Category: Medical Politics

Medicare Payment Formula Finally Changed – Win or Loss?

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Congress passed a  law in 1977 linking Medicare payments for physician services to growth in the economy.  Because it failed to take into account inflation and other factors, Congress has had to act 17 times to prevents cuts to physician pay under the sustainable growth rate (SGR) formula. This year physicians were set to get a 21% pay cut this year. This created a lot of stress and uncertainty for physicians, and caused some physicians to stop accepting Medicare patients.

The Senate recently voted to repeal this formula, 92 to 8. The bill was already approved by the House, and now President Obama has signed the bill.

That sounds like a great triumph for physicians. Although this may prompt some to pull out their imaginary violins in mock sympathy, I’m not so sure it will turn out to be such a great deal for physicians, which actually only consumes 12% of the Medicare budget.

The bill freezes the current rates, then increases them 0.5% a year from 2016 to 2019. For 2020 through 2025 there is no increase, and from 2026 onwards it increases by 0.75% per year. That is far below the current rate of inflation, and there is no provision if inflation gets worse than the currently low rate. That effectively means a real loss every year into the indefinite future.

There is a provision to transition payments to reward physicians for quality, rather than quantity. That is good in theory, but we’ll have to see how that works out in practice. Quality healthcare is very difficult to measure, and there is a risk that quality will be defined based on what’s easy to measure, and that will lead to physicians and other healthcare providers to concentrate on what they are rewarded to do, and not what may be in patients’ best interest. I hope I’m wrong.

How to Get Rich – A Guide for Pharmaceutical Companies

The Changling Ming Dynasty Tomb of the Yongle Emperor
The Changling Ming Dynasty Tomb of the Yongle Emperor – copyright 2012 Daniel Ginsberg Photography

Thanks to Congress, Medicare is not allowed to negotiate for the cost of medications. The bill was shepherded through by congressman Tauzin, the chairman of the House Energy and Commerce Committee that regulates the industry, who subsequently stepped down then took a job as the President and CEO of the Pharmaceutical Research and Manufacturers of America. This is a lobbyist group for pharmaceutical companies.

Here’s a suggestion to pharmaceutical companies; the next time you come out with a new first in class medication, for which there are no other medications that can be substituted, price it at 10 billion dollars a month. After the first prescription gets filled, it may move Congress to act, but by then you will be set and it won’t matter if you don’t sell another pill.

Quitting Smoking and Happiness

The FDA is proposing a new rule in regards to tobacco regulation. As detailed recently in the New York Times, the benefits of stopping smoking, such as less heart and lung disease, would need to be discounted 70%, making it that much harder to justify spending money on smoking cessation. It sounds like something inserted at the bequest of tobacco lobbyists. Tomorrow is the deadline to make a public comment. Here is what I submitted:

I think it’s a dire mistake to discount the economic and health benefits of stopping smoking because of the loss of enjoyment. Although smokers may get temporary enjoyment from smoking, they also get enjoyment from being healthy. Surely one gets more pleasure taking a walk in a park and living at home, than pushing an oxygen tank down a hall in a nursing home because of severe emphysema. Smokers die at a younger age than they otherwise would. What about the enjoyment their partners, children, and grandchildren lose when the smoker dies prematurely? Loss of enjoyment should not be part of the equation, unless it’s a negative number which would serve to magnify the cost smoking places on individuals and society.

PhRMA Two-Step Dance

As part of my practice I conduct research studies for pharmaceutical companies. In order to get medications approved by the Food and Drug Administration, companies need to do studies to prove the medications are safe and effective. Studies are often conducted by multiple physicians around the world in order to get a sufficient number of patients, and to help them get the drugs approved in many countries.

The kinds of studies I do are mostly big and fairly complex endeavors. They usually have an investigator meeting prior to starting in order to explain the study, how to enroll patients, ship blood samples, order supplies, and many other details. It’s also a chance to ask questions and meet others involved in the study.

Pharmaceutical companies pay a certain amount of money to each practice for helping them do a study. That money is used for a number of things, including paying for staffing, and usually a small stipend to patients to cover their transportation and time. The budget includes money for investigators, such as myself, to attend investigator’s meetings, but unless it’s a local meeting, I make less money than I would just seeing patients in my office. A trip to the East coast takes about 3 days including the travel time each way, but I only get paid for the one day. It’s a nice change of pace, though, and it’s fun if I get to go to a city I’ve never been to before, or enjoy visiting.

