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The Hoax of Entitlement Reform

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By Robert Reich

It has become accepted economic wisdom, uttered with deadpan certainty by policy pundits and budget scolds on both sides of the aisle, that the only way to get control over America’s looming deficits is to “reform entitlements.”

But the accepted wisdom is wrong.

Start with the statistics Republicans trot out at the slightest provocation — federal budget data showing a huge spike in direct payments to individuals since the start of 2009, shooting up by almost $600 billion, a 32 percent increase.

And Census data showing 49 percent of Americans living in homes where at least one person is collecting a federal benefit – food stamps, unemployment insurance, worker’s compensation, or subsidized housing — up from 44 percent in 2008.

But these expenditures aren’t driving the federal budget deficit in future years. They’re temporary. The reason for the spike is Americans got clobbered in 2008 with the worst economic catastrophe since the Great Depression. They and their families have needed whatever helping hands they could get.

If anything, America’s safety nets have been too small and shot through with holes. That’s why the number and percentage of Americans in poverty has increased dramatically, including 22 percent of our children.

What about Social Security and Medicare (along with Medicare’s poor step-child, Medicaid)?
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2012 Digital Health Investment Activity: The View From the Valley

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By David Shaywitz, MD

Rock Health recently released a decidedly mixed report on the current state of Digital Health investing, as the data suggest many investors continue to tentatively explore the sector, but most have yet to make a serious commitment.

Overall, VC funding for digital health increased significantly over the past year, from just under $1B in 2011 to about $1.4B in 2012; 20% of this total was associated with just five deals: two raises for transparency companies, Castlight (targeting employees with high deductible plans looking to manage their costs) and GoHealth (targeting consumers contemplating purchase of health insurance); two raises for referral companies, Care.com (helps consumers find the right caregiver – defined broadly, as needs addressed include eldercare, child tutoring, babysitting, and pet care) and BestDoctors (helps employees find the right doctor), and one deal for 23andMe (a pioneering consumer genetics company).

Not surprisingly, the largest thematic area of investment ($237M) was “health consumer engagement,” comprised of companies that – like the first four above – help consumers or employees with healthcare purchases.   “Personal health tools and tracking,” the second leading category, captured $143M in funding last year.  “EMR/EHR” ($108M) and “hospital administration” ($78M) rounded out the list; the last two numbers seem shockingly low given the apparent size of these markets, and suggest both areas may be perceived as  firmly owned by incumbent players, and prohibitively difficult for new participants to enter.

Athenahealth’s just-announced acquisition of Epocrates highlights the competitive pressures even existing EMR companies face as they struggle for traction in an environment that seems to be increasingly dominated by a few large players, most notably Epic. “Our biggest obstacle,” Athenahealth CEO Jonathan Bush told Bloomberg Businessweek, “is that 70% of doctors don’t even know we exist.”  In contrast, I’ve suggested that a category I’d broadly define as EMR adjacencies may be primed for growth, as VC’s Stephen Kraus and Ambar Bhattacharyya have also discussed recently in this intelligent post.  The related area of care transitions is also attracting considerable entrepreneurial interest, including current Rock Health portfolio companies WellFrame and OpenPlacement, and TechStars alum Careport; it remains to be seen whether a robust business model will emerge here.

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Unscience

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By David Katz, MD

According to a widely circulated op-ed in the New York Times by Paul Campos, a law professor at the University of Colorado with whom I don’t believe I have ever managed to agree on anything, our “fear” of fat — namely, epidemic obesity — is, in a word, absurd. Prof. Campos is the author of a book entitled The Obesity Myth, and has established something of a cottage industry for some time contending that the fuss we make about epidemic obesity is all some government-manufactured conspiracy theory, or a confabulation serving the interests of the weight-loss-pharmaceutical complex.

