THCB

Categories

Month: June 2005

QUALITY/POLICY: P4P get official in Businessweek, no less

• 11

So in a remarkable bit of futurism, only 8 years after Greg Schmid invented the concept at IFTF (well, we end up calling it performance-based reimbursement, but it’s the same thing as P4P), Businessweek has noticed and Pay for Performance has gone mainstream.

I’m still looking for someone to find an earlier citation of an equivalent term or concept–I still can’t believe that we allowed a non-healthcare economist to invent the term!  And with reference to the Gianfranco post from yesterday…. Greg came into work every day for 5 years and always said to me "How come they named the football team you support after the President’s daughter?"

PHARMA/POLICY: More on Plan B and its relationship to the overall chaos at the FDA

A little more about my FDA article from Monday….

Prospect/Nation journalist Ayelish McGarvey, who wrote the article about David Hager, and knows way more about Plan B than I’d ever want to, says that I (and by implication Robert Steeves who’s earlier article on Plan B I lifted for THCB) don’t actually understand what’s really going on with Plan B’s non-approval. She tells the real story in a long comment to my piece over at Ezra’s blog.

Essentially Barr’s first application to make Plan B available OTC was turned down. The delay in approval, over which the three Dem senators are holding up Crawford’s nomination is for a second application in which Barr Labs asked to put Plan B behind the counter for women over 16 years old and by prescription only for those under 16. FDA hasn’t approved drugs in that manner before, and its lawyers won’t sign off. To know more we need to wait till McGarvey’s article comes out (next week), but it’s clear that in her view, Steven Galson, the director of the Center for Drug Evaluation and the surprise signatory to the original non-approval (the one that turned over the 23-4 scientific vote in favor of approval) acted more or less independently from Crawford. It’s certain that he went against the staff scientists advice. This is what it says on the FDA page about Plan B:

12. Dr. Steven Galson signed the letter FDA sent to the sponsor. Does Dr. Galson usually sign such letters? Why did Dr. Galson sign the letter?No, Dr. Galson does not usually sign regulatory action letters. However, his opinion of the adequacy of the data in young adolescents differed from that of the review staff. He believes that additional data are needed and for that reason he made the decision to take final action within the Office of the Center Director.

And the differences between the political leadership of the bureaucracy and the staff are huge. Meanwhile there is a pretty good article which I missed at the time in the NEJM on what happened, and another blog, The CarpetBagger Report, picks up the story from what Jon Cohn wrote in TNR.

On the other hand, I really only wanted to make two points about the FDA.

First, there are fundamentalist loons with an agenda inside FDA (i.e. whoever it was inside FDA who asked Hager to provide a dissenting opinion), or at least those who want to air the fundamentalist loon’s opinions. I can never tell if its the fundamentalist loons using the cynical rightwingers or the other way around, but their views are clearly being heard and acted upon.

Secondly, forgetting Plan B — which in the grand scheme of things is just another story of how screwed up sex education and reproductive health in this country have become — the issue of whether FDA can be trusted on pharma safety overall is still a complete mess. That cannot change unless we get a total change in the current regime at FDA including Crawford, Galson and anyone else favoring either fundamentalist loons or the short term interests of big pharma over full disclosure about drug safety. I know that Ted Kennedy (and by Ayelish’s implication Sens Clinton and Murray too) have given up on trying to fix that, but someone needs to be reminding the American public about it!

And, for the nth time, full disclosure about drug safety may lead to people taking drugs that could be considered dangerous.  Some people might want to take a Cox-2 and trade off pain relief for a higher chance of heart disease.  But the key is that they need to be sure that the FDA is making all the information available — and that’s where it’s fallen down on the job and lost the public’s trust. And in the end it’s better for big pharma to be in a market where the public trusts what the government says about their products.

On another topic, talking of what pharma says about its products, the Washington Legal Foundation, which got DTC ads on TV in the first place, is causing a little more fuss in that arena.

POLICY/INTERNATIONAL: The Weekly Standard on moron support

• 24

In an article called Socialized Medicine on Life Support, there is just yet more rubbish from a libertarian doctor form a libertarian "think-tank" writing in a conservative weekly. For chrisssakes, Canada doesn’t even have "Socialized Medicine" — defined as the physicians providing the care working for the state.  That would be Cuba, Sweden or even the UK.  Canada has single payer….In American terms Medicare is single payer, the VA is socialized medicine…

It’s not even worth refuting the rubbish they write, but just once it would be nice if the sources they quote actually had done some, say, real research.