Recently I was invited for the first time to an international meeting, in Vienna, Austria, by Novo Nordisk. I’d never been there so I figured I’d go a few days early to see the city. I called to book my flight but was told I could only travel the day before the meeting and return the evening of the meeting, or at most the next day. I explained that I intended to pay for the extra hotel nights and food expense, and it wouldn’t cost them any additional money. They said that they could not because of PhRMA guidelines which I’ve discussed before. They said if I arrived early they would not pay for my flight there. The concern was that they would violate the guidelines because if I spent more time at the destination than necessary, they would essentially be paying for a vacation. I pointed out that arriving early would be to their benefit as I’d be less jet lagged while attending the meeting. I also said that if I was taking a vacation, I would bring along my wife, stay for a couple of weeks if going that far, and I wouldn’t visit Vienna in the middle of the winter.

Going to Vienna I want to waltz, but PhRMA wants me to do the two-step, straight there and back. Well I have better things to do with my life, so they will need to find another dance partner.

An Epidemic of Gun Violence

Last week I wrote about the 1st Amendment. This week I’m going to talk about the 2nd. There is an epidemic of gun violence. This is a serious health problem. Watching your diet, exercising, and taking pills is all for naught if a bullet kills you.

In Newtown, Connecticut, one of the worst mass shooting occurred last week when a gunman shot his mother at home, apparently with her own gun, then walked into an elementary school and shot 6 other adults and 20 children, before shooting himself. Gun rights are hotly debated and highly politicized, but gun violence is a serious health issue. The National Rifle Association (NRA) and others have been strong proponents of gun rights, and have fought hard to fight off attempts for even the slightest form of control, including restrictions on semi-automatic and assault weapons.

One of their arguments is that citizens can protect themselves with guns, and that concealed guns are a particularly effective deterrent because potential assailants won’t know who may be armed. But in 61 cased in the US in the past 30 years, maybe only one was stopped by a gun other than their own, or by the police. Even if people want guns to protect themselves, they shouldn’t need to cover the contingency of an invading army, so I see no need for high capacity bullet magazines.

Many mass shooters have mental illness and we need to do a better job providing access to mental health treatments. Some illnesses, such as schizophrenia, often don’t really manifest until people are in their teens or early 20’s, allowing them to purchase guns when their sick enough to do real damage, but not so severe that they would have more trouble planning an attack or convincing someone to sell them a gun. Even if not mentally ill, young men tend to act less rashly as they get older, and are more likely to consider the consequences of their actions. From a list of 22 of the deadliest mass shootings around the world, 65% of them were under 30. We already have a law that says that people can’t buy alcohol until they are 21-years-old, even though they can vote and serve in the military at 18-years-old. Perhaps the right to own a gun should only be allowed for those who are at least 30-years-old.

We need to close legal loopholes, such as sales between private buyers, that allow people to avoid background checks before purchasing guns. I need to fill out more paperwork to prescribe shoes for a diabetic than to buy an assault weapon. We need people to speak up and let our politicians know that gun violence caused by guns is not acceptable. We’ll never prevent all such tragedies, but we should try to minimize the possibility as best we can.

Off Label Drugs and Free Speech

The Food and Drug Administration (FDA) has ruled that pharmaceutical companies cannot promote drugs for purposes other than the reasons for which the drug was approved. Physicians are free to do such off-label prescribing, however the drug companies cannot suggest in any way that physicians and other prescribers do so.

Companies have to do expensive studies to show that a medication is both safe and effective. How the FDA approves the drug is based on the research the company did. For example, Neurontin (gabapentin) is approved for certain kinds of seizures, post-herpetic neuralgia, and neuropathic pain. In 2004 Warner-Lambert paid $430 million in a court case brought by the government for off label use. The pharmaceutical company sales representatives had, promoted it for conditions including bipolar mental disorder, Amyotrophic Lateral Sclerosis, attention deficit disorder, migraine, and other conditions.

