Cutler, David2009-03-072007Cutler, David. The lifetime costs and benefits of medical technology. 2007. Journal of Health Economics 26, no. 6: 1081-1100.0167-6296http://nrs.harvard.edu/urn-3:HUL.InstRepos:2643640Measuring the lifetime costs and benefits of medical technologies is essential in evaluating technological change and determining the productivity of medical care. Using data on Medicare beneficiaries with a heart attack in the late 1980s and 17 years of follow up data, I evaluate the long-term costs and benefits of revascularization after a heart attack. I account for non-random selection into treatment with instrumental variables; following McClellan, McNeil, and Newhouse, the instrument is the differential distance to a hospital capable of providing revascularization. The results show that revascularization is associated with over 1 year of additional life expectancy, at a cost of about $40,000. Revascularization, or other treatments correlated with it, appears to be highly cost-effective.en-UScostsbenefitsmedical technology10.1016/j.jhealeco.2007.09.003