And as for the hackneyed old arguments; "Canadians flooding the US looking for care". Rubbish. "Opinion polls show Canadians think their health care is in crisis" — not compared to the US (read down to "System Satisfaction"), and "long waits for care everywhere but the US" — again just BS.

But the point is that these guys don’t need to deal with the truth or even fake real research.  Spreading FUD about anything that’s not the US status quo is all that’s needed.

INDUSTRY: Scrushy verdict is in–He walks

• 5

So after about 15 years of deliberation, the biggest fraud in the history of health care is coming to its zenith. The news is that the jury has reached a verdict in Scrushy trial. Now we’ll see if all that showing up at black churches and sponsoring Christian boy bands was worth it….

My guess is that in the Michael Jackson tradition he walks, but in my book the crook who blames his underlings and then claims that God forgives him is the lowest kind.

Check back soon for the verdict….

And of course he walks. Not guilty on all charges. Every CFO and person who works there said that he was fully in charge of orchestrating the whole fraud, but up to 200 local preachers appeared on Scrushy’s evangelistic radio show on Alabama cable and said he was innocent. So who would you trust.  A bunch of admitted crooks or emissaries from God?

The amusing thing is that he’ll now try to get control back of HealthSouth. Listening to Jim Cramer on CNBC has been quite amusing…Cramer is not too impressed with the wisdom of the Alabama jury.

Now he’s live on TV giving all the thanks for God, thanking all the pastors and ministers, and everyone who helped get him off.  On CNBC the squawkbox wag said "How about a foursome at the Alabama golf club–Scrushy, OJ, Robert Blake and Jacko?".  His other good line was "Lucky the charge wasn’t ‘Poor interviewing of CFOs" as 5 out of 5 managed to put one over on him…"

POLICY/QUALITY: The Nursing Shortage — It’s real

• 10

Over at Code: the WebSocket Alwin has a really great article about the nursing shortage called A hard rain is gonna fall. I think he’s right and that after we’ve emptied every third world nation of their meagre nursing supply, we’ll realize that we have do something about it here. And in my view that means training fewer doctors and more nurses instead.

PHARMA/POLICY/POLITICS: The FDA remains in tatters

• 23

It’s time to dip into the murky waters of the FDA once more. This is a classic tale of politics intruding into an agency that should have science as its prime motivator. Here’s the story summarized so far.

The FDA has barely had a full time official commissioner since the start of the Bush Administration. Mark McClellan was officially head for a brief while in 2003, but he barely had time to look embarrassed on 60 Minutes when asked why Canadian drugs weren’t safe enough for Americans before he nipped off to the rather more rarefied atmosphere of CMS — where he’s much better suited.

Meanwhile before, after (and basically during) McClellan’s time at FDA, the acting commissioner has been Lester Crawford. Some cynics have noticed that there are a few clouds over Crawford. He was involved in some pretty close to the wind activities when he was in charge of Food Safety (ironically this weekend, there’s more suspicion about the Administration covering up a second case of Mad Cow).  But more recently there’s been much fuss over both his personal affairs (i.e. was he or wasn’t he abusing his power to forward the career of a female colleague with whom he was having a close relationship) and, much more importantly, about his being behind the non-approval of Barr Labs’ Plan B emergency contraceptive.

Robert Steeves has written convincingly on Why Plan B went down.  Essentially Crawford overruled a scientific committee which voted overwhelmingly that Plan B (an emergency morning-after contraceptive) was safe and effective.  So it won’t go on the market. Of course, any time you hear anything to do with "safety" in reproductive health care in this country, your ears should prick up. There are allegations that information was withheld from the Senate Panel investigating this. Whether that’s true or not, David Hager the physician who apparently has Crawford’s ear and was a one of the few dissenters on the panel, appears to be a certifiable loon. Yup, he attributes all his research skills and influence to God and is not shy about telling the world about it.  However, his ex-wife is not shy about telling the rest of the world about Hager’s at the least inhumane and at most criminal treatment of her — including paying her (at first) and then forcing her into types of sex that many on the Christian right probably think of as against God’s law and should be banned (although they all probably indulge in private…OK that’s my last direct slam on the Fundamentalists in this piece).

At any rate, it’s good to know that the future of contraception in this country is in such stable and rational hands. And overall of course the whole thing is a payback from Crawford to the Christian right for supporting his appointment. 

