Category: Uncategorized

Pharma vs. Devices – FDA, Supreme Court and Liability Whiplash

Mar 18, 2009• 16

By TOBIAS GILK

Whiplash. I don’t know what else to call it when the US Supreme Court does a near 180° reversal on a decision from just a year ago on medical product liability. Consider the following…

On February 20th, 2008, the US Supreme Court ruled in favor of Medtronic in the case Riegel v. Medtronic. The case involved a cardiac catheter, which ruptured during surgery. Medtronic asserted (and the Court agreed) that, because the company had received premarket FDA approval for the device, the company was immune from suit in state courts. The prevailing argument was, in essence, that the rigor of the federal review and approval process trumped the individual’s right to seek judgment using the state courts.

Many supported the notion of keeping federally-regulated medical devices above the reach of state courts, but at the same time questioned whether the FDA was really capable of the safety rigor that the Court attributed to it.

A Sticky Solution to a Sticky Problem

Mar 16, 2009• 23

By ALISTAIR ROCK

“Don’t pull the knot tight,” the philosopher Ludwig Wittgenstein once warned, “before being sure you have got hold of the right end.” Those who hope to sort out the tangle of health care spending would do well to heed his advice.

Clearly, there’s been no lack of solutions put forward since the Clintons first put health care atop the national agenda more than a decade ago. But with health care spending still rising at twice the rate of inflation, few have made any real and lasting impact.

Employers (who still pay the lion’s share of health insurance premiums here in the U.S.) know, of course, that keeping employees from getting sick in the first place—and minimizing the severity and duration of their illness when they do—is the first step in reducing this unwelcome “growth sector” of our economy. They understand, for the most part, that healthier employees equal not only lower healthcare costs but reduced absenteeism and greater productivity for the economy as a whole.

Op-Ed: Pathway for FOBs Should Balance Need for Competition and Need for Innovation

Mar 14, 2009• 5

By JAMES BIANCO MD

President Obama's first budget calls for the creation of a regulatory pathway for the creation of follow-on, or biosmiliar, biologics. This is obviously now the most high-profile call yet to move forward with a system that will provide the benefit of biotech drugs to patients who need them the most.

The biotech industry has done an outstanding effort in the last 10 years producing some of the most high-tech but also the most expensive drugs on the market. Some biotech medicines cost hundreds of thousands of dollars each year. Many of these products face no competition, because there is no legal way for a generic version of the product to get on the market. Individual patients as well as the healthcare system generally simply cannot absorb these continually rising costs.

To date, the debate over follow-on biologics has been mostly political posturing between the trade groups that represent the generic drug industry and the pioneering companies. The generic industry wants biotech companies to have only three to five years of market protection after bringing a new drug to market. The industry counters it needs up to 14 years of exclusivity to recapture its investment costs, which can reach over $1 billion for a single product.

Another Look: The Wal-Mart and E-ClinicalWorks Deal

Mar 13, 2009• 14

By David E. Williams

The New York Times reported this week (Wal-Mart Plans to Market Digital Health Records System) that
the company’s Sam’s Club division will bundle eClinicalWorks
electronic medical record software, Dell computers, installation,
maintenance and training to offer to small physician practices. Pricing
is about $25,000 for the first physician in an office, and $10,000 for
each subsequent physician. Annual maintenance and support costs will be
about $4,000 to $6,500 (though it doesn’t say whether that’s per
physician or per practice).

Wal-Mart says its package deal of hardware, software,
installation, maintenance and training will make the technology more
accessible and affordable, undercutting rival health information
technology suppliers by as much as half…

Dell will be responsible for installation of the computers, while
eClinicalWorks will handle software installation, training and
maintenance. Wal-Mart is using its buying power for discounts on both
the hardware and software.

This program has promise, but it isn’t revolutionary and is by no
means certain to succeed. Interestingly, the Wal-Mart PR people, who
usually send me a heads up about any new Wal-Mart move in health care,
didn’t tell me about this one. It makes me wonder what’s really going
on. There are a couple of very promising aspects of this program:

Today’s NEJM Hospitalist Study: What’s the News?

Mar 13, 2009• 8

By Bob Wachter

A paper in today’s New England Journal
proves what we all know – the hospitalist field is the only thing
growing faster than the national debt. Even though that’s not news,
this elegant biopsy of the Medicare database offers some new insights
about our field, the fastest growing specialty in medical history.

Briefly, the study used a methodology developed
by Sanjay Saint a decade ago: by examining evaluation and management
(E&M) codes submitted by general internists to Medicare, one can
determine which physicians do virtually all their E&M work in the
hospital, which have traditional general internist practices
(part-inpatient, part-outpatient), and which do virtually no inpatient
work (“ambulists” or “officists” – somebody will ultimately need to
settle on a term).

Controlling Health Care Costs by Seduction

Mar 13, 2009• 26

By PETER NESBITT

The past failure of insurers and care providers to control medical costs challenges the Obama health care team to redesign health care to provide broader coverage while managing costs. If the past is any guide, they will fail just as certainly as those who went before. The problem is that those working on the new health care plans do not fully understand why existing plans failed over the past 30 years. The panoply of managed care ideas; HMO’s, rationing, pre-approvals, denial of benefits, denial of service, reduction in fees have all failed to reduce medical costs. If we wish to get past these failures, we need to think about seducing those who control the costs.

