Friday, February 22, 2019

The Revolving Door Spins Again: the Now Constant Coziness Between the Health Care Industry and US Government

Just because Washington DC is now crazy town does not mean the revolving door has stopped spinning.  We have been dutifully accumulating cases, so it is time to present our latest update.

I will divide this into two sections 1) the incoming revolving door, through which come people from the health care industry to enter US government positions in which they may influence health care regulation or policy relevant to their former positions; and 2) the outgoing revolving door, through which go people from US government positions in which they influenced health care regulation or policy to industry positions which were relevant to the scope of their government work.  In each section, we will list cases chronologically according to when they were made public.

Incoming Revolving Door Transitions

James Parker from Multiple Positions in For-Profit Health Insurance Companies to Director of DHHS Office of Health Reform

This was reported in Health Leaders Media in April, 2018:

Parker's profile on LinkedIn says he worked for Anthem from 1995 through 2004, serving more than four years as president of Anthem Blue Cross and Blue Shield of Maine.

Parker then worked about five years for WellPoint after it was acquired by Anthem, serving as president of federal employee benefits, then president of federal government solutions, then chief of staff to President and CEO Angela Braly.

Parker spent more than three years as an independent healthcare consultant before landing his job as president and CEO of provider-sponsored IU Health Plans in 2012. Last year, he was named president and CEO of MDwise, an Indianapolis-based Medicaid managed care organization.

Note that current Secretary of DHHS Alex Azar, who came to his job from a top management position in pharmaceutical giant Eli Lilly, rationalized Parker's appointment thus:

His knowledge and expertise will be vital to our work at HHS to ensure that Americans have access to insurance that meets their needs,
Funny, he did not seem at all worried about putting a long term leader of for-profit health insurance companies in charge of ... health care (but operationally largely health insurance) reform.

Andrew Smith from a Legal Firm for which he Represented Numerous Large Health Care Corporations to Head of Federal Trade Commission Consumer Protection Bureau

This was summarized in The Hill in December, 2018:

The top consumer protection official at the Federal Trade Commission (FTC) is barred from handling cases involving more than 100 different companies due to conflicts of interest from his prior work as a private sector attorney, according to documents obtained by the consumer group, Public Citizen.

Andrew Smith, who was tapped as the chief of the FTC’s Consumer Protection Bureau in May, listed 120 conflicts on a financial disclosure form that Public Citizen released on Thursday.

The Hill's reporting emphasized Smith's representation of financial and technology firms, but he also represented a number of big health care corporations, based on the disclosure form that Public Citizen obtained via a freedom of information act (FOIA) request.

These included Bioverativ (a Sanofi subsidiary), Cardinal Health, GlaxoSmithKline, and the Pharmaceutical Research and Manufacturers of America (PhRMA).

Lisa Gilbert, Public Citizen Vice President of Legislative Affairs, was quoted:

Even in an administration full of unprecedented conflicts of interests, Mr. Smith’s conflicts stand out from the pack

An article in GizModo noted

Senator Elizabeth Warren was another staunch critic of Smith’s hire who in May said the agency’s decision was 'outrageous' and added that the FTC 'should pick someone with a track record of protecting consumers, not companies that cheat people.'

Dr Amy Abernethy from Chief Medical Officer for Roche Subsidiary Flatiron Health to Principal Deputy Commissioner of the FDA

Per Matthew Herper writing for Forbes in December, 2018:

The Food and Drug Administration has named Amy Abernethy, currently the chief medical officer at Flatiron Health, a unit of the drug giant Roche, to one of its highest positions. She will start in a few months.

Abernethy, an oncologist who is credited with helping Flatiron transform data collected from electronic medical records into information that might become acceptable to FDA regulators, will be the Principal Deputy Commissioner for Food and Drugs. This is the highest position at the FDA that is not a political appointment. It cuts across all areas of the agency’s remit, overseeing initiatives that cut across offices that oversee the regulation of drugs, medical devices, tobacco and food. Flatiron was purchased by Roche at a valuation of $2.1 billion earlier this year.

Mr Herper did include this dry statement

That potential conflict of interest could be an issue for some outside the FDA.

Of course, the current FDA commissioner was rather blase about any conflict of interests Dr Abernethy might have:

In his memo to staff, Scott Gottlieb, the FDA commissioner, said that Abernethy’s ethics review is still pending. It will likely help that she is unlikely to own large amounts of stock in either Flatiron or Roche, because Roche paid for Flatiron in cash.

There was considerable discussion of  Dr Gottlieb's own conflicts of interest at the time of his appointment (see, for example, this article from the New York Times).  

Outgoing Revolving Door Transitions

Multiple High Ranking FDA Officials to Pharmaceutical Companies

This was reported in April, 2018 in the newsletter of the Regulatory Affairs Professional Society:

Twenty-year FDA veteran Badrul Chowdhury, most recently director of the Center for Drug Evaluation and Research’s (CDER) Division of Pulmonary, Allergy and Rheumatology Products, has taken a job this month as senior vice president at AstraZeneca.

FDA confirmed to Focus that Chowdury joined the agency in 1997 and left on 16 April. And Chowdury isn’t the only one to leave in recent months for an industry job, FDA said.

