California Nightmares - More Troubles at UC, and Big Conflicts of Interest at UCSD

It is getting hard to keep up with all the stories about the University of California (UC) system, most about the lavish pay and perks given to its top managers, and the rising tide of editorial criticism of the huge university. At the same time, UC-Irvine has been accused of mismanaging its liver, bone marrow, and kidney transplant programs, and of hiring a resident after his father gave the hospital a large contribution (see most recent post here).

Here are the latest additions to this on-going saga:

Undisclosed Severance Packages - The San Francisco Chronicle found that many University of California managers have received previously undisclosed severance packages even after they voluntarily resigned. "While the program was approved by regents, details about the individual payments and who received them have never been publicly reported." Although the program is only supposed to be open to executives without simultaneous faculty appointments, or those hired before 1996, the University seems to have made various exceptions. For example, UC- Santa Cruz Chancellor Denice Denton is on this plan, although she is not a faculty member and was hired after 1996. Denton is well known for receiving one particularly striking perk: the University constructed a $30,000 run for her dogs at her executive mansion (see the Modesto Bee). Also, "In another case, UC quietly worked out a similar severance arrangement for a dean who was not eligible for the program, UCSF's David Kessler. Many UC managers have received severance packages, including some from Health Sciences, and some were from UC-Irvine.

No Confidence Vote at UC-Davis - The San Francisco Chronicle also reported on a petition calling for no-confidence vote in the Chancellor of UC-Davis, Larry Vanderhoef, in the Academic Senate. This was inspired by Vanderhoef's agreement to give former Vice Chancellor Celeste Rose a settlement that included $205,000 yearly for two years without any work responsibilities after Vanderhoef's attempt to fire Ms Rose, and her complaints of gender and racial discrimination. Simultaneously, in another setback for UC-Davis, its medical center has lost its designation as a magnet hospital for nursing excellence (per the Sacramento Bee).

Investigation into Incidents at UC-Irvine - The Los Angeles Times also reported that UC-Irvine will start scrutinizing all refusals of kidneys for transplant after media reports suggested that its medical center has had an unusually high rate of refusal and low rate of transplants (see our post here). Also, Medical School Dean Thomas C. Cesario announced that a panel of associate deans would review the case of a admittance into a special residency slot of a physician whose father made a large donation to the hospital. The Times noted that "Cesario approved the creation of the position and the selection .... [UC-Irvine spokeswoman Jennifer] Ward was unable to explain why Cesario was chosen to appoint the [investigative] panel [to investigate Cesario's own actions]."

But that's just the warm-up for today's main act....

Ten Corporate Boards for the UC - San Diego Chancellor'

UC - San Diego Chancellor Marye Anne Fox joined the legion of lavishly compensated UC executives when a report appeared that she received an undisclosed bonus of $248,000 when she was hired to compensate for a sabbatical she had not taken before she was hired.

On top of that, the San Diego Union-Tribune disclosed that Chancellor Fox serves on the board of directors of ten different for-profit and not-for-profit corporations. "In the past year, she received cash and stock worth at least $339,260 from her board memberships.... In addition, she receives more than 12,000 shares in stock options from the public companies annually. In the past 10 years since she began serving as a board director, Fox has accumulated stock and stock options worth more than $1 million." Fox's salary is $359,000, so it appears she collects more income from being on corporate boards than from being Chancellor. "Last year, Fox was expected to attend 50 corporate board and committee meetings." The Union-Tribune noted that "the average corporate board member devotes 191 hours annually in preparation time, travel and attendance on each board...." Based on that figure, membership in 10 boards would require 1910 hours a year, nearly 40 hours a week.

Furthermore, while Fox as Chancellor is responsible for the UC-San Diego School of Medicine and UCSD Medical Center, she sits on the boards of two for-profit health care corporations.

One is Boston Scientific Corp (some of whose travails were mentioned in this recent post). Boston Scientific is a major manufacturer of medical devices. Presumably, UC- San Diego medical center is a major user of such devices.

Chancellor Fox also sits on the board of Pharmaceutical Product Development Inc., which describes itself as "a leading global contract research organization providing discovery and development services, market development expertise and compound partnering programs. Our clients and partners include pharmaceutical, biotechnology, medical device, academic and government organizations."

Fox justified her board memberships thus, "the real benefit is the university's profile is enhanced by board service by chancellors and presidents." She also "said her experience as a director helps here management skills and provides important insights into private industry."

On the other hand, one UC- San Diego professor said "I would worry about whether she's either compromising her fiduciary responsiblities to the people of California or to the corporations and nonprofits she's serving."

In particular, in my humble opinion, having ultimate leadership responsibilities for a medical school and medical center, while also having ultimate fiduciary responsibilities for the management of a medical device company and a contract medical research company amounts to the biggest conflicts of interest I have ever seen.

This case illustrates why I am skeptical of the widely publicized approach to conflicts of interest recently published in JAMA by Brennan et al (see post here). Brennan and colleagues had zero tolerance for any financial relationships between physicians and drug and device companies. Their rationale was:

Social science research demonstrates that the impulse to reciprocate for even small gifts is a powerful influence on people's behavior. Individuals receiving gifts are often unable to remain objective; they reweigh information and choices in light of the gift

Brennan and colleagues were silent, however, about conflicts of interest affecting managers of health care organizations, yet authorized the managers of academic medical centers to enforce such zero tolerance on physician faculty.

If applied to UC -San Diego, this approach would authorize management to condemn a junior faculty member for accepting a coffee cup with a Boston Scientific logo, while the managers answered to a Chancellor who was a Director of Boston Scientific.

If even small gifts from a corporation have a powerful influence on behavior, what effect would one expect from being made a director of the corporation?

It seems hypocritical to have zero tolerance for trivial corporate gifts to medical school faculty, but infinite tolerance for lavishly remunerated, highly responsible corporate positions for university management.

New Problems for Guidant and Boston Scientific

Device manufacturer Guidant, Inc., was recently the object of a bidding war between Boston Scientific and Johnson & Johnson, seemingly won by the latter. We had posted quite a bit about Guidant in the past, focussed on its history of withholding information about possible adverse effects of its devices. (For our more recent posts, go here, here, and here.)

Guidant has just had to recall yet more devices, this time, older pacemakers. (See story here.)

Furthermore, the New York Times reported that documents possibly related to charges that Guidant withheld negative information about its products were just subpoenaed by a US Attorney. The Times reported:

Among other things, the records indicate that company executives debated whether to warn doctors that some heart defibrillators could short-circuit. The records suggest that Guidant might have sold potentially flawed devices.
The documents include a hand-written annotated chronology related to the Contak Renewal that was apparently composed by the head of Guidant's cardiac unit, J. Frederick McCoy Jr. It suggested that Guidant executives debated in January 2005 whether to alert doctors to the Contak Renewal problem.
At the time of the debate, one entry also states "Informed Ron Dollens: Guido Neels of the development," an apparent reference to Guidant's chief executive and chief operating officer at the time; both men have since retired. Mr. Dollens declined, through a company spokesman, to comment. Mr. Neels, reached by telephone, also declined to comment.
The released documents, hand-dated Oct. 20, 2004, apparently projected that existing inventories of Contak Renewals would run out in mid-November 2004. The company did not disclose the Contak Renewal problem until June 2005, after the F.D.A. had opened an inquiry.

