Tuesday, December 11, 2018
Blog Page 1033

INDUSTRY: Forrester’s predictions for the year ahead


If you click on Forrester Research’s  FirstLook Archive you’ll see their predictions for next year and some other interesting stuff. They think this will be the year of the EMR (or at least the start of its mainstream appearance) and of the elderly getting wired to their providers. Knowing something about how to make lousy predictions myself, I wouldn’t put too much stock in this "big for next year" stuff. But at least they’ve lost the rhetoric about Why Doctors Hate The Net, which remains the research report in health care with the lowest ever "research validity to press column inches" ratio.

HEALTH PLANS/POLICY: Health insurance for individuals is a big mess, and HSAs won’t help, probably.


Right.  A little housekeeping. I’ve been under the cosh the last week or so, and you’ll see some evidence of the massive project I’m working on showing up in TCHB over the coming weeks. I can’t tell you exactly what it is but suffice it to say that it concerns looking into the inefficiencies of our "health care system" and, whatever viewpoint you come from, they are legion.

My various contributors in the Crestor/A-Z/Pfizer/Lipitor conversation are all alive and well. I’ll be getting back to that later, but apparently the Industry Veteran agrees with me about Chomsky but thinks that the Lancet /Pfizer relationship is too blatant to be as compromised as the Anonymous Cardiologist has suggested. I’m glad that some of you are enjoying this spontaneous series, and I’m sure that it’s continuing at least to confirm the complexity of the pharma marketing world. And it is complex.

But as Monty Python says: Now for something completely different. If you didn’t know this already, let me confirm it for you–the small group and individual insurance market is in a mess. I know this because as a solo operation I have to shop there. Because of a prior surgery, even though the same affected area is excluded from my first 6 months of coverage as a pre-excluding condition, for a $2,000 deductible and $4,000 max out of pocket, my insurance company wanted to put my rates up 350% over what they first quoted when I tried to buy the policy (when they didnt kno about the surgery). Instead I bought a temporary insurance plan at 30% of the cost (ironically enough from another division of the same company).  But those plans don’t cover people with systemic chronic illnesses, who are SOL.  Even in California I have friends who have been intermittently unemployed long enough that they have outlived COBRA and, due to various ailments, cannot get individual coverage at less than $1,000 a month for an individual. This is a broken market, and now the data is coming in to prove it.

The folks at the Center for Studying Health System Change (HSC) have a new report out in Inquiry on Health and the Cost of Nongroup Insurance. To quote the pres realease:

    They found that people with deteriorating health are about half as likely to purchase individual, nongroup insurance as people in excellent health. Furthermore, when adjusting nongroup premiums for selection bias based on health status, individuals in fair or poor health face premiums that are 43% to 50% higher than people with no health problems. "The results suggest that medical underwriting may be more extensive and, in fact, may shut some people out of the nongroup insurance market," the authors say.

No shit Sherlock. In fact some analysis last year in Health Affairs from market-apologist Mark Pauly at Wharton, who’s always felt that health care spending grows as it should and damn the consequences, suggested that the small group market worked relatively well–for 80% of the participants.  But "its performance for the remaining 20 percent of low-income or high-risk persons is controversial." To me that’s like saying 80% of Iraqis are happy the US army’s there but 20% are trying to blow our boys’ heads off. Whatever Pauly and the Bush administration may want to say in both cases, it’s with the 20% that we’ve got a problem.

Funnily enough, while market failure continues in the small group market, for the last few years and especially the last year, what’s left of the managed care industry has been making out like bandits. Overall earnings rose 81% and earnings from Medicare went up over 118%.  How do health plans make their money?  It’s the same joke I used to tell in 1995–the easy part of managing care is not insuring sick people.  Oh, and it helps if you are at the top of the underwriting cycle.  Sadly for plans we are now somewhere near the top.  At least HSC also reports that, in the first half of 2003, health costs only went up 8.3%  as opposed to 10% for the last half of 2002. Given that health plans the last few years have mostly been "cost-plus" actors, there’s slightly less "cost" to "plus" onto. Although a poll of health plans earlier this month showed that while costs were slowing, it instead showed that increases were still well into the double digits.

