Doctor and Patient Incentives, and Lack of Competition, Fuel High Health Costs

 

HealthCostsGraphCBO.gif  Source of graphic:  online version of the NYT article quoted and cited below.

 

Why are so many lumbar fusions done, in spite of the absence of evidence for their efficacy?  Well, doctors find the procedure lucrative.  Patients do not pay for it themselves, so they have little incentive to look hard at the effectiveness.  And health care providers, through licensing and government regulations, have largely insulated themselves from competition from low cost providers.

 

(p. C1)  In Idaho Falls, Idaho, anyone suffering from the sort of lower back pain that may conceivably be helped by the fusing of two vertebrae is quite likely to have the surgery.  It’s known as lumbar fusion, and the rate at which it is performed in Idaho Falls is almost five times the national average.  The rate in Idaho Falls is 20 times that in Bangor, Me., where lumbar fusion is less common than anywhere else.

These numbers come from the wonderful Dartmouth Atlas of Health Care.  The Dartmouth researchers adjust the numbers to take into account age, race and sex, which is another way of saying that there is no good explanation for the huge variations they find.  Doctors in the Idaho Falls area are probably just being more aggressive than doctors elsewhere.

But it’s not clear that their patients are any better off.  The evidence for lumbar fusion is incredibly mixed.  It seems to help people with certain kinds of pain, but many others recover just as well without the surgery. Of course, doctors are almost always better off if the surgery is done:  The typical hospital bill for lumbar fusion is roughly $50,000.

This is about as good an example as you can find of the health care mess.  The number of lumbar fusions performed in this country has more than tripled since the early 1990s, and Medicare now spends more than $600 million a year on the procedure.  It’s one reason your health insurance bill has gone up.

 

For the full commentary, see: 

DAVID LEONHARDT.  "ECONOMIX; Health Care As if Costs Didn’t Matter."  The New York Times  (Weds., June 6, 2007):  C1 & C8.

 

How to Protect Against Bad Drugs: “Don’t Take Them”

 

The FDA’s major problem is not laxity, but zealotry.  Its current get-tough view on conflict of interest only aggravates the fundamental flaw in its institutional design. Transfixed on the harms drugs can cause, the FDA remains largely oblivious to the harms they can prevent. Any delay in the use of a successful drug is costly: The delay matters little to the FDA, but a great deal to the thousands who plea for compassionate exemptions to try a drug that has not met with FDA approval.  Nor is the FDA sensitive, as individual physicians surely are, to the simple fact that a drug which cannot be tolerated by one person works wonders in another.

. . .

Right now, we all have a simple expedient to protect ourselves against dangerous drugs that make it to the market: Don’t take them. But we have no protection at all when the FDA denies us that choice in the first place. Right now the pace of drug approval is too slow.  We don’t need the FDA to slow it up still further.

 

For the full commentary, see: 

Richard A. Epstein.  “Drug Crazy.”  The Wall Street Journal  (Mon., March 26, 2007):  A12.

(Note:  ellipsis added.)

 

Creating Incentives for Quality Health Care

 

    Source of graphic:  online version of the NYT article quoted and cited above.

 

The experiment described in the article excerpted below sounds promising. Such experiments would be easier, and more common, if health care were not so highly regulated, and if the government did not create such large barriers to entry in the practice of medicine.

 

(p. A1)  What if medical care came with a 90-day warranty? 

That is what a hospital group in central Pennsylvania is trying to learn in an experiment that some experts say is a radically new way to encourage hospitals and doctors to provide high-quality care that can avoid costly mistakes.

The group, Geisinger Health System, has overhauled its approach to surgery. And taking a cue from the makers of television sets, washing machines and consumer products, Geisinger essentially guarantees its workmanship, charging a flat fee that includes 90 days of follow-up treatment.

Even if a patient suffers complications or has to come back to the hospital, Geisinger promises not to send the insurer another bill.

Geisinger is by no means the only hospital system currently rethinking ways to better deliver care that might also reduce costs. But Geisinger’s effort is noteworthy as a distinct departure from the typical medical reimbursement system in this country, under which doctors and hospitals are paid mainly for delivering more care — not necessarily better care. 

. . .

Under the typical system, missing an antibiotic or giving poor instructions when a patient is released from the hospital results in a perverse reward: the chance to bill the patient again if more treatment is necessary. As a result, doctors and hospi-(p. C4)tals have little incentive to ensure they consistently provide the treatments that medical research has shown to produce the best results.

Researchers estimate that roughly half of American patients never get the most basic recommended treatments — like an aspirin after a heart attack, for example, or antibiotics before hip surgery.