Furthermore, Boston Scientific, which apparently won the bidding war for Guidant, has quality problems of their own. The Boston Globe just reported that the company

has been slapped with a rare federal warning letter that could prevent the Natick company from introducing new products until it fixes 'continuing serious deficiencies' in quality control, the Food and Drug Administration said last night.
The FDA warning letter focused on the Natick company's top management, saying executives failed to fix numerous problems the agency had already outlined at particular plants and offices. Such emphasis is unusual for the FDA. This week's 'corporate warning letter' was only the third issued in a decade by the agency's medical device division, officials said.
'The problems we identified in this letter we consider very serious,' said Daniel G. Schultz, the director of the FDA's medical device division, in a phone conference last night.
Boston Scientific received three FDA warnings last year about shipping errors and lapses in keeping track of doctors' reports of device problems. In one case, workers were able to override a computer system and ship devices to a hospital even though the products had failed an inspection.
This letter also detailed problems in three other plants, including one facility in Indiana where managers were unaware that one of their products, the Leveen needle electrode, had been recalled.

As we have noted many times before, physicians and patients cannot make good decisions about whether to implant medical devices in the absence of unbiased information about the devices benefits and harms.

Furthermore, such devices are now so expensive that physicians and patients should expect that the devices will be manufactured to exceptional quality standards.

Medtronic's Payments to Doctors: "Too Damn Lucrative to Believe Anyone Can Resist"

The New York Times reported allegations about the payments device manufacturers have made to physicians.

Documents came from a whistle-blower lawsuit which charged that Medtronic Inc., the medical device manufacturer, gave sugeons "excessive remuneration, unlawful perqueisites and bribes in other forms for purchasing goods and medical devices."

The Times reported that the documents show that:

Medtronic spent at least $50 million on payments to doctors over some four years, through June or later in 2005.
Medtronic played host at medical conferences where the 'principal objective' was to 'induce the physician, through any financial means necessary' to use its devices.
According to Medtronic documents, the company closely tracked the use of its devices by the doctors who attended the conferenences, choosing some for 'special attention.'
While payments to some doctors slowed during 2004, when the company was first under investigation, they rebounded last year.... A doctor in Virginia, Hallett Matthews, for example, made $300,000 in consulting fees in 2003, but only $75,000 in 2004. Last year, the company paid him nearly $700,000 for his consulting work through September.
Dr Matthews ... said the spike in payments was a result of a change in how he was paid, requiring him to document his work before he received any money and therefore increasing the amount he received last year. The consulting fees he got from Medtronic, he said, are compensation for his time spent away from his family and practice.
Medtronic's overtures to doctors often began when the surgeons were still in training, Ms. Poteet said. The company commonly paid for doctors to attend any of 200 professional meetings a year. If the doctors wanted to go snorkeling or play golf, the sales representatives or Medtronic employees almost invariably paid for the expense, she said.
When the doctors visited Memphis, she said, Medtronic employees would take them to a local strip club, PlatinumPlus, disguising the expenses as an evening at the ballet.
A spreadsheet compiled by Medtronic for a June 2003 meeting in Dana Point, Calif., indicated what Medtronic hoped to accomplish with each doctor attending an event....
This list of 230 or so doctors included an estimate of the dollar value of the devices each doctor used in surgery, including the value of the devices made by Medtronic. One doctor is described as 'a 100 percent compliant M.S.D. customer,' while others were cited for 'special attention.' M.S.D. referred to Medtronic Sofamor Danek, the largest competitor in the spinal device market.
Many doctors were paid consulting fees far higher than the $3,000 a day a surgeon might typically expect, documents from the legal filing suggested. Dr. Thomas A. Zdeblick, the Wisconsin surgeon, signed a 10-year contract in 1998 that required him to consult with the company for two days every three months, a total of eight days, for which he would be paid $400,000 a year, according to a copy of his contract. Those payments stopped in 2004.

The New York Times article contained some reaction to the allegations about Medtronic's interactions with physicians.

In a written response, a spokesman, Rob Clark, said, 'We take these allegations very seriously and we do not tolerate conduct that is illegal or unethical.' Consulting arrangements with doctors to improve devices, he said, 'are critical, in our view, to the delivery of state-of-the-art health care and are perfectly legal.'

On the other hand,

But even if the payments are within the law - and Medtronic has not been found guilty of any illegal activity - the increasing amounts being given to doctors distort their judgment, said Arthur Caplan, a medical ethicist at the University of Pennsylvania, who said such industry payments were 'too damn lucrative to believe anyone can resist.'

Amen to Dr Caplan.

We surely need better mechanisms to prevent both parties, physicians and health care organizations (device makers in this case, but not limited to device makers) from partaking of such relationships, and when prevention fails, for penalizing them.

New ways to abuse health IT

I think I'm going to create a new department called "new ways to abuse health IT." Two such stories came to my attention today:

New York Daily News
10 years later & still a mess
Wednesday, January 25th, 2006

After the brutal killing of 6-year-old Elisa Izquierdo in November 1995, the politicians vowed to fix New York's broken child welfare system. They made the same promise again yesterday, barely two weeks after the shocking murder of yet another child, 7-year-old Nixzmary Brown. But through all their promises, they have failed to address a fiasco that has gone unresolved for nearly 10 years.

I am referring to the state's centralized child abuse information system, commonly known as Connections. Few people outside the social work community have ever heard of the system, but Connections has quietly emerged as the biggest single boondoggle in the history of our state's child welfare agencies.

My website on health IT failure is but a cautionary tale, it seems. How is it that computer systems that impact people's lives the most seem to be the biggest vortex for "biggest single boondoggles"? What underlying systemic pathologies are reflected in that fact?

Launched by Gov. Pataki only a few months after Elisa's death, this New Age information system was supposed to streamline child protective services. Pataki promised it would do away with cumbersome paper files; provide local government and nonprofit agencies access to complete case records, and create a central database of all known child abusers. Connections was heralded as the ultimate solution to child protection.

Ten years later, the problem-plagued system is still not fully operational. The original contract, hurriedly awarded to IBM and Accenture in a bidding process marked by numerous irregularities, was pegged by Pataki at $113 million. By 2001, the cost had ballooned to more than $360 million, an Assembly investigation concluded. State officials did not have an up-to-date tally available yesterday of the system's current cost.

Last Thursday, the day after Nixzmary Brown's funeral, the Connections system once again crashed at the city's child welfare offices in Brooklyn. For more than four hours, no one in the offices could get into the system to retrieve or enter information on child abuse cases, according to several city social workers. "This happens all the time," one frustrated Brooklyn caseworker told me. "It's gotten worse since they brought Build 18 [the newest version of Connections] online in Brooklyn last September."

360 million dollars? Hurriedly awarded to IBM and Accenture in a bidding process marked by numerous irregularities? These themes are all too familiar. An entire hospital system could be built for far less than $360 million. Where is this money going, one should ask? Combine this with the IT debacle that occurred at the Bay Pines VA Hospital in Florida, which was abandoned, and with just two computer projects you have nearly One Billion Dollars down the drain (or, rather, into someone's pocket; money does not simply vaporize into thin air).

In another story, a new way has been found by the MBA class, via perverse incentives that will likely be applied based on defective metrics, to make clinicians even more resistant to adopting electronic medical records systems. EMR is a tool that in the proper hands and used in the proper ways could actually improve the quality of medical care:

Plan would tie copayments to doctors' rankings
Lower fee for using 'best value' physicians
By Jeffrey Krasner, Boston Globe
January 27, 2006

The agency that oversees health insurance for 144,000 state workers wants to launch a program to control runaway healthcare expenses: a ranking of doctors' quality and efficiency that would be tied to lower copayments for patients who seek care from higher-rated doctors.