Finally if you really believe (as Robert Prather does–we’ve respectfully butted heads over this issue in DB’s Comments a while back) that the solution for all this mess is to give everyone a HSA and have them spend their own dollars at the doctors, you might consider this. There’s a small problem, as David Durenbeger, former Republican Senator and wise old man of health care, shows–no one in health care has a clue what the actual transaction price for any service should be.

PHARMA: NEJM reports that combo therapy works for BPH


The NEJM reports a 5 year study that shows that a combo therapy of Finasteride (Proscar) and Doxazosin works better than either alone on improving the lives of men with an enlarged prostate. Here’s the news from the AP if you don’t like boring academic abstracts.

PHARMA: The Industry Veteran takes on Crestor and the Anonymous Cardiologist


I didn’t think that the Industry Veteran would just ignore the comments from the Anonymous Cardiologist or the Anonymous Academic, and he doesn’t disappoint.  Unlike the Academic, at least he’s convinced that the Cardiologist is a doctor not a Crestor bag-carrier! I don’t know about you but I’m learning tons from these exchanges! So here’s the Veteran’s question:

    Was the anonymous cardiologist on the grassy knoll?

    The efforts of AstraZeneca’s partisans to free up your time with conspiracy theories and riffs on Pfizer must be gratifying, but their notes appear questionable.  In particular, your cardiologist may know how to complain about declining capitation rates for performing angiograms, but his knowledge of the pharmaceutical industry’s business side remains poor.

    In particular, his perceptions relative to stain marketing are typical of office-based physicians.  Practitioners are not so much biased or uninformed about tactical details as they are arrogant grunts trying to pontificate on the war’s trends from foxholes.  Specifically, he adduces Pfizer’s panic over Crestor from the fact that they are cross-training their Women’s Healthcare sales group on Lipitor.

    In the first place, it is often standard practice in the industry for companies to cross-train virtually all their reps on the big PCP products.  For example, specialty reps from Merck who only detail neurologists on the migraine drug Maxalt also carry Vioxx in their bags.  In the case of Pfizer reps carrying Lipitor to OB/GYNs, it remains a fact that a large segment of women who do not suffer some chronic condition receive their primary medical care from their gynecologists.  As Pfizer will next year launch Caduet, a fixed-dose combination of Lipitor and Norvasc, it is entirely appropriate that they would try to recapture some of $4 billion they will lose to generic amlodipine with an all-hands-on-deck sales effort for the new product.  Former CEO Bill Steere was an especially strong advocate of cross-training; when products such as their antibiotic Trovan hit the crapper, it allowed Pfizer to redeploy the reps they had hired for that launch into other areas.  If one is to impute panic, I hear from sources far more reliable than the umbrella man or three tramps in the railroad yard that Dave Brennan and Tony Zook (Note: respectively President & Senior VP, AstraZeneca in the United States) are running out of toilet paper in the executive bathroom due to Crestor’s slow start.

    Your cardiologist’s second error consists of his effort to suggest Pfizer’s panic is leading them to make underhanded payoffs as a result of Crestor’s greater potency at reducing LDL.  Pfizer has known Crestor’s clinical profile for several years and they adopted a well conceived marketng strategy to defend against it.  Two years ago Karen Katen (Note: Kate is Exec VP, & President of the Pfizer Global Pharmaceuticals) responded to the superstatin tagline that AZ was trying to pin on Crestor with the reply, "Superstatin or superfluous statin?"  Pfizer’s idea, then as now, was that for all but the more refractory patients, Lipitor produces good LDL reduction with a demonstrated safety record.  If some self-styled lipidologist needs a Hail Mary pill to use on a familial homozygous patient before going to plasma aphoresis, then he can try Crestor until the Zocor-Zetia or the Lipitor-torcetrapib combinations appear on the market.

