Health Reform Impacts Research Funding

by U.S. Medicine

September 22, 2010

BETHESDA, MD—While most of the Healthcare and Education Reconciliation Act‚ the 2,000 page health care reform bill signed into law by President Obama in March‚ is centered on ensuring all Americans have access to health insurance, there are a number of implications for clinicians, federal and private, and for clinical researchers. As its provisions begin going into effect over the next several years, the bill could have a profound impact on hospitals, physicians, the health care workforce in general, and on the research focus of federal agencies.

Atul Grover, MD, PhD, is chief advocacy officer for the Association of American Medical Colleges, an organization that has been on the ground floor of the health reform debates since Congress took up the challenge.

“When we started this public policy discussion, we talked a lot then about paying for value and how to promote quality,” Grover explained to an auditorium of NIH researchers gathered on the NIH campuses last month. “How do we move from a payment system [where we pay for care and not quality]? We haven’t really figured out how to do that in this bill. What we have is a lot of opportunities to do that on the provider side‚Äîa lot of opportunities for us to look at ending that cost curve over the next
10 years. But there’s very little in there to give us the answers.”

Comparative Effectiveness Research

Some of those opportunities to improve quality and cost effectiveness will occur on the research side of the equation. “A great investment was made to NIH with the Recovery Act. Our institutions, schools, and teaching hospitals were very much benefited by that as well,” Grover noted. “Now what we’re trying to think about, and what I think policy makers are pushing us to think about is‚Äîas scientists, as physicians, as researchers‚Äîhow do we fit in what happens at the bench, move it to the bedside, and actually improve the health of populations? How do we thread all this together and show some meaning-ful results to the American people?”

To this end, the health reform law includes a provision for the creation of the Patient-Centered Outcomes Research Institute, a non-profit, non-governmental body to set priorities and determine funding for comparative effectiveness research. The goal of PCORI is not to address cost of care, but to determine what works best. “It will be an evidence synthesis that really considers different populations and different diseases and tries to get more information to clinicians as they go about doing their daily work,” Grover explained.

There are two intertwined motivations for the law’s provision. Giving the right treatment at the right time will obviously be better for the patient, and will result in cost-savings in the long run compared to giving less effective treatments. The research sponsored by PCORI will focus on both complex and binary issues, which are represented by questions like: Which works better, drug A or drug B? Giving an example of complex issues that PCORI will cover, Grover explained “It will look at questions such as what kind of processes make sense in trying to reduce hemoglobin A1C. Is it better to use nutritionists, clinical social workers, or physicians to do the education?”

This institute will intersect in a many ways with other government agencies, especially NIH and AHRQ. These agencies will have leadership on PCORI’s board and its methodology committee. PCORI will contract with AHRQ and NIH on a preferential basis if the research that they think is most important to focus on is actually within those agency’s charters.

The hope is that there will be a joint effort to develop clinical registries and to pull together health outcomes data by linking PCORI into these data-robust agencies, creating an interoperable data network for analysis.

Because of worries that patients could be denied coverage or hospitals denied reimbursement due to comparative effectiveness findings, limits have been placed on PCORI when it comes to cost and coverage. PCORI cannot mandate coverage or reimbursement for public or private payers. It also cannot prevent HHS from covering routine costs of clinical care for individuals in a clinical trial.

PCORI will be funded with $10 million in FY 2010 and $15 million in FY 2011 before ramping up to an estimated $150 million a year from 2012 to 2019.

The Cures Acceleration Network

Another research initiative created by the health reform act is the Cures Acceleration Network at NIH. The network’s purpose is to accelerate development of drugs and devices, and to facilitate FDA review for “high need cures.” These are defined as drugs, biological products, or devices that are priorities to diagnose, mitigate, prevent, or treat harm from any disease or condition, and for which the incentives of the commercial market are unlikely to result in their adequate or timely development.

CAN is being established within the Office of the Director of NIH, which has been allocated $500 million for the network for FY 2010.

The network was one of the pet projects of Sen Arlen Specter, D-PA, who proposed the legislation, which eventually ended up as part of the health reform act, over a year ago. Specter argued that a mechanism was needed to bridge the “valley of death” that exists between the research done to discover a treatment and getting that treatment approved for clinical use. “We must do this on the scale and with the focus of the way we sent astronauts to the moon,” Specter said when he introduced CAN. “And we need to start now. Americans battling cancer, autism, Alzheimer’s, Parkinson’s, diabetes, and so many other dreaded diseases have not a minute to waste.”

While the goal of the network is legitimate, the reason it made it into the final bill might have more to do with public relations than science, Grover suggested. “The goal of that is something the public and Congress can really identify with. Who doesn’t like cures, and who doesn’t like faster cures? Hopefully we’ll find a way to leverage that investment.”

Certainly patients will have easier access to clinical trials following the health reform act, which could be good news for patients and for researchers. “One of the provisions in the health care reform bill is that by 2014 health insurers cannot deny access to any approved clinical trial,” Grover stated.

However, which trials are “approved” and by whom is still up in the air. While the law has been signed, and timelines been set in place for the enacting of its provisions, the regulations guiding how agencies follow that law have yet to be written.

“What is ‚Äòapproved’? What does that mean? That’s got to get written into regulations,” Grover declared. “All of this stuff has to have regulations written so we know how to translate it.”

Funding Outlook for 2011

As far as the nation’s FY 2011 research budget is concerned, stakeholders should be conservative but optimistic, Grover suggested. The House and Senate budget proposals for research in HHS, VA, the military, and other science agencies currently averages around a 2.5% increase. “At least it’s increasing at the rate of inflation,” Grover noted. “I think that’s a good sign that the House and the
Senate have recognized the need to continue that investment.”

Currently the HHS appropriations proposals are set at $176 billion in the House bill and $169.6 billion in the Senate. None of the science funding for agencies under HHS has been decreased in those proposals. “Given the bleak outlook of the nation’s finances, I think this represents a significant investment in research for the nation.”

However, it is unlikely that legislators will touch these bills until January, after the November elections have decided the make up of the new Congress.

One thing that both Congress and researchers are concerned about is what NIH will do when the $10.4 billion awarded to the agency in the Recovery Act runs out around 2011 and 2012.

In a Senate report on the FY 2011 HHS appropriations bill, legislators admitted that this could be disastrous if not prepared for. “The committee recognizes that NIH faces an imposing ‚Äòfunding cliff’ following the historic increase,” the report states. “Negotiating the softest possible landing is critical to maintaining the scientific momentum gained over the past two years and ensuring that young investigators in particular can find a bright future in the field of biomedical research.”

The report goes on to state that it hopes the 3.2% increase proposed for NIH in the appropriations bill will represent the first of several years of growth that will be “if not spectacular, at least steady and predictable.”

“That might be the best we can hope for in this economic environment,” Grover admitted.

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