Some of those claims were true, and the company later received the nerve pain indications that it didn’t originally have. Physicians may rightly prescribe the medication without it having an indication because they have reasons to believe it may work based on the pharmacology or published studies. The pharmaceutical company may just not have been able to get it approved yet, or if it’s not a common problem, they may decide that financially it’s not worth the cost of getting an indication.

When a physician prescribes a medication, there is usually no direct economic benefit to them, and whether they are right or wrong, they will prescribe a medicine because they think it will benefit the patient. That’s not necessarily true of pharmaceutical companies, though. They have a direct economic incentive to sell as much of their product as possible, and their sales reps are often compensated on how many prescriptions the doctors they call on write. So although many of the reps are ethical, economic pressures are a strong incentive to get them to push for off label uses. Multi-million dollar settlements help hold those pressures in check.

Recently a three-judge panel of the Second Circuit Court of Appeals, in a case involving pharmaceutical sales rep Alfred Caronia, ruled that the FDA regulations violated the First Amendment’s guarantee of free speech. In an editorial the Wall Street Journal sided with the court, saying that, “health regulation is by nature health coercion.”

The Wall Street may smack down anything at all related to the Affordable Care Act (ObamaCare), but I think they are wrong. I’m not a lawyer, and much less a constitutional one, but I think of free speech in a different way. I don’t think selling a product is free speech. Selling an idea is. If you are not allowed to put up a sign touting you believe or don’t believe in God, for example, then your right to express your opinion is being abridged. If, however, you put up a sign saying the price of gasoline at your station, that’s not stating what you believe in, that’s just advertising. Granted, some cases might be fuzzy and I would err on the side of free speech, but sales reps talking about their medications are usually just advertizing. In fact the FDA does allow companies to support off label use, but it’s strictly limited (done by a physician in response to questions, etc.).

The Supreme Court acted in a similar manner in 2010 when they removed some limitations to political causes, allowing unlimited donations. This led to over a billion dollars donated in the last presidential cycle. It was done in the name of free speech, but because they could blanket the airwaves with ads, I’d argue those with less money basically lost some of their free speech to rich donors.

A lot of taxpayer money is spent on prescription medications. Busy physicians don’t have time to fact check every thing pharmaceutical sales reps tell them. Allowing reps to say whatever they want, in the name of free speech, is not good for anyone’s health, other than perhaps that of the pharmaceutical companies.

Dinners and the Sunshine Law

Though implementation has been delayed until 2013, per the Sunshine Law, pharmaceutical companies are now collecting information to report to a public website the value of things they give to physicians, including such things as dinner meetings. It may sound like doctors are just being wined and dined to get them to prescribe their medications, but as I’ve said before, there is value in such dinners.

For example, I went to a local dinner meeting early this year, featuring a speaker who was an expert on hypertension. Sure the meal was free, but not such a bargain when you considered that my wife could not attend, it was with people I might not necessarily have chosen to dine with, and despite a long day at the office, this expert was talking about medicine before I could even look at the menu.

But it was worth it because I learned some valuable information. As a result of hearing him talk, one change I made was to more often start giving at least one blood pressure medication at night because he said it would help prevent early morning strokes and heart attacks. After that meeting I later saw an article confirming the value. Had I not attended the talk I might have eventually changed my prescribing habits, but I changed it sooner as a result. In fact studies have shown it usually takes ten years for doctors to incorporate new medical information into their practice.

The pharmaceutical company that sponsored that dinner has a blood pressure medicine that I use some, but frankly not that much, and it has not increased since that dinner meeting. But perhaps I saved a life as a result of knowledge gained from that meeting.

Tort Reform and the Sanctity of the Jury

I serve on WAMPAC, a political action committee for the Washington State Medical Association (WSMA). To help guide our members, last month we met with candidates for Washington State governor Rob McKenna and Jay Inslee.  They were both generous with their time and answered our questions.

As physicians, one of our issues is tort reform. We are concerned that large and unreasonable malpractice awards increase the cost of medical care and cause physicians to order unnecessary tests as ‘defensive medicine’. Attorney General Rob McKenna said he was supportive of tort reform, though didn’t give much specifics. Congressman Jay Inslee said he did not believe in malpractice caps because, he said, unlike others, juries are untainted and therefore we need to respect their decisions. That prompted me to send him the following letter. One month later, he has yet to respond. I wonder how I’ll vote in the primary?

