McClellan: Bringing stakeholders together.
In the healthcare sector, few luminaries are as well recognized as Mark B. McClellan, MD, PhD, who is both a former administrator of the Centers for Medicare and Medicaid Services (2004–2006) and a former FDA commissioner (2002–2004). Last July, McClellan began a new chapter in his distinguished career in public service and academic research, when he was named senior fellow and director of the Engelberg Center for Health Care Reform and holder of the Leonard D. Schaeffer Chair in Health Policy Studies at the Brookings Institution ( Washington, DC).
In the following interview with MX editor in chief Steve Halasey, McClellan describes the work of the new Engelberg center, which will support studies of ways to provide practical solutions for the access, quality, and financing challenges facing the U.S. healthcare system. He also discusses some of the key areas where public healthcare policy is undergoing significant changes, as well as the expected impact of recently passed—and recently vetoed—legislation on medtech companies and the broader healthcare community.
Tell me about the Engelberg Center for Health Care Reform. What is its function and what will your role be in getting the center up and running?
It is a new program, and it's a real privilege to be able to run it. The initial funding is about $30 million from individual donors with different kinds of political backgrounds, as well as foundations like the Robert Wood Johnson Foundation.
Our main goal is not to be a think tank, but to be a do tank. I'm trying to use this as an opportunity to bring together two different parts of my past career—both my work in academics and developing health policy ideas and also my work in the political process in actually getting good ideas implemented.
Among the initial projects for the center is some continuing work on the FDA reform law. I wrote a paper earlier this year laying out ideas for an active postmarket surveillance system. Many other people have worked on similar ideas, and together we got them incorporated into the new law. But now we have to implement the new system.
We also recently announced a new collaboration among health plans and Medicare to produce summary information on the quality of healthcare, starting with some nationally endorsed measures of physician quality, and that's going to expand into measures of cost and overall quality of care for different kinds of patients.
Overall, the center's goal is a mixture of trying to bring good ideas together to have an actual impact on the policy process for the healthcare system.
Is the center's goal to help policy get written, to help policy get implemented, or both?
A little of both. One of the things lacking in Washington is the ability to bring people together in a setting where they can trust that their ideas can be openly discussed and their concerns can potentially be addressed. We're trying to serve that role with the center.
We're also serving a role in bringing together different stakeholders who want to improve healthcare in some way. This includes parties who want to find better ways to support medical product innovation using the new FDA critical path authorities, as well as those who want to find better ways to measure quality of care so we can focus on what we all want, which is better care at a lower cost. But once again, it's helpful to have a setting in which we can convene different stakeholders with different perspectives to come together to work on these important issues.
Will the center have a regular calendar of events to bring together those stakeholders?
We will have some events, but not all the events will be public. Many will be background meetings to ensure we're taking into account the views of different parties.
We've already sponsored some events focused on the upcoming elections. The Brookings Institution has a project called Opportunity '08, which is about bringing more-informed debate to the big issues for the 2008 election. As part of that project, we recently sponsored a forum in New Hampshire, moderated by former U.S. Senator Warren Rudman (R–NH), to bring together different perspectives and ideas on healthcare reform for the 2008 election.
People can go to www.brookings.edu/health.aspx to find out about current and upcoming activities at the Engelberg Center for Health Care Reform.
What will your role be at the center? Will you be managing others to accomplish the goals you've outlined, or will your work be focused on running meetings and writing papers—or all of the above?
With our initial endowment, we will have some staff. Some of our early hires come from different parts of the healthcare industry—some come from CMS, some have FDA experience. Others come from groups such as the Medicare Payment Advisory Commission and private sector consulting and advising firms.
A lot of our work is going to be done through collaboration with many different associations and organizations. For example, I cochair the Quality Alliance Steering Committee, which is a collaborative effort across the Hospital Quality Alliance, the Ambulatory Care Quality Alliance (AQA), and other groups that are developing and supporting the implementation of better measures of quality of care. In cases such as this, the center will help bring together collaborations rather than do all of the work itself.