The wide variation in treatments can translate to big differences in death rates and surgical complications. In Pennsylvania alone, the mortality rate during a hospital stay for heart surgery varies from zero in the best-performing hospitals to nearly 10 percent at the worst performer, according to the Pennsylvania Health Care Cost Containment Council, a state agency.

 

For the full story, see: 

REED ABELSON.  "In Bid for Better Care, Surgery With a Warranty."  The New York Times  (Thurs., May 17, 2007):  A1 & C4.

 

    Providing a warranty provides the hospital to provide higher quality care, as evidenced, for example, in this nurse counting sponges to make sure that none have been left behind in the patient.  Source of photo:  online version of the NYT article quoted and cited above.

 

FDA Irrationally Bans Drugs that Would Help Patients Suffering from Deadly Disease

 

The most welcome news a cancer patient can hear from their doctor is: "Your tumor is regressing." Sadly, the message that the Food and Drug Administration is now delivering to cancer patients is that the fight against tumors is regressing.

Current FDA policies are discouraging the development of groundbreaking treatments for cancer and other killer diseases, turning the clock back on hard-won regulations put in place in response to the AIDS crisis that allow patients faster access to new drugs. Case in point: This week, facing rejection by the Agency, GPC Biotech withdrew its New Drug Application (NDA) for Satraplatin, a drug to treat prostate cancer — despite data from a large controlled clinical trial showing the drug delayed tumor growth in patients where the disease is widespread.

Most of the patients in this study had exhausted all known therapies; many required powerful medication to control bone pain. Time is running out for them, yet results from this statistically significant study were not sufficient for the FDA. Although GPC Biotech’s application for Satraplatin was under consideration for accelerated approval, the Agency indicated it would need to wait for full survival data from this trial, which will delay approval at least one year.

Sadly, far from being an aberration, Satraplatin is the fifth promising cancer treatment set back by the FDA this year.

. . .

For patients with life-threatening diseases and their families, the implications of the FDA’s recent regressive trend are devastating. It may be acceptable for regulators to be risk-averse when considering drugs for routine or nonserious diseases where alternative therapies exist. But this mindset is simply irrational when it comes to drugs intended to treat patients suffering from deadly diseases — people who often have only weeks or months to live.

 

For the full commentary, see: 

RICHARD MILLER.  "Cancer Regression."  The Wall Street Journal  (Weds., August 1, 2007):  A15.

 

“I Couldn’t Write a Prescription for Antibiotics, Because There Were None”

 

    "THE DOCTOR MIGHT BE IN Cubans young and old at a Havana clinic in 2004."  Source of caption and photo:  online version of the NYT article cited below. 

 

CUBA works hard to jam American TV signals and keep out decadent Hollywood films. But it’s a good bet that Fidel Castro’s government will turn a blind eye to bootleg copies of “Sicko,” Michael Moore’s newest movie, if they show up on the streets of Havana.

“Sicko,” the talk of the Cannes Film Festival last week, savages the American health care system — and along the way extols Cuba’s system as the neatest thing since the white linen guayabera.

Mr. Moore transports a handful of sick Americans to Cuba for treatment in the course of the film, . . .

. . .

Universal health care has long given the Cuban regime bragging rights, though there is growing concern about the future. In the decades that Cuba drew financial and military support from the Soviet Union, Mr. Castro poured resources into medical education, creating the largest medical school in Latin America and turning out thousands of doctors to practice around the world.

But that changed after the collapse of the Soviets, according to Cuban defectors like Dr. Leonel Cordova. By the time Dr. Cordova started practicing in 1992, equipment and drugs were already becoming scarce. He said he was assigned to a four-block neighborhood in Havana Province where he was supposed to care for about 600 people.

“But even if I diagnosed something simple like bronchitis,” he said, “I couldn’t write a prescription for antibiotics, because there were none.”

He defected in 2000 while on a medical mission in Zimbabwe and made his way to the United States. He is now an urgent-care physician at Baptist Hospital in Miami.

Having practiced medicine in both Cuba and the United States, Dr. Cordova has an unusual perspective for comparison.

“Actually there are three systems,” Dr. Cordova said, because Cuba has two: one is for party officials and foreigners like those Mr. Moore brought to Havana. “It is as good as this one here, with all the resources, the best doctors, the best medicines, and nobody pays a cent,” he said.

But for the 11 million ordinary Cubans, hospitals are often ill equipped and patients “have to bring their own food, soap, sheets — they have to bring everything.”  . . .

. . .

Until he had to have emergency surgery last year, Fidel Castro — who turned 80 this year — was considered a model of vibrant long life in Cuba. But it was only last week that he acknowledged in an open letter that his initial surgery by Cuban doctors had been botched. He did not confirm, however, that a specialist had been flown in from Spain last December to help set things right. 