The Group Insurance Commission this morning will examine proposals it requested from Harvard Pilgrim Healthcare, Tufts Health Plan, Health New England, Fallon Community Health Plan, and other insurance companies. A key feature of each proposal is variable copayments. For example, under the Harvard Pilgrim and Tufts scenarios patients would pay $15 to visit a doctor who is rated highly and $25 to see one with a lower rating.

... ''We don't want people making decisions on their healthcare based on inaccurate or misleading information," said Dr. Alan M. Harvey, a anesthesiologist and president of the Massachusetts Medical Society, a doctors' group. ''If the GIC decides to go ahead without accurate information, that's not fair for patients or physicians."

The move to provide information on individual physicians is another in a series of pioneering steps by the Group Insurance Commission. Two years ago, it required that health companies bidding for its business rank hospitals. The result was Navigator, a Tufts insurance plan that offered varying copayments based on quality rankings. Navigator became so popular that Tufts offered it to other businesses, and the approach has now become widespread. That could also happen with plans that rank individual doctors.

See whole article at URL.

What are the odds that "inaccurate or misleading information", derived as only non-clinicians with financial conflicts of interest or other axes to grind can do from even the finest EMR, will be used in this program?

I believe such odds are high, and the horrid performance of an information system designed to prevent child abuse, above, not just measure clinical "quality", certainly doesn't contradict my opinion.

I should add that my having to see these stories about health-related IT debacles is a form of adult abuse. It is simply incredible.

-- SS

Death by Chelation, Revisited

Regarding the latest report in the Pittsburgh Post-Gazette about the 5-year old boy who died after receiving disodium EDTA to treat his autism:

Roy Poses was absolutely correct that Dr. Mary Jean Brown, the CDC’s “expert in chelation therapy,” missed the real point of the tragedy: that the child was a victim of quackery, not merely of “medical error.” The truth is even more disturbing than that, however. Dr. Brown may have been technically correct that if calcium-disodium EDTA had been used instead of disodium EDTA, the child would likely not have died of hypocalcemia (though he might have died of another complication; calcium-disodium EDTA is also a dangerous drug). But this was not a simple case of mistaken drug identity, or "look-alike/sound-alike medications," as Dr. Brown supposed. Disodium EDTA is the form of EDTA preferred by the major advocacy group for all implausible uses of "chelation therapy," the American College for Advancement in Medicine (ACAM)*—the same organization that the FTC had cited in 1998 for “false or misleading” claims regarding “chelation therapy” and atherosclerosis.

The reason for that preference seems to be that when EDTA was first being pushed as a miracle cure for atherosclerosis (‘60s-‘70s), its purported mechanism was to leach calcium from plaques. That claim, which can still be found in pro-chelation literature, has largely given way to the theory that chelation works as an anti-oxidant by removing heavy metals such as mercury, lead, copper, and iron. Both of these theories are implausible on stoichiometric and physiological grounds. The disodium form of EDTA persists as the ACAM-recommended preparation, not only for atherosclerosis but for arthritis, Alzheimer’s, Parkinson’s, psoriasis, high blood pressure, scleroderma, cancer, macular degeneration, and more. The rationale for “chelation therapy” in autism, according to advocates, is that the disease is caused by mercury poisoning—mainly from childhood immunizations. This claim is not supported by epidemiologic studies

Dr. Brown might be disturbed to learn that disodium EDTA is the form used in the current, $30 million, Phase III "Trial to Assess Chelation Therapy" (TACT), jointly sponsored by the National Center for Complementary and Alternative Medicine and the National Heart, Lung, and Blood Institute. The reason that NIH investigators chose the more dangerous form of EDTA is that it was “recommended by the American College for Advancement in Medicine” Curiously, it’s almost impossible, merely by looking on the NCCAM website, to discover which salt of EDTA is used in the TACT. Except in the well-hidden RFA (Request for Applications), only “EDTA” is named, without reference to cations.

Thus most descriptions of the TACT are similar to this one posted by the NIH: “EDTA…is approved by the U.S. Food and Drug Administration (FDA) for use in treating lead poisoning and toxicity from other heavy metals. Although it is not approved by the FDA to treat coronary artery disease, some physicians and alternative medicine practitioners have recommended EDTA chelation as a way to treat this disorder.” On the contrary, disodium EDTA has not been approved by the FDA for the treatment of lead poisoning, but only for the emergency treatment of hypercalcemia and dig-toxicity (and for these purposes it is considered obsolete).

The NIH language implies that disodium EDTA for any other purpose is merely “off-label” and is safe, which is what chelationists and their influential champions assert (see p.2 of this slow-loading document). But this is misleading, because the FDA has specifically contraindicated disodium EDTA for atherosclerosis, and a “black box” warning states: “The use of this drug in any particular patient is recommended only when the severity of the clinical condition justifies the aggressive measure associated with this type of therapy.” Thus the numerous unapproved uses of disodium EDTA, prescribed by that strange subculture of practitioners who preach “detoxification” as a near-panacea, do not meet FDA standards for off-label use. On p. 37 of the TACT protocol, version 2, NIH investigators refer to such practitioners as “prominent experts.”

Perhaps unbeknownst to Dr. Brown, her statements would seem to challenge the NIH to explain why it would expose human subjects to a drug that the CDC considers highly dangerous, when a less dangerous substitute is readily available. The larger question is why the NIH would expose 2300 human subjects in a Phase III study of a treatment that has yet to successfully graduate from Phases I or II, and that has not been substantially studied in animals. Federal Code states: “Phase III studies…are performed after preliminary evidence suggesting effectiveness of the drug has been obtained…” The Declaration of Helsinki states: “Medical research involving human subjects must…be based on a thorough knowledge of the scientific literature…and on adequate laboratory and, where appropriate, animal experimentation.”

* Rozema TC. The Protocol for the Safe and Effective Administration of EDTA and Other Chelating Agents for Vascular Disease, Degenerative Disease, and Metal Toxicity. Journal of Advancement in Medicine. 1997;10, 1:5-100

Health IT mismanagement strikes again

I post this article without commentary other than the title above, and a question: was this method of IT "disaster recovery" (using your own employee's cars and homes as backup repositories) done to save a few dollars? I worked at one time for the Comdisco Healthcare Group. One of Comdisco, Inc.'s specialty areas was disaster recovery/business continuity services. Those services were costly.

I've seen financial issues cause conventional desktop computers to be hung from the ceilings of small ICU rooms, instead of industrial clean-room-quality machines, and conventional keyboards and mice to be used, despite the risks of spreading infection. So anything is possible.

-- SS

365,000 lose health files to thief

Critics question safeguards after a car burglar steals the records of home services patients

Thursday, January 26, 2006
JOE ROJAS-BURKE and JOSEPH ROSE
The Oregonian

Medical privacy advocates expressed horror over Providence Health System's revelation Wednesday that a car thief had walked away with the medical records of 365,000 patients across Oregon and Washington.

The thief who smashed the window of a Plymouth Voyager parked outside a Milwaukie home last month seized a trove of records containing names, addresses, Social Security numbers and intimate health information from patients receiving home services from Providence. Records of Providence hospital or clinic patients were not stolen.

The records, some dating to 1987, were stored on computer disks and digital tape that a Providence employee took home and left in his car overnight. Providence officials said certain employees routinely took home records to provide readily available backup.

... medical records contain information that employers, insurers and others could use to unfairly exclude people with health problems. Disclosures, they say, also could humiliate them.

With no leads in the case, the Clackamas County Sheriff's Office has suspended its investigation. The likelihood that criminals will exploit the information is difficult to calculate.

... Driveway break-in

Steve Shields, a Providence information systems analyst, reported the theft about 10:30 a.m. Dec. 31, according to a sheriff's office report. Shields' van was parked in his driveway ... The thief took a laptop computer bag containing 10 computer disks and data tapes but no computer. "Nothing else was taken," said Detective Wendi Babst, a sheriff's spokeswoman.

