Improving Clinical Guidelines and Decisions under Uncertainty
This paper discusses how limited ability to assess patient risk of illness and predict treatment response may affect the welfare achieved by adherence to clinical practice guidelines and by decentralized clinical practice. I explain why predictive ability has been limited, calling attention to imperfections in clinical judgment and to questionable methodological practices in the research that supports evidence-based medicine. I discuss recent econometric research that can improve the ability of guideline developers and clinicians to predict patient outcomes. Recognizing that uncertainty will continue to afflict medical decision making, I apply basic decision theory to suggest reasonable decision criteria with well-understood welfare properties.