As a result, three Democrats on the panel are going to hold up Senate confirmation of his nomination even though it got out of committee — even with Ted Kennedy supporting him. (Kennedy says that FDA needs a leader of some kind to remove uncertainty). The real joke is that one of those delaying his vote is an even more extreme member of the Christian right, Sen. Tom Coburn of Oklahoma (ironically like Hager another ObGYN obsessed with sex, although in his case it’s rampant schoolgirl lesbianism) who thinks that the FDA should be printing warning labels on condoms because they aren’t effective enough preventing disease (and of course Coburn probably thinks that people shouldn’t be having sex anyway).

This might all be fun and games in an inside baseball kind of way if the issues at hand weren’t so damn important. Since the Vioxx scandal there is no trust of anything the FDA says about drug safety, and it’s fairly clear that the FDA leadership at least has basically been in PhRMA’s pocket. We’re now even getting whiff of a bigger scandal about the contentious link between mercury and autism. I won’t even pretend to look at the science behind that, but it’s safe to say that the Robert Kennedy article that has reignited this fuss wouldn’t have had nearly so much press if the FDA commanded more respect, and if the allegations that it covered up studies on behalf of the pharma industry — as essentially it did in the cases of Vioxx and Celebrex — weren’t so believable.

The final piece of the puzzle rest with now famed FDA whistleblower David Graham. With maverick Republican Sen. Chuck Grassley in his corner, he is taking aim at the newly appointed FDA safety panel. Essentially, instead of creating an external review board with the power to pull drugs from the market, the FDA has created an internal panel to which insiders like Crawford control all the appointments. FDA needs to be seen to be scientific and neutral, but that’s not happening. For example, the advisory panel that voted to continue sales of Celebrex and narrowly voted to allow Vioxx to return to market was shown to be filled with scientists with drug company ties, and that when they were excluded the tallied votes would have been very different. This may be what big pharma thinks it wants, but it’s not what is good for the country or for that matter for the future of big pharma. We need an FDA that is beyond reproach or politics.

Instead we have a series of government agencies, with the FDA being a prime example, where whistleblowers are needed to maintain standards of honesty and dignity; something our Dear Leader said he was going to bring back to the White House (ha, ha). And the whistleblowers are being treated pretty badly, even if they do have the protection of an influential Senator.  (If you want more look at this article and editorial from PLoS about the treatment of whistleblowers)

Given that there are other Presidential appointments in deep trouble, and that a Supreme Court fight is about to start that will get nasty very quickly, one cynic has suggested to me that Crawford will be confirmed without a vote as a recess appointment. In any event, the politicization of every government agency has now produced a situation where the politicians, the bureaucrats and the industry are conspiring against the public. This is bad for business, bad for health care, and bad for America.

TECH: Conversation with Girish Kumar, eClinicalWorks

• 18

I wrote a brief editorial in THCB and also on FierceHealthcare last week, suggesting that the problem with IT in the US wasn’t so much a lack of interoperability as it was a lack of use of IT in the clinical workspace by physicians in small practices. My editorial was in part inspired by a comment emailed onto me from Girish Kumar, who’s President of eClinicalWorks–an EMR vendor aiming at that market. Given that I’m doing some work on the use of ePrescribing by doctors in that market anyway, I thought I’d imitate MrHISTalk and do a CEO interview to go down a layer or two about how that small practice segment of the market is playing out. So here’s my take on my discussion with Girish.

 

 

eClincial Works is based in Westborough Mass , and it’s a private company with no debt and no investors and no plans to go public — working in a similar philosophy to Meditech just down the road. Currently it has around 150 employees with some $20-25m in software revenues on an annualized basis. They are doubling in size each year with 1500+ customers representing 3300 providers (meaning nurse practitioners and doctors). Their business is focused on the small end of the market, which they define as practices with 1-15 physicians, although they have started going into mid (15- 50) and large (50 +) practices. And a couple of even bigger practices have signed on recently, although that’s not been their prime market.

What about the market in general?

Girish believes that EMR adoption in health care is a long term process — and that realistically we are still 5-7 years away from peak adoption rates and some time after that from total penetration. He was (he says somewhat mis)-quoted last week as suggesting that government help was needed to get that market to take off. He does think that the conversation emanating from Washington is creating a catalyst which is helping physicians move towards automating their practices. But this is a numbers problem. While there are only a few thousand hospitals and big practices, there are over 150,000 small practices. Their EMR adoption is low in percentage terms but quite a few have EMRs which makes a large total number. Girish says that as eClinicalWorks continues to see more and more business every quarter, that tells him that the market is moving forward rather than backwards or sideways. But, and this is the key issue, the numbers of doctors needing to make that move are so large that unless the government puts in place bigger incentives the market won’t go from 30% adoption to 80% without a catalyst any time soon.

