Category: Regulations

The Hurdles to Getting Paxlovid Reduce Its Use

Requiring prescriptions for most drugs is defended as a way to protect patients. But getting a quick physician appointment, making the appointment, and then getting the prescription filled, can all take nontrivial amounts of time and effort, especially burdensome for the poor or for those with work or family duties. Many drugs, such as Paxlovid for Covid, only work if taken in the early days of the disease. As a result, few people end up taking Paxlovid.

How does that protect patients?

If we respected the right of adult patients to make their own decisions, as soon as they had symptoms of Covid, they could go to a pharmacy and purchase Paxlovid.
Showing respect would both be moral, and would be more effective against the disease.

(p. A19) . . . Paxlovid seems to reduce the chance of hospitalization and death from Covid by more than 85 percent, . . .

. . .

But having drugs, especially highly effective ones like Paxlovid, is critical. And for these medications to succeed they must be taken correctly. People need to start them within five days of an infection, and because of the deficiencies of our testing system and other problems in health care, beginning treatment that quickly is difficult.

. . .

If you test positive, you can’t go straight to a pharmacy for the drug therapy like you did for the test. You need a prescription for the medication, which often requires a doctor’s visit. That presupposes that you have a doctor (many people don’t), and that there’s an appointment available. Before the pandemic, fewer than half of people in the United States could get a same-day or next-day appointment with their provider when they were sick.

If you’re lucky enough to traverse this gantlet successfully, though, you now need to get your prescription filled. Most insurance will restrict where you can get your medications paid for, and it’s hit or miss whether that pharmacy will have pills in stock. If not, hopefully they’ll be in a few days later, but those are precious days.

Too few people understand that much of the U.S. health care system is set up to make it harder for people to get care — an attempt to drive down overall health care spending. That’s why your insurance likely has higher deductibles than it used to, and more visits come with co-pays or coinsurance. But poorer people have a harder time covering these costs, so this worsens disparities and makes it harder for those who need help the most to get it.

We see this play out with Covid-19 treatments. A recent study looked at how efficiently and effectively Medicare beneficiaries (all of whom were elderly) received monoclonal antibody therapy from 2020 to 2021 for Covid. It found that those at highest risk were the least likely to be treated, in large part because it was difficult to navigate these hurdles within the 10 days from infection that treatment requires.

It doesn’t need to be this way.  . . .  Pharmacists could be more empowered to talk to patients about whether the pills are safe for them and distribute pill packs without a prescription if patients qualify.

For the full commentary, see:

Aaron E. Carroll. “Covid Drugs Might Work Well, but Our Health System Doesn’t.” The New York Times (Monday, February 14, 2022 [sic]): A19.

(Note: ellipses added.)

(Note: the online version of the commentary has the date Feb. 13, 2022 [sic], and has the title “Covid Drugs May Work Well, but Our Health System Doesn’t.”)

Disintermediate Healthcare

Many of the problems of our broken healthcare system could be fixed if insurers and healthcare providers were competing directly and transparently for the dollars of patients. But their are middlemen between patients and providers–mostly employers and governments. The goals and knowledge of the payers overlap, but are not the same. The payers may prioritize lowering their costs and may not care as much, or even know, the full costs to the patients.

The patients have a much better knowledge of the value of the healthcare or insurance that they are receiving, but they are very constrained in their ability to switch to insurers or healthcare providers who provide better services, or do so more efficiently. For many workers healthcare and health insurance are bundled with their work. They can leave their work, but other components of the bundle matter.

And nothing is transparent.

The fancy word for cutting out the middleman is “disintermediation.”

(p. 1) Weeks after undergoing heart surgery, Gail Lawson found herself back in an operating room. Her incision wasn’t healing, and an infection was spreading.

At a hospital in Ridgewood, N.J., Dr. Sidney Rabinowitz performed a complex, hourslong procedure to repair tissue and close the wound.

. . .

But the doctor was not in her insurance plan’s network of providers, leaving his bill open to negotiation by her insurer. Once back on her feet, Ms. Lawson received a letter from the insurer, UnitedHealthcare, advising that Dr. Rabinowitz would be paid $5,449.27 — a small fraction of what he had billed the insurance company. That left Ms. Lawson with a bill of more than $100,000.

“I’m thinking to myself, ‘But this is why I had insurance,’” said Ms. Lawson, who is fighting UnitedHealthcare over the balance. “They take out, what, $300 or $400 a month? Well, why aren’t you people paying these bills?”

The answer is a little-known data analytics firm called MultiPlan. It works with UnitedHealthcare, Cigna, Aetna and other big insurers to decide how much so-called out-of-network medical providers should be paid. It promises to help contain medical costs using fair and independent analysis.

But a New York Times investigation, based on interviews and confidential documents, shows that MultiPlan and the insurance companies have a large and mostly hidden financial incentive to cut those reimbursements as much as possible, even if it means saddling patients with large bills. The formula for MultiPlan and the insurance companies is simple: The smaller the reimbursement, the larger their fee.

