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The Real Cost of Early Elective Deliveries

What if I told you that across the country there’s a procedure being performed on pregnant women that makes their newborns more likely to end up sick and in a $3,000-a-day Neonatal Intensive Care Unit (NICU)?

Too outrageous to believe?

It’s true.

Early elective delivery ‚ when labor is induced 3 to 4 weeks early without medical necessity , is on the rise in the U.S. According to a report released in January 2011 by the Leapfrog Group, between 1992 and 2003 the number of these births increased from 19% to 29%. Seven hospitals across the country perform these deliveries on 100% of women without medical necessity, and over thirty others perform them 50% of the time or more.

The American College of Obstetricians and Gynecologists (ACOG) has long recognized the risks associated with inducing labor when it is not medically needed. One retrospective study found that infants born at 37 weeks are nearly 23 times more likely to suffer severe respiratory distress than those born between 39 and 41 weeks. ACOG thinks this is unacceptable.

So why do hospitals do it? Experts see a few possible explanations:

  1. Obstetricians deliver but don’t care for newborns. They move quickly from birth to birth, and lack a complete understanding of the complications associated with early deliveries.
  2. Natural deliveries are difficult to anticipate. Nature can be fickle and tends to ignore the schedules of busy physicians. Patients may simply agree because they see little harm in early deliveries.

There’s yet another incentive worth pondering. It’s prefaced by a big green $, and followed by plenty of zeros. NICUs – where many pre-term babies end up – are highly profitable for hospitals. John Lantos, a former Chief of General Pediatrics at the University of Chicago, recently wrote in Health Affairs:

The NICU – which represented nearly 4 percent of total admissions [for the hospital] ‚Äì had generated 11 percent of the net revenue. Since most of the academic medical center’s divisions either barely broke even or lost money, that meant that a staggering 69 percent of the net profits of the entire hospital system came from the 4 percent of hospital admissions to the NICU.

In other words, healthy, full-term babies are not nearly as profitable as preemies. The average cost of caring for a premature baby is $41,610 versus just $2,830 for a full term baby. A clear line can be drawn between more early term births and more days spent (and dollars generated) in the NICU. Increasing the numbers of preterm births creates a perceived need for additional NICU beds, thereby increasing the need to fill those beds. A self perpetuating cycle quickly emerges.Continue reading…

A World Without Breast Cancer?

There isn’t a country on this planet where there isn’t someone dreaming of curing cancer. What if there was something even more spectacular than curing cancer? What if you could stop cancer right in its tracks and eliminate its existence. Prevent it. Squash it before it starts.

Vincent Tuohy, PhD, an immunologist at Cleveland Clinic, may be on a path toward living this dream. This month at our hospital’s quarterly meeting, Tuohy was awarded Cleveland Clinic’s F. Mason Sones Award for 2010 Innovator of the Year for his recent breakthrough that may one day prevent breast cancer and perhaps revolutionize our approach to fighting all cancers.

Tuohy has spent the past eight years working to create a vaccine to prevent breast cancer. He and his team have found that vaccination with the protein α-lactalbumin prevents breast cancer in mice. His results were published in Nature Medicine, one of the most respected science journals, last summer.

The study yielded dramatic results. A group of mice that were at high risk to develop cancer according to their genetic profile was selected. Half of the mice were given the vaccine and half were not. All the ones given the vaccine did not develop breast cancer. All the ones not given the vaccine developed breast cancer. Yes, these are mice, and human trials are yet to begin. It may be ten years before we have a finished product, but such overwhelming results are promising and exciting.Continue reading…

The Quest for the “Not For Comfort” Healthcare Organization

The current reorganization of health care could make it better and cheaper for everyone, harnessing real creative and competitive energies to build the “next health care”—or it could lead to local monopolies, higher prices and less real competition where it matters. The many and various moves toward accountability, competition and transparency could defeat themselves.

The theme of the reorganization is clear: new types of cooperation between physicians, hospitals and other providers that cut down on duplication and unnecessary procedures and tests; that make the system accountable both for processes and outcomes; and that share economic risk among the providers. This new and strange cooperation comes in many types, typically labeled “accountable care organizations” (ACOs), “bundling,” “patient-centered medical homes” (PCMHs) and “co-management.”

All these concepts require new structures: complex organizational, contractual, reporting, liability and payment structures that in one way or another stretch across specialties and providers throughout whole regions. What could these new structures (particularly ACOs) look like if they were to turn evil? They could look like monopolies, like regional health care cartels, capable of forcing other providers into disadvantaged relationships and jacking up prices to health plans and employers.Continue reading…

Are Market-Oriented Economists Wrong About Health Care?

Tyler Cowen posted 10 common mistakes of market-oriented economists the other day, paired with 14 common mistakes of left-wing economists. That prompted Ezra Klein to propose his own list of mistakes and others are chiming in.

I think it’s too bad that economists are classified as right and left. After all, economics is a science and reality is reality. Why should political preferences interfere with the scientific quest for truth? Milton Friedman once said there are only two kinds of economics: good economics and bad economics. I not only agree, I think only “good economics” qualifies as “economics.” But I’ll yield to convention for the remainder of this post.

