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EDUCATION & DEBATE Effectiveness and efficiency under competition: the Cochrane test Donald W Light A major purpose of introducing economic competition into health services in Great Britain, Holland,

3 Competition can increase efficiency if quality is increased through better information, better training, and better planning and coordination. The effects tend to be small; the efficiency and cost-effectiveness of a health service system depends on all of these features of market forces, not just on how they interact.4 Competition can also increase efficiency and reduce costs by eliminating inefficient or counterproductive methods. That is especially true in a health care system, where people pay for services because they have medical needs (or conditions) and doctors and hospitals are in a business to improve the health of the people who use their services. These methods include: prescribing the most expensive drugs, spending the most money (in administrative fees), or getting the most people treated. As noted earlier, some of the best health care interventions are cost-saving; that is, their effects are small, but their economic cost is large.5 Cost-saving is not always the most efficient way to deliver care. When cost-saving interventions reduce health care efficiency, patients become worse off because they have less time to receive needed services. Health outcomes are only partly determined by health system features such as services and technology; the other part of the answer involves quality of care. In a major study of the United States, for example, researchers found that cost-saving measures were highly correlated with poor health outcomes, but quality of care and other factors were more important than cost in the diagnosis and treatment of health conditions.6 The impact of new technology on quality of care and on patients' overall health is important, as well. New medical technologies can improve the quality of care in several ways. One is that people may have more confidence in a particular service than they did before. A third way involves better technology at the point of care. Because medical devices tend to make diagnoses more quickly than they could before, the process of obtaining a service for a specific medical condition may be quicker. Another new medical technology called computed tomography (CT) scans enables providers to detect certain diseases earlier than they could before, such as in the hospital before an initial treatment for a serious illness. CT scans can also reveal abnormalities in organs and arteries that have not been seen on X-rays (such as gallbladder surgery, which is generally associated with a need for a gallbladderotomy after it has been seen on X-rays).7 Another is the use of video-conferencing to collaborate with a health professional when people have an unexpected problem with their health.

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