Sarah Pope Miksinski, former director of the Office of New Drug Products in FDA’s Office of Pharmaceutical Quality, left the agency in February, also for AstraZeneca. And last July, Geoffrey Kim, former director of FDA’s Division of Oncology Products moved to AstraZeneca to become its VP of oncology and head of oncology strategic combinations.

Meanwhile, Jean-Marc Guettier, former director of FDA’s Division of Metabolism and Endocrinology Products, left FDA in December 2017 for Sanofi, Niraj Mehta, former associate director for global regulatory policy at FDA moved over to Merck as a director in March 2018....
So where could former FDA officials get such well compensated, top positions outside the pharma industry?

Bruce Greenstein, Chief Technology Officer of DHHS to LHC Group (For-Profit Home Health Care Provider)

Reported in the Home Health Care News in May, 2018:

HHS CTO Bruce Greenstein will become LHC Group’s first chief innovation and technology officer in June, the home health, hospice and personal care services provider announced Tuesday.

Note that in 2017, we discussed how Greenstein had transited the incoming revolving door from a health care technology company to DHHS.

Once a revolving door transitioner, always a revolving door transitioner? 

Dr Tom Price, Former Secretary of DHHS to Jackson Healthcare

As reported in Health Leaders Media in January, 2019:

Tom Price, MD, the scandal-plagued former secretary for the Department of Health and Human Services, has been named to the advisory board of Jackson Healthcare.

A spokesperson for the Atlanta-based healthcare staffing firm said that the company is privately held and would not detail Price’s compensation.

It is interesting that Health Leaders Media inserted that phrase, "scandal-plagued," in such a prominent way.  Nonetheless, the leaders of Jackson Healthcare was effusive:

'Nobody has as profound an understanding of the national healthcare landscape as Dr. Price,' Richard L. Jackson, chairman and CEO of Jackson Healthcare, said in a media release. Tom has exhibited an unwavering commitment to preserving the patient-physician relationship. That mindset, along with his physician, business and policy experience, will make him an invaluable addition to our board.'

No scandals to see here, please move on. 

Courtney Price, Assistant Secretary for Legislative Affairs at DHHS to Cigna

In February, 2019, ProPublica published an article documenting the departure of 33 top  executive branch officials for lobbying positions.  These included:

Courtney Lawrence was a longtime aide for Reps. Bill Cassidy and Tom Price and a federal lobbyist for the insurance trade association America’s Health Insurance Plans before taking a job as assistant secretary for legislative affairs at Health and Human Services in March 2017, when Price briefly headed the agency. Lawrence stayed for 18 months before leaving in August 2018 for a director role at Cigna Corp., the health insurance conglomerate.

Lawrence registered as a lobbyist with Cigna in October. Her disclosure forms state that she was working on proposed changes to Medicare, the Affordable Care Act and prescription drug rebates. Federal lobbying disclosures show that Lawrence was one of several lobbyists to communicate with federal agencies and the White House, and not just members of Congress. In a statement, Cigna asserted that the lobbying disclosure — which was prepared by the company — is inaccurate. Cigna blamed a 'formatting issue.' The statement said Lawrence 'does not and will not lobby the Executive Branch.' The company said it would correct her lobbying disclosure form.
So where will she lobby instead?

Alex Campau, White House Health Policy Aide to Cozen O'Connor

ProPublica also briefly noted

Alex Campau, a White House health policy aide now running the health lobbying team at Cozen O’Connor

That should do it for now.


With so many crises appearing during the Trump regime, the issue of the revolving door seems to get lost in the fray.  However, the Trump regime has supercharged a chronic problem, especially in its proclivity to hire people direct from industry to regulate and set policy that affect their old employers.  As we have said again and again, that is three times in 2018,  

The revolving door is a species of conflict of interest. Worse, some experts have suggested that the revolving door is in fact corruption.  As we noted here, the experts from the distinguished European anti-corruption group U4 wrote,

The literature makes clear that the revolving door process is a source of valuable political connections for private firms. But it generates corruption risks and has strong distortionary effects on the economy, especially when this power is concentrated within a few firms.

The ongoing parade of people transiting the revolving door from industry to the Trump regime once again suggests how the revolving door may enable certain of those with private vested interests to have disproportionate influence on how the government works.  The country is increasingly being run by a cozy group of insiders with ties to both government and industry. This has been termed crony capitalism. The latest cohort of revolving door transits suggests that regulatory capture is likely to become much worse in the near future.

Remember to ask: cui bono? Who benefits? The net results are that big health care corporations increasingly control the governmental regulatory and policy apparatus.  This will doubtless first benefit the top leadership and owners/ stockholders (when applicable) of these organizations, who are sometimes the same people, due to detriment of patients' and the public's health, the pocketbooks of tax-payers, and the values and ideals of health care professionals.  

 The continuing egregiousness of the revolving door in health care shows how health care leadership can play mutually beneficial games, regardless of the their effects on patients' and the public's health.  Once again, true health care reform would cut the ties between government and corporate leaders and their cronies that have lead to government of, for and by corporate executives rather than the people at large.

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