You mentioned the ideal of bringing together political parties as well as varied stakeholders. The manufacturing community tends to be an afterthought whenever the physician community is seen as the primary stakeholder. How do you see the manufacturers and developers of medical technologies being brought into the mix of stakeholders that you're addressing?
I think they have a very important and critical perspective, and they need to play a leadership role now more than ever. The work we're doing on drug safety and postmarket safety of medical products has had a lot of involvement from the leading scientists at some of the drug and biotech manufacturing firms. They have some good ideas about how we can use existing databases and our increasingly rich electronic data to do more routine population surveillance, and they also have a good appreciation of the limitations of these kinds of observational data sets.
On many of the issues that we're working together to address—such as improving safety, developing better evidence on risks and benefits, and improving quality of care—we're seeing a lot of support from product manufacturers and developers.
Now that the Food and Drug Administration Amendments Act of 2007—which encompasses multiple drug safety provisions—has been signed into law, what is your thinking on the various opportunities the legislation presents and the challenges it will create for FDA?
The new law creates a lot of opportunities as well as challenges. Many people who have looked at it view the new regulatory authorities that FDA will have in the postmarket setting as a reason for concern due to the potential for higher regulatory barriers and additional costs in developing and keeping products on the market.
On the other hand, there are some very important elements of the legislation that could lead to a much more efficient process for developing and using new medical treatments. For example, the law includes some strong bipartisan support for the critical path initiative that started in 2004 when I was still at FDA. Since that time, the initiative has made some important progress on developing biomarkers, better predictors of treatment response, and new statistical methods. All of these elements can improve the science of product development and help determine if products are safe and effective quicker and more efficiently.
Now there will be new sources of financial support for the critical path initiative, new legislation to back that effort, and new opportunities to build public-private partnerships to develop and implement some of the key critical path ideas. So that's a very important legislative authority and a very important new program at FDA that will help speed up and improve the product development process through better science.
How do you view the new postmarket authorities that the law gives to FDA?
On the postmarket side, the final version of the legislation places greater emphasis on surveillance than when the legislation was initially conceived. It emphasizes routine, active surveillance, as well as the need to develop better evidence using available population data on risks, benefits, and adverse events with treatments.
The final legislation did not envision using new regulatory authorities, such as restrictions on the marketing and use of products, or placing new regulatory burdens on manufacturers—unless there are key, identifiable risks to drugs that would otherwise keep them from being approved. All the routine surveillance and steps for addressing product safety are going to be handled through active postmarket surveillance, not new regulatory burdens on manufacturers.
If this approach can be implemented effectively, we will have a much more efficient way of learning about risks and benefits of treatments. And because the public and FDA will have confidence that we have a better system in place for monitoring the safety and effectiveness of drugs when they're on the market, that could help avoid some of the barriers and delays to getting new drugs approved. Issues that are appropriate to deal with in the postmarket setting will not have to be dealt with in the premarket setting.
Much of the focus of the new legislation is on drug safety. But many of the techniques, especially on the postmarket surveillance side, are potentially applicable in the medical device arena. Is FDA actively trying to make use of those techniques in the device space and, if so, what kinds of challenges will the agency face in making that adjustment?
The same opportunities for improving the scientific process on the premarket side in terms of demonstrating that drugs are safe and effective can be applied to devices through critical path efforts, especially if there is leadership from industry in working with FDA to identify opportunities for improving the process of product development. Many of the device associations, as well as the National Venture Capital Association, have laid out ideas for doing just that, and now is the time to follow through on those opportunities and ideas.
On the postmarket side, it's inevitable that we are going to see more routine monitoring of the safety and effectiveness of both medical device and drugs. It's inevitable because of improving electronic databases that are now available for increasingly large populations of patients using medical devices. It's inevitable because of the increasing concerns about ensuring that safety problems are addressed in a timely and effective way.
It's also inevitable on the payer side because of the increasing importance of demonstrating value in new devices that reach the market. That's not an FDA issue, it's a payer issue.