 

For the full commentary, see: 

ANTHONY DePALMA.  "‘Sicko,’ Castro and the ‘120 Years Club’."  The New York Times, Section 4  (Sun., May 27, 2007):   3. 

(Note:  ellipses added.)

 

Fred Thompson Skewers Michael Moore with Wit and Wisdom

Mr. Moore was back from Cuba, where he made a documentary on the superiority of Castro’s health-care system. Mr. Thompson suggested Mr. Moore is just another lefty who loves dictators. Mr. Moore challenged Mr. Thompson to a health-care debate and accused him of smoking embargoed cigars. Within hours Mr. Thompson and his supposedly nonexistent staff had produced a spirited video response that flew through YouTube and the conservative blogosphere. Sitting at a desk and puffing on a fat cigar, Mr. Thompson announces to Mr. Moore he can’t fit him into his schedule. Then: "The next time you’re down in Cuba . . . you might ask them about another documentary maker. His name was Nicolás Guillén. He did something Castro didn’t like, and they put him in a mental institution for several years, giving him devastating electroshock treatments. A mental institution, Michael. Might be something you ought to think about."

You couldn’t quite tell if Mr. Thompson was telling Mr. Moore he ought to think more about Cuba, or might himself benefit from psychiatric treatment. It seemed almost . . . deliberately unclear.

 

PEGGY NOONAN.  "DECLARATIONS; The Man Who Wasn’t There."  The Wall Street Journal  (Sat., May 19, 2007): P14.

(Note:  ellipsis in original.)

 

See Fred Thompson’s response to Michael Moore on YouTube at:

http://www.youtube.com/watch?v=Ds_GhRxivOI  

 

    Source:  screen capture from Fred Thompson’s response to Michael Moore at http://www.youtube.com/watch?v=Ds_GhRxivOI

 

Private Companies Beat Government in Accessible and Affordable Health Care

 

MinuteClinic.jpg    A CVS pharmacy MinuteClinic.  Source of photo:  online version of the WSJ article cited below. 

 

It’s Friday evening and you suspect that your child might have strep throat or a worsening ear infection. Do you bundle him up and wait half the night in an emergency room? Or do you suffer through the weekend and hope that you can get an appointment with your pediatrician on Monday — taking time off your job to drive across town for another wait in the doctor’s office?

Every parent has faced this dilemma. But now there are new options, courtesy of the competitive marketplace. You might instead be able to take a quick trip on Friday night to a RediClinic in the nearby Wal-Mart or a MinuteClinic at CVS, where you will be seen by a nurse practitioner within 15 minutes, most likely getting a prescription that you can have filled right there. Cost of the visit? Generally between $40 and $60.

These new retail health clinics are opening in big box stores and local pharmacies around the country to treat common maladies at prices lower than a typical doctor’s visit and much lower than the emergency room. No appointment necessary. Open daytime, evenings and weekends. Most take insurance.

Much like the response to Hurricane Katrina, private companies are far ahead of the government in answering Americans’ needs, this time for more accessible and more affordable health care. Political leaders across the country seeking to expand government’s role in health care should take note. 

 

For the full commentary, see:

GRACE-MARIE TURNER.  "Customer Health Care."  The Wall Street Journal  (Mon., May 14, 2007):   A17.

 

FDA Rejects Long-Lasting Disappearance of Disease as a “Theoretical Construct”

 

Consider the FDA’s handling of Genasense, a new drug for melanoma and chronic lymphocytic leukemia (CLL), two often terminal forms of cancer. The drug is being developed by Genta, a small, innovative company with only one approved drug and limited financial resources. Despite compelling evidence that Genasense is making progress in fighting both diseases, the FDA appears determined to kill the drug.

In the case of the melanoma application, instead of reviewing the clinical-trial data in accordance with usual methods (which showed positive results), the FDA chose a nonstandard statistical approach aimed at discrediting the results. The agency used this analysis in its briefing to its advisory committee, claiming that the drug might not be effective. The committee then relied on that information to vote against approval.

. . .

The FDA’s inane answer to the CLL experts was that the long-lasting disappearance of disease in patients taking Genasense was a "theoretical construct" and not grounds for approval.

The experts explained to the FDA that complete responses in advanced CLL patients are the medical equivalent of the Holy Grail. The FDA finally agreed, but was unimpressed with emerging data showing responders to Genasense living longer than responders in the control group.

The experts were unanimous in advising that Genasense should be approved, but the FDA was unmoved. The agency’s Dr. Pazdur suggested that Genta could make the drug available as an unapproved treatment through an expanded access program — this from a regulator fond of stating that the best way to get a drug to patients in need is through approval! In this case the agency was saying to Genta: We are not going to approve your drug, but any patient who needs it can have it so long as you give it away.

. . .

