Many factors contribute to high health care costs, including provision of care that is not evidence based, lack of integration across providers and settings, overreliance on medical specialists, and inappropriate adoption of new technologies and procedures. Because Medicare and Medicaid have such a powerful influence on the U.S. health care system, these programs could be leaders in creating a value-driven health system and increasing evidence-based care.

Achieving a value-driven system will require analyses of the clinical-and cost-effectiveness of options for disease prevention and treatment and the way care is organized and delivered. These analyses should build on existing data collection efforts in agencies such as CDC, FDA, NIH, CMS, and AHRQ—as well as on external data sources—and will require transparent and credible analytic tools. The committee sees this type of research as providing useful guidance in clinical decision making, but recognizes it cannot be an absolute guide to the clinical care of individual patients, whose circumstances vary widely.

With new and better information available from comparative effectiveness analyses, CMS can develop a range of incentives for

  • better management of high-cost chronic illnesses;

  • use of primary, versus specialist, care;

  • reduced geographic variation in care patterns;

  • better integration of care, through, for example, establishment of a medical home or similar mechanism for assuring continuous, accessible, comprehensive, and coordinated care for Medicare and Medicaid patients; and

  • more efficient practices, generally, including widespread adoption of electronic information exchange and electronic medical records.

Americans are becoming better informed about their health, health care technologies, and ways of navigating the health care system. They are also becoming increasingly responsible for managing their own health and illnesses. Today’s consumers need access to unbiased, clearly worded, evidence-based, and up-to-date information about health concerns, prevention strategies, and the advantages and disadvantages of alternative tests, treatments, medications, and interventions. When they have full information, individuals often wisely make more conservative, less costly treatment choices.

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