OP-ED

OP-ED

Pharma and Volume-to-Value: The Big Throwdown

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Joe FlowerThe collision between the “volume-to-value” movement and the pharmaceutical and biotech industries over the next few years will have a powerful impact on them and on the healthcare industry and on us as customers, patients, and payers. 

On the one hand, pharma is perhaps the part of the healthcare industry least exposed to direct price regulation under the Obama reforms. The actual costs of pharmaceuticals have been rising as a percentage of what people spend on healthcare, and are seen as the part they have the least influence on. At the same time, many new drugs for cancer and other life-threatening diseases have come with astonishingly high price tags, often not fully covered by insurance (due to the high deductibles and co-pays of the new plans), and with few ways for regulators or the market to push back on them. The public perceives these huge price tags as threatening people with a Hobson’s choice of bankruptcy or death. In the volatile political atmosphere of the 2016 elections, this leaves the pharmaceutical industry highly exposed to political attack and actual new price regulation.

On the other hand, the pharmaceutical and biotech industries also potentially offer some of the best answers to bringing the cost of healthcare down through the use of personalized medicines, smart medicines, new methods of administration such as implants, as well as the possibilities glimmering at us from recent research of real breakthroughs in such important chronic disease areas as Alzheimers, diabetes, addiction, behavioral medicine, and functional medicine. For the most part, though, these answers remain potential. We will not see them adding to the “value” side of the equation until they become fully integrated into a system that is at risk for the health of its customers and using every trick in the handbook to bring those costs in line.

ONC Report on Health Information Blocking: A Solid Double, But NOT a Home Run

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flying cadeuciiLast Friday ONC (the Office of the National Coordinator for Health IT) released a long-awaited Report On Health Information Blocking. The ONC blog capsulizes the report:

Health information blocking occurs when persons or entities knowingly and unreasonably interfere with the exchange or use of electronic health information. Our report examines the known extent of information blocking, provides criteria for identifying and distinguishing it from other barriers to interoperability, and describes steps the federal government and the private sector can take to deter this conduct.

We were struck with two major reactions to the ONC Info Blocking Report:

  • It’s a solid double: it does a credible job of recognizing that the major problems of interoperability and blocking are not technical or due to a lack of standards, but rather due to business practices and business models. The report also proposes a baseline of potential solutions.
  • It’s not a home run: the report misses the opportunity to describe a comprehensive approach to combat information blocking.

The Facebook Model for Socialized Health Care

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Screen Shot 2015-02-26 at 5.06.17 PMAs government involvement in U.S. health care deepens—through the Affordable Care Act, Meaningful Use, and the continued revisions and expansions of Medicaid and Medicare—the politically electric watchword is “socialism.”

Online, of course, social media is not a latent communist threat, but rather the most popular destination for internet users around the world.

People, whether out of fear for being left behind, or simply tickled by the ease with which they can publicize their lives, have been sharing every element of their public (and very often, their private) lives with ever-increasing zeal. Pictures, videos, by-the-minute commentary and updates, idle musings, blogs—the means by which people broadcast themselves are as numerous and diverse as sites on the web itself.

Even as the public decries government spying programs and panics at the news of the latest massive data-breach, the daily traffic to sites like Facebook and Twitter—especially through mobile devices—not only stays high, but continues to grow. These sites are designed around users volunteering personal information, from work and education information, to preferences in music, movies, politics, and even romantic partners.

So why not health data?

Healthcare’s Reform Pareto Trap

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It is reassuring that in a country which produced HL Mencken, Homer Simpson and Mark Twain, reports of death of satire have been grossly exaggerated.

Recently, the faculty at Harvard were up in arms because their new health plan involves copayments and deductibles. With ninety cents to the dollar covered, the plan is generous by national standards, and would be rated “platinum” in Obamacare’s exchanges. It’s not as if the professors were placed on Medicaid to show solidarity with the poor.

Increased out-of-pocket contribution is the trend post health care reform. That same reform which many Harvard professors supported and some designed. This is why their revolt, an Orwellian political satire, has spread schadenfreude amongst conservatives who are enjoying Gore Vidal’s favorite words in the English Language: “I told you so.”