The FDA’s handling of Genasense lays bare the all too common, aggressive incompetence of the FDA’s cancer-drug division and should lead to an immediate examination of its policies and leadership, followed by swift corrective action.

As for the FDA’s belief that their power to control us and even deny us the pursuit of life itself is unlimited under the Constitution, we can only hope the appeals court disagrees. An agency that blocks progress against deadly diseases — while arguing that its power to do so is above challenge — is in dire need of a court supervised review.

 

For the full commentary, see: 

STEVEN WALKER.  "Drug Czars."  The Wall Street Journal  (Fri., May 4, 2007):  A15.

(Note:  ellipses added.)

 

Incentives Matter in Medicine, But Profit is Not the Problem


AnemiaEPOdoseGraph.gif      Source of graphic:  online version of the NYT article quoted and cited below.

 

In the article excerpted below, the profit motive in medicine is painted as the villain of the piece.  But the problem is not the profit motive.  The problem is that government occupational licensing and regulation in medicine raises barriers to entry for low-cost competitors to enter, innovate, and compete. 

 

(p. A1)  Two of the world’s largest drug companies are paying hundreds of millions of dollars to doctors every year in return for giving their patients anemia medicines, which regulators now say may be unsafe at commonly used doses.

The payments are legal, but very few people outside of the doctors who receive them are aware of their size. Critics, including prominent cancer and kidney doctors, say the payments give physicians an incentive to prescribe the medicines at levels that might increase patients’ risks of heart attacks or strokes.

Industry analysts estimate that such payments — to cancer doctors and the other big users of the drugs, kidney dialysis centers — total hundreds of millions of dollars a year and are an important source of profit for doctors and the centers.

 

For the full story, see: 

ALEX BERENSON and ANDREW POLLACK.  "Doctors Reap Millions for Anemia Drugs."  The New York Times  (Weds., May 9, 2007):  A1 & C4. 

 

   Bernice Wilson’s kidney dialysis treatment includes the anti-anemia drug Epogen.  Source of photo:  online version of the NYT article quoted and cited above.


FDA Should Not Restrict Drugs the Terminally Ill Choose to Use

 

On March 1, a federal appeals court will hear oral arguments in the case of the Abigail Alliance organization’s lawsuit to change systems at the Food and Drug Administration to allow terminally ill patients access to promising drugs that have successfully completed initial stages of human safety testing. Because of my former role in the oncology division at the FDA, and in my eight-year experience as a cancer patient advocate on behalf of my son, I may be able to shed some light on the regulatory policy, medical drug development and patient rights issues surrounding this landmark case.

. . .  

Patients have valid arguments in demanding greater access to promising agents under development. Public servants should respect citizens who advocate that they be allowed to have a say in methods of their treatment when terminally ill, and government officials should have very compelling reasons for denying such access. New drug development will not suffer if a small minority of patients fighting for their lives, with no other options and in concert with their physician, gain access to a potentially beneficial agent with an established basic safety profile.

 

For the full commentary, see: 

MARK THORNTON.  "The Clinical Trial."  The Wall Street Journal  (Mon., February 12, 2007):  A14.

(Note:  ellipsis added.)

 

According to the online version of USA Today, the court did hear oral arguments on March 1st, and ". . .  isn’t likely to rule for several months, . . . "

Source:  http://www.usatoday.com/news/nation/2007-04-02-unapproved-drugs_N.htm

 

More Evidence that Statins Match Stents for Long Life and Fewer Heart Attacks

 

    A stent from Boston Scientific.  Source of photo:  online version of the NYT article cited below.

 

Dr. Boden would not have been so "incredulous" if he had read August 2006 and December 2006 entries on artdiamondblog.com.  My title for this entry could have read "Statins Beat Stents" if I had taken account of statin’s being less invasive than stents, with lower risk of complications.

 

NEW ORLEANS, March 26 — Many heart patients routinely implanted with stents to open arteries gain no lasting benefit compared with those treated just with drugs, researchers reported Monday.

The researchers said patients with stents to prop open coronary blood vessels in addition to being treated with statins and other heart drugs in a five-year trial had better blood flow to the heart than patients treated only with drugs.

But they did not live longer or suffer fewer heart attacks, a finding that confirmed the results of smaller studies.

The researchers also found that the stents were highly successful at improving blood flow and relieving symptoms, including chest pain and shortness of breath, but that the advantage disappeared over time.

“When I saw the results, I was incredulous,” said Dr. William E. Boden, a cardiologist at the University at Buffalo School of Medicine and Biomedical Sciences, lead author of a report on the study published online on Monday by The New England Journal of Medicine.

 

For the full story, see: 

BARNABY J. FEDER.  "In Trial, Drugs Equal Benefits of Artery Stents."  The New York Times  (Tues., March 27, 2007):  A1 & A13.