The phenomenology of health care shows that medical costs are a function of fees and utilization. Fees are what we pay for a medical service. Utilization denotes the variety of services available. Almost all medical services are performed or ordered by physicians. The ever spiraling cost of medical care amply demonstrates that coercive methods used by insurers and managed care proponents against physicians have failed to bring about the desired results.

If physicians cannot be coerced into cooperating, perhaps they can be seduced.

ARRA: A New Era for Health IT, and for CCHIT – Part 1

Mar 12, 2009• 10

By MARK LEAVITT

When President Obama signed the American Recovery and Reinvestment Act (ARRA) into law, health IT
was catapulted into a new era. I believe this is — and forever will be — the biggest milestone in the history of health IT. I’d like to share my perspectives on it, but it will take several blog posts to cover such a big topic. Today, I’ll start with a high level view of the significance of this event, and talk about some of the confusion that has resulted from the injection of so much new money – and with it, some new politics – into the world of health IT. Then I’ll follow up with posts that delve into the details of how I believe CCHIT will need to evolve in this new environment.

I’m personally struck by the parallels to a historical event still vivid in my memory: Project Apollo, President Kennedy’s incredible national goal of achieving manned spaceflight to the moon.

Apollo cost $22B (in 1969 dollars, now worth five times that) and took 8 years to achieve the first moonwalk. NASA, a new government agency, spearheaded the effort, but the technology was developed by private sector contractors.

The New Landscape of the Health Reform Debate

Mar 12, 2009• 28

By Bill Kramer

In the recent publicity about President Obama’s budget and health reform initiative, an important issue
has not received enough attention. Most reporters, analysts, editorial writers and bloggers have focused on the proposed $634 billion reserve fund, the aim for universal coverage, the reduction in Medicare Advantage payments, the tax on families with incomes over $250,000, and other key features. In the view of many Republicans and others opposed to this approach, the proposal looks like just another version of a “tax and spend” strategy to fix our health care system. There is something different, however, and the health reform battle is moving into new terrain.

In the past, advocates of health reform focused on need to provide access to care for the uninsured. This was (and is) a moral issue – “How can the richest nation on earth let millions of people go without access to decent health care?” To provide universal access, however, required a lot more government spending. This set up a conflict, because every reform proposal had a big price tag, and few politicians were willing to support a program that dramatically enlarged the federal deficit. Many advocates believed that expanding coverage was worth it, but it faced very difficult obstacles due to concerns about the rising government debt load.

Is the Healthcare Economy Rightsizing?

Mar 12, 2009• 34

By Brian Klepper and David C. Kibbe

More than at any time in recent memory, powerful forces are buffeting
the health care sector. We are in
the midst of profound upheaval,
driven by market and policy responses to the industry's long-term
excesses.
We can already see evidence that the dysfunction of our traditional
health system is accelerating. It also seems clear that the center
cannot hold indefinitely.

Dog Eat Dog
It is useful to remember that the health care industry's
different stakeholders are adversaries. While they clearly share a
common understanding that a wholesale meltdown is possible, there is
little real motivation for collaboration and no unity. Independent of
role, the industry as a whole has been focused on, and extremely
effective at, securing dollars from purchasers: government, employers
and individuals. But each silo within the industry has been separately
focused on growing its own slice of the health care pie. In every
niche, there are courteous conceits – access, appropriateness, efficiency and value – reserved
for the good manners of public relations. But these are meaningful in
practice only if they do not conflict with the professional's or the
firm's economic performance.

Commentology

Mar 12, 2009

Carla was one of many commenters who wrote in response to insurance broker John Sinibaldi's thoughtful post on the role that he and his colleagues play in the current healthcare system. ("A Broker's Lament: We Brought This On Ourselves.")

"To get anywhere, we are all going to have to go to a 12 step program and admit our problem: "Hi, my name is Carla and I'm a physician, I'm addicted to our current healthcare system and have been completely focused on pushing through as many patients as possible, because that's what pays."

"Hi, I'm an American patient and I'm addicted to our current healthcare system because it fulfills my every whim and doesn't have time to help me do the hard stuff to improve my health."

"Hi, I'm your health insurance company and I'm addicted to our current healthcare system because it enables me to insert myself in the middle and make a nice profit, without really adding much value."

Mr. Sinibadi, thanks for being the first one to stand up at the meeting."

Christopher George had this to say in response to Dr. Albert Waxman's post on the free market's power to create change. "Innovation + Economics: Keys to Successful Healthcare Reform."

"When I was in medical school, CCJ Carpenter, legendary infectious disease giant, used to brow beat the poor interns for ordering so much as an un-necessary serum calcium level for which a good reason could not be articulated.(At the time probably a $10 test.) The exact opposite of today. No test is too unlikely to order. Again, like a broken record, no meaningful reduction in utilization will happen without tort reform. The un-empowered, demoralized professionally castrated doctor is not the one who will make the decision to NOT order something stupid. Instead, he order out of the fear that it might, in retrospect, if it were positive, seem logical to do. These are the tests that are killing the system."