Category: Uncategorized

Biotech Grant Funding: Are a Few Crumbs Better Than No Crumbs At All?

Nov 18, 2010• 1

By GLENN LAFFEL, MD

After assuming control of the House in the mid-term elections, Republicans vowed to eviscerate the Affordable Care Act, the health reform law signed by the Big O last March. Thank heavens therefore, that the Boehners were too busy congratulating themselves to even notice those federal helicopters dumping $1 billion in cash on some needy biotech companies just as the election results were being tallied.

Yep, it happened. Federal disbursements in the form of grants and tax credits were made last week, as required by a provision in the reform law known as the Qualifying Therapeutic Discovery Project Program. According to the terms of this Program, biotech and life sciences companies with less than 250 employees could apply for federal funds to cover research costs they had incurred in the last 2 years, so long as the research focused on the prevention, diagnosis and treatment of chronic diseases.

The Program amounted to a nod by the Feds to biotech and life sciences, 2 industries that had been battered to near oblivion by the Great Recession of 2008-2010. Biotech and life sciences fared worse than most industries because the core of their business, research and development, consumes enormous capital early-on and there are long delays before these projects hit pay-dirt–if they ever do. Early-stage companies in these industries are therefore high risk investments, the sort VCs steer clear from when the going gets tough.

Unfortunately for the targeted industries, the Program turned out to be a small nod, indeed. It attracted 5,600 applications, far more than expected, and by rule all 4,600 that met congressional requirements had to be funded. With the pool capped at a bil, qualifying projects attracted far fewer dollars than requested.

Saving the Good in Healthcare Reform

Nov 18, 2010• 20

By JANE ORIENT, MD

Some have suggested piecemeal repeal of the most obnoxious features of the Affordable Care Act (ACA). The risk of this approach is comparable to that in cancer surgery: you might not get it all. In 906 pages of arcane statutory language, a lot can be hidden.

I suggest instead that we wipe the slate clean with a total repeal, and then consider reenacting any features that most agree are good. This would be the most efficient method because the list of items is shorter. Much shorter.

The most popular part is probably the elimination of “pre-existings.” You can’t eliminate the uninsurable condition of course, only the insurance company’s ability to deny coverage to people who have it. How would such an isolated law work?

In a free market, coverage for people with pre-existings might well be available, without any law—if insurers could simply charge a premium reflecting their risk, or limit the potential pay-out. The premium, naturally, could be very high. That would be a strong incentive to buy insurance when young and healthy, and resist temptations to spend the premium money on iPods and new cars instead. But for many it is already too late.

The U.S. already has the equivalent of fire insurance for those whose house is burning down. It is called Medicaid. Roll into the emergency room desperately ill, and the hospital will treat you, and probably enroll you in Medicaid—likely after you have spent through any assets and lost your SUV and your home.

To prevent such personal tragedies, how about a law that simply said: “Insurance companies must take all comers, without price discrimination for pre-existing conditions.” This is called “guaranteed issue” and “community rating” (GI/CR).

Hospital Price Dispersion

Nov 18, 2010• 6

By DAVID DRANOVE, PhD

A study by the Center for Studying Health System Change that will be released today shows that hospitals receive different prices for treating the same diseases. Center President Paul Ginsburg says this about the findings:

“The variation in hospital prices found in this study are (sic) inconsistent with highly competitive markets—at least for markets outside of health care,” said HSC President Paul B. Ginsburg, Ph.D.,

Hospital markets may not be highly competitive, but this argument is silly. One might as well say “The variation in automobile prices is (not “are”) inconsistent with highly competitive markets.” But one would be wrong in either case.

Vertical quality differentiation (i.e., some sellers are better than others) generates price dispersion in competitive markets. It is only in the most basic treatment of competition — in the first week of an intro economics course — that vertical differentiation is ignored. Observed price dispersion is not incompatible with competition.Continue reading…

Rating the Raters: Physician Compare

Nov 18, 2010

By NAOMI FREUNDLICH

Let’s say you’ve enrolled in a new health insurance plan and need to find an internist who participates. How do you decide which doctor to choose? My (long deceased) grandmother made her choices by using the following criteria: She looked for a male doctor with a Jewish-sounding last name who graduated from an American medical school—preferably one located in New York City. Nowadays her narrow (and culturally biased) criteria would have excluded some of the most esteemed practitioners around.