In this instance, the op-ed was reacting to a meta-analysis, published last week in JAMA, and itself the subject of extensive media attention, indicating that mortality rates go up as obesity gets severe, but that mild obesity and overweight are actually associated with lower overall mortality than so-called “healthy” weight. This study — debunked for important deficiencies by many leading scientists around the country, and with important limitations acknowledged by its own authors — was treated by Prof. Campos as if a third tablet on the summit of Mount Sinai.

We’ll get into the details of the meta-anlysis shortly, but first I’d like to say: Treating science like a ping-pong ball is what’s absurd, and what scares the hell out of me. Treating any one study as if its findings annihilate the gradual, hard-earned accumulation of evidence over decades is absurd, and scares the hell out of me. Iconoclasts who get lots of attention just by refuting the conventional wisdom, and who are occasionally and importantly right, but far more often wrong — are often rather absurd, and scare the hell out of me.

And so does the obesity epidemic.

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Building a Better Health Care System: Patient-Friendly Orders

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By RONI ZEIGER, MD

Here’s another technically easy and culturally hard product: Patient Friendly Orders.

My version of this idea was born when I was admitted to the hospital for pneumonia about 5 years ago.  Even though I had previously worked in that hospital, the quality of communication about my care between the patient and the medical team was poor.  This got me thinking…

There should be a touchscreen by my bed that lists all the current doctors’ orders.

They’re not hidden in the chart.  They’re not explained only in ephemeral conversations that occurred without me present.  And of course, if they’re in front of me, they’re going to have to get written in English.

Let’s organize the orders, too.  Imagine a loved one is hospitalized for a severe skin infection which also caused his diabetes to get way out of control.  He has difficulty sleeping in the hospital and also needs pain control.  All the orders — whether for diabetes, infection, sleep, or pain — are organized according to the problem they address.  (While doctors’notes are generally organized by problem, their orders are not.  I bet if we implemented Patient Friendly Orders, they’d be useful for doctors if only just for this reason.)

When the doctor or nurse or physical therapist comes in, the patient and family can have a conversation about the current plan, with that plan laid out in front of them.  They make a shared decision, and the doctor can update the plan on the same touchscreen.  “Sounds like a plan,” the patient says while actually looking at it.  When you visit your loved one, he can show you the plan, too.  If a question comes up about a given order, or why something is missing from the plan, you can make a note on the touchscreen so the medical team knows to address it when they next come by.Continue reading…

Alice in Healthcareland

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By Michael Turpin

Alice: Cheshire-Puss, would you tell me, please, which way I ought to go from here?

Cheshire Cat: That depends a good deal on where you want to get to.

Alice: I don’t much care where.

Cheshire Cat: Then it doesn’t matter which way you go.

Alice: —So long as I get somewhere.

Cheshire Cat: Oh you’re sure to do that if you only walk long enough.

Lewis Carroll, The Adventures of Alice in Wonderland

2013 has arrived and employers now find themselves on the other side of a looking glass facing the surreal world of healthcare reform and a confusion of regulations promulgated by The Accountable Care Act (ACA) and its Queen of Hearts, HHS Secretary Sebelius. Many HR professionals delayed strategic planning for reform until there was absolute certainty arising out of the SCOTUS constitutionality ruling and the subsequent 2012 Presidential election. They are now waking up in ACA Wonderland with little time remaining to digest and react to the changes being imposed. A handful of proactive employers have begun, in earnest, to conduct reform risk assessments and financial modeling to understand the impacts and opportunities presented by reform. Others remain confused on which direction to take – uncertain how coverage and affordability guidelines might impact their costs.

If reform is indeed a thousand mile journey, many remain at the bottom of the rabbit hole – wondering whether 2013 will mark the beginning of the end for employer sponsored healthcare or the dawning of an era of meaningful market based reform in the US. HR and benefit professionals face a confusion of questions from their companions — CFO’s, CEOs, shareholders and analysts.