Here’s how it works: The most common way Americans get health coverage is through employers that “self-fund,” meaning they pay for their workers’ medical care with their own money. The employers contract with insurance companies to administer the plans and process claims. Most medical visits are with providers in a plan’s network, with rates set in advance.

But when employees see a provider outside the network, as Ms. Lawson did, many insurance companies consult with MultiPlan, which typically recommends that the employer pay less than the provider billed. The difference between the bill and the sum actually paid amounts to a savings for the employer. But, The Times found, it means big money for MultiPlan and the insurer, since both companies often charge the employer a percentage of the savings as a processing fee.

In recent years, the nation’s largest insurer by revenue, UnitedHealthcare, has reaped an annual windfall of about $1 billion in fees from out-of-network savings programs, including its work with MultiPlan, according to testimony by two of its executives.

. . .

(p. 18) In some instances, the fees paid to an insurance company and MultiPlan for processing a claim far exceeded the amount paid to providers who treated the patient. Court records show, for example, that Cigna took in nearly $4.47 million from employers for processing claims from eight addiction treatment centers in California, while the centers received $2.56 million. MultiPlan pocketed $1.22 million.

. . .

In examining MultiPlan’s dominant role in this secretive world, The Times reviewed more than 50,000 pages of confidential corporate records, legal filings, claims information and other documents. The Times also interviewed more than 100 patients, doctors, billing specialists, advisers to employer health plans and former MultiPlan employees.

. . .

Mary Reinbold Jerome had been diagnosed with ovarian cancer at age 62 and received treatment at Memorial Sloan Kettering. Because the hospital was outside her plan’s network, she was billed tens of thousands of dollars.

. . .

She stood beside Andrew M. Cuomo, then the attorney general, as he announced his office’s blistering conclusions: A payment system riddled with conflicts of interest had been shortchanging patients, and at its core was a data company called Ingenix. Insurers used the company, a UnitedHealth subsidiary, to unfairly lower their payments and shift costs to patients, the probe found.

. . .

But amid the triumph, a key detail in the attorney general’s agreements with insurers largely escaped notice: The companies were required to use the nonprofit database for only five years.

When that term expired in 2014, MultiPlan was well positioned to capitalize.

For decades, the company, founded in 1980, offered a traditional approach to managing out-of-network claims by negotiating rates with doctors. Insurers got discounts and assurances that patients would not have to make up the difference.

But after MultiPlan’s founder sold it to private equity investors in 2006, the company pursued a more aggressive approach. It embraced pricing tools that used algorithms to recommend lower payments, and no longer protected patients from having to pay the difference, documents show.

Meanwhile, private equity ramped up investments in physician groups and hospitals and, in some instances, began billing for extraordinary sums. Once insurers were no longer obligated to use the nonprofit database, FAIR Health, they began looking for ways to combat that billing and other charges they considered egregious.

. . .

Internal documents show that UnitedHealthcare began a campaign to persuade employers to switch from FAIR Health. In a 2019 email, a UnitedHealthcare senior vice president emphasized creating a “sense of urgency” and helping companies still using FAIR Health “understand they don’t want to be on that program anymore.”

UnitedHealthcare had a big incentive to encourage this change. When it processed claims from employer plans using FAIR Health, the insurer collected no additional fee, according to legal testimony. But when it used MultiPlan, documents show, it typically charged employers 30 to 35 percent of the difference between the billed amount and the portion paid.

MultiPlan, too, charged a percentage of the savings, meaning it could make more by recommending lower payments. (FAIR Health charged a flat fee.)

. . .

(p. 19) Some providers said they had begun requiring payment upfront or stopped accepting patients with certain insurance plans because appealing for higher payments can be time-consuming, infuriating and futile. Others have tried to sue insurers or MultiPlan. Dr. Rabinowitz, who repaired Ms. Lawson’s incision, hopes to collect the remaining balance from UnitedHealthcare in an ongoing case.

Surprise bills for some types of care are no longer an issue, insurers said, thanks to the law that went into effect in 2022. Brittany Perritt didn’t realize the anesthesiologists at her 3-year-old’s brain tumor treatments in 2020 were out-of-network until the claims went to MultiPlan. If that care occurred today, she likely would be spared the calls from debt collectors, because she didn’t go out of network by choice.

But MultiPlan assured investors shortly before the law’s passage that it was likely to have “limited impact” on the company. In fact, MultiPlan said, 90 percent of its revenue involved out-of-network claims that wouldn’t be affected.

. . .

Even when patients figured out where to direct complaints — the Employee Benefits Security Administration — they described the process as draining and mostly fruitless.

. . .

Insurers can set negotiation parameters for MultiPlan, including not negotiating at all, records and interviews show. Multiple providers and billing specialists said that in recent years they had increasingly been told their claims weren’t eligible for negotiation.

“It wasn’t this bad before,” said Tiffany Letosky, who oversees a small practice specializing in surgeries for endometriosis and gynecologic cancers.

Former MultiPlan negotiators said their bonuses had been linked to their success at reducing payments, incentivizing a hard-line approach.