    Your cardiologist’s main contention — that Pfizer paid the Lancet’s editors for their rant on Crestor — is really where he emulates Arlen Spector and propounds a magic bullet theory.  While conclusive proof of this would neither shock or surprise me, I tend to be highly skeptical of your man’s allegation for four reasons.

    Pfizer has lawyers crawling all over it from the Neurontin whistleblower suit that the Department of Justice joined.  Any e-mail or note hinting at this sort of payoff to the Lancet could easily come up as a by-product of discovery and would seriously jeopardize the entire Lipitor franchise.  The downside risk far outweighs even the worst consequences of the Neurontin suit that involve disgorgement of all profits from off-label Neurontin sales.

    My second reason for doubting a Lancet payoff is based on the fact that since the Warner-Lambert takeover, Pfizer has been a fairly disorganized company.  The two organizations were not well integrated and this problem was further exacerbated by the Pharmacia acquisition.  Unless there was a rogue contingent there operating entirely beyond control, I doubt Pfizer could exercise the coordination required for such a black bag job.

    My third reason for skepticism comes from experience with the Lancet editors.  They constitute some of Big Pharma’s fiercest critics.  If Pfizer had approached them with a bag of cash, it would have become the lead story for every news outlet around the world.

    Last but not least, the Lipitor people knew that a payoff was unnecessary.  When Arnold Relman comes out and says that Crestor is a me-too drug and Sidney Wolfe predicts it will prove worse than Baycol, Pfizer couldn’t buy such PR for any amount of money.

    Your academic contributor stands on much firmer ground when she notes Pfizer’s impending loss of big product sales to generics.  This does not, however, substantiate any implication that Pfizer is going ballistic over Crestor.  McKinnell and his people have in place some well articulated strategies (fixed-dose combinations, co-development deals, marketing structure, others) that seek to cope with this.  I have my doubts that they’ll be able to carry it off without their sales and stock price going into a trough similar to Merck’s current one, but we’ll have to see.  Deducing current panic and payoffs from this possible scenario is too farfetched.

    Alas, while I don’t care for your cardiologist’s style of thinking or his blithe ignorance of the industry, I do come down beside him in predicting that Crestor will eventually sell $2.5 billion a year as a result of hypolipidemic market growth and patent loss for Zocor and Pravachol.

I’ll step in to referee this soon, but let it be known that I’m with Oliver Stone and believe that there was more than one shooter in Dallas in 1963. And I’m somewhat with Noam Chomsky when he says that the Media "manufactures consent" based on knowing which side its bread is buttered, and he wouldn’t be quite as comfortable as some with the chinese wall between The Lancet‘s editorial board and its advertising business manager.

PHARMA: More on Pfizer from another new source.


So we’ve had an industry veteran, a cardiologist and now the Anonymous Academic makes his (or her) way onto the THCB platform to talk about, what else, statins. I barely have to write or think about this subject any more! (My limited comments are in the text in plain text not italics):

    The really important upcoming development in the statin market is the fact that both Pravachol and Zocor are losing patent protection in the U.S. within the next 2 years. Once that happens, it will be interesting to see what happens to sales of Lipitor and Crestor.  My guess is that a lot of people will switch to the generics.

    I think both companies (Pfizer and A-Z) have a very tough road ahead, especially Pfizer. It’s remarkable that they have been able to turn Celebrex into a $3 billion drug given that it is no better than naproxen or ibuprofen in preventing GI bleeding. (see this post from yesterday) It is even more remarkable that they have been able to turn Norvasc into a $4 billion drug even though it is no better that generic diuretics that cost a few cents per pill. However, all of Pfizer’s blockbuster products (which together account for more than 80 percent of PFE’s pharmaceutical sales) are going to face a lot of new competition in the next few years:

    — Dr. Reddy’s Norvasc knockoff, AmVaz, is expected to come to market in 2004;
    — Celebrex and Bextra will face increased competition from Novartis’s Prexige and Merck’s Arcoxia in 2004-05;
    — Zoloft’s U.S. patent will expire in 2005;
    — Generic versions of Neurontin are on their way very shortly in the U.S.;
    — Viagra is facing increased competition from Cialis and Levitra;
    — Zithromax’s patent will expire in 2005.
    — Zyrtec will face competition in the U.S. market from generic Allegra in 1Q 2004. It already faces competition from OTC Claritin; and
    — Diflucan loses U.S. patent protection in 1Q 2004.