Is there a distinct set of players for different practice size?

For practices with 50 + doctors there are a now a more or less dominant set of EMR vendors, such as NextGen, Epic, Allscripts & GE Centricity (Logician). When you go to the below 50 doctor market, it’s coming down to 6-8 companies too, but not the same as the larger ones. For example, Epic doesn’t sell into that market. There are many smaller vendors who used to be able to be much cheaper than the better known companies, but the challenge for those companies is that original price point of $15-20,000 per physician is now falling. So the difference between the small vendor and bigger, better-known players has come down. For example eClincalworks’ EMR is $7500 a seat (you need to add $2500 more for the practice management module).

This is being accompanied by some level of market confidence in the vendors. Girish claims that others are telling him that eClinicalWorks is becoming a brand name for EMR. In addition the vast majority of doctors who buy their EMR product are also picking up the practice management application, and are starting to replace the Medical Managers of the world. As in many other parts of the health care IT arena, the value of the pre-integrated product can exceed the reason for keeping a legacy practice management system, and he expects to see that trend continue. Incidentally, some of his competitors, don’t share that view–Allscripts for instance doesn’t have a practice management module and integrates with those legacy systems. But clearly if physician organizations can recognize a distinct set of vendors who will be around for a while, then it will help the market.

So what should the government do?

In Girish’s view government is recommending the standards for building the highway, (interoperability and RHIOs). There’s no question that you need that for nodes (or in his analogy, cars) to be able to able to connect with each other. But we need to focus on the nodes, and we have to build the on-ramp and off-ramp to the highway. The government needs to incentivize both the infrastructure creation and incentivize the plug-in at the doctor’s office. He’s not critiquing building the highway but we must realize that we need the cars too.

What should that look like at the node level?

The government should come up with a subsidy either via Medicare or a pay for performance package directly related to IT adoption. Then the government should mandate that vendors implement interoperability standards at no additional cost — customers shouldn’t be burdened with the extra costs of interoperability. We need to build an incentive to vendors to do that and that incentive for vendors should be a growing market. In other words, create a market so that the vendors make more money but force them to make interoperability part of the products features. In one example Girish cited a vendor who wanted $60K to integrate inpatient and outpatient information together for single practice. That’s not acceptable to him and the path to interoperability ought to be built into vendors’ standard product roadmaps.

Having said that, there is only a small demand from doctors for seeing the inpatient chart in the outpatient environment, although that varies by specialty. For example, no dermatologist cares, but an ObGyn or cardiology practice might care. The big deal in terms of interoperability is access to lab results. However, overall adoption will be easier if physicians know that the products they buy are interoperable and that they are both able to get information from other systems and able to walk with their data if they don’t like the system they have.

So why should the government subsidize the EMR?

Putting aside the fact that the government subsidizes lots of parts of the health care system already, I pushed him a little on the idea of subsidies. After all if adopting technology gives the physician efficiency (and several vendors show that in their studies) and it’s saving them money, why should there be an incentive from the taxpayer? Girish felt that the improvement in care EMRs would create would save Medicare and the government money in terms or reduced hospital admission, better drug compliance, etc — so in his view it would be an investment. But he was happy enough with a proposal that any subsidy should be budget neutral overall for physicians, but that Medicare or the government would essentially be paying them to adopt the EMR while they were paying them less for other activities in their practice.

While I agree and I think that the P4P movement is pushing this way, I can imagine the AMA might not agree quite so readily! Still, I’m with Girish in believing that the adoption of EMR tools in small practices is the most crucial aspect of IT in health care, and it’s good to hear that there is some activity in that arena. And that at least one vendor is talking a good game about how that market can be grown at benefit to all of us.