In our healthcare system today, more of the evidence being developed about the effectiveness and cost-effectiveness of treatments is being developed outside of the control of manufacturers through population-based approaches. Medicare is now doing coverage with evidence development in some cases—for implantable cardioverter-defibrillators, for example. And many private health plans are trying to learn more about how well products are working and about patients' experiences with them. They're doing this by establishing registries of patient experiences on a more routine basis.
These trends are going to continue, and the best approach for the device industry is to recognize that there is a fundamental trend toward developing better evidence on what works best in individual patients—and then to get out in front of it. This can be done right. It's a big push away from price controls and broad restrictions on access to treatments. After all, if we have better evidence on which devices, combination products, or specific treatments work best in individual patients, we can do a better job determining their true value. The traditional approaches of price controls and broad restrictions on access just aren't going to work at all.
If there's going to be more postmarket surveillance and more studies in the device area, manufacturers would like to feel that there is some sort of payoff, most likely in the form of a clearer path to reimbursement. Do you see that coming together as a result of these changes?
Device manufacturers, more so than drug manufacturers, are already used to the notion of a life cycle for products. With drugs, up until now, it's been a very binary process in which there's a huge amount of effort, cost, and time that goes into getting a drug approved. Then once a drug is on the market, it may often be used in many ways that aren't consistent with the label. There's isn't a very extensive process for learning more and refining how to use a drug product.
In contrast, for devices, there's a much greater expectation for incremental continuing improvements in how the device works and what is known about the best circumstances in which to use it. That trend is going to continue, so there is real potential for faster reimbursement.
We're seeing more products that are combination products or otherwise targeted to particular applications in which they may be more effective. The industry has real concerns about the burden of getting a product approved if it has a narrow market of patients who are going to respond well. But if the industry takes advantage of these new critical path steps—combined with the fact that the agency and public can be more confident in a device that is approved for a targeted indication—we will still have opportunities to learn about a device in other contexts once it is approved. That potentially means a faster pathway to approval, which in turn means a faster pathway to reimbursement.
On the flipside, device manufacturers do need to recognize that they are going to be expected to provide clearer evidence—or it will be provided for them—on the value of their products in a broader range of indications. They will need to provide more-detailed evidence on effectiveness and cost-effectiveness in order to continue to maintain reimbursement. But if manufacturers can get their devices to market faster, and if we do a good job implementing methods for learning about the benefits as well as the cost-effectiveness of treatments once they're on the market, then this can be a good opportunity for getting truly innovative, targeted, personalized therapies to the market more effectively.
It's nice to see progress around issues like developing better evidence and supporting the critical path to get innovative, valuable products to market more quickly. But we're not done yet. I don't think any of us can relax. There are still a lot of questions about how these new approaches are going to be implemented, and about how to ensure we're using the right kind of statistical evidence to generate valid conclusions about effectiveness and cost-effectiveness of treatments, as well as potential safety risks. We still need to follow through on the critical path opportunities. So I'm not relaxing, and I don't think device manufacturers should either.
President Bush recently vetoed the State Children's Health Insurance Program (SCHIP). What is your thinking on that and the challenges it could create for the healthcare system going forward?
This was not unexpected. President Bush made it very clear that he felt the bill was too much of an expansion of government spending and government control of health insurance for kids who are above the traditional low-income eligibility limit for most people in SCHIP.
I remain hopeful that people will find a way to come together on a compromise approach that the administration—or at least enough Republicans in Congress—can support. It is possible to have broad bipartisan legislation on challenging healthcare issues. For example, look at the FDA legislation that just recently passed with very large bipartisan margins.
There are some good ideas for going forward on children's health insurance. A potentially effective compromise would do more to assure that the final legislation would not replace private insurance but would work with private insurance. For example, a compromise would make it easier to use SCHIP support to provide subsidies toward buying employer coverage or toward buying private insurance offered through a state program like in Massachusetts.
You don't have to do expansions of children's health insurance at a higher income level through the same mechanisms that you use at low-income levels. There are ways to bring in more employer financing, and there are ways to bring in more individual and family financing. I think that some of the concerns that the president is raising could be addressed, and we could still see truly bipartisan legislation that reduces the uninsured rate among kids and does so in a way that doesn't crowd out private insurance.
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