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Report calls for incentives to spur high-value medical technologies

April 22, 2014

A report released today by RAND Corp. proposes policy options to reduce health care spending by creating incentives for the development and use of high-value medical technologies. Among other policies, the report calls for more creativity in funding basic science; offering prizes for drug or device inventions that satisfy pre-specified performance criteria; purchasing patents on products that could decrease spending but are financially unattractive to inventors and investors; establishing a public-interest investment fund for products that reduce spending; and expediting Food and Drug Administration reviews and approvals for medical products that are expected to substantially reduce spending. Among other options, the report proposes that Medicare payment and coverage policies encourage technologies that decrease spending, and calls for more and timelier assessments of the cost effectiveness of drugs, devices and procedures.