Shields, who declined to comment when contacted at Providence on Wednesday, told authorities that the disks contained confidential information, including Social Security numbers and medical information, for thousands of people. At the time, he told Tomas Solano, a sheriff's community service officer who took the report, that the information on the disks was "highly encrypted" and almost impossible to retrieve.

"I advised him that although he feels it is unlikely that the information can be obtained, he should still send a letter or contact anyone that could have information compromised," Solano wrote.

On Wednesday, a Providence spokesman said the records were not encrypted.

... Upon Wednesday's announcement, critics immediately questioned the practice of sending records to employees' homes.

"What were they thinking? Did they not have a data-security person tell them this is not a good plan?" said Lillie Coney, associate director of the Electronic Privacy Information Center, an advocacy group in Washington, D.C.

Cagen said Providence asked certain managers or supervisors to take home backup information on home services patients, and not others, in case a patient emergency and a major failure of the division's main records system coincided.

"The intention was to protect the patients and the vulnerabilty of that data," Cagen said. "What we didn't do was evaluate the practice of taking it home. That's where we fell short."

I would agree with that last assessment.

-- SS

California [Bad] Dreamin' - More Troubles at UCI

There is a continuing drip, drip of unfavorable stories about management problems at the University of California - Irvine medical center, and simultaneously about the lavish pay and perks awarded to University of California (UC) managers in general.

UCI

As the media continue to investigate the University of California - Irvine (UCI), more disturbing stories have come to light. (Our last post about problems at UCI was here.)

Alleged Misrepresentation Regarding the Liver Transplant Program - The Orange Country Register alleged that top UCI managers misrepresented how the medical center's liver transplant program was going to be lead to stave off a recommendation that the program be closed. In May, 2004, the United Network for Organ Sharing (UNOS) announced its intention to have the program shut down. In July, 2004, a delegation from UCI, including the hospital CEO Ralph Cygan, medical school Dean Thomas Cesario, and transplant surgeon Marquis Hart met with UNOS personnel, and assured them that Hart would become the full-time, on-site director of the program. Based on this, UNOS rescinded its recommendation to close the program. But Hart never worked full-time at UCI. Instead, he continued to shuttle from his full-time position at University of California - San Diego (UCSD). The Register said, "it would not be until Medicare auditors went to UCI on July 19, 2005, investigating a patient complaint that regulators discovered Hart was not there. The auditors said they were told Hart was 'in surgery all day' at his primary transplant center where he serves as medical director." Neither Cygan, Cesario, or Hart agreed to talk to the Register about the meeting and its aftermath.

A UNOS official said, "if there was a change, and the member knew that they had provided information to the committee that changed, I think the committee would expect (an) update." US Senator Charles Grassley (R - Iowa), chair of the Finance Committee, said, "here, it appears that an institution represented that it had hired a full-time transplant surgeon, when this apparently was not the case. This apparent misrepresentation raises concern about any disservice to patients in need of organ transplants and whether much-needed corrective action to the transplant facility was postponed."

The Kidney Transplant Program - The Los Angeles Times now has found problems with the UCI kidney transplant program, to accompany previous stories about problems with liver and bone marrow transplants. The Times found that the kidney program accepted many fewer kidneys (8.7%) than other programs (averaging 25.9% - 31.2%). The rate of patients getting transplants (16.5% from 1999 to 2001) was slower than the national rate. Although the program now has a full-time director, for over a year it had no full-time on site physicians. UCI was first warned in 2002 by the US Center for Medicare and Medicaid Services (CMS) about its kidney transplant program. It just got another warning from CMS.

The Radiology Residency - The Los Angeles Times just reported that an applicant was accepted into a specially created position in the UCI radiology residency program soon after his father pledged a $250,000 donation to the radiology department. Dr Fong Tsai, chair of radiology, and the resident's father both "denied the donation was given in exchange for the son's residency position." However, the father "said he began discussing a donation with Tsai in early 2004. He said he and Tsai discussed his son's desire to join UCI's residency program but never in connection with the donation." Nonetheless, bio-ethicist Arthur Caplan of the University of Pennsylvania opined, "it looks like the prospect of donations may have shaped their assessment of the candidate's admissibility. I hope not, but it looks that way."

UC Pay and Perks

Stories continue to pop up about top UC managers collecting more in pay and perks than had previously been publicly disclosed.

UC-San Diego Chancellor Mary Anne Fox - the San Diego Union-Tribune found that during her first year, Chancellor Fox received "far more than the $350,000 salary disclosed when she was hired." Her total compensation was actually nearly $700,000. It included a payment of "$248,000 for a sabbatical she had earned at her previous university, but did not take."

UC-Berkeley Chancellor Robert Berdahl - The San Francisco Examiner found that when he resigned, "he was given a yearlong leave at this chancellor's salary with the understanding he would return to teaching. Now Berdahl says he'll leave in May - after teaching one semester - to run an academic trade group. But UC officials said he won't have to pay back the $355,000 he earned on leave because UC made 'an exception to policy.'" Commented UC-Berkeley journalism Professor William Drummond, Vice-Chair of the Academic Senate, "This is a completely different system of rewards than I or my faculty colleagues operate under."

An editorialist at the Sacramento Bee said it well,

The perks, payoffs, and golden parachutes provided to top University of California administrators are outrageous, and they reflect a culture of excess and lax oversight created by none other than the UC Regents.
The perks and payoffs have gotten out of hand, especially at a time when UC campuses have seen cuts and tuition raised in recent years. The Regents need to assert control over the process, but it is doubtful they will. This board no longer runs the university system. The chancellors do. In recent years, UC chancellors have created their own fiefdoms and power structures, turning the regents into mere figureheads.

Concentration and abuse of power? And its effects in the health care realm can be seen at UCI.

Illinois Attorney General Charges Not-For-Profit Hospitals Give Little Charity Care

The Chicago Sun-Times reported that Illinois state Attorney General Lisa Madigan wants legislation that would force not-for-profit hospitals to provide more free care to the poor.
She cited a 2003 report that most hospitals provided charity care worth less than 1% of the hospitals' total charges. The Illinois Hospital Association (IHA) countered that "these statistics can be misleading for a number of reasons, partly because hospitals only collect a portion of what they charge, and charity care amounts don't reflect the compenstated care hospitals provide when bills go unpaid."
On the other hand, I wonder if these amounts were compared to the charges for specific services some hospitals make to uninsured patients, which are often much higher than those for those same services negotiated with insurance companies and managed care. If they were compared to those much higher charges rather than what the hospital usually accepts for insured patients, even these figures could have inflated the amount of charity care provided.
The IHA also "doesn't like the idea of any law dictating hospitals' charity requirements. An IHA task force report written last year says such mandates run the risk of shifting costs to insured patients and causing cuts in hospital services."
I agree that trying to address this problem with legislation specifying charity care amounts may be heavy-handed. A potentially more flexible approach would be to give more power over this issue to a state regulatory board.
But I'm afraid this heavy handed approach may seem attractive after numerous stories of hospitals "'gouging' those without health insurance by charging them much higher rates than what's paid by government-run Medicare and Medicaid programs or by private insurers, who have the clout to negotiate steep discounts." "Hospitals also have been chastised for overly aggressive attempts to make financially strapped patients pay up." [Quotes from the Sun-Times.]
These ongoing issues make it particularly worrisome that some thought leaders are now advocating giving hospital managers even more power to enforce ethical standards covering physicians (see post here).