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The Fix that Failed

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By Dr. Wes

The new “fiscal cliff” legislation hailed by some as a “one-year doc fix” of the scheduled 26.5% sustainable growth rate (SGR) cut that was scheduled to take effect on 1 January 2013, has passed the Senate and House as part of the American Taxpayer Relief Act ( HR 8 ) goes to President Obama for his likely signature.

But was this “one-year doc fix” really a fix?

Not at all.

In fact, once again Congress has failed to resolve the ever-present sustainable growth rate cuts that repetitively surface year after year by kicking the proverbial can down the road another year.

The cost of the one year patch will be $25.1 billion dollars over 10 years and will be paid for almost entirely by health care cuts in other areas.

  • Hospitals (increasingly doctor-employers now, remember?) will see audits of their billings increase as efforts to recoup some $10.5 billion of “overcoding” charges are seen as the largest source of revenue for the one-year “fix.”
  • Hospitals will also see an extension of lower Medicaid payments to hospitals that treat a high number of uninsured or low-income beneficiaries, known as “disproportionate share hospitals” to find savings of about $4.2 billion.
  • Another $4.9 billion offset will be applied to the lowered bundled payments given for patients with end-stage renal disease – some of the sickest people receiving services from Medicare.

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Building a Better Health Care System: End of Life Care – A Case Study

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By John Henning Schumann, MD

She was 94 years old with advanced Alzheimer’s. She thought it was 1954 and asked if I wanted tea. Not a bad memory for someone in a hospital bed with a broken left hip.

She’d fallen at her assisted living facility. It was the second time in as many months. She’d broken her collarbone on the previous occasion.

Over the past year, she’d lost thirty pounds. This is natural in the progression of Alzheimer’s. But it’s upsetting to families all the same.

My patient was lucky. She’d lived to 94, and had supportive children who were involved in her care. Her son had long ago been designated as power-of-attorney for her health care. This meant officially that his decisions regarding her care were binding. She was not capable of making sound decisions, medical or otherwise.

The patient had been under the care of a geriatrician. His office chart told me that the option of hospice and palliative care had been discussed with the family. They were interested in learning more; the son had agreed that “Do Not Resuscitate” status was appropriate for his mother. Doing chest compressions on a frail 94 year-old is something none of us want to do.

The morning after her hospital admission for the broken hip, the medical intern called me with an ethical dilemma: “She’s DNR,” the intern explained. “She’s having intermittent VTach on the monitor, and I fear she won’t be stable enough to have the hip repaired. The family is open to the idea of hospice, but I don’t know whether to treat the arrhythmia or not.”

Elaine (not her real name) is one of our brightest interns. She’s thinking about going into geriatrics. Situations like this are in many ways the most meaningful for doctors. Too often we stress about minutiae at the expense of the big picture; helping guide a family and patient through a period of critical illness is of true service.

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Why Getting to a Digital Health Care System Is Going to Be Harder Than We Thought Ten Years Ago

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By David Shaywitz, MD and Tory Wolff

A leading scientist once claimed that, with the relevant data and a large enough computer, he could “compute the organism” – meaning completely describe its anatomy, physiology, and behavior. Another legendary researcher asserted that, following capture of the relevant data, “we will know what it is to be human.” The breathless excitement of Sydney Brenner and Walter Gilbert —voiced more than a decade ago and captured by the skeptical Harvard geneticist Richard Lewontin [1]– was sparked by the sequencing of the human genome. Its echoes can be heard in the bold promises made for digital health today.

The human genome project, while an extraordinary technological accomplishment, has not translated easily into improved medicine nor unleashed a torrent of new cures. Perhaps the most successful “genomics” company, Millennium Pharmaceuticals, achieved lasting success not by virtue of the molecular cures they organically discovered, but by the more traditional pipeline they shrewdly acquired (notably via the purchase of LeukoSite, which ultimately yielded Campath and Velcade).

The enduring lesson of the genomics frenzy was succinctly captured by Brown and Goldstein, when they observed, “a gene sequence is not a drug.”

