Month: March 2005

TECHNOLOGY: And you thought drugs got on the market too quickly and easily?

Mar 7, 2005• 4

I’ll be at the HIT West conference later today hopefully with a little live blogging if things go well. But meanwhile two articles over the weekend persuaded me that plus ca change plus c’est la meme chose in the wacky world of American health care.

15 years ago I wrote a thesis on the spread of laproscopic cholestectomy (gall bladder removal), which replaced both the conventional surgical method and a sound wave machines called a lithotripter to blast the gallstone. Lithotripsy didn’t actually work in that the gallstones tended to reform later. Lap choles did work, and were self-evidently better than laparoptomy (surgical dissection and removal). But in the case of a new surgical technique or procedure, there is no clinical trial required before it hits the market. Lap chole was popularized by a Tennessee surgeon called Eddie Jo Rickett. In his heyday in the late 1980s, he was teaching other surgeons how to do it 50 week for a couple of grand a time. He made so much money that (if I recall rightly) he quit surgery and became a country and western singer. Of course everyone had converted over to lap choles without any big clinical trial, just as lots of hospitals had bought million dollar lithotripters who’s main use a couple of years later was as a doorstop. Meanwhile the quick spread of lap choles also produced some real horror stories.

A decade further on not much has changed. Today’s trendiest surgery is bariatric bypass (or stomach shrinking). You might think this is pretty rare but there were over 150,000 done last year in the US including weather man Al Roker. However, just like lap choles and anything else that’s spreading fast, there’s not really any good trial data that shows it’s an effective treatment in the real world. This fascinating and long article in the St Louis Post-Dispatch shows that like lap-chole and laser eye surgery, bariatric surgery has become a cash cow for some hospitals, and a stampede of surgeons learning the technique has massively increased its use. Of course the backlash is starting and patients including former proponents of the surgery are starting to come forward with a litany of complaints, and many professionals and facilities are either getting out of the business or are starting to offer repairs on the shoddy work that’s being done. The article starts with this grim story:

She dropped from 302 pounds to 126 after her gastric bypass surgery in 2001. Since then, she’s become a strong advocate for other patients,
providing encouragement and advice to hundreds who have had weight-loss
operations. She arranges visits to the hospital rooms of people just
undergoing the surgery. From her home in Cincinnati, she runs a support
group called "Midwest Losers." Her work was honored with an award last
October at a national surgery trade show. But she’s paid a price to be thin: Five surgeries in four years for
related problems, including two hernias and three small bowel
obstructions. She was just diagnosed with a crippling vitamin
deficiency.She’s 41 now. She wonders how much more her body can take. "I’m second-guessing everything right now," Pierce said recently. "Is this what I have to look forward to the rest of my life?"

The point is of course that these surgeries spread in an uncontrolled fashion. While there’s been plenty of criticism of the FDA, there just is no equivalent body demanding a clinical trial of surgical procedures, and any government agency that even dares to suggest such a thing needs to be wary of the fate of the AHCPR which fell foul of some Texas back surgeons in the mid 1990s and damn nearly was killed off by the surgeons’ friends in the newly Republican Congress.

The only time that surgery tends to get a clinical trial is if Medicare does one (which is rare) or if it involves a medical device regulated by the FDA. That’s just happened in the case of the drug eluting stents (DES). A new study shows that the DES (Taxus from Boston Scientific and Cypher from J&J’s Cordis unit) both are much more effective than bare metal stents. (Incidentally both stents worked equally well and a new one from Medtronic coming on the market next year did just as well too. In any other industry you might expect a price war, but here don’t hold your breath)!
So at least there’s some good news that the trial proves these things are helpful. But let’s consider two things.

1) Virtually anyone who needed a stent was already getting a DES. Even despite the manufacturing problems both major stents have had and an entire recall of the Taxus stent last year, their use has been growing like crazy and they are the dominant treatment of choice for early stage heart blockages. All this happened well before any clinical trial results came out. So what was the point of the trial? I guess it was like phase IV post market surveillance in the drug world. But if the results had been bad, would it really have stopped Taxus and Cypher in their tracks? I doubt it. Why? See reason number two.