King/Drew Managers Wake Up After Their "Serious Lethargy," Discipline or Fire One-Fifth of Their Staff

At the end of 2004, the Los Angeles Times ran a multi-part series on the troubles of Martin Luther King Jr./Drew Medical Center, many of which were attributed to management's failings. We posted on King/Drew more than a year ago.

This week, a follow-up story shows that a clean-up is beginning, but that there is a lot of cleaning to be done.
The new story focused on personnel issues. In summary, "more than a fifth of the staff ... has been fired or disciplined since January 2004 in an extraordinary crackdown prompted by revelations of widespread misconduct at the troubled public hospital."
Some of the more vivid anecdotes were:

• A critical care nurse dozing off in a break room while one of her patients decompensated. She was fired, as was her supervisor, who had previously "frequently witnessed" her sleeping on the job.
• A nursing attendant was arrested on her lunch break for battery. She then "had a family member call the hospital to say an 'unexpected emergency' would keep her from her shift. She was in jail."
• "Several custodians goaded a belligerent patient struggling with a police officer, urging him to 'kick the police's ass.'"
• The hospital "sent some chronically absent staffers what it called 'where are you?' letters after they didn't show up for days or weeks at a time." A technician was suspended after getting four such letters. After that, he missed three months out of the next seven, and was then fired. A nurse was fired after seven such warnings.
• etc, etc, etc

Jim Lott, executive vice president of the state hospital association, said "there was a serious lethargy in management for years." That seems to be an understatement. But maybe the new management has woken up. That's good news, but the ongoing problems at King/Drew are a reminder that we need a better way to ensure good management of our hospitals and academic medical centers.

Dodging Stones Thrown From Glass Houses: the JAMA Article on Conflicts of Interest

This week's JAMA featured a major article about addressing conflicts of interest that face physicians. (Brennan TA et al. Health industry practices that create conflicts of interest: a policy proposal for academic medical centers. JAMA 2006; 295: 429-433.) The article has already attracted a lot of media attention (e.g., see the New York Times, Washington Post, and Los Angeles Times).

Unfortunately, I believe that this article is much more notable for what it omits than what it says.

I will summarize its main points, and then comment.

Main Points

Conflicts of Interest Are Important-

Physicians' commitment to altruism, putting the interests of the patients first, scientific integrity, and an absence of bias in medical decision making now regularly come up against financial conflicts of interest.

The Most Important are Conflicts of Interest Involving Pharmaceutical Corporations and Device Manufacturers and Affecting Physicians -

Arguably, the most challenging and extensive of these conflicts emanate from relationships between physicians and pharmaceutical companies and medical device manufacturers

Academic Medical Centers (AMCs) Shall Police Such Conflicts-

To remedy the situation and prevent future compromises to professional integrity, academic medical centers (AMCs) must more strongly regulate, and in some cases prohibit, many common practices that constitute conflicts of interest with drug and medical device companies.

Specific Interactions Between Physicians and Pharmaceutical and Device Corporations Must Be Addressed -

The following list, while not exhaustive, indicates the interactions with industry that must be addressed: gifts, even of relatively small items, including meals; payment for attendance at lectures and conferences, including online activities; CME for which physicians pay no fee; payment for time while attending meetings; payment for travel to meetings or scholarships to attend meetings; payment for participation in speakers bureaus; the provision of ghostwriting services; provision of pharmaceutical samples; grants for research projects; and payment for consulting relationships.

Physicians Shall Not Receive Any Gifts from these Corporations -

All gifts (zero dollar limit), free meals, payment for time for travel to or time at meetings, and payment for participation in online CME from drug and medical device companies to physicians should be prohibited. A complete ban on these activities by eliminating potential gray areas greatly eases the burden of compliance.

Physicians Shall Not Get Pharmaceutical Samples -

he direct provision of pharmaceutical samples to physicians should be prohibited and replaced by a system of vouchers for low-income patients or other arrangements that distance the company and its products from the physician.

Hospital Formulary Committees Shall Exclude Those Health Professionals with Financial Ties to Drug Companies -

Hospital and medical group formulary committees and committees overseeing purchases of medical devices should exclude physicians (and all health care professionals) with financial relationships with drug manufacturers, including those who receive any gift, inducement, grant, or contract.

Corporations Shall Not Support Continuing Medical Education (CME) Directly, but Shall Give Money to a Central Repository at the AMC -

Drug and Device Manufacturers should not be permitted to provide support directly or indirectly through a subsidiary agency to any ACCME-accredited program. Manufacturers wishing to support education for medical students, residents, and/or practicing physicians should contribute to a central repository (eg, a designated office at an AMC), which, in turn, would disburse funds to ACCME-approved programs.

Drug and Device Manufacturers Shall Only Support Trainees' Travel by Giving Money to the Central Repository -

Pharmaceutical and device manufacturers interested in having faculty or fellows attend meetings should provide grants to a central office at the AMC. That office could then disburse funds to faculty and training program directors.

Physician Faculty Shall Not Serve on Industry Speakers Panels -

Faculty at AMCs should not serve as members of speakers bureaus for pharmaceutical or device manufacturers.

Physician Faculty Shall Not Publish Ghost-Written Articles -

Faculty should be prohibited from publishing articles and editorials that are ghostwritten by industry employees.

To Consult for Industry, Physicians Shall Have Explicit Contracts with Deliverables -

Because the process of discovery and development of new drugs and devices often depends on input from academic medicine, consulting with or accepting research support from industry should not be prohibited. However, to ensure scientific integrity, far greater transparency and more open communication are necessary. Accordingly, consulting or honoraria for speaking should always take place with an explicit contract with specific deliverables, and the deliverables should be restricted to scientific issues, not marketing efforts.

Industry Shall Give Research Grants and Contracts to AMCs -

To promote scientific progress, AMCs should be able to accept grants for general support of research (no specific deliverable products) from pharmaceutical and device companies, provided that the grants are not designated for use by specific individuals.

AMCs Shall Post Grants and Contracts on the Web -

To better ensure independence, scientific integrity, and full transparency, consulting agreements and unconditional grants should be posted on a publicly available Internet site, ideally at the academic institution.

My Comments

The paper starts out well, by highlighting the importance of conflicts of interest in health care.

Conflicts Involving Other Health Care Organizations

It first goes seriously wrong by limiting its concern to only conflicts of interest involving pharmaceutical and device manufacturers, and only conflicts of interest affecting physicians. Health Care Renewal, and other related sources have documented conflicts of interest involving nearly all kinds of health care organizations.

Most particularly, although they don't often make news any more, most physicians are acutely aware of the strong conflicts of interest posed by their relationships with managed care organizations. Much was written about this in the 1980s and 1990s when managed care became ascendent as a way to control health care spending. To summarize, I wrote this in 2003,[1]

Physicians, especially primary care physicians, are often exposed to incentives that conflict with professional values. 'Market driven health care creates conflicts that threaten medical professionalism.'[2] Managed care organizations, in particular, provided strong incentives to do less for patients, but at the risk of making physicians into 'double agents,' whose financial incentives are no longer clearly aligned with providing services, but may turn on holding services to some minimum level.'[3] Most primary care physicians feel pressure from managed care to limit referrals and see more patients,[4] and thus are concerned about conflicts of interest and failure to regard the patient’s interests as paramount.[5] Managed care organizations may employ a 'strategy of giving with one hand while taking away with the other, of offering consumers comprehensive benefits while restricting access through utilization review, [which] obfuscates the workings of the system, undermines trust between patients and physicians, and has infuriated everyone involved.'[6]

Conflicts Affecting People Other Than Physicians

Conflicts of interest affect not only physicians, but also others involved in health care, particularly the leaders of health care organizations. Again, my "Cautionary Tale" article, and the contents of Health Care Renewal provide many examples. Some recent ones include the cases at Roger Williams Medical Center, the University of California, and the University of Medicine and Dentistry of New Jersey (UMDNJ).