Ms. Young, the former negotiator critical of the process, said she had occasionally called a provider from a cellphone — knowing that her work line was recorded — and advised against accepting her own offer.

Another former negotiator said the pressure to get bigger discounts had made her physically ill. “It was just a game,” she said. “It’s sad.”

For the full story see:

Chris Hamby. “Patients Hit With Big Bills While Insurers Reap Fees.” The New York Times, First Section (Sunday, April 7, 2024): 1 & 18-19.

(Note: the online version of the story was updated April 9, 2024, and has the title “Insurers Reap Hidden Fees by Slashing Payments. You May Get the Bill.”)

A Nimble Evolving Virus Can Outpace Sluggish Vaccine Clinical Trials

The long time that Phase 3 clinical trials take is a major cost. This is especially true for the poor souls whose dire disease will kill them soon. It is also true, as was the case for the rapidly evolving Covid virus discussed below, where the disease is evolving so fast that it is a moving target.

We should calibrate relative risks. What is the risk from delay? What is the risk from less certainty about efficacy?

When the risks from delay are huge, it makes sense to use quicker, allegedly less certain, sources of knowledge, rather than wait for the allegedly certain results of Phase 3 clinical trials.

(p. A13) WASHINGTON — A panel of independent experts advising the Food and Drug Administration is set to recommend on Tuesday [June 28, 2022] whether to update existing Covid-19 vaccines to target a newer version of the coronavirus in a booster shot that Americans could get in the fall.

The federal government is hoping to improve the vaccine to better boost people’s immunity before a likely resurgence of the virus this winter. But to move that quickly, it may need to abandon the lengthy human trials that have been used to test coronavirus vaccines over the past two years in favor of a faster process that relies more on laboratory tests and animal trials.

The most recent trials with human volunteers have taken five months, even using relatively small groups. But the virus is evolving so quickly that new vaccine formulations are out of date before such trials are even finished.

For the full story see:

Sharon LaFraniere. “Chasing Fast-Evolving Virus, F.D.A. May Move to Update Covid Vaccine.” The New York Times (Tuesday, June 28, 2022 [sic]): A13.

(Note: bracketed date and bolded words, added.)

(Note: the online version of the story has the date June 27, 2022 [sic], and has the title “F.D.A. May Move Toward Updating Vaccines.”)

W.H.O. Ignored Those Who Knew Covid Was Airborne

The article quoted below provides more evidence that the World Health Organization (W.H.O.) failed to protect world health during the Covid pandemic. Its funding and decision-making processes made failure highly likely.

In the absence of W.H.O, how can we learn quickly of potential pandemic threats from around the world? The Covid book co-authored by Ridley documents quick and effective Twitter (now X) networks that spread and evaluated Covid information. Maybe a proof of concept?

(p. D3) In early February 2020, China locked down more than 50 million people, hoping to hinder the spread of a new coronavirus. No one knew at the time exactly how it was spreading, but Lidia Morawska, an expert on air quality at Queensland University of Technology in Australia, did not like the clues she managed to find.

It looked to her as if the coronavirus was spreading through the air, ferried by wafting droplets exhaled by the infected. If that were true, then standard measures such as disinfecting surfaces and staying a few feet away from people with symptoms would not be enough to avoid infection.

Dr. Morawska and her colleague, Junji Cao at the Chinese Academy of Sciences in Beijing, drafted a dire warning. Ignoring the airborne spread of the virus, they wrote, would lead to many more infections. But when the scientists sent their commentary to medical journals, they were rejected over and over again.

“No one would listen,” Dr. Morawska said.

It took more than two years for the World Health Organization to officially acknowledge that Covid spread through the air.

For the full story see:

Carl Zimmer. “Covid Proved Airborne. Could Bird Flu Be, Too?” The New York Times (Tuesday, February 4, 2025): D3.

(Note: the online version of the story has the date February 3, 2025, and has the title “Could the Bird Flu Become Airborne?”)

The book co-authored by Ridley that I praise in my initial comments is:

Chan, Alina, and Matt Ridley. Viral: The Search for the Origin of Covid-19. New York: Harper, 2021.

S.B.A. “Forgives” Most Covid “Loans” Even Though at Least 17% Were Issued to Fraudsters

We used to handle suffering during crises by mutual aid societies or by giving philanthropy to those we know best–our friends and neighbors. The potential fraudster is less likely to defraud their brother or neighbor, than some unknown taxpayer in a distant state. And the local philanthropist is more likely to be able to judge which relative or neighbor will benefit from aid. Giving billions to fraudsters fueled the future inflation that ordinary decent citizens would latter struggle with.

If the federal government wanted to reduce the pain from the pandemic, the best way would have been to reduce the number, and shorten the length, of mandates. Handing so much money to fraudsters, with so little due diligence, is outrageous.

[Admission: I was the victim of identity theft when the S.B.A. gave a fraudster, using my name, tens of thousands of dollars for a potato farm supposedly run by me. Then the S.B.A. had the audacity to start sending me threatening letters about my alleged failure to pay back the loans they had given to the fraudster.]

