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Transforming Health Care:
Using Evidence in Benefit Decisions
Leah Hole-Curry, HTA Program Director
Washington State Health Care Authority
IOM Essential Benefits – February 2011
The State Budget, Health Care, and
National Health Reform



Budget Shortfall 2009-2011 – $2 Billion (of $33 Billion)
– Past 3 years, total of $5.1 Billion in cuts to state budget
– Federal funds of about $500M anticipated; $300M Medicaid
– Preparing for a 4-7% across the board cut by October 2010
Projected shortfall for 2011-2013 is $3 billion
Total health care spending now about 1/3 of state budget, was
about 1/5 in 2005
– Waiver request to sustain BHP, Medical Care Services programs
– Executive order to consolidate Medicaid, public employees health
purchasing, eventually all state health purchasing, under HCA
– Executive implementation of NHR, Joint Legislative Select
Committee on Health Reform Implementation

Low income expansion

Health insurance exchange

Health care workforce
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The Budget and Health Care
Washington State

In FY2010 WA spent nearly $7 billion State General Fund to provide medical
coverage to 1.5 million Washington residents … about 33% of the budget.

In 2006, WA state spent $4.5 billion on health care; Up from $2.7 Billion in
2000 (a rise from 20% to 28% of budget)
National Trends

In 2007, total health care spending 15% of gross domestic product compared to just 4%
in 1960
– Real per capita spending on health care grew an average of 4.2 percent annually;
real per capita GDP grew at 2.2 percent
Private Sector Trends

Average annual insurance premium 7.3% increase over last 20 years (Mercer)

For small businesses, increase is greater than the increase in wages or gross
business income, some years by a factor of five

Outpaces wage and overall inflation increases averaging approx 3% annually
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What Accounts for Health Care Cost Growth?
CBO Long term Health Care Cost Outlook 2007

Most analysts agree that the most important factor contributing to the growth in health
care spending in recent decades has been the emergence, adoption, and widespread
diffusion of new medical technologies and services.
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ConsumerReports.org
10 overused tests and treatments
November 2007
1 BACK SURGERY. … surgery, which can cost $20,000 plus physician's fees …..
2 HEARTBURN SURGERY. operation, costs $14,600 or more
3 PROSTATE TREATMENTS. . over treated with surgery that costs $17,000, or by
radiation therapy for $20,700
4 IMPLANTED DEFIBRILLATORS. … cost some $90,000 over a lifetime.
5 CORONARY STENTS. Billions are spent each year….
6 CESAREAN SECTIONS. ..cost almost $7,000, about 55 percent more than natural
delivery...
7 WHOLE-BODY SCREENS. CT scans, which can cost $1,000 … no proven benefits
for healthy people. A few CT scans a year can increase your lifetime risk of cancer.
8 HIGH-TECH ANGIOGRAPHY. Using a CT …costs an average of $450...standard
angiography is sometimes still needed.
9 HIGH-TECH MAMMOGRAPHY. Using software to flag suspicious breast X-rays
would add $550 million a year to national costs if used for all mammograms. But a 2007
study found that this technique failed to improve the cancer-detection rate significantly,
yet resulted in more needless biopsies.
10 VIRTUAL COLONOSCOPY. …Though less costly than a standard colonoscopy, the
virtual test isn't cost-effective because any suspicious finding requires retesting with the
real thing.
Copyright © http://www.consumerreports.org/cro/health-fitness/index.htm 2000-2006 Consumers Union of U.S., Inc.
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Goal: Find and Pay for What Works
Proven Effect for
Better Health
Cost
Proven Safe
Effective
Estimates range from only 4% to 53% of
health care interventions have strong evidence
to support them. (IOM, CBO, Lancet)
No reliable evidence
No reliable Evidence
High Cost
Or Ineffective
Or Unsafe
vs. alternatives
Well-designed, well-conducted studies of the effectiveness of most health care services are the
exception, and the available research evidence falls far short of answering many questions that
are important to patients and providers. IOM: Knowing what works. 2008.
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Evidence Based Health Care

Cutting edge programs that have become part of our offerings:
– Prescription Drug Program