If you are like most people, you don’t depend on your grandmother’s advice to find a physician, but rather ask friends, colleagues or other doctors for recommendations. But taking one person’s experience with an internist or surgeon as a signal that he or she is “really good” is still far from the optimal way to choose a practitioner.

Over the years, several commercial websites like HealthGrades and Angie’s List have cropped up that provide such consumer-friendly information as the distance a doctor’s office is from the patient, and whether foreign languages are spoken there. They usually include ratings that reflect consumers’ personal experiences with the practitioner. For people who want to dig deeper, most state medical boards collect data that can be searched to find out where your doctor went to medical school, where he did his residency and what board certifications she has. In some states you can also search to see if the doctor in question has received disciplinary action or been sued for malpractice.

This is a lot of on-line legwork for the average person—a task that even professionals can find difficult. Chip Amoe, assistant director for federal affairs at the American Society of Anesthesiologists told a group recently, “When I tried to go find a primary care physician, I couldn’t. You know, it was very difficult. I had to go on several different Web sites to be able to find [one].”

Cousin Jimmy Syndrome

Nov 17, 2010• 2

By JOHN HALAMKA, MD

I have great respect for my colleagues in the IT industry. It’s a challenging profession that requires a mixture of technical knowledge, people skills, and the emotional stability to deal with customer dissatisfaction when technology fails.

However, there’s a downside to being an IT professional. No matter how much expertise you have or what your reputation may be, many customers will not be able to distinguish between a polished industry expert and a self-promoting IT groupie.

I call this the “Cousin Jimmy Syndrome”.

Here’s how it happens. You join a meeting to discuss a major IT project. You talk about issues such as security, disaster recovery, change management, training, and support.

Then someone says, “Oh yeah, we’ve got ‘Cousin Jimmy’ doing that.” Or Bob who lives in his parents’ basement. Or Carol who knows how to use Excel and serves as the go to technology guru.

Unfortunately, when Jimmy, Bob, or Carol have an opinion, their colleagues trust them over you, since professional IT organizations may appear less nimble, less focused, and less accommodating than dedicated local experts.

Health 2.0 Fall Conference Videos

Nov 17, 2010

By Bianca Grogan

The annual Health 2.0 Fall Conference was held October 7-8 in San Francisco and opened with this presentation from founders Matthew Holt and Indu Subaiya. More videos with keynote speakers, panels and product demonstrations may be found at Health 2.0 TV.

Antibiotic Resistant Bacteria in Hospitals: A Time for Action

Nov 17, 2010• 20

By ARJUN SRINIVASAN. MD and RAMANAN LAXMINARAYAN, PhD

Every few years there are reports of antibiotic resistant microbes that prompt a series of predictions about “the end of antibiotics.” It happened in the 90s with multi-drug resistant tuberculosis and then again earlier this decade with methicillin-resistant Staphylococcus aureus or MRSA. It’s happening again with carbapenem-resistant Enterobacteriaceae or CRE. Predictably, over time these bacteria have become resistant to more and more antibiotics. Almost just as predictably, they could be treated by a category of powerful antibiotics known as carbapenems – until now.

Today, 35 states have reported cases of CRE infection to the Centers for Disease Control and Prevention in Atlanta. And they are dangerous. In a recent study of almost 100 cases, more than a third of the patients died from the infection. The concern over these bacteria is compounded by the fact that there are no new antibiotics to treat them coming anytime soon. Most experts agree that even in the most optimistic scenario it will likely be about 10 years before effective new drugs are developed. A variety of efforts are being debated to speed the development of new antibiotics, but these discussions often overlook one critically important issue. One of the reasons our current antibiotics are losing their effectiveness is because we don’t use them properly. Studies have shown, repeatedly, that up to 50% of antibiotic prescriptions are either unnecessary or inappropriate – a statistic that is disappointingly consistent across both in-patient hospitals and out-patient clinics. Not only does this overuse reduce the effectiveness of our current antibiotics, it threatens the utility of any new antibiotics that come along in the future.