    Pfizer will be OK for the next year or two, but after that it will be virtually impossible to maintain double-digit sales growth, as it did throughout the 1990s. In fact, I think they will be lucky to have any growth. Their only hope is a bailout in the form of a new government program called "Medicare prescription drug benefit."

Well our Anonymous Academic is a little snide about that Medicare program, which I don’t think gives the pharmas so much a big new market as protects their back from price controls in the medium term.  But the information about Pfizer is pretty interesting.  It’s not of course just Pfizer among big pharma which is in some trouble. Merck has its own patent problems and as Derek Lowe reports at In the Pipeline, it also seems to be having problems with its pipeline too. But Pfizer’s performance in dealing with all these patent and competitively related pressures–particularly in the statin market–is key in determining if the pharma company as "marketing machine" that we saw in the 1990s has a long term future. Given, though, the success it’s had so far persuading both doctors and patients to do what’s good for Pfizer (and often good for patients too, let’s not forget), don’t write this company off quite yet.

QUALITY/PHARMA: Getting patients to take the right meds is not easy


This post is tangentially related to the back and forth I’m having with DB’s Medical Rants about evidence-based medicine. I owe DB a follow up to his post in which I will (hopefully) explain that capturing information about medical care and using it to improve said care is possible and will become more widespread. However, that post has to wait a day or so.  In the meantime there are some interesting reports out that impact on how drugs get used and why practicing the best evidence-based medicine is so difficult (but not impossible!). This was, if you remember, my earlier notion before I got forced into defending the concept of EBM–a defense I will take up again very soon!

First, there’s been a new study out from Express Scripts the PBM which last month put out a study showing that patients were being prescribed Cox-2 inhibitors like Celebrex, even though they should have made do with NSAIDS or ibuprofen. In their latest study the same team at Express Scripts looked at the combined use of Cox-2 Inhibitors with PPIs (like Prilosec). The theory is that Cox-2 inhibitors are better for the GI tract than NSAIDs, so that people getting Cox-2’s should be using fewer PPIs than those getting simple NSAIDs. In fact the study found:

    . . . .many COX-2 prescribing physicians actually continued co-prescribing gastroprotective drugs like proton pump inhibitors or H(2) receptor antagonists …..gastroprotective drug use was actually higher for COX-2 patients than for those taking a traditional NSAID – by a margin of 20% vs. 18%.

And that’s not quite all, another Express Scripts study from the team lead by Cox, too (sorry, but I had to get that in somewhere!), found that the use of PPIs to reduce death by ulcers was not in the least cost-effective.

    In a September Journal of Managed Care Pharmacy article they reported that economic models used to compare ulcer treatments overstated the cost-effectiveness of more expensive treatments. They looked at treatments that combined antibiotics with either a generic bismuth drug or a more expensive branded proton pump inhibitor (PPI). The more economical bismuth-based treatment was actually the most cost-effective.

Forbes, a magazine which spends much of its time promoting the pharma industry, actually got so interested in this that they ran an article saying that it costs $150,000 To Prevent An Ulcer Death. Why is this happening?  Well physicians prescribe based in part on detailing and patient demand driven by DTC and Internet advertising–to quote a recent survey-based study on the impact of the patient-physician relationship in the Internet age

    Physicians appear to acquiesce to clinically-inappropriate requests generated by information from the Internet, either for fear of damaging the physician-patient relationship or because of the negative effect on time efficiency of not doing so.