POLICY: Why health care costs so much

• 11

This one is the cross-post from Ezra’s blog yesterday.  I was going to do something different last night, but the wind was right and so I went paragliding instead! And it was great! I will have more on the FDA later today or tomorrow

Health Affairs (the essential peer reviewed health policy journal) has an article from the very well respected Center for Studying Health System Change (HSC) which announces that the decrease in the increase of health spending has stalled (here’s the slightly more digestible press release). No kidding, the press release starts off with this line. See if you can get the gobbledygook here:

“The reprieve from faster-growing health care costs stalled in 2004 as costs per privately insured American grew 8.2 percent”

The good news is that nominal GDP growth  (real growth plus inflation) was 5.2% in 2004, so health care costs (the 8.2%) were less than double that. So in the bizzaro world of American health care, it’s still something of a success when health care is expanding only are only a little under double the rate of the rest of the economy or less than three times the inflation rate. That’s why health care takes up 15% of the economy now when it was around 5% in 1970.

But the two key questions are a) do we have to spend so much more? and b) what are we getting for the money?

The short answer to a) is no, we don’t have to spend so much.  Most other countries spend between 6% and 10% of their GDPs on health care, and some, such as Canada and Japan in the 1990s, actually reduced the share of GDP they spent on health care.  The more complex answer to a) depends on what you think we ought to be spending our money on.  Back in the time of Vietnam and the Cold War the US spent nearly 10% of GDP on “defense”.  Now we spend money on frappuchinos and viewing pictures of Paris Hilton on-line. These are all political choices, and it’s clear that Americans view medical care as to some extent a luxury good that they are happy to spend money on. In her book Medicine and Culture the late Lynn Payer described the difference between the British stiff-upper lip, the French consternation about balance in the liver, and the American desire to operate on any patient who’d lie still for a moment, and she ascribed most of the difference in medical practice, and thus costs, to culture. More recently Uwe Reinhardt has shown that it’s not just culture but also prices — we pay our health care workers and supplier more than foreigners do and that’s a big factor in our overall larger costs.

The other factor that allows us to spend so much more is that there is neither a competent market mechanism that stops us spending too much, nor a central budget authority doing so. Market mechanisms work in one of two ways, either on average we just can’t consume more (i.e. pictures of Paris Hilton) or we can’t afford to all consume as much as we might possibly want (i.e. we can’t all afford Prada dog-caddying purses or whatever Paris carries her dog around in). In health care our ability to consume is essentially limitless, especially if we’re sick, and usually some other sucker is paying the tab. So we are dependent either on the producers of care to say “that’s enough” (which is the British stiff upper lip approach which results in what Americans call rationing and Brits call compassionate care for the sick and elderly), or on the sucker that’s paying the tab to cry “Uncle!”. Briefly (and this is a much more complex subject), because of our diffuse system of third party payment, none of the said suckers have either had the ability or the will to really reduce payment. And the producers here have always known that putting up their costs will result in someone ponying up. Even though as the prices go up more people get excluded out of the system on the margins, those who can stay in it will more than make up the financial difference. So costs go up, as we do more things with more technology at a higher price. And because not everyone is in the system, and there’s not one universal pot of money or line-item budget, or no effective consumer pricing mechanism (and there can’t be for reasons that I wont go into here), no one is there to cry “Uncle!”. Of course in other countries that’s usually the job of the other cabinet ministers who say things like, hey if you put all the taxes towards health care there’s nothing left for education, roads, invading Iraq or whatever. When Congress votes on a new healthcare bill no-one seems to care too much about that bottom line, as the Medicare Modernization Act cost fiasco proves. Note that this is not how Walmart governs relations with its suppliers.

The second question is harder to answer. In some ways it’s easy to say that we don’t do as well as other countries on several outcomes measures and that we’re not getting our money’s worth.  On the other hand several of the things that used to kill people are now relatively easily surmountable — at a cost.  And then there’s the paying for comfort issue.  It used to be that if you had real heart trouble, you needed to have your chest cracked and have a full CABG.  No fun.  Now getting a stent put in is a relatively painless procedure that they don’t even put you to sleep for. Does that lower the bar on the decision to do invasive cardiology? Indeed. Does it cost more for the payer per individual? Probably, as in the end many of those stent patients need a by-pass anyway. Does it cost the payers and society more overall? You betcha. And the parking lots outside the cardiologist suites are filled with physicians’ Porsches as are those outside the executive offices at J&J and BSC.

Is that a good or a bad thing?  Complex. In aggregate the cheapest thing is to let the heart (and therefore patient) go when it’s time, but we’re never going to do that. So should we restrict procedures to only those in real trouble, and only give them a CABG?  Fine if you say so, but let me ask you two questions. What do you define as real trouble?  And would you rather have a stent put in while you lie there listening to Lite jazz, or have your chest cracked?

And that uncertainty is what drives our system and drives that cost barometer up.

assetto corsa mods