Examines the experience with hemodialysis for end-stage renal disease. The paper reviews (1) development history of the artificial kidney, (2) the critical turning points as the threshold to utilization was crossed, (3) the boundary between using the artificial kidney for experimental use vs. therapeutic use, and (4) current use due to extending Medicare to patients with chronic kidney failure. Lessons learned: (1) Technology transfer can be facilitated by policymakers affirming the therapeutic benefit of a medical technology before the debate in the medical community is resolved, and by providing reimbursement for services through federally-financed health insurance. (2) Cost control should focus on reimbursement decisions, on forcing clinical consensus on the least-cost form of therapy, and on R&D investment to reduce costs and improve performance. (3) Assessment of the secondary effects of new technology should occur prior to reimbursement decisions. (4) Reimbursement for half-way technol- ogies should require that a concurrent research investment be made on underlying causes and disease mechanisms.