So in this half of the equation we’ve got doctors prescribing drugs they shouldn’t really be prescribing for a variety of reasons that don’t have much to do with following the best evidence-based medicine.  Meanwhile on the other side of the relationship there’s a new set of numbers out from Harris and BCG showing that, as we always knew, non-compliance in pharmaceutical regimens is rife.  And it’s rife for a variety of reasons.  Why didn’t patients take the pill the doctor prescribed?

    20 percent of patients who forgo medications said they do so because they perceive a drug’s side effects to be undesirable or debilitating, 17 percent because they find the medicines too costly, and 14 percent because they don’t think they need the drug. This last group of patients view themselves, not their doctors, as the best ultimate judges of what medications they should take and when. Also among those actively not complying with doctors’ orders are the 10 percent of patients who said they find it difficult to get the written prescription to the pharmacy or to get the filled prescription home.

BCG’s spin on this is that it’s the patients’ fault. But why would you take a drug if you couldn’t afford it or if it made you sick, and why would you trust your doctor over yourself? So there’s a combination of factors here that require education, communication and financial support for patients as well as doctors.

So my conclusion is that as there’s still lots of work to do in figuring out how to do a seemingly simple thing like getting patients to take their pills.  And there’s an equal amount of work in getting doctors to prescribe them the right pills. That’s if we can decide what the right pill is for the right patient, which as is common knowledge, we can’t.

Damn, I just realized that I forgot to take my one new and daily med yesterday!

PHARMA: Yet more views on Crestor v Lipitor v The Lancet


Ooh, this is getting fun.  I have a new mole on the Astra-Zeneca, Crestor, Lancet, Lipitor et al issue that I’ve blogged about here and here.  The story so far is that AZ’s Crestor is selling more slowly that some observers expected, and The Lancet has suggested that its safety profile was such that it was not sufficiently researched to be on the market. But there’s still more going on here, as The Anonymous Cardiologist writes:
(Note: links and the odd clarification to keep the flow are from me)

    AZ isn’t fluffing that they were expecting slow uptake, Tom McKillop said 4 months ago in the Economist that in other markets it was after 20 weeks that Crestor sales took off, and he was expecting the same in the US. Reps are giving me enough samples so that I don’t have to write any statin right now, I can sample most people through February. Lipitor is loading in the stock bottles, I can get all I want, if I just pressure them a little by saying, "I can put them on Crestor for free." I received the 30 day stock bottles and then a large amount of one week samples, around 60 weeks, and I’ll get more, when I utilize them.

    Here’s the news though. If you have the number 1 drug in the world (Lipitor), why do you run scared at the launch of "dangerous" competitor? I don’t know, ask Pfizer.  They are taking an entire Female Healthcare team and training them on Lipitor this week. Why do they need them, they are #1 and Crestor is killing people? The truth is in the pudding, Pfizer is worried. AZ has a study called Stellar, the authors are the same MD’s that led the Lipitor CURVES study (used at their launch) and the comparitor’s are the same, except for one thing, statistical power. Lipitor compared itself vs. all the competitors, enrolling only 500 pts total. Crestor enrolled 2,400 pts in its comparison to other statins.

    Crestor reps just received copies of Stellar and I got one last week. I’ve already read it in the AJC but most Dr’s haven’t heard of it. Basically, it says 10 mg of Crestor is ABOUT the same in efficacy as 40 mg of Lipitor. 40 mg of Lipitor is $125.00, 10 mg of Crestor is $80.00. That is what caught my eye. Obviously, it caught Pfizer’s eye too and they decided they needed more people selling against Crestor. The data is not all in yet, we still need to see some usage but my partners are now starting to give all their statin failures to Crestor and that is a lot of patients. The 20% of the market is probably realistic considering Zocor and Pravachol are going generic in the next 18 months. There will be ADR reports of Rhabdo with Crestor, just as there are with Lipitor, Zocor and a few with Pravachol. It’s a crap shoot in the Pharma Industry, who would of thought that Iressa would have been approved after all of the deaths in the trials? Or that the FDA would allow Bendectin back on the market? Or, that Premarin, the #1 prescribed drug in the world would be found to cause cancer in post-menepausal women?