Furthermore, there have been many examples of leaders of health care organizations being willing to sacrifice physicians' core values at the alter of increasing the organizations' bottom lines. A recent one would seem to be at the University of Sheffield, where research leaders cautioned Dr Aubrey Blumsohn not to demand the data from his own research project, lest he offend the pharmaceutical company that was sponsoring that research. More systematic evidence was provided by the Mello study[7], (see post here), which showed that AMC leaders were willing to sign research contracts with commercial sponsors that allowed the sponsors, rather thant than the AMC faculty, to control how the research was done, and how and even whether its results were presented.

I agree that physicians should be held to high ethical standards that strictly limit their conflicts of interest. But these standards should restrict all conflicts of interest that could threaten physicians' professionalism. If payments from a drug company that could make physicians more favorably disposed to its products are bad, financial incentives from a managed care organization that tempt physicians to withhold care that could benefit patients are equally bad.

Furthermore, leaders of health care organizations, including executives and trustees of AMCs, should be held to equally strict standards.

The Commandments

The article sets forth what amount to a set of commandments. I actually agree with many of them, even though some are harsh. However, I disagree with those that forbid individual physicians from specific intereactions with drug and device companies but allow AMCS to have such interactions. As noted above, corporate money can sway leaders of AMCs away from their institutions' missions, just like such money can sway physicians from their professional values. Also, as implied above, lacking are any commandments dealing with conflicts involving organizations other than pharmaceutical and device manufacturers. In particular, there are no commandments relevant to conflicts involving managed care organizations or insurance companies. Furthermore, again as implied above, lacking are any commandments for anyone other than physicians.

Enforcement of the Commandments

Why are AMC managers better qualified than are physicians to enforce these ethical standards? Physicians already are held to strict ethical standards incorporated in their training, the oaths they swear, and the requirements for licensure they must maintain to practice. AMC executives, aside from the decreasing minority who are also physicians, are not held to any standards of training or licensure, or any particular code of ethics. Chervenak and McCullough found "there has been to date no ethical framework offered that academic leaders can use to identify, prevent, and responsibly manage the ethical conflicts that are inherent, but sometimes hidden, in being an academic leader." Also, "ethics is an essential but largely neglected tool in the AHC (i.e., AMC) leader's 'toolbox'...."[8]

This blog is full of cases of bad, conflicted, and sometimes frankly corrupt leadership of AMCs and teaching hospitals. Again, the most recent examples include Roger Williams Medical Center (the entire organization was indicted, its CEO was indicted and just fired), UMDNJ (the entire organization admitted to commiting crimes, and is now operating under federal deferred prosecution agreement, while its President was just fired). In the past year, we have also seen the CEO of Fletcher Allen Health Care convicted of federal conspiracy (see post here), ongoing stories of mismanagement at University of California-Irvine (see post here), King/Drew Medical Center (see post here) and at Westchester Medical Center (see post here), etc, etc, etc.

Yet, the JAMA article's policies would put AMC managers in charge of policing physicians' compliance with conflicts of interest policies. These policies would condemn a physician for accepting a $1 pen from a drug company because such a gift might affect his or her practice. However, the policies would tolerate a drug company sending millions of dollars to an AMC. How could one deny the possibility that receiving large amounts of money would affect the organization's decision making?

Instead, I suggest developing a broad set of principles about conflicts of interest, and generally about business ethics in health care, focused on all transactions with outside organizations with their own vested interests or agendas. These principles should apply to all who make decisions in health care, physicians, other health care professionals, and leaders of health care organizations. The details of the implementation of these principles could vary, so as to apply to the setting and role of each individual.

A Final Irony

Finally, it is ironic that the first author of an article on conflicts of interest apparently had an important, relevant conflict of interest that was not disclosed in this article. Dr Troyen Brennan, who is listed as a Professor at Harvard Medical School, just accepted a position as Medical Director of Aetna, Inc, the large, for-profit health insurance and managed care company (see Jan 19, 2006 articles in the Boston Globe and Hartford Courant). Brennan must have been in negotiation with Aetna during some phase of the writing of this article, yet his relationship to the company is not indicated in the JAMA article.

Notes
1. Poses RM. A cautionary tale: the dysfunction of American health care. Eur J Int Med 2003; 14 (2003) 123–130.
2. Kassirer JP. Managed care and the morality of the marketplace. N Engl J Med 1995; 333: 50-52.
3. Shortell SM et al. Physicians as double agents: maintaining trust in an era of multiple accountabilities. JAMA 1998; 280: 1102-1108.
4. Grumbach K et al. Primary care physicians’ experience of financial incentives in managed-care systems. N Engl J Med 1998; 339: 1516-1521.
5. Feldman DS et al. Effects of managed care on physician-patient relationships, quality of care, and the ethical practice of medicine. Arch Intern Med 1998; 158: 1626-1632.
6. Robinson JC. The end of managed care. JAMA 2001; 285: 2622-2628.
7. Mello MM et al. Academic medical centers' standards for clinical-trial agreements with industry. N Engl J Med 2005; 352: 21.
8. Chervenak FA, McCullough LB. An ethical framework for identifying, preventing, and managing conflicts confronting leaders of academic medical centers. Acad Med 2004; 79: 1056-1061.

Update (1/31/2006) - For a take on this in the inimitable manner of PharmaGossip, go here.

NHS Told: Put Money Before Medicine

I am wary of writing about health care systems in countries other than the US, since my failure to understand the intricacies of their contexts may lead to errors.
So I quoted the headline above from a story in the (UK) Guardian, and here are some excerpts:

Patricia Hewitt, the health secretary, will call for the end of the "handout culture" in the NHS this week and demand that financial management be put ahead of clinical objectives.
On Thursday, Ms Hewitt will issue the first rulebook for NHS managers in an attempt to eliminate the financial deficits threatening to destabilise reform plans for hospitals and primary care services. She is expected to say that financial management must have a higher priority than clinical objectives during the coming year, a shift expected to enrage medical staff.

It sounds like the medical staff will have reason to be enraged. I would say putting money before medicine is a good way to encapsulate the external threats to physicians' core values that certainly are not just an American problem.

Another One Bites the Dust: President of UMDNJ Fired

The new Governor of the State of New Jersey, Jon Corzine, has secured the resignation of the President of the University of Medicine and Dentistry of New Jersey (UMDNJ), John Petillo.
We have posted repeatedly (most recently here) about the multiple scandals at UMDNJ, which resulted in the University signing a deferred prosecution agreement with the federal government, and accepting federal monitoring of its operations.
According to the Newark Star-Ledger, Petillo will get a severance agreement worth $600, 000 in exchange for his promise to depart by February 28. A variety of comments suggested that Petillo, although not directly responsible for the mess at UMDNJ, was slow to clean it up. Former NJ Governor Codey defended him, "he inherited a culture that he had never really encountered before, and to think that he could change it overnight is ridiculous. It's hard to describe or even understand [sic] to an outsider the way the place - as we now understand - had been run over the years." But State Senator Loretta Weinberg (D-Bergen) said the resignation was "good news." She suggested that in the future the state needs to "get the best possible person for what is a very important institution...."
Also according to the Star-Ledger, many in the state are calling for a different kind of search process to find the next President. The search that resulted in Petillo's appointment cost $349,000, took four months, yet found a local candidate who had been suggested by a local political power-broker. Petillo was installed in "a lavish inaugural at the New Jersey Performing Arts Center," according to the North Jersey Media Group. But a consultant with a national search firm noted, possibly with some irony, "the one thing you can count on is ego and greed will always find you good candidates."
In my humble opinion, UMDNJ could use someone not motivated by ego and greed, but someone with intelligence and knowledge of health care on the ground, but more importantly, with a real commitment to behaving transparently, responsibly, and ethically.
We'll see whom they get.