2) Because the trial is comparing DES to a treatment that is known to be pretty useless. The Bare Metal Stents have a high degree of re-occlusion. In other words the arteries they are placed in clog up again anyway. In late 2003 a Stanford study showed that that stents were less cost-effective than traditional by-passes. So the real challenge for the DES is to prove that over time they are more cost-effective than CABGs. Do you expect to see that clinical trial any time soon? Nope, neither do I.

So 15 years on from the lap chole and lithotripsy story, we still don’t have anything like the clinical controls over new types of surgery that the FDA imposes over drugs. And you may have noticed that some grumpy people have been complaining that the clinical trial and surveillance system for drugs is too lax!

POLICY: Medicaid muddles on

Mar 4, 2005

Today’s story about California hospitals suing Medi-cal comes on the heels of a
week of meetings between state governors and the Bush administration about
Medicaid. Medicaid has long been a dog’s breakfast of American health policy
with all types of programs thrown together. It’s a health insurer for the very
poor, it’s a long-term care plan for some of the elderly, it’s a subsidy program
for large inner city hospitals (the DiSH program), and it even pays Medicare
Part B premiums for those "dual eligibles" too poor to afford them. In addition,
in many states the CHIP program for near-poor children is rolled into Medicaid
too. Furthermore, many states use what are now called by HHS secretary Leavitt
"accounting gimmicks" to get more of their program on the Feds’ tab.

The problem is that all these programs tend to be underfunded anyway, and in
a time of state and federal budget squeezes, they come severely under fire.
Taking even another $6 billion per year out of the program, as the
Administration proposes, feels to the states like getting blood out of an
already over-squeezed stone–even if the GAO says its only $5bn a year. A rational system would somehow fold Medicaid into
some type of universal insurance system. But we are not getting that any time
soon, and right now many poor Americans and their safety net providers rely on
Medicaid to keep them from toppling into the abyss. So expect the politics of
desperation to play out in that sector over the next few months.

This is not going to be a fun time to be either a Medicaid recipient, or worse someone who would like to be. And that includes a lot of young and poor children. It’s also not going to be fun to be a safety-net provider who relies on Medicaid as one of their better payers.

PBMs: Express Scripts net surges

Mar 3, 2005

From the "why does this keep happening?" file, it looks like the PBM sector is continuing to remain very profitable. Today it’s the turn of Express Scripts to announce that its earnings were up 13 percent. It also revised up expectations for next year. The stock rallied about 7%.

THCB continues to be baffled at how the PBMs and other health plans are getting away with this. After all this is a group that has had no success in saving its clients’ money on drugs in the last 10 years, and a recent survey showed that fully one-quarter of employers believe that PBMs are responsible for increasing their drug costs. But with the Medicare drug benefit giving the PBMs increased visibility and access to a whole new market of customers, it would be a brave short seller to look for the top to the stock here.

TECHNOLOGY: Nine Tech Trends and one big barrier

Mar 2, 2005

I am wrestling with a much longer piece on the EMR than I was hoping it would be, but silly me I’ve got myself mired in CHINs, ePrescribing and RHIO. And given that I’m going to see Duran Duran tonight I will doubtless be further into "Rio" before I’m done, and hopefully she’ll still be dancing in the sand…

So meanwhile go look at these pieces. In the first Healthcare Informatics features Nine Tech Trends that it thinks are hot in health care. I’m not certain that the list is quite correct, but it’s well worth a scan and I do like this one quote from a hospital CIO in New Jersey:

"I really think we’re just beginning to see digitization," Sharrott
says. "I think if we’re talking 10 or 20 years out, the amount of
integrated digitization is going to be amazing."

Meanwhile the ever wonderful Jane Sarasohn Kahn has her wrap up from HIMSS over at iHealthbeat. She pretty much confronts the inter-operability issue head on.

Finally, Brailer is very concerned that adoption will be done in silos,
creating more IT fragmentation and an even greater barrier to
interoperability. This is a very real possibility because in the United
States we’ve made an art out of building a fragmented health system
based on outmoded regulations, unchecked competition and other
externalities. The great value for Americans and the national economy
in achieving interoperable health information networks will be what
Brailer calls "the ubiquitous sharing of patient information."