Then The Anonymous Cardiologist raises an issue that I’d missed and it appears everyone else in the blogging world did too.  The Lancet‘s motives are called into question. He writes

    As to The Lancet, what credible physician could find that to be an honest analysis? First of all, the Lancet broke all FDA rules last month when they sent most of the physicians in the US a free copy of the Lipitor study Supplement, whether they had a subscription or not. Who paid for it, Pfizer? (maker of Lipitor). Second, the editor is upset that AZ published an article about how greater lipid lowering could equate in to a greater reduction in events. Finally, Pfizer is obviously trying to protect their #1 franchise with this negative publicity towards Crestor. Don’t put it past Pfizer to do anything negative these days. Pfizer’s package insert is probably the least clean of all the statins, including albumiuria, different blood plasma levels of the drug for men, women and the elderly and as to the time of day the drug is taken. This is not going to go away when you consider how much money is involved.

This is one to watch with interest, especially in a month or two when all those samples are used up and we’ll see who really goes on what drug in the ongoing statin wars. In any event the Anonymouse Cardiologist is right that this "is not going away" considering that Pfizer is defending an $8bn product and A-Z needs Crestor to become a $3bn one.  For context, and so that you realize what’s at stake here I’ve complied a quick list of are some huge companies you may have heard of that have lower revenues than just Lipitor, and of course their margins are nothing like as good!

    PNC Financial Svcs. Group $7.6bn
    PPG Industries $7.7bn
    Unysis $7.5Bn
    Aramark $6.7bn
    Mellon Financial Corp. $6.0bn
    Comcast $6.2
    Air Products & Chemicals $5bn
    Starbucks $4bn
    Bethlehem Steel $3.9bn

PHARMA: Lucky old MedImmune…


A company called Aviron developed FluMist, a nasally-delivered live flu vaccine. My friend (and now top VC) Vera Kallmeyer was the CFO during Aviron’s early stage and she rather cleverly did a deal that sold rights to FluMist in Korea for about enough cash to get Aviron public in (I think) 1996. In yet another tale of appalling stock trading on my part and "defensive medicine" on hers, she told me that buying their stock was kind of risky (what, a small-tech biotech company years away from phase III risky?). So I didn’t buy it at $5.  When Medimmune bought them a few years later they paid 10 times that!  However, because of FluMist’s higher price and the change in third party reimbursement, it hasn’t been selling that well.  That is, not doing too well until the current awful flu season as the NY Times reports that with flu shots dwindling, nasal spray vaccine surges. I of course have avoided FluMist again (this time the product not the stock) and have had pretty bad flu twice already this season!

POLICY: Inciting trouble! RangelMD, Steffi and flying off the handle!


Every so often I run into someone, usually a doctor or someone else in healthcare who should know better, who just loses control when faced with a proposal they don’t like about health reform, and it’s usually got the words "single payer" and "Canada" involved in close proximity.  The always entertaining Chris RangelMD had such a moment last week, and unleashed a load of bile on Steffi Woolhandler following her interview with the NYTimes. Chris’ piece was filled with so many inaccuracies and crass misunderstandings about health care in the US (including in his native Texas), taxes in Europe, rationing, etc, etc, etc, that it required a response almost equally bilesome. As that type of thing is not the kind of cool analysis I try to provide at TCHB, I sneakily hid my response in Alwin’s entry about Chris’ piece at his code: theWebSocket blog I’m hoping that I’ll stir Chris into action over there too, and maybe get some other lefties like Ross at the Bloviator or single-payer advocate like Graham at Gross Anatomy to get stuck in too.  Then Sydney at Medpundit might get involved and the bar-room brawl really might get going into the silly season.  Graham incidentally found the the link to the article on rationing in Texas that I mention in my comment over at Alwin’s blog.

Meanwhile at THCB I’ll be trying to continue the highbrow discussion I’m having with DB’s Medical Rants about health care quality.  Of course if I mention the word malpractice that highbrow reserve could all fly out the window . . . . .