On health care, Tyler says right-of-center economists go wrong in two ways:

  1. I’m all for Health Savings Accounts, Tyler writes, but unless done on a Singaporean scale, and with lots of forced savings, they’re not a health care plan to significantly benefit most Americans.
  2. There is less of a coherent health care plan, coming from this side [the right] than one might like to think. There is already considerable health care cost control embedded in the Affordable Care Act (ACA), most of all for Medicare, and this is not admitted with sufficient frequency.Continue reading…

Privatize Medicaid? Have We Learned Nothing??

As we move thru 2011, many states are eagerly progressing with implementation of the Affordable Care Act (ACA). We have many Early Innovators that are leaders in setting up the state based exchanges.  These states are Kansas, Maryland, New York, Oklahoma, Oregon, Wisconsin and a multi-state entity led by the University of Massachusetts Medical School that consists of Connecticut, Maine, Massachusetts, Rhode Island, and Vermont.  Furthermore, Vermont is poised to pass the country’s first state-wide single payer system.

You can imagine when I look in my own back yard I get a bit depressed. Despite our 80 degree sunny weather, our state is leading the charge to overturn the ACA. Our newly elected governor, Rick Scott (the past CEO of Columbia/HCA when the company pleaded guilty to MCR fraud and paid $1.7 bil fine) is singularly focused on not implementing the ACA in Florida. As the months go by and other states move forward, we continue to move backwards.

As expected, it is the poor and sick that continue to suffer the most. The current assault occurring in Florida is on Medicaid. Medicaid currently covers close to 3 million Floridians (nearly 15% of the population) at a cost of nearly $19 billion dollars. The cost of each state Medicaid program is a burden shared jointly by the states and the federal government.

For every $1 spent by the state, the federal government matches $1.84. Florida Medicaid already has some of the most restrictive eligibility criteria in the country, such that the only people who can qualify for Florida Medicaid are: 1) low-income infants, toddlers, preschool-age children, and pregnant women; 2) extremely low-income school-age children, seniors, people with disabilities; and 3) parents of children in deep poverty. 60% of FL Medicaid recipients are children.Continue reading…

The Promise of Stem Cell Research: Recent Advancements and Setbacks

Few technologies spark as much fascination, hype, and controversy as stem cell technology. One of the most interesting medical applications of stem cell research is in regenerative medicine, where stem cells are being developed to regenerate tissue and repair failing organs. Perhaps the most befitting symbol for this emerging technology is the Greek god, Prometheus, whose immortal liver was feasted on day after day by Zeus’ eagle and day after day was able to regenerate. The leading minds in science and medicine today hope to make this legendary concept of regeneration into reality, but hurdles abound.

The excitement about stem cell research and its potentially transformative therapeutic applications is evidenced by the large investments into research that have been made by companies, governments, and universities around the world. Significant unmet needs associated with chronic diseases have catalyzed this investment. In contrast to the symptomatic-focused treatment offered by conventional therapeutics, stem cell therapies offer potentially curative treatments for many diseases that arise as a result of damage to terminally differentiated cells. High market potential for both embryonic and adult stem cell therapies has resulted in strategic partnerships between large pharmaceutical companies and stem cell research-based companies, such as the agreement between Athersys and Pfizer to develop and market MultiStem for the treatment of Inflammatory Bowel Disease. Pharmaceutical companies are also interested in exploring the various methods in which stem cells could be utilized in the drug discovery process to accelerate the discovery of novel and safe drugs. Illustrative of this interest, GlaxoSmithKline, AstraZeneca, and Roche teamed together to form a consortium with the UK government to develop stem cells for safety testing of new drugs.Continue reading…

Bias And How to Deal With It

The coverage of the Japanese reactor situation reminds me of the coverage of many other technical issues when they overlap with serious breaking news stories. I wrote a little on this subject a few years ago, talking about the Merck/Vioxx business, but I wanted to expand on it.

I’m not going to rant on about the popular press not understanding this or that scientific or technical issue. There are more systemic problems with the way that news is reported, and in the way that we take it in. I’m not sure of what to do about them other than to be aware of them, but that’s an important step right there.

The first of these is narrative bias. Reporters like to relay stories (and the rest of us like to hear stories) that have a progression. They have a beginning, a middle, and an end, the way our most popular novels and movies do. Something starts, something happens, something ends. Real life sometimes conforms to this template, but sometimes it doesn’t. For example, some situations don’t start, so much as they suddenly get noticed after they’ve been there all along. And some don’t end, so much as they just stop having attention paid to them.

Another narrative-bias problem is the tendency to assign participants in any event to recognizable categories: good guys and bad guys, for starters. Moving to finer distinctions, there’s Plucky Young X, Suffering Y, Salt-of-the-Earth Z, along with Untrustworthy Spokesman A, Obfuscating B, Crusading C, and the whole crowd. Mentally, we tend to assign people to such categories, especially if we don’t know them personally, and it makes it easier for reporters, too. It’s a team effort. The problem is, of course, that not everyone fits into a recognizable category, and many others overlap in ways that a simple narrative structure won’t accommodate. Most real people are capable (more or less simultaneously) of great and venal actions, of heroism and cowardice, of altuism and selfishness.

Continue reading…

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