Managed Care and the Evaluation and Adoption of Emerging Medical Technologies

By Steven Garber; M. Susan Ridgely et al. | Go to book overview

Chapter Two
TECHNOLOGY-ADOPTION DECISIONS BY MCOs:
AN OVERVIEW

This chapter provides a general background, culled from the literature and our interviews, for the discussions that follow. It describes basic issues and activities that can be involved in technologyadoption decisions by MCOs. As will become apparent, decision processes are often much less orderly than might be inferred from this general overview, and the processes that are used vary both across MCOs and within MCOs, depending on the particular technology or context.

For a technology to be eligible for payment or reimbursement by a managed care organization, usually the technology must not be excluded by the language of the health insurance contract between the MCO and payers,1 which generally means that the technology must contribute to provision of one of the broad categories of services specified as being covered (e.g., hospital services, physician office visits, durable medical equipment), must be “medically necessary” under the particular circumstances of the case,2 and must not be “experimental” or “investigational.”3 In addition, many contracts

____________________
1
Sometimes care is provided despite contractual limitations, e.g., for fear of legal action. See, for example, Hall and Anderson (1992), Anderson (1992), Anderson et al. (1993), Ferguson et al. (1993), Havighurst (1995), and Adler (1996).
2
See, for example, Havighurst (1995, pp. 125–132).
3
See, for example, Havighurst (1995, pp. 132–135). Medical devices are generally considered experimental or investigational prior to FDA approval for U.S. marketing, and may be considered experimental or investigational for all or selected uses well after approval.

-7-

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