Flash forward to today: technologists, investors, providers, and policy makers all exalt the potential of digital health [2]. Like genomics, the big idea – or leap of faith — is that through the more complete collection and analysis of data, we’ll be able to essentially “compute” healthcare – to the point, some envision, where computers will become the care providers, and doctors will at best be customer service personnel, like the attendants at PepBoys, interfacing with libraries of software driven algorithms.

A measure of humility is in order. Just as a gene sequence is not a drug, information is not a cure. Getting there will take patience, persistence, money and aligned interests. The most successful innovators in digital health will see the promise of the technology, but also accept, embrace, and ideally leverage the ambiguity of disease, the variability of patients, and the complexities of clinical care.
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Health Reform: The Political Storms Are Far from Over

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By Henry J. Aaron

The history of president Obama’s health reform bears an uncanny and disturbing similarity to the life cycle of a hurricane. With Sandy fresh in our memory, the similarity is not comforting.

Hurricanes have three phases. The front wall of the storm brings high winds, lightening, and rain. Next, at the hurricane’s center, or eye, the wind drops and the air warms. If one is at sea, the water may turn calm and warm, bringing the illusion that the storm has ended. As the storm moves on, wind and rain return, often with increased force. Those fooled by the calm who leave safe havens may be destroyed by what follows.

The life cycle of a hurricane will bear an eerie similarity to that of health reform. Nearly four years elapsed between president Obama’s initial call for national health reform until the bill became law and the Supreme Court ruled on its constitutionality. The political and legal turmoil was intense and continuous. The process was rancorous and the outcome in doubt from start to finish. It took a bitterly fought presidential election to put an end to this phase of the struggle.

Now, we are in a period of relative calm. The 2012 election settled the immediate fate of the Affordable Care Act (ACA). The candidate who swore to repeal it lost. The ACA was the major domestic legislative achievement of the victorious incumbent president who won reelection. Now, eighteen states are in process of designing rules for health insurance exchanges — the administrative entities that will manage implementation of the new law, the most important provisions of which will take effect one year hence. The other states will either leave implementation entirely to the federal government or share administrative responsibilities with federal agencies.

A huge amount of work remains to be done by October 1, 2013 when people can begin enrolling for insurance coverage in the new exchanges.

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Advances In Cancer 2012

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By JAMES SALWITZ, MD

The 30,000 member American Society of Clinical Oncology is the world’s leading group of cancer physicians. ASCO is dedicated to curing cancer, supporting research, quality care, reducing treatment disparities and a heightened national focus on value. This month they released their annual Report on Progress Against Cancer, which highlights research, drug development and cancer care innovations.  This hundred-page document is important reading for anyone who wants to be up-to-date regarding cancer care.

Cancer related deaths in the United States are dropping, but still totaled 577,000 in 2012.  While world cancer research funding is rising, in the USA it continues to decrease, with the purchasing power of the largest funding source, the National Cancer Institute, having fallen 20% in the last decade, and a further 8% cut slated for January 1, 2013.   Development is dependent on government and private funding, as well as the willingness of more than 25,000 patients a year who volunteer to be involved in cancer trials.  All these critical supports are threatened. The Federal Clinical Trials Cooperative of the National Cancer Institute (FCLC, NCI) supports research at 3100 institutions in the USA.

The report discusses the many types of cancer which continue to be naturally resistant to cancer treatment, particularly chemotherapy.  In some cases, drugs do not penetrate a part of the body, such as the brain, in other cases even when they reach the tumor, they are not effective.  In such cancers the genetic code of the cancer cells has mutated (changed) such that the particular drug does not kill the cancer.  In 2012, there was increased interest in attacking each cancer cell at multiple targets either by using a single drug, which attacks in several different ways, or multiple drugs at the same time.  This concept improved cancer killing in GIST, colon cancer, certain lymphomas (ALCL) and medullary thyroid cancer.  In addition, unique targeted compounds, such as “tyrosine kinase inhibitors,” show increasing benefit in leukemia, sarcoma and breast cancer.

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