Alleged bribery and procurement fraud in Cook County's hospital system

Hospitals seem to be fertile grounds for financial shenanigans. Not even the people who supply the x-ray machines can apparently keep themselves out of trouble.

Siemens U.S. Subsidiary, Employees and Minority Partners Indicted in Alleged Fraud Scheme

CHICAGO, Jan. 20 /U.S. Newswire/ -- Siemens Medical Solutions USA Inc., two of its employees, and two partners in a joint venture were indicted on federal fraud charges relating to a $49 million radiology equipment contract that required minority business participation and was awarded during the construction of Cook County's new Stroger Hospital, federal authorities announced today. The company allegedly formed a sham joint venture with a minority business enterprise (MBE) to successfully bid on the public contract in 2000, and its employees allegedly schemed to cover up the initial fraud when the contract was challenged by a competitor in a federal court lawsuit. The sham joint venture partners, Faustech Industries, Inc., a local consulting firm that was certified by Cook County as a minority-owned business, and its sole owner, Faust Villazan, were re-indicted for allegedly paying a $20,000 bribe to a county contract compliance official a month after the contract to provide and service the hospital's radiology equipment was awarded to Siemens-Faustech.

Between May 2000 and November 2001, the indictment alleges that the defendants engaged in a fraud scheme by creating a sham joint venture in which they represented to Cook County that Villazan, through Faustech, was a true joint venture partner with Siemens Medical Solutions (SMS), and that it shared in the risks and rewards in proportion with its declared 30 percent ownership in the joint venture. The defendants allegedly knew, however, that the Siemens-Faustech relationship was a facade that did not comply with the county's bid requirements because Faustech and Villazan's risk in the venture was zero and Villazan's compensation was a flat fee of $500,000, which was not tied to the venture's loss or profit.

Five defendants -- two companies and three individuals -- were charged in a five-count superseding indictment that was returned by a federal grand jury late yesterday, announced Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois, and Robert D. Grant, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

"Sham joint ventures deprive legitimate minority businesses of a level playing field in seeking contracts," Mr. Fitzgerald said. "When individuals or companies compete for public contracts they must be honest about describing whether the minority participation is real, and not enter into secret side agreements. If instead they commit fraud, they will face criminal prosecution. In addition, corporations and their employees, including their attorneys - like everyone else - have a duty to tell the truth when they speak to investigators or testify under oath. No one has the right to withhold documents from the Court or to lie about the facts to investigators or, worse yet, under oath in Court," he added.

Mr. Grant noted that the indictment brings to eight the number of defendants who have been indicted in recent months in connection with alleged bribery and procurement fraud in Cook County's hospital system. "We are determined to ensure that public contracts, especially those in the lucrative healthcare industry, are obtained based on merit and are not tainted by corruption. The investigation is continuing," he said.

The defendants and the charges are as follows:

Siemens Medical Solutions USA, Inc., formerly known as Siemens Medical Systems - one count of wire fraud and one count of mail fraud. Based in Malvern, Pa., SMS is the wholly-owned U.S. medical supply subsidiary of Siemens AG, which is publicly-traded and headquartered in Erlangen, Germany. SMS, which has a field office in suburban Hoffman Estates and is one of the world's largest suppliers to the healthcare industry, owned 70 percent of DD Industries, LLC, (also known as Siemens/Faustech), the joint venture entity that was formed to bid on and was awarded the Stroger Hospital radiology contract;

Faust Villazan, -- one count each of wire fraud, mail fraud and bribery. Villazan, 44, of Western Springs, was the chief executive officer and sole owner of Faustech Industries;

Faustech Industries, Inc. -- one count each of wire fraud, mail fraud and bribery. Faustech, then located in suburban River Grove, was certified by Cook County as a minority business enterprise. On paper, Faustech owned 30 percent of DD Industries;

Daniel Desmond -- one count each of wire fraud, mail fraud and perjury. Desmond, 43, of Arlington Heights, was the district business administrator of the SMS office in Hoffman Estates and the president of DD Industries, the bidding entity that was named after him; and

Ellen Roth -- one count each of wire fraud, mail fraud and making false statements to the FBI. Roth, 61, of Ridgewood, N.J., was an in-house attorney for Siemens USA. She was the principal corporate decision-maker responsible for creating DD Industries and drafting certain portions of the radiology bid package, including a sworn statement submitted by DD Industries attesting to the Siemens-Faustech joint venture arrangement.

All five defendants will be arraigned at a later date in U.S. District Court in Chicago. A status hearing previously was set for Jan. 25 on the bribery charges that were filed last September against Villazan and Faustech. The case is assigned to U.S. District Judge John Darrah.

On May 15, 2000, Cook County officials announced they were seeking bids for a complete turnkey package -- known as Bid Package No. 3 -- for radiology equipment and a Picture Archiving and Communication System for a new hospital on the westside of Chicago. DD Industries was among three entities that bid on the contract. Under a county ordinance in place at the time, bidders were required to set aside at least 30 percent of such contracts for the participation of certified minority businesses. If the MBE requirement was to be satisfied by a joint venture, the county required that MBE must share in the ownership, control, management responsibilities, risks ands profits in proportion with the MBE ownership percentage, that the MBE partner be responsible for clearly defined portion of the work using its own workforce and equipment, and the MBE must perform work that it has the skill and expertise to perform and which is clearly designated in a joint venture agreement.

On June 20, 2000, DD Industries submitted its bid, including a sworn statement attesting that: SMS would share profit and loss in proportion with SMS' 70 percent ownership and 30 percent for Faustech; there were no other ownership interests or agreements that restricted ownership or control; and there were no other agreements other than the joint venture agreement between the partners. The Cook County Board found DD Industries to be the lowest qualified bidder and formally awarded the contract on August 9, 2000.

On October 24, 2000, GE Medical Systems filed a civil lawsuit against Cook County in federal court in Chicago seeking to block the radiology contract based on claims it was fraudulently obtained by DD Industries. An evidentiary hearing was held before U.S. Magistrate Judge Geraldine Soat Brown in January 2001. GE Co. v. County of Cook, 00 C 6587 (N.D. Il.) Ultimately, the parties settled the lawsuit and almost all of the Stroger Hospital radiology contract was transferred to GE.

Hospitals spending millions to raise profiles - instead of on improving patient care

Perhaps the millions spent to "raise profiles" might be better spent in "raising quality" (which might obviate the need to artificially "raise profiles").

One thing is certain: the millions spent will not be offset by millions in executive compensation reductions.

The B-schoolers have truly taken over healthcare. What a way to run ruin medicine.

A previous post on this topic is here.

Hospitals spending millions to raise profiles
John George
Bizjournals Staff Writer

Dr. Steven Merahn recently accepted a new job where his responsibilities, and even his title, include "brand management."

The post wasn't with a soda company, automobile manufacturer or computer firm -- all businesses that rely heavily on product name recognition.

Merahn was hired as vice president of marketing and brand management for the North Philadelphia-based Albert Einstein Healthcare Network. He sees his job as creating and maintaining a brand that defines the value Einstein brings to the communities it serves.