Finally and OT for this blog but as both Medpundit and RangelMD lead with it I’ll make an exception, ask yourself the following question: If you had access to at least $750,000 in cash, a false passport and a huge price on your head, wouldn’t you have shaved off the mustache, lost the beret, snuck over the border and been on the first plane to the south of France like this guy and this other guy did it?

POLICY: Private health in the UK muddies the American waters.


I commented in response to a post in DB ‘s Medical Rants about a piece written by the libertarians at the Adam Smith Institute about private health care in the UK. (Don’t worry–they’re nice gentle British libertarians with no guns!). I too got an email requesting a look, so here goes. Their piece seems to be pretty accurate and I had the following comments that are already over at DB’s. So quoting myself:

    There’s a little cheating going on here. Most of what the author is talking about is what’s called long term care in the US. That is funded by a mix of public (Medicaid) and private (mostly cash) sources here, but provided almost entirely by private sector facilities (including for-profit ones). That’s similar to the UK other than the money comes more from the state. In the UK, private provision of standard health services is used mostly as a safety valve so that middle and upper income people can get around the queue for NHS surgery. That’s been around forever, as allowing specialists to see private patients was part of the deal cut in 1945 by which they agreed to support the introduction of the NHS. NHS surgeons in specialties like orthopedics or gynecology can (quite legally) double or triple their incomes doing private work on the side.

    But in the US context this is all misleading. Not even the most radical single-payer advocate believes that the government should provide all health care, they just think that it should pay for it. What this post ignores is that the every country apart from the US provides some kind of universal system of payment for care, usually delivered in a mixed public/private system. In virtually all of those countries you can "trade-up" with your own money to get better amenities or jump the queue in the public system.

As I wrote directly to Alex Singleton at the Adam Smith Institute, the cheating I’m referring to is at the American end–what they from their UK perspective think of as "private" is private sector provision of services that are often paid for by the government. The government here pays for over 50% of care in its role as insurer to seniors, the poor, the military, veterans and its employees.  So what they think is surprising in the UK is exactly what’s happening here in the US in most of the things that they write about in that post (such as government funding for a significant chunk of private long term care via Medicaid). 

Americans tend to be told by the more mendacious among us that universal health insurance (which of necessity requires some kind of government regulation of the insurance system) equals government-based provision of care.  This argument is made with frequent reference to "useless" American government agencies with low social status (like the California DMV) and rather less mention of the pretty effective ones with higher social status (like the US Marines or the NYFD). In fact the UK is pretty unusual even in Europe in having so much government provision of care facilities and services in the acute setting (I think only the Swedish have more), but government provision of care is by no means unknown in the US–once you add up the VA system, county hospitals, and the DOD there’s a big chunk of government provision going on here too. However, overall who owns care facilities or who provides care is mostly irrelevant.  What is important is the financing situation that determines what care is provided to whom.  In most of the UK’s NHS and in Canada there’s a group/community-based decision made on who gets what care in which area (e.g. we’ve got money to do 50 hip replacements this year and we’ll do the 50 neediest).  In the US that decision is almost totally dependent on the type and level of insurance that is attached to the individual patient, so in my hip example you may get 70 done but 30 of them may be medically "unnecessary" and 15 of the neediest may not get done as the patient couldn’t afford them.  (Ignore for the moment that there are other factors at work too such as race and education impacting access to care in every system). So my overall contention with the Adam Smith Institute’s piece is that they should be focusing on how private insurance markets work in health care rather than looking at who owns what beds.

What’s rather more interesting is that Smith himself back in 1776 thought a great deal about what constituted a competitive free market–although current American conservatives have totally forgotten what little they ever knew about that. The great Northwestern professor Edward FX Hughes gives a talk based on Smith’s principles of perfect competition and how they struggle to work in health care. American health care (not to mention defense, agriculture, energy and several other industries) is in fact predominantly full of the mercantilist behavior and government-protected and subsidized oligopolies that Smith was trying to undermine in his modest treatise called The Wealth of Nations.