Overoutrage and the Asymmetric Skepticism of Healthcare Journalists

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flying cadeuciiI like healthcare journalists. Some of my best friends are healthcare journalists. I’d rather read Larry Husten on clinical trials than the constipated editorials in peer review journals. Healthcare journalists are an important force against overdiagnosis, overtreatment, overprescription, overdoctoring and overmedicalization. They’re articulate and skeptical. But they seem to have a blind spot – overoutrage.

Overoutrage is excessive moral outrage. Outrage is excessive anger. Anger is excessive emotion. Emotion is excessive anti-reason. Overoutrage is the mother of all overdoing.

Overoutrage is the healthcare journalist’s kryptonite. These skeptical Rotweillers become credulous poodles when they see overoutrage. Overoutrage axiomatically assumes a moral high ground – for the transgression must have been severe for the outrage to occur. Overoutrage is circular reasoning without an exit. Overoutrage is more powerful than any randomized controlled trial. Much of healthcare policy, indeed civic life, is shaped by it.

A recent event highlights this phenomenon very well. NEJM’s national correspondent, Lisa Rosenbaum, wrote about a surgeon’s determined, and widely publicized, advocacy to ban morcellation, a procedure to treat uterine fibroids. Dr. Hooman Noorchashm’s wife, Amy Reed, underwent morcellation to treat uterine fibroids. Unbeknownst, she had uterine cancer, and the morcellation almost certainly worsened the prognosis by spreading the cancer beyond the uterus. Banning morcellation would be a no-brainer except that morcellation has fewer complications than open surgery for fibroids, and that the chances of undiscovered uterine cancer in a woman with fibroids are exceedingly rare.

Making Sense of Health Care Prices

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Take a look at the chart below. It shows representative prices for a knee replacement for different patients in different settings. The most shocking thing about the chart is that prices for essentially the same procedure are all over the map. Here are some obvious questions:

  1. Why is the price of a knee replacement for a dog — involving the same technology and the same medical skills that are needed for humans — less than 1/6th the price a typical health insurance company pays for human operations? Why is it less than 1/3 of what hospitals tell Medicare their cost of doing the procedure is?
  2. How is a Canadian able to come to the United States and get a knee replacement for less than half of what Americans are paying?
  3. How are Canadians getting knee replacements in the U.S. able to pay only a few thousand dollars more than medical tourists pay in India, Singapore and Thailand — places where the price is supposed to be a fraction of what we typically pay in this country?
  4. Why do fees U.S. employers and insurance companies are paying vary by a factor of three to one, when foreign, and even some U.S., facilities are offering a same-price-for-all package?

It’s amazing how often people cannot see the forest for the trees. Think how many volumes have been written trying (and failing) to explain why our health care costs are so high. Sometimes the answers to complex questions are more easily found by asking the simplest of questions.

The War on Death

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Screen Shot 2016-01-08 at 11.31.53 AMThomas Hobbes described life as pitifully “nasty, brutish, and short.” Thanks to the free market and the state, life is no longer a Hobbesian nightmare. But death has become nasty, brutish, and long.

Surgeon and writer, Atul Gawande, explores the medicalization of ageing and death in Being Mortal. Gawande points to a glaring deficiency in medical education. Taught to save lives and fight death, doctors don’t bow out gracefully and say enough is enough. We’re not taught about dying. We’re taught about not dying.

In our lexicon, life is a constant war against the Grim Reaper. We say inactivity kills; screening saves lives; an intervention reduces mortality by 5 %—an arithmetic impossibility as mortality for our species, barring select prophets, remains 100%. Words have precise meanings. Words also hide precise desires. It’s not that we can’t distinguish between a murderer and colorectal cancer; but by giving cancer moral agency—we wage war on cancer—we imply that death is an anomaly that must be fought.

And we fight. We fight death in the hospices. We fight death in the hospitals. In many parts of the world, more people die in hospitals than in their homes. Some die, attached to a noradrenaline infusion, in the CAT scan—the last pit stop of hope between the intensive care unit (ICU) and the morgue.