"A brand is not a logo or a color scheme," Merahn said. "While all of that helps with recognition, people don't drink Coke or Pepsi because of what is on the can."

With the trend toward health insurers and employers striving to empower workers to be better consumers of health-care services, hospital and health systems are placing more importance than ever before on their brand recognition.

And they are spending millions of dollars promoting their brands. For example:

Virtua Health will soon be launching a multimillion-dollar advertising campaign, while the University of Pennsylvania Health System has embarked on a study of its branding strategy.

Thomas Jefferson University Hospital is getting ready to distribute branded CDs that will enable people to keep track of their health records on their home computer.

Temple University Health System has a sports marketing deal with Comcast-Spectacor that includes signage at the Wachovia Center and sponsorship of the scoreboard displayed for home viewers of Philadelphia 76ers and Flyers games.

Cooper Health System in Camden, one the region's most high-profile hospital marketers, has created an online store to sell branded apparel and novelties.

Merahn has only been on the job for a few months at Einstein, so his branding strategy is still evolving. He has spent much of his time interviewing people at Einstein to learn more about that network, and how and what to promote. The pediatrician-turned-administrator believes branding is a key component in any communications strategy -- regardless of whether you're selling cars, cell phones or health-care services.

"You need to have a distinct identity among the audiences you are trying to reach," Merahn said. "We are in one of the most competitive health-care markets in the country, so having a unique identity is something each of us wants. Part of what we are doing here is deciding what promise we want to make to the community and then fulfilling it."

In South Jersey, Virtua Health is spending $3 million to $4 million on a brand awareness campaign set to debut within the next few weeks.

"I don't want to blow the cover off what's going to be coming," said Richard Miller, Virtua's president and CEO, "but we are going to be talking about our programs and services in a much different way."

... Dandorph [Penn's senior vice president for business development] said Penn's approach equates to General Motors, where the parent organization is promoted along with separating branding efforts for its individual components, such as Chevrolet, Pontiac and Cadillac.

... read it all.

Misattributing CAM Errors

The Pittsburgh Post-Gazette reported on a new theory about why an autistic boy who was being treated with chelation therapy died.

Dr Mary Jean Brown, an expert on the treatment of lead poisoning, suggested that the boy was treated with disodium EDTA rather than calcium disodium EDTA. Both are chelating agents. Treatment with the former agent could have resulted in an acute decrease in the blood level of calcium, a medical emergency. This could explain the low blood calcium level found at autopsy.

Thus, the news article's headline was "Drug Error, Not Chelation Therapy, Killed Boy, Expert Says." The Associated Press version of the story also attributed his death to a "drug mixup."

But hold the phone, here. As the Post-Gazette reported, "Though its [calcium disodium EDTA] only approved use, according to the U.S. Food and Drug Administration, is for lead poisoning, Dr. Brown said she is aware that iti is used by some people for other medical problems, ranging from clogged arteries to autism. She said there have been no reputable medical trials demonstrating the effectiveness of chelation as a therapy for anything but lead poisoning." Furthermore, "In recent months, chelation treatments of a wide variety ranging from IV to oral to topical have been gaining popularity for autistic children due to anecdotal information from parents indicating a reduction in symptoms."

Chelation therapy for conditions other than lead poisoning has been advocated widely in the complementary and alternative medicine (CAM) community, as per this post in Quackwatch. It is easy to find CAM web-sites that tout chelation therapy for autism, e.g., here and here. There is no good evidence from clinical research to support the use of chelation with calcium disodium EDTA for autism. Substituting a similar, but more dangerous medication for an anecdote-based CAM treatment was not a medical error, because it did not occur in the course of conventional medical treatment. So perhaps it should have been called a "CAM error."

Physicians who attempt to base their practice on science have already been saddled with the responsibility for innumerable medical errors. They do not deserve to also be made responsible for the misadventures of alternative practitioners.

Drug industry officials see room to improve safety - or do they?

I've written about the substantial inadequacies of the postmarketing drug safety surveillance "system" here , here and here (note: the word "system" in this context is a bit of an oxymoron).

The Gartner Group utilized some of my opinions in formulating their report "Predicts 2006: Life Science Manufacturers Adapt to Industry Transitions" (unfortunately available only to subscribers). I'd been interviewed in the report's preparation after a Gartner principal had seen my writings on the subject.

An article has now appeared at Reuters stating that the system for monitoring drug side effects only needs "focused treatment" (?). It does not need "major surgery", only additional funding of the FDA bureaucracy and 'better ways to collect data.' The latter on it face seems to mandate exploratory surgery due to problems such as this.

Excerpts from the article:

Drug industry officials see room to improve safety
Thu Jan 19, 2006 04:06 PM ET
By Lisa Richwine

WASHINGTON, Jan 19 (Reuters) - The U.S. government's monitoring of drug side effects could be strengthened but does not need the major changes critics have advocated, industry officials told an expert panel on Thursday.

Additional funding for the Food and Drug Administration and better ways to collect and analyze safety information could help improve detection of unexpected problems after drugs reach the market, the officials said.

"Drug safety in the U.S. definitely needs improvement. It needs a careful, focused treatment, but I would argue not radical exploratory surgery," said Geoffrey Levitt, chief counsel for regulatory and research at Wyeth (WYE.N: Quote, Profile, Research) .

A string of serious side effects linked to widely used prescription drugs has led to calls for major changes, such as moving safety oversight to an independent board outside the FDA.

Industry officials who spoke to an Institute of Medicine (IOM) panel said they felt that that proposal, as well as suggestions that companies re-apply for approval five to 10 years after a drug launch, were unnecessary and could have negative consequences.

"We think that moving oversight of safety to another federal agency seems extreme and could significantly stall incremental progress," [translation - stall profits? -ed.] said James Nickas, senior director of development at Genentech Inc (DNA.N: Quote, Profile, Research) .

The panel will consider the input as it prepares a report on drug safety oversight that is scheduled to be completed this summer. The FDA requested the investigation last year after the agency was criticized as being slow to respond to signs of problems with antidepressants and Merck & Co. Inc.'s (MRK.N: Quote, Profile, Research) withdrawn painkiller Vioxx ...

"Exploratory surgery" is a metaphor that implies a major problem exists but is not yet identified nor understood, and exposure of the internals are required to establish a diagnosis and render treatment. My belief is that is exactly what's needed to bring the paper-based, 1970's approach to postmarketing drug safety surveillance into the 21st century.

One major improvement would be for pharmas to become more aware of the field of Medical Informatics, whose cross-disciplinary experts are working to move the U.S. towards national electronic health records. Such a resource is perhaps the best (if not only) way to move drug surveillance from the hit-or-miss systems currently in place (e.g., FDA MedWatch and use of payor billing information) to a concurrent, comprehensive system of data flow on this problem.

Yet I still see job postings such as this from my former employer, Merck (now struggling to regain the public's confidence on clinical data issues). I sat on a "talent management" team there whose role was to suggest improvements in talent-seeking. On a number of occasions I advocated for medical informatics experts cross-trained in both medicine and biomedical information science for clinical data management and IT-related leadership roles. However, this type of posting is common throughout all pharmas:

Worldwide Clinical Data Management Operations Manager - Global Data Operations

The Manager of WCDMO (Worldwide Clinical Data Management Operations) is responsible for providing all aspects of supervision to individuals supporting a functional area within WCDMO ... This position is in the Global Data Operations area.

Education: BA, BS or MS degree, preferably in Biology, Nursing, Computer Science, or related discipline. Experience: At least 8 years' experience in data management, clinical research, and/or database design and development. At least 3 years of supervisory and/or management experience. Six Sigma and PMI certification is a plus.