimately proceed to surgery? Is this wasted care? I would say in this case it would have been but others would not agree. If you have insurance, once you have satisfied the deductible through all the tests, the surgery suddenly becomes much “cheaper”. This is why it is hard to get rid of waste. It is so easy to justify.

    • @ Steve – your home builder example would not be an AT problem. But if all of the home builders got together and bought wood collectively, that would be a problem.

      Back to health plans and implementing CER. Can they get together and agree on a DM vendor? — No. Can they each try their own guidelines and drive providers crazy with a dozen different sets of rules — Yes

    • Kevin
      On certain things, yes, a unified DM company approach may be helpful, although I am not convinced. But leave that for now…

      However, for a lot of CER, say, using H2 Blockers vs PPI’s for GERD–why couldnt Aetna, Cigna, Wellpoint, etc., congeal and pronounce that as of July 1, we are all using a specified GERD treatment algorithm as a result of NIH study “x.”

      Gets us from A to B in about as squeaky a clean fashion as one could imagine, and from where I sit, no AT violations, correct?

      This is a good chunk of decision making with lots of potential–granted wont flatten or diminish the cost curve to great proportions, but nonetheless, not chopped liver either.


      • @ Brad – it would depend how the AT enforcement agencies viewed your “congealing” process – they are competitors, agreeing in advance about particular market conditions. Normally, that is an AT problem. Under rule of reason analysis (best case) they will need to prove that the joint action (conspiracy) is pro-competitive or results in additional market efficiencies. Perhaps we think the answer is yes, and yet the companies may be reluctant to take the risk.

        The companies could ask for an advisory opinion. Perhaps someone has tried and I don’t know it.

    • Kevin
      Still not getting it.

      Try this example: several restaurants all decide they are only going to sell sustainable seafood, no more bluefin tuna, monkfish, etc. The supplier down the street who sells the bad stuff gets shut out.

      All the restaurants can prepare the seafood in a manner in which they choose, in an environment of their liking. They serve the customers who are aware of the product.

      Some restaurants cook the fish better than others.

      Is that a no go?


      ps–this is a learning exercise, not being confrontational here. You offer a different, very welcome legal slant. Nice change. 🙂

      • 1. Each restaurant individually deciding to buy only sustainably caught fish = OK
        2. Govt telling all restaurants to buy only sustainably caught fish = OK
        3. Competing restaurants meeting together and jointly deciding to buy only sustainably caught fish = group boycott
        4. Restaurant trade association issues “good fish restaurant” guides and many restaurants voluntarily chose to follow the guidelines = OK

        I may decide to create a series called Antitrust 101

        • Please, please, please, do AT 101 with a health care focus. I tried my best in a few lame posts, but I’m not a trained law professor. I’m not even a trained economist! I’m a trained engineer. I can’t possibly get the law right! 🙂

          • I agree.

            Suggest breaking out AT on hospital, provider, insurer (maybe supplier, eg, Cardinal health, etc), and issues germane to each. Keep it brief for the non-legal scholars among us.

            Even using a case as springboard–good example might be recent kerfuffle in Michigan with the Blues (“favored nation”) or Bay Area and Sutter as a springboard.