The
leap of faith here is that nationally interoperable health information
networks will be developed as regional programs adopt sharing through
open standards and convergent business practices and policies. As
Brailer characterized, interoperability will occur "not from the top
down, but inside-out."

Developing interoperable health
information systems will require the collaboration of the broad range
of stakeholders in communities to give up their proprietary data
concerns and ante up cash and a collective spirit.

PHARMA: DTC WARS, Epsiode IV (with more apologies to George Lucas)

Mar 1, 2005• 3

Apologies in advance, THCB goes back into movie mode once again to discuss the somewhat arcane subject of DTC Rx marketing…..

Yoder A long time ago in a universe far, far away a bright young survey researcher enrolled with some fellow Jedi warriors to make the universe safe and easier for the pharmaco guild to better target the right citizens of the galaxy with the right message about their wondrous potions. The Jedi warriors wanted to build a great database that would create a Beacon to tell the noble pharmaco guildsmen which of the citizens of the galaxy were responding to their clarion calls, and how they ought to change the sound and direction of those calls. Their goal was for the the noble pharmaco guild to spread health and prosperity while increasing the general well-being and respecting the sanctity of the galaxians’ information as mandated by the Emperor’s HIPAA army — while cutting down on the spending on those pesky airwave borne messages that ineffectively carried the narrow message far wider than it needed to go and surrounded every spare moment of the great Seers’ nightly network prophecy.

Well, as is common in these stories, this episode opens with our band of Jedi heroes distributed to the four corners of the galaxy. Their mighty Death StarData Base was never properly completed before a cold wind crashing down from the NASDAQ quadrant blew fear and loathing into the heart of the great vulture capital birds, and they ceased flying around the universe distributing their nourishing droppings which had kept the Jedis warm and safe while they built their great i-Beacon. Oh, how the poor Jedis suffered, as did many of their fellow warriors in the freedom loving Dotcomposition and many were forced into exile for lengthy periods, marooned on the tropical beaches of the land with the Faraway Thais.

Indeed while the Jedis endured their exile, the pharmaco guild kept sending out its messages, a little less in some years but again with greater volume in 2003 and 2004, mostly because of the need to let the galaxy celebrex the nexium generation of wonderous potions. But the pharma guild still had to rely on the whispers of Oracles and Monitors to figure out if their message was getting across.

Indeed the Monitor which drew its wisdom from a mere 6,000 voices empaneled across the known galaxy continued to tell the noble pharmaco guild that indeed their clarion calls to the undifferentiated hordes known as the health care consumer were "increasingly believable and likeable". Now the brave pharmaco guild members really believed that sending their messages of health and happiness helped their mission. And there was some reason to believe that it was true. Indeed the green eyeshaders at the Imperial Senate reported that:

DTC advertising appears to increase prescription drug spending and utilization. Drugs that are promoted directly to consumers often are among the best-selling drugs, and sales for DTC-advertised drugs have increased faster than sales for drugs that are not heavily advertised to consumers. Most of the spending increase for heavily advertised drugs is the result of increased utilization, not price increases. For example, between 1999 and 2000, the number of prescriptions dispensed for the most heavily advertised drugs rose 25 percent, but increased only 4 percent for drugs that were not heavily advertised. Over the same period,prices rose 6 percent for the most heavily advertised drugs and 9 percent for the others. The concentration of DTC spending on a small number of drugs for chronic diseases that are likely to have high sales anyway and the simultaneous promotion of these drugs to physicians may contribute to increased utilization and thereby increase sales of DTC-advertised drugs.

But the pharmaco guildsmen still didn’t know nearly as much about their messages as their friends in the consumer packaged goods guild. Where were their ACNeilsen data on the citizens of the galaxy’s consumption habits? They couldn’t track whether their citizens saw their messages and bought their drugs because they couldn’t link their viewing, activity and usage data together safely? And where was the data broken down by planet and type of citizen? In marked contrast, they did know much about the potion-prescribing habits of the Shamans who were overwhelmed by visits from their drone detail armies because they were told the answers by the all-knowing Xponents of the IMS.