Engaging Responsibly In the Health Care Debate

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flying cadeuciiWith no apology offered, I will be venturing into a very subjective realm, namely, a characterization of today’s healthcare dialogue and what, in my opinion, might be an improvement.

I would suggest we have fallen into the trap that was partly enhanced by email and blogs, namely, that we can say outrageous things impolitely and without consequence.  With email we tend to be much blunter and impolite than we would be face to face.  On blogs, we can be positively toxic.  It’s like driving in a car with a tinted windshield that no one can see through.  You are anonymous and therefore can act less responsibly.

Another vignette.  I grew up in a very small upstate New York town where everyone knew everyone else.  You used your car horn to beep “hi” or to warn, and not in anger, ever.  When you waved at someone, it was with all five fingers.  And so on.  I think you get my point.

The healthcare debate always has stoked emotions like almost no other.  It is intensely personal, and the stakes are high.  We’re all involved and engaged.

As I’ve written in the past, I first earned my stripes as a lawyer representing my local Blue Cross plan in rate hearings.  These rate hearings always started with “public comment.”  The comment ranged from pure outrage to controlled anger to discontent coupled with suggestions.  What did we pay the most attention to?  Of course, the latter.

Why We Have so Little Useful Research on ACOs

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flying cadeuciiOur country urgently needs research on the impact of “accountable care organizations” on cost and quality. The ACO has been the establishment’s great hope for health care reform since the concept was invented at the November 9, 2006 meeting of the Medicare Payment Advisory Commission. If ACOs are not going to work, we need to know sooner rather than later.

Although it’s been almost a decade since the ACO concept was invented and six years since Congress endorsed it, we know remarkably little about ACOs. What little reliable research we have was done on CMS’s ACO programs, but even that research is woefully incomplete. As for the ACOs set up by state Medicaid agencies and insurance companies, we know almost nothing.

Yes, I know, we have a few dozen papers telling us where ACOs are starting up, whether physicians or hospitals are “leading” them, and whether their managers tells pollsters they can “monitor care across the continuum” and “have programs in place to reduce hospital admissions,” etc. But we have no idea what ACOs do for patients that non-ACO providers do not do.

There are two reasons for this information vacuum. The first is the definition of the ACO. ACO proponents have never defined the ACO; they have told us only what they hope ACOs will do (they tell us they want ACOs to “hold providers accountable”). The second problem is the cavalier attitude toward evidence with which ACO proponents and analysts approach ACO research. Until the US health policy community addresses these problems, the dearth of useful research on ACOs will continue.

In this comment, I will describe these twin problems – the amorphous, aspiration-based definition of ACO, and the casual attitude toward evidence exhibited by ACO proponents and analysts. In Part II of this series I will illustrate these problems with a report on ACOs financed by the Robert Wood Johnson Foundation. The report, entitled “Accountable Care Organizations: Looking back and moving forward,”http://www.chcs.org/media/ACOs-Looking-Back-and-Moving-Forward.pdf was released last month by the Center for Health Care Strategies. In Part III I will argue that the vague definition of ACOs and the cavalier attitude toward evidence exhibited by ACO proponents is a result of a permissive culture that evolved first within the managed care movement and then spread throughout the American health policy community.

American Medicine’s Toxic Workplace

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Nortin HadlerI’ve attended medical Grand Rounds most weeks for the past 50 years. I consider the exercise one of the grander traditions of my profession. I trace it back to the amphitheater at the University of Montpelier where the 15th C cleric, humanist, author and physician, François Rabelais, first studied and then held forth. By mid-20th C, Grand Rounds had become a focal point of training and continuing medical education in academic medical centers. A patient was presented whose illness was puzzling, informative, and/or daunting. A member of the faculty considered the clinical challenges in a fashion designed to be illuminating. The front rows of the audience were populated by silverback physicians behind whom various levels of novitiate were seated. It was incumbent on the discussant to engage the interest of all in the audience regardless of their degree of specialization and incumbent on the audience to participate in a lively exchange. By lively, I mean disagreements on points of substance were valued. There was always an element of showmanship. The result was a durable transfer of information and an hour that was memorable more often than not.