(p. A1) When J. Bryan Quesenberry first learned that the federal government was sending out hundreds of billions of dollars to help businesses survive during the Covid-19 pandemic, he thought: “There’s going to be fraud here. There just has to be.”

A few months later, Mr. Quesenberry started sifting through a list of businesses that received Paycheck Protection Program loans, which were intended to help small businesses ravaged by the pandemic continue paying their employees. The Oregon lawyer said he knew businesses were not allowed to receive more than one loan during a single round, so he searched for “double dippers.”

He soon found dozens of businesses across the country that appeared to improperly obtain P.P.P. loans. During the summer of 2020, Mr. Quesenberry started suing those firms to try to help the government recover funds.

“It just blows my mind,” Mr. Quesenberry said. “That’s tax money that comes out of your pocket and that comes out of my pocket.”

As federal officials try to retrieve billions in stolen pandemic relief funds, private citizens are scouring public data, company websites and social media pages to help identify potential cases. Those who have filed suits say they are motivated by the desire to root out wrongdoers and expose corporate fraud.

But there is also a strong financial incentive. Under the False Claims Act, private citizens can file lawsuits on behalf of the federal government against those who may have defrauded the United States. If the government recovers funds, those citizens can typically earn between 15 and 30 percent of that amount.

. . .

(p. A15) The armchair sleuthing highlights how widespread pandemic fraud was and how federal investigators have struggled to keep up with it. In its haste to stave off an economic crisis and provide immediate aid to Americans, Washington distributed billions of dollars with few strings and little oversight. The Small Business Administration’s inspector general has estimated that more than $200 billion — or at least 17 percent of the pandemic loans the agency distributed — was awarded to “potentially fraudulent actors.” The majority of P.P.P. loans have been forgiven by the federal government.

While federal investigators have gone after some of the biggest perpetrators of fraud, limited resources have hindered their ability to go after the estimated thousands of people who improperly took government money.

. . .

Some private citizens said that it often took hours to investigate leads, and that they were unearthing cases that might otherwise slip through the cracks. Although Mr. Quesenberry said he relied primarily on information available on the internet to build cases, he said it was a time-intensive process that often required combing through government websites, Yelp pages, news articles and LinkedIn profiles. He said he thought he added value because he was pulling together evidence to “paint the picture of fraud.”

Mr. Quesenberry has earned more than $400,000 from 10 cases that have helped the federal government recover more than $3 million, according to a review of documents from U.S. attorney’s offices. Mr. Quesenberry said he had been investigating pandemic fraud for about four and a half years and was now working on his cases full time.

. . .

Hadar Susskind, the president and chief executive of Americans for Peace Now, said officials thought they had qualified for the loan because they did not consider the nonprofit to be a political organization. He said they had settled because it could have been costlier to go to court.

Mr. Susskind said he had never met Mr. Abrams, but he believed the complaint was “very much ideologically motivated” because of the nonprofit’s work to promote Israeli-Palestinian peace.

In an email, Mr. Abrams said: “In America these anti-Israel organizations have the right to spin, distort or even outright lie about Israel. However, they do not have the right to subsidize their activities with government monies for which they were not eligible.”

Mr. Abrams said he had long done other activist work, including recently representing a Jewish high school student who was the victim of antisemitic bullying. He said that he did not charge fees in those matters, and that the “whistle-blower cases do generate significant revenue so things more or less balance out.”

For the full story see:

Madeleine Ngo. “Fraud Hunters Earn Windfalls Tied to Covid.” The New York Times (Monday, November 25, 2024): A1 & A15.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story has the date Nov. 23, 2024, and has the title “They Investigated Pandemic Fraud, Then Earned Thousands.”)

Healthcare Innovations Can Be Effective AND Cheap

Many are resigned to accept our current mess of a healthcare system because they fear that if the system was changed into a fully free market system they would not be able to afford anything approaching their current level of healthcare. But they do not understand what would change. If patients paid for their own healthcare there would be competition to provide cheaper healthcare services to the many. Henry Ford got rich finding ways to make cars better and cheaper. Bill Gates got rich mainly by making adequate operating systems cheaper.

If we made healthcare a free market, then healthcare would find its Henry Ford and Bill Gates. If patients directly paid for healthcare, then healtcare services would be more consumer oriented–for instance the value of patients’ time would be respected. Medical entrepreneurs would compete to bring us more cures and cheaper cures.

The problem is not that we are “fixated on profits” as is suggested in the last paragraph quoted below. The problem is that our non-market healthcare system creates perverse incentives and perverse regulatory constraints, so that simple frugal innovations are not rewarded.

[Below I first quote a few passages from The New York Times obituary of Cash, and then from The Wall Street Journal obituary of Cash.]

(p. A21) Richard A. Cash, who as a young public-health researcher in South Asia in the late 1960s showed that a simple cocktail of salt, sugar and clean water could check the ravages of cholera and other diarrhea-inducing diseases, an innovation that has saved an estimated 50 million lives, died on Oct. 22 at his home in Cambridge, Mass. He was 83.

. . .