S.M.A.R.T. Objectives: An Essential Step in Strategy Formulation

Nov 17, 2010• 3

By MATT MODLESKI

We are often asked to weigh in on organizational strategy when the proverbial “house is on fire” and a client’s business is experiencing challenges. Our first question to the CEO and his/her staff once we begin our consulting journey is simply, “what is your objective?” Many times there is uncomfortable silence, or clients offer admirable and ambitious objectives that are not quantifiable. Things like “we want to be the high quality provider” or “we want to delight our customers.” In one instance a CFO told us “I’ll worry about the financial objective later, I want to talk strategy!”

Aspirational and inspirational rhetoric is valuable in many contexts. Leadership arouses energy and enthusiasm with aspirational declarations from the podium. And Mission and Vision statements are appropriately fraught with statements that reflect aspirations and commitments to what we want our organization to “do and be.” That’s fine. What’s not fine is when we confuse these things with business performance objectives.

Needless to say, with no clear objective, there can be no clear strategy. When there is no clear S.M.A.R.T. objective, an organization has difficulty deciding how to align activities and resources in ways that will result in achievement of that objective. For example, “to be the Quality Provider” is much less clear than saying “by December 31, 2011, we will be in the top 15% of VHA Hospitals in Employee Satisfaction Scores.”

Health Reform Won’t Fix the Real Problem: Unemployment

Nov 16, 2010• 6

By GEORGE PILLARI

While the effects of persistently high unemployment have surfaced in the shape of reduced consumer spending, shrunken tax rolls and a host of social problems, there is yet another harsh reality lurking in the shadows. Hospitals, already in precarious financial positions, are seeing their most profitable source of revenue fade away. Should the situation continue, even darker days for hospitals will surely be in store.

More than 150 million people in the U.S. rely on employer-sponsored health insurance to pay for the bulk of their medical costs. One of the more credible criticisms of health reform is the potential backlash against the employer pay-or-play provisions in the legislation, which could throw millions of today’s insured off their employer plans and into the streets with the chronically uninsured. Even if this did not occur, or at least not to a market-moving degree, it would be small recompense, literally, for hospitals relative to the boogeyman that no political party can legislate or filibuster in or out of existence at will: unemployment. Hospitals in our country rely on the privately insured and better-paying patients for approximately 35 percent of net revenue. Given the already compressed profit margins in the hospital industry, any deterioration in the supply of its best customers could seriously threaten the financial solvency and operational viability of many hospitals across the country. Health reform will not prevent this from happening. Reform targets the un- and under-insured and provides only a base level of coverage (Medicaid), coverage that traditionally add nothing to hospital margins and in many cases erode them.

HUB’s List

Nov 16, 2010• 2

By HERBERT MATHEWSON, MD

1). CELL PHONES DON’T CAUSE CANCER–

Despite ample scientific evidence to the contrary much buzz continues about cell phone usage causing brain cancer. Why is that ? A recent review in Scientific American magazine points out how hard it is to prove a negative. I am reminded about the story of the English farmer spreading purple dust over his fields last year. When asked why he did that he replied “To keep the lions away”. The questioner pointed out that there had been no lions in England for at least four centuries. “Works pretty well doesn’t it,” was the proud rejoinder.

A $24 million study (2) of 12,000 regular cell phone users, half of whom already had brain cancer, found no correlation between cell phone use and the two most common brain tumors. A recent article in Skeptic magazine stated that the non-correlation was because, as my oldest son the engineer often says to me, “It’s just physics.” X-rays and gamma rays can cause cancer because their radiation energy can disrupt chemical bonds inside cells, about 480 kilojoules per mole (it’s just a physics energy term). A cell phone generates radiation of less than 0.001 kilojoules per mole. Whatever kilojoules per mole are, it is clear that cell phones don’t generate very much of them; no where near enough to disrupt chemical bonds. The article’s author notes that probably the only way to hurt someone’s brain with a cell phone is to throw it at his/her head. I would add that since HPV (a virus) is associated with cervical cancer and is more apt to be present in sexually active women, I guess you could cause cancer with a cell phone by sexting!