Comparative Effectiveness Research (CER)

Comparative effectiveness research (CER) compares two or more treatments on the basis of effectiveness, benefit and risk. Treatments include more than medications. Treatments compared may be devices, tests, procedures, or other intervention designed to improve health. 

The ACA provides funding for CER through the Patient Centered Outcomes Research Institute (PCORI). PCORI studies can be original research or the analysis of existing data. The ACA contains language restricting the use of data regarding cost, specifically use of QALYs. PCORI research cannot use cost per QALY to make decisions on coverage for Federal programs.  Why? Because of the concern that the quality adjustment used to determine a QALY discounts the lives of the old and ill. Thus, CER (comparative effectiveness research)  has not been universally embraced (think death panels). As you can tell, the issues are complicated and it remains unclear how this will be fully resolved. 


FAQ: Comparative Effectiveness Research

Why is comparative effectiveness research needed? What problem is it trying to solve?

What are the practical benefits of comparative effectiveness research?





Patient A has a common and life threatening condition. The current treatment provides a life expectancy of 2 years at a quality level of 0.3.A radical new treatment recently approved by the FDA gives a life expectancy of 2 years and 3 months at a quality level of 0.4. Costs of the current treatment is $5000 per year, while the costs of the new treatment is $25000 per year.



1) Compute the current and new QALYs. What is the difference in QALY between the current and new treatments?



2) What is the incremental cost of the new drug for an added QALY?



3) Should payers pay for the new drug? (Use a standard of $100,000 per QALY as the upper limit for payment.)



4) Suppose that 250,000 people have the condition described above. Given the information provided above for this scenario, what is the cost of the current treatment to the total health care system?



5) Suppose again that 250,000 people have the condition described above. What will be the cost of the new treatment to the total health care system?



Click to close