Dr. Cash, the son of a doctor, arrived in East Pakistan, today Bangladesh, in 1967 as part of a project through the U.S. Public Health Service. There he worked with another young American doctor, David Nalin, to respond to a cholera outbreak outside the capital, Dhaka.

The two had already been researching a simple oral rehydration therapy and knew of other, previous efforts, all of which had failed. But they believed that the therapy held promise, especially in the face of mounting deaths.

They realized that a main problem was volume: Past efforts had resulted in too little or too much hydration. Dr. Cash and Dr. Nalin conceived a trial in which they carefully measured the amount of liquid lost and replaced it with the same amount, mixed with salt and sugar to facilitate absorption.

They divided 29 patients into three groups, with one group receiving an IV drip, another an oral treatment through a tube, and the third an oral treatment by drinking from a cup.

Other doctors and nurses found their experiment bizarre and tried to stop them. But Dr. Cash and Dr. Nalin persisted, splitting the work between them in two 12-hour shifts, to ensure the integrity of the trial.

The results were definitive: Only three of the tubed patients — and only two who drank the solution — needed additional IV treatment.

. . .

“We’re enamored by high technology,” he said at the Council on Foreign Relations. “And we’re not in love with low-tech. Low-tech is always seen in our eyes as second-class. Why would you do this, when you could do that? And I would argue just the opposite.”

For the full obituary from The New York Times that is quoted above, see:

Clay Risen. “Richard A. Cash, 83, Who Saved Millions From Dehydration, Dies.” The New York Times (Monday, November 4, 2024): A21.

(Note: ellipses added.)

(Note: the online version of the obituary has the date Nov. 2, 2024, and has the title “Richard A. Cash, Who Saved Millions From Dehydration, Dies at 83.”)

(p. C6) Half a liter of water, plus a pinch of salt and a fistful of sugar. As scientific insights go, it can’t compare to the intricate equations developed to split the atom or map the planets’ paths. But its simplicity was crucial to its monumental impact.

That simple solution—the cornerstone of Oral Rehydration Therapy, or ORT—has proved extraordinary in staving off and reversing the devastating consequences of dehydration caused by cholera and other diarrheal diseases, saving tens of millions of lives since its development nearly six decades ago. In 1978, an editorial in the Lancet called ORT “potentially the most important medical advance of the century.”

. . .

Cash saw this ethos of simplicity and accessibility as instructive for a western medical system that’s infatuated with high-tech solutions, dismissive of low-tech ones and fixated on profits—and where, consequently, an overnight stay in the hospital for dehydration can result in a four-figure bill. “A solution that can’t be applied,” he told Harvard Magazine, “is really no solution at all.”

For the full obituary from The Wall Street Journal that is quoted immediately above, see:

Jon Mooallem. “A Doctor Whose Simple Treatment Prevented Millions Of Cholera Deaths.” The Wall Street Journal (Saturday, Nov. 9, 2024): C6.

(Note: ellipsis added.)

(Note: the online version of the obituary has the date November 7, 2024, and has the title “Richard Cash, Whose Rehydration Therapy Saved Millions of Lives, Dies at 83.”)

Regulators Do Not Understand the Sense of Urgency of Some Who Are Dying

Many know that the first gift of Prometheus to humanity was fire. Fewer know that his second gift was blind hope. International value surveyor Ronald Inglehart concluded that happiness depends less on current status than on hope for the future.

Many who are facing death without any standard therapy to save them, are anxious to try a Hail Mary experiment–a potential therapy with many risks, but with a possible path forward, with hope.

A libertarian or classical liberal says that they have the right to choose hope.

In the concluding passages quoted below it is easy to sense the hope that the pig kidney transplant gave Tawana Looney.

(p. A18) A 53-year-old Alabama woman with kidney failure who waited eight years for an organ transplant has received a kidney harvested from a genetically modified pig, NYU Langone Health surgeons announced on Tuesday [Dec. 17, 2024].

The patient, Towana Looney, went into surgery just before Thanksgiving. She was in better health than others who have received porcine organs to date and left the hospital 11 days after the procedure.

. . .

Dr. Robert Montgomery, director of the NYU Langone Transplant Institute, co-led the surgery with Dr. Jayme Locke, a transplant surgeon who applied two years ago for approval from the Food and Drug Administration to perform the operation for Ms. Looney.

. . .

The experimental procedure was approved by the Food and Drug Administration under its expanded access or compassionate use program, which allows unapproved products to be used when patients have life threatening conditions.

. . .

About two years ago, Dr. Locke contacted Ms. Looney. Dr. Locke was intent on finding better solutions for patients with kidney failure, which is rampant in Alabama and disproportionately affects the state’s Black residents.

It was the beginning of a conversation that spanned nearly two years while the physician sought special F.D.A. permission to do the xenotransplant on Ms. Looney, who was eager to get started.

“I said, ‘OK, where do I sign?’” Ms. Looney recalled.

“But she said, ‘This is new territory. This is new ground. I don’t know what might happen, and a lot of things could go wrong here.’ I said, ‘OK, when are we going to do it?’ And she went through all the if’s and and’s and what might happen again.”

