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Suggested Citation:"1. Introduction." Institute of Medicine and National Research Council. 2002. Medical Innovation in the Changing Healthcare Marketplace: Conference Summary. Washington, DC: The National Academies Press. doi: 10.17226/10358.
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1
Introduction

Medical innovation has contributed enormously to the improvement of the health of the American people, especially to the increase in life expectancy over the past 50 years. At the same time, aggregate health care costs have grown much faster than the overall economy. As Mark McClellan of the Council of Economic Advisers pointed out in his introductory address, medical innovation is at a public policy crossroads. On the one hand, there is strong pressure to develop innovative medical technologies, while on the other hand, there are growing concerns about the economic implications of medical innovation. In McClellan’s view the critical questions is:

In an environment of renewed concern about rising health care costs, where can public policy stimulate or remove disincentives to the development, adoption, and diffusion of high-value innovation in diagnostics, therapeutics, and devices?

To address this question, the Board on Science, Technology, and Economic Policy and the Board on Health Care Services organized a conference at the National Academies headquarters on June 14–15, 2001.

THE CONFERENCE AGENDA

The first half of the conference addressed two key aspects of the public policy debate about new medical technology—the extent to which new medical technology is driving up health care costs and the challenge of

Suggested Citation:"1. Introduction." Institute of Medicine and National Research Council. 2002. Medical Innovation in the Changing Healthcare Marketplace: Conference Summary. Washington, DC: The National Academies Press. doi: 10.17226/10358.
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putting a value on the benefits of new medical technology. These two issues were addressed at the macro level and at the disease level for cardiovascular disease8 and metastatic melanoma.9 The conference agenda is in Appendix A.

In choosing these two diseases, the organizers of the conference sought to contrast the situation for a disease where there has been significant therapeutic progress, cardiovascular disease, with the situation for a disease with, to date, limited therapeutic progress, metastatic melanoma.10 Indeed, metastatic melanoma can be considered representative of many cancers in the sense that new drugs are becoming available that provide improvements but at substantial cost.

The second half of the conference addressed the impact of innovations in the pipeline and the barriers to these innovations. Barriers to innovation occur at all stages of the innovation cycle—development (potentially exciting ideas that do not leave the drawing board), adoption (coverage denied or delayed for cost-effective solutions), and diffusion (proven solutions only slowly replacing inferior approaches). Ways to overcome identified barriers to medical innovation were considered with respect to treatments for cardiovascular disease and for metastatic melanoma, as well as more generally.

Chapters 25 of this report summarize the discussion of the four principal themes of the conference:

  • The characteristics of medical innovation.

  • The costs and benefits of medical innovation.

  • Cost-effectiveness studies: a key to innovation development.

  • Barriers to medical innovation.

A list of conference participants is given in Appendix B. This list does not include those people who tuned into the conference webcast, which drew about 100 listeners each day.

8  

Cardiovascular disease, principally heart disease and stroke, is the leading cause of death in the United States for both men and women among all racial and ethnic groups. More than 960,000 Americans die of cardiovascular disease each year, accounting for more than 40 percent of all deaths. In addition, about 58 million Americans live with some form of cardiovascular disease.

9  

Melanoma is a malignant tumor that begins in the cells that produce skin coloring (melanocytes). When melanoma cells spread beyond the initial site to other parts of the body (for example, lymph nodes, liver, lungs) the disease is called metastatic melanoma. The incidence of melanoma in the United States is increasing. It is estimated that in 2001 about 51,000 new cases of melanoma will be diagnosed and about 7,800 deaths will be attributed to the disease.

10  

It should be noted that other cancers (for example, cancers of the lung, bronchus, and pancreas) also have very low 5-year survival rates.

Suggested Citation:"1. Introduction." Institute of Medicine and National Research Council. 2002. Medical Innovation in the Changing Healthcare Marketplace: Conference Summary. Washington, DC: The National Academies Press. doi: 10.17226/10358.
×

A transcript of McClellan’s speech and the subsequent discussion appears in Appendix C. David Lawrence, chief executive officer of Kaiser Permanente, delivered the opening address on the second day of the conference. A transcript of his speech and the subsequent discussion appears in Appendix D.

Suggested Citation:"1. Introduction." Institute of Medicine and National Research Council. 2002. Medical Innovation in the Changing Healthcare Marketplace: Conference Summary. Washington, DC: The National Academies Press. doi: 10.17226/10358.
×
Page 9
Suggested Citation:"1. Introduction." Institute of Medicine and National Research Council. 2002. Medical Innovation in the Changing Healthcare Marketplace: Conference Summary. Washington, DC: The National Academies Press. doi: 10.17226/10358.
×
Page 10
Suggested Citation:"1. Introduction." Institute of Medicine and National Research Council. 2002. Medical Innovation in the Changing Healthcare Marketplace: Conference Summary. Washington, DC: The National Academies Press. doi: 10.17226/10358.
×
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A wave of new health care innovation and growing demand for health care, coupled with uncertain productivity improvements, could severely challenge efforts to control future health care costs. A committee of the National Research Council and the Institute of Medicine organized a conference to examine key health care trends and their impact on medical innovation. The conference addressed the following question: In an environment of renewed concern about rising health care costs, where can public policy stimulate or remove disincentives to the development, adoption and diffusion of high-value innovation in diagnostics, therapeutics, and devices?

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