Berwick’s Budget Bet

The CMS administrator has launched a major new initiative to support greater patient safety and reduce readmissions through better coordination of patient information and treatment plans. Under his leadership, CMS is allocating $1 billion to support local collaboratives to make quantifiable inroads in safety and transitions in care. Interestingly, he also maintains that reducing access to technology or rationing of care will be unnecessary if the U.S. health care system improves its performance in quality and efficiency, according to a Kaiser Health News report.

On the other hand, the New England Journal of Medicine recently published an editorial about sipuleucel-T (Provenge), the new immunomodulating vaccine for end-stage prostate cancer that on average extends life by 4 months at the cost of nearly $95,000 per patient.

The editorial questioned the wisdom of making this technology available through the Medicare program. It’s worth noting that a commentary on the NEJM website supported the views of the editorial writer. Sipuleucel-T is but a proxy for a number of new diagnostic and therapeutic interventions that can raise global health expenditures with modest or uncertain marginal returns to patients and the community, it said.

While there is much to be admired in Dr. Berwick’s commitment to and investment in safety and efficiency, I am not convinced that we can deal with health care-related budgetary pressures without addressing the appropriate use of emerging, expensive technology. Hard-won cost savings in the care of common conditions can be erased all too quickly by the use of high-cost technologies in a handful of patients. Granted, the politics of resource allocation within the context of health care reform has lead to distortions and grandstanding that have precluded “adult conversations” about the cost effectiveness of emerging technologies and about the thoughtful allocation of resources to maximize population health in the short and long term. Nevertheless, the new CMS initiatives, while interesting and ambitious, will likely be insufficient to deal with the budgetary pressures facing health care in the not too distant future.