The dialogue continued on and off for months. “We talked every day, and every day we talked she said, ‘Are you sure?’ And I said, ‘I’m positive. My mind is made up,’” Ms. Looney said.

Last month, while Ms. Looney was sitting in her dialysis chair during her morning treatment, her phone rang. It was Dr. Locke, who asked, “How do you feel about flying up to New York?”

Dr. Locke explained that she would do the surgery with Dr. Montgomery, the mentor who trained her.

“I said, ‘But what about Christmas? What about Thanksgiving?’ ” Ms. Looney said.

“She said, ‘It is going to be the best Christmas present you ever got.’ I said, ‘Yes, ma’am, it is.’”

For the full story see:

Roni Caryn Rabin. “Alabama Woman Gets Nation’s 3rd Pig Kidney Transplant.” The New York Times (Wednesday, December 18, 2024): A18.

(Note: ellipses, and bracketed date, added.)

(Note: the online version of the story has the date Dec. 17, 2024, and has the title “Alabama Woman Receives Nation’s Third Pig Kidney Transplant.”)

Chinese Communist Regulators Will Want to Deep-Six DeepSeek

Many policy experts have worried than China’s economy will surpass the economy of the United States. If we lived in a world of totally free trade, I would not care if this happened. Economics is not a competitive sport where one team can win only if another team loses. A free economy is not a zero-sum game. If you are OK with me mixing metaphors: a rising tide really does lift all boats. (Amar Bhidé (quoting Paul Krugman, if memory serves) does a good job of making this point in The Venturesome Economy.)

But even though it wouldn’t bother me, China’s economy will not surpass that of the United States if China continues to oppressively regulate its economy and we continue to exuberantly unregulate our economy. An economy thrives when entrepreneurs thrive and entrepreneurs thrive when unregulated.

Consider the recent hand-wringing over the recently announced DeepSeek Chinese A.I. program. The Chinese Communists will be especially energetic in regulating entrepreneurs in the A.I. sector because the Communists cannot afford to have Chinese A.I. programs giving true answers to questions in any way related to the Chinese economy, or to the corruption and authoritarianism of the Chinese Communist regime. A.I. policy expert Barath Harithas understates the situation when he says: “Overregulation and the need to adhere to ‘core socialist values’ could risk neutering A.I.’s potential” (as quoted in Pierson and Wang 2025, p. A4).

Barath Haritas’s statement on overregulation of A.I. in China can be found in:

David Pierson and Berry Wang. “Success of DeepSeek Lifts China, but Party May Halt Its Progress.” The New York Times (Tues., February 4, 2025): A4.

(Note: the online version of the article has the date February 2, 2025, and has the title “DeepSeek Is a Win for China in the A.I. Race. Will the Party Stifle It?”)

The book by Amar Bhidé that I praise in my initial comments is:

Bhidé, Amar. The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World. Princeton, NJ: Princeton University Press, 2008.

Some Heavily Subsidized Hospitals File Liens Against Poor Patients, Rather Than Bill Medicaid

Laws that were once well-intentioned but are now outdated often remain on the books. The laws that allow hospitals to take out liens on the property of poor patients are an example. Some policy experts have proposed that each law or regulation should have a “sunset clause” that gives a date on which they expire unless they are passed again. Another solution to the lien practice would be if all hospitals were managed on the basis of ethical side-constraints. They would then not take advantage of the perverse incentives that the lien laws create.

Even without ethical side-constraints, exploiting the outdated lien laws would be harder if greater competition between hospitals created greater transparency about shady practices–the reputation of unethical hospitals would suffer, and they would lose patients.

(p. A1) When Monica Smith was badly hurt in a car accident, she assumed Medicaid would cover the medical bills. Ms. Smith, 45, made sure to show her insurance card after an ambulance took her to Parkview Regional Medical Center in Fort Wayne, Ind. She spent three days in the hospital and weeks in a neck brace.

But the hospital never sent her bills to Medicaid, which would have paid for the care in full, and the hospital refused requests to do so. Instead, it pursued an amount five times higher from Ms. Smith directly by placing a lien on her accident settlement.

Parkview is among scores of wealthy hospitals that have quietly used century-old hospital lien laws to increase revenue, often at the expense of low-income people like Ms. Smith. By using liens — a claim on an asset, such as a home or a settlement payment, to make sure someone repays a debt — hospitals can collect on money that otherwise would have gone to the patient to compensate for pain and suffering.

They can also ignore the steep discounts they are contractually required to offer to health insurers, and instead pursue their full charges.

The difference between the two prices can be staggering. In Ms. Smith’s case, the bills that Medicaid would have paid, $2,500, ballooned to $12,856 when the hospital pursued a lien.

“It’s astounding to think Medicaid patients would be charged the full-billed price,” said Christopher Whaley, a health economist at the (p. A19) RAND Corporation who studies hospital pricing. “It’s absolutely unbelievable.”