In the good times perhaps these details didn’t matter very much. For example a group of wise men in an ivory tower quoted by the Oracles at Brandweek (Ed: don’t be fooled by the anti-pharma group hosting it, this is a balanced article) found out this :

A study by Harvard University’s schools of medicine and public health, published in 2003, found that for every 10% increase in DTC
advertising, drug sales rose 1%. That does not sound too impressive until it is translated into hard
cash: Every additional dollar spent on DTC yielded an average of $4.20 in sales.

So perhaps there was no need for the pharmaco guildsmen to be able to link the real uses of their potions in real people to the messages they were sending out; for a wise man once said "if you cast enough mud against a wall some will stick up there".

But then came a pestilence upon the pharmaco guilds. All at once the flood of wondrous potions coming down their great pipeline from the wells on the planet Arandee began to slow. In woe the guildsmen looked at each other and searched hard in the neighboring planets of Bio and Tek. But to no avail, and their creditors and bankers from the iBanker guild over on the Street of The Impassable Barrier, took askance at their new found woes. Many pharmaco guildsmen who’s life had seemed as happy as walk through a field full of daisies in one of the allergy messages found that their bankers, schering a fall in their profits, had mercked down their stock price.
And worse was to come.

Some of the wondrous potions were perhaps not quite as wondrous as the pharmaco guildsmen had first said, and and some heretics declared that the messages of the guild were not to be trusted, and even had hidden the truth from the good citizens of the galaxy in their messages. Still other heretics released satirical songs suggesting that anyone believing the messages was a dumb as a mark at a carnival, and some of the guilds members took fright and began to dismantle some of their detail drones that visited and policed the shamans in every nook of every planet.

Then even the guildsmen’s friends who lived in the Imperial Bureaucracy in the friendly city of Effdeeay suggested that the guildsmen might need to quieten their messages and even told the guildsmen to stop them all together for the mysteriously troubling potions known as Cokstoos. And the great bastions of information across the galaxy began to suggest that the overbearing amount of the messages was counterproductive and might even be beginning to have a wearying effect on the citizens of the galaxy. There were even calls for the messages that surrounded the all knowing Seers delivering their nightly prophecies to be banned altogether, and for the power of persuasion to be used only on the shamans and not to be taken direct to their supplicants. Even the noted wise MackMan who was a good friend of the pharmaco guildsmen suggested that the time had come to change their tune and to understand that they couldn’t escape all culpability with a quickly read disclaimer.

But the lone Jedi survey researcher looked on from his lonely exile in a planet on the far left coast of the galaxy, and his mind wandered. He wondered if the pharmaco guild, too, might not have been happier if they had been able to better target their messaging. Perhaps they didn’t need to surround the seers with messages about their potions as they prophesied, and perhaps if they hadn’t the prophecies would have not been so nasty about the pharmaco guildsmen quite as often. Perhaps they didn’t need to persuade the not-really sick that they had another dread aliment. Perhaps instead they needed a way to connect just with the citizens of the galaxy who could truly use their help. Perhaps they could benefit from knowing what those citizens who had problems that they could help were doing in their everyday lives, and how they could target them more effectively, and hand over less money to the Seers’ employers in the process. The lone Jedi wondered wistfully if the Force might ever return to the DeathStar Data Base, and if it would one day be able to help the right citizens hear the right message from the guildsmen, without pissing off the rest of the universe. Would the pharmaco guildsmen change their tune, or would they
stubbornly continue on to ultimate humiliation in the next great battle
to come?

The lone Jedi sighed. The Force was weak. He saw no way to recreate the DeathStar Data Base by himself. But he began to realize that his fellow warriors had been on the cusp of a great thing before they were scattered to the four corners of the galaxy. And he wondered if an alternative universe of anonymity protected one-to-one marketing wouldn’t just have been better for the pharmaco guild, the citizens and the galaxy. Perhaps the prophecy of old would come true and a new Jedi would be found to lead the warriors, but the lone Jedi didn’t see much hope.