Access the full text.
Sign up today, get DeepDyve free for 14 days.
D. Acemoglu, Joshua Linn (2003)
Market Size in Innovation: Theory and Evidence from the Pharmaceutical IndustryMIT Economics Department Working Paper Series
D. Grabowski, D. Lakdawalla, D. Goldman, Michael Eber, Larry Liu, T. Abdelgawad, A. Kuznik, M. Chernew, T. Philipson (2012)
The large social value resulting from use of statins warrants steps to improve adherence and broaden treatment.Health affairs, 31 10
P. Michaud, D. Goldman, D. Lakdawalla, A. Gailey, Yuhui Zheng (2011)
Differences in health between Americans and Western Europeans: Effects on longevity and public finance.Social science & medicine, 73 2
S. Ramsey, D. Blough, A. Kirchhoff, Karma Kreizenbeck, C. Fedorenko, K. Snell, P. Newcomb, W. Hollingworth, Karen Overstreet (2013)
Washington State cancer patients found to be at greater risk for bankruptcy than people without a cancer diagnosis.Health affairs, 32 6
D. Goldman, D. Lakdawalla, T. Philipson, Wesley Yin (2010)
Valuing health technologies at NICE: recommendations for improved incorporation of treatment value in HTA.Health economics, 19 10
A. Basu (2015)
Financing cures in the United StatesExpert Review of Pharmacoeconomics & Outcomes Research, 15
D. Goldman, D. Cutler, J. Rowe, P. Michaud, J. Sullivan, D. Peneva, S. Olshansky (2013)
Substantial health and economic returns from delayed aging may warrant a new focus for medical research.Health affairs, 32 10
Yang Lu, J. Penrod, N. Sood, S. Woodby, T. Philipson (2012)
Dynamic cost-effectiveness of oncology drugs.The American journal of managed care, 18 11 Suppl
Carmelo Giaccotto, R. Santerre, J. Vernon (2005)
Drug Prices and Research and Development Investment Behavior in the Pharmaceutical Industry*The Journal of Law and Economics, 48
Tal Gross, Matthew Notowidigdo (2011)
Health Insurance and the Consumer Bankruptcy Decision: Evidence from Expansions of MedicaidJournal of Public Economics, 95
E. Nord, J. Richardson, A. Street, H. Kuhse, P. Singer (1995)
Maximizing health benefits vs egalitarianism: an Australian survey of health issues.Social science & medicine, 41 10
Michael Hay, David Thomas, J. Craighead, Celia Economides, Jesse Rosenthal (2014)
Clinical development success rates for investigational drugsNature Biotechnology, 32
D. Goldman, P. Michaud, D. Lakdawalla, Yuhui Zheng, A. Gailey, Igor Vaynman (2010)
THE FISCAL CONSEQUENCES OF TRENDS IN POPULATION HEALTHNational Tax Journal, 63
L. Garrison, D. Veenstra (2009)
The economic value of innovative treatments over the product life cycle: the case of targeted trastuzumab therapy for breast cancer.Value in health : the journal of the International Society for Pharmacoeconomics and Outcomes Research, 12 8
D. Goldman, T. Juday, M. Linthicum, L. Rosenblatt, D. Seekins (2014)
The prospect of a generation free of HIV may be within reach if the right policy decisions are made.Health affairs, 33 3
J. Romley, Y. Sanchez, J. Penrod, D. Goldman (2012)
Survey results show that adults are willing to pay higher insurance premiums for generous coverage of specialty drugs.Health affairs, 31 4
S. Seabury, Dana Goldman, J. Maclean, John Penrod, Darius Lakdawalla (2012)
Patients value metastatic cancer therapy more highly than is typically shown through traditional estimates.Health affairs, 31 4
J. Carlson, S. Sullivan, L. Garrison, P. Neumann, D. Veenstra (2010)
Linking payment to health outcomes: a taxonomy and examination of performance-based reimbursement schemes between healthcare payers and manufacturers.Health policy, 96 3
D. Lakdawalla, J. Shafrin, Claudio Lucarelli, S. Nicholson, Z. Khan, T. Philipson (2015)
Quality-adjusted cost of care: a meaningful way to measure growth in innovation cost versus the value of health gains.Health affairs, 34 4
A. Weiss, A. Elixhauser, R. Andrews (2014)
Characteristics of Operating Room Procedures in U.S. Hospitals, 2011
Abstract Medical innovation has generated significant gains in health over the past decades, but these advances have been accompanied by rapid growth in healthcare spending. Faced with a growing number of high-cost but high-impact innovations, some have argued to constrain prices for new therapies – especially through global caps on pharmaceutical spending and limits on prices for individual drugs. We show that applying this threshold to past innovations would have limited access to many highly valuable drugs such as statins and anti-retrovirals. We also argue that budget caps violate several important principles of health policy. First, budget caps treat healthcare spending as a consumption good, like going to a movie or buying a meal. However, healthcare spending should be viewed as an investment, whose benefits accrue over many years – much like spending on education. Second, budgetary cost is a poor indicator of value, thereby distorting coverage decisions. Third, affordability arguments often use a short-term horizon, thereby missing that long-term health is society’s ultimate goal. Fourth, assessments of benefit should incorporate not just the immediate clinical benefit to patients, but also long-term health improvements, cost savings, and increased productivity. Fifth, global budget caps arbitrarily anchor spending on the status quo, thereby setting too stringent a threshold for socially-desirable innovation. In sum, a solitary focus on short-term costs can be detrimental to population health in the long-run. When medical treatment decisions are properly viewed as investments, budget caps are not the answer; rather, we need to find mechanisms to encourage spending decisions based on long-term value. Only then can we generate health returns to societal investments, while also encouraging the new research and development necessary to extend the gains of recent decades.
The Economists' Voice – de Gruyter
Published: Dec 1, 2016
Read and print from thousands of top scholarly journals.
Already have an account? Log in
Bookmark this article. You can see your Bookmarks on your DeepDyve Library.
To save an article, log in first, or sign up for a DeepDyve account if you don’t already have one.
Copy and paste the desired citation format or use the link below to download a file formatted for EndNote
Access the full text.
Sign up today, get DeepDyve free for 14 days.
All DeepDyve websites use cookies to improve your online experience. They were placed on your computer when you launched this website. You can change your cookie settings through your browser.