The practice of bypassing insurers to pursue full charges from accident victims’ settlements has become routine in major health systems across the country, court records and interviews show. It is most lucrative when used against low-income patients with Medicaid, which tends to pay lower reimbursement rates than private health plans.

. . .

Hospitals have come under scrutiny in recent years for increasingly turning to the courts to recover patients’ unpaid bills, even in the midst of the coronavirus pandemic. Hospitals, many of which received significant bailouts last year, have used these court rulings to garnish patients’ wages and take their homes.

But less attention has been paid to hospital lien laws, which many states passed in the early 20th century, when fewer than 10 percent of Americans had health coverage. The laws were meant to protect hospitals from the burden of caring for uninsured patients, and to give them an incentive to treat those who could not pay upfront.

. . .

When states have permissive hospital lien laws, some hospitals take advantage in ways that hurt patients. These hospitals tend to be wealthier, The New York Times found, and many of those that received hundreds of millions of dollars in federal bailout funding during the pandemic are among the most aggressive in pursuing payment through hospital liens.

Community Health Systems, which owns 86 hospitals across the country, received about a quarter-billion in federal funds during the pandemic, according to data compiled by Good Jobs First, which researches government subsidies of companies.

One of its hospitals in Tennessee refused to bill Medicare or the veterans health insurance of Jeremy Greenbaum after a car crash aggravated an old combat wound to his ankle. Instead, the hospital filed liens in 2019 for the full price of his care, records show.

For the full commentary, see:

Sarah Kliff and Jessica Silver-Greenberg. “The Upshot; Waiting for Insurance Payout? A Hospital May Collect It First.” The New York Times (Tuesday, February 2, 2021 [sic]): A1 & A19.

(Note: ellipses added.)

(Note: the online version of the commentary was updated Feb. 12, 2021 [sic], and has the title “The Upshot; How Rich Hospitals Profit From Patients in Car Crashes.”)

Appeals of Health Insurance Claim Denials Often Succeed, but at Great Cost

About 75% of those who appeal insurer rejections of healthcare claims, end up receiving an approval of the claim. But that does not mean that of those who did not appeal, 75% would have succeeded. Presumably one difference between those who appeal and those who do not appeal, is that on average those who appeal have stronger cases. Of course there are other differences, like perseverance, and the opportunity cost of the time and energy it takes to appeal.

Those opportunity costs, and the damage to morale whether the claim is appealed or not, are usually not counted among the costs of our healthcare system.

Note also in the case discussed below that claims for treatment of rare diseases are much more likely to be denied than otherwise similar claims for common diseases. You see randomized double-blind clinical trials (RCTs) are unlikely to have been done for treatments for rare diseases for a couple of reasons. One is that it is hard to find enough patients to populate the RCT. Another is that even with an eventually successful treatment, the revenue will not be enough to cover the costs of the RCT. So insurance companies can reject the claims because there is no “evidence” for efficacy–where “evidence’ is defined as the outcome of an RCT. The lesson: if you’re going to acquire a dire illness, make sure it is a common dire illness.

(p. A1) CUMMING, Ga.—After three years of doctors’ visits and $40,000 in medical bills didn’t cure their daughter’s rare condition, April and Justin Beck found a specialist three states away who offered a promising treatment.

They set out before dawn last spring for the nine-hour drive to Arkansas Children’s Hospital in Little Rock, where Dr. Aravindhan Veerapandiyan explained how infusions of antibodies could help Emily, now 9 years old, and her misfiring immune system.

They returned home with an appointment to start the infusions. But the Becks’ insurer, UnitedHealthcare, declined to pay for a treatment it said wasn’t medically necessary.

They decided to fight back. “I really had no idea it was going to be this hard,” April Beck said.

Health insurers process more than five billion payment claims annually, federal figures show. About 850 million are denied, according to (p. A8) calculations by appeals company Claimable, based on data from health-policy nonprofit KFF and the Centers for Medicare and Medicaid Services. Less than 1% of patients appeal.

Few people realize how worthwhile those labors can be: Up to three-quarters of claim appeals are granted, studies show.

Patients who fight denied claims must marshal evidence from medical studies, navigate dense paperwork and spend hours on the phone during what is often one of the most difficult times of their lives. They debate insurers over whether a patient might ever recover from a stroke, or whether an expensive new treatment holds real promise.

. . .

The sense of futility that keeps people from appealing denied claims is part of a current of anger against insurers that surged in December [2024] after the assassination of UnitedHealthcare Chief Executive Officer Brian Thompson.

. . .

In one letter, UnitedHealthcare denied the treatment because the medication wasn’t ordered from an in-network pharmacy. In another, on July 25, [2024] the insurer said the treatment wasn’t medically necessary and hadn’t been proven helpful for Emily’s condition.

“The services are not eligible for coverage because your plan doesn’t cover unproven procedures,” the insurer said.

Rare cases often put patients and insurers in protracted conflict. Some people want experimental treatments that insurers reject because they aren’t thoroughly proven to work. But for patients with rare conditions, the number of cases are so small it’s difficult to widely document a drug’s effects.

. . .