Dear Mr. Inslee,

I enjoyed meeting you, and appreciate your spending time to talk with the Washington State Medical Association WAMPAC Committee 7/3/12 regarding your candidacy for governor.

On the issue of tort reform, you mentioned that you didn’t support malpractice caps because you believed in juries making the decision, as they are untainted by lobbyists or others.

Speaking for myself, I have some concerns about this. Short of Plato’s philosopher kings, juries may be the best choice to decide cases, but they are hardly perfect. There are numerous well documented cases of people sentenced to death, yet later found innocent by DNA evidence. In malpractice cases, I would argue that juries are far from perfect. How else could you explain the differences in the chances of being sued and the size of the award based on specialty (http://www.nejm.org/doi/full/10.1056/NEJMsa1012370)? The average neurosurgeon is sued once every 5 ½ years. You would be hard pressed to find a retired neurosurgeon who has never been sued.

Even if juries make perfectly logical decisions, it’s only as good as the cases presented to them, which may be flawed.

In cases where juries decide the outcome, there are restraints. There are judicial guidelines, and juries cannot impose the death penalty for shoplifting, for example, even if they wanted to. Putting financial caps on malpractice cases would be no different. The jury could still decide if the defendant is guilty, but guidelines would cap the size of the reward.

I hope you will reconsider your view on tort reform.

Sincerely,

Daniel Ginsberg, MD, FACP

Making the Affordable Care Act Individual Mandate Work

The Supreme Court has ruled that most of the Affordable Care Act, aka Obamacare, is constitutional.

In order to provide affordable care to all, insurance companies need the healthy to pay premiums, and not just the people who will use a lot of health care resources. In order to try and ensure this, Congress gave a penalty for those who don’t purchase an insurance plan. The problem is that the penalty is far less than the cost of insurance, and the only way they can even force you to pay is if you are getting a tax refund, in which case they can deduct the fine. So someone could elect to go without insurance, and, whether or not they pay the fine, just sign up if they need it. If enough people did that, the plan would not be sustainable. The penalty is $695, and up to $2085/year or 2.5% of income for a family, though it’s lower the first two years. A healthy individual might decide $695/year for no insurance is a better deal than $2000/year for insurance they don’t think they need.

So I propose a solution. Congress could pass a law saying that if someone does not get and maintain insurance within 1 year of when it becomes mandatory, and if they elect to get it later, they will be responsible for the first $10,000 or so expenses they sustain within the next 3 months of applying for insurance. If they get in a major accident or discover a lump that turns out to be cancer, they will still be able to get care and not be burdened with medical expenses that could easily far exceed $10,000. But for those considering going without insurance, even that would be a tough bill to pay.

Of course even now people go without insurance because they feel they can’t afford it. Although that could still apply after the Affordable Care Act goes into effect, the calculations change. Just as a poker player will adjust their bet depending on the size of the pot, I believe consumers would do the same. Instead of a cost of $2000/year versus $0, it would be $2000 versus $695, for example. Thus the cost of going without insurance in this example would drop from $2000 down to $1305 after paying the penalty (or tax, depending on your point of view). Balancing the benefits of having insurance and the risks of not having it, I think more people would elect to get insured with this plan.

Rush to Judgement

Conservative radio show host Rush Limbaugh recently launched an attack on Georgetown University law student Sandra Fluke. She had testified to house Democrats in support of mandates to provide contraceptive care in insurance plans. On his show two days later, Rush Limbaugh said that Ms. Fluke  was asking for taxpayers to pay her to have sex, and that made her a, “prostitute”.

Others have chimed in that contraception is a lifestyle choice and society shouldn’t have to pay for it.  Whether or not you believe women have the right to get an abortion, it’s a flawed argument. By the same reasoning, insurance shouldn’t cover heart attacks, strokes or cancer if the person smoked or was obese. It’s one thing to incentive healthy behavior, but Rush Limbaugh’s attack is either not well thought out in regards to its health care implications, it’s misogynistic, or it’s politically motivated.