Preferred drug list used by PEBB, Medicaid, and workers compensation programs
– Drug Purchasing Consortium

Pooling of state and private purchasing power, used by PEBB & workers compensation
– Health Technology Assessment

State pays for procedures and medicine that show evidence of efficacy, cost-effectiveness,
and safety

Estimated savings of $27 million since 2007
– Patient decision aid pilot

Focus on high-variation, preference-sensitive areas that involve multiple options and
tradeoffs, e.g. cardiac disease; breast & prostate cancer
– Opioid Dosing Guidelines
– Medical Necessity Language tied to Evidence Rating
– Advanced imaging management

Using evidence based guidelines, identify highest cost/utilization advanced diagnostic
imaging services for state programs
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HTA Program Elements
1. HCA Administrator Selects Technology
Nominate, Review, Public Input, Prioritize
Semi-annual
2. Vendor Produce Technology Assessment Report
Key Questions and Work Plan, Draft, Comments, Finalize
2-8 Months
3. Clinical Committee makes Coverage Determination
Review report, Public hearing
Meet Quarterly
4. Agencies Implement Decision
Implements within current process unless statutory conflict
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Evidence for use in Policy
Decisions
Different Data Sources

Efficacy
– How technology functions in “best environments”



Randomized trials-distinguish technology from other variables
Meta-analysis
Effectiveness
– How technology functions in “real world”



Population level analyses
Large, multicenter, rigorous observational cohorts (consecutive pts/objective observers)
Safety
– Variant of effectiveness



Population level analyses
Case reports/series, FDA reports
Cost
– Direct and modeled analysis


Administrative/billing data (charge vs cost)
Context
– Mix of historic trend, utilization data, beneficiary status, expert opinion
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HTA Measures and Outcomes

Transparency
– Topics, Key Questions, Draft Reports, Final Reports, Criteria Posted
– Average 83 days of public comment per technology
– 13 public meetings – all deliberations open

Technology Reports: Analysis completed
– Over 9,000 articles/trials reviewed
– 19 comprehensive technology assessment reports

Independent Coverage Decisions
– 19 decisions where reliable evidence:
 10 show benefit and support coverage for certain situations
 8 do not yet show benefit and are not covered
 1 shown unsafe or ineffective
– Estimated $30 million cost avoided
– Utilization impact: 3 increased; 6 same; 10 decrease
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HTA Measures
WA HTA Comparison with Insurer Policies
WA HTA
Topic
Private Insurer
Date
Coverage
Decision
Aetna
Regence-BC
NCD
No decision
Same
Same
No decision
No decision
Same
Same
n/a
No decision
Ped Bariatric Surgery <18
Aug-07 Not covered Less Restrictive Less Restrictive
Same
BCBS TEC
Premera-BS
May-07 Not covered Less Restrictive
Conditional
Medicare
Group Health
Upright MRI
Ped Bariatric Surgery 18-21
Reference Sources
Same
Less Restrictive Less Restrictive Less Restrictive
Same
Lumbar Fusion for DDD
Nov-07 Conditional More Restrictive
No decision
Same
Same
No decision #
No decision
Discography for DDD
Feb-08 Not covered Less Restrictive
Same
No Decision
No decision
No decision
No decision
Same
Same
Same
Same*
Less
Restrictive
Virtual Colonoscopy (CTC)Feb-08 Not covered
Cancer screening

Same*
Summary Comparison of HTA Decisions and Private Insurers:

Same as Private (some occur before, some after)
- 47%

Private Insurer is Less Restrictive
- 22%

Private Insurer is More Restrictive
- 9%

Private Insurer does not have published policy
- 18%
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Thank you!
Additional resources:
 HTA: http://www.hta.hca.wa.gov/
 PDP: http://www.rx.wa.gov/
 Discount Card: http://www.rx.wa.gov/discountcard.html
 AIM: http://www.hta.hca.wa.gov/aim.html
 PDA/SDM:
http://www.informedmedicaldecisions.org/washington_state_legi
slation.html
 Joint Select Committee:
http://www.leg.wa.gov/jointcommittees/HRI/Pages/default.aspx
 Governor Gregoire:
http://www.governor.wa.gov/priorities/healthcare/reform.asp
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