April learned from a Facebook support group for parents of children with PANS/PANDAS about Claimable, which uses artificial intelligence to help patients appeal denials. Claimable was offering to submit claims for PANS/PANDAS patients free of charge.

The Becks on Dec. 6 [2024] sent their appeal to the new denial based on medical necessity by email to UnitedHealthcare, copying Andrew Witty, CEO of its parent company, as well as Georgia’s governor and attorney general. Claimable encouraged them to copy Witty on every interaction.

The package included a letter from the PANS Research Consortium stating that immunoglobulin therapy is widely accepted as standard treatment for kids like Emily and that, as of Nov. 22, 2024, 13 states have made it illegal to impede access to the treatment for people with PANS/PANDAS. The letter cited 25 studies backing the treatment’s efficacy. It was cosigned by physicians from Stanford and the National Institutes of Health.

. . .

Two days before Christmas, a representative from UnitedHealthcare called to say Emily had won her appeal. UnitedHealthcare told the Journal that its medical director decided the infusions would be appropriate as a trial for Emily.

For the full story see:

Julie Wernau. “These Families Beat Health Insurers.” The Wall Street Journal (Friday, February 13, 2025): A1 & A8.

(Note: ellipses, and bracketed years, added.)

(Note: the online version of the story has the date Feb. 12, 2025, and has the title “Health Insurers Deny 850 Million Claims a Year. The Few Who Appeal Often Win.”)

“Once Autonomous and Highly Esteemed, Doctors” Lament Being “Trapped Between Insurers” and Hospital Managers

As health regulations and malpractice lawsuits increase, doctors have increasingly needed support staff to help them navigate the morass. Large hospitals and clinics have such support on staff, so doctors increasingly have found it easier to join such institutions, than to run their own private practice. But a trade-off is that they give up considerable autonomy, making the practice of medicine less fulfilling and risking burn-out. To protect themselves and their institutions, doctors must follow the protocols rather than follow their experience-based judgement to innovate for the benefit their patients.

(p. A6) The killing of a top health insurance executive outside a Midtown Manhattan hotel last week triggered an outpouring of public anger at an industry many Americans blame for the ills of the nation’s healthcare system.

Count doctors among the aggrieved.

. . .  Doctors say their frustration is born of intimate experience and has been building for years.

Their chief complaint is the aggravation and expense of convincing insurance companies to pay them for their patients’ treatment. Even when they are ultimately approved, MRI scans and other vital but costly procedures often require days of campaigning and paperwork, say doctors.

“It’s getting worse,” said Dr. Zulfiqar Ahmed, an internist in Augusta, Ga., who has practiced in the U.S. for 35 years. “This is not only UnitedHealthcare—this is universal in this country.”

. . .

“They hire certain doctors, and they sit at a desk, and their whole purpose is to deny or delay,” Ahmed said, echoing a common complaint among doctors.

. . .

In a recent post on X, Dr. Alan Nguyen, a spine specialist in Fort Myers, Fla., noted that when insurance-company doctors reject an MRI request, he now asks for their name and health provider identification number. “I tell them if a cancer is missed, then the patient will know who to sue,” wrote Nguyen. In an interview, he said he believes the situation had worsened significantly over the last five years. When insurers denied treatment, Nguyen observed, doctors were still left to deal with the patients and their pain.

A familiar lament among doctors is how sweeping changes over the last 20 years—some instigated by insurers, others not—have degraded their profession. Once autonomous and highly esteemed, doctors are increasingly employees of large hospital chains and find themselves trapped between insurers and their own cost-conscious management.

. . .

Dr. Richard Lechner, a family dentist in New Britain, Conn., for years paid for three administrative staff members whose days, he said, were mostly spent fighting with insurers. This for an office that consisted of one dentist and two hygienists.

“They’re always throwing up roadblocks for practitioners like me to get paid,” Lechner said. Requests for additional documentation, or claims of paperwork lapses, were, he said, “specifically designed to prolong, prolong, prolong and then hope the dentist gives up.”

Last year, Lechner did give up: He sold his private practice to Dental Associates of Connecticut, a company that operates a network of more than 40 dental offices across the state. Like Davidian, he is now an employee. Much of the work of chasing insurance claims is now handled by a specialist team at Dental Associates’ central office.

“The primary reason I sold my dental practice is because I couldn’t keep up with the insurance companies’ shenanigans,” he said. “I thought I was going to have a stroke.”

For the full story see:

Joshua Chaffin and Julie Wernau. “Haggling With Insurers Getting Worse, Doctors Say.” The Wall Street Journal (Friday, Dec. 13, 2024): A6.

(Note: ellipses added.)

(Note: the online version of the story has the date December 12, 2024, and has the title “Doctors Say Dealing With Health Insurers Is Only Getting Worse.” Where the online version provides somewhat more elaboration than the print version, the passages quoted above follow the online version. In the print version, but not the online version, the last four paragraphs quoted above appear in a separate boxed sidebar with the title “Dentist Gave Up, Sold His Practice After ‘Shenanigans’.” In the online version, the paragraphs appear at the very end of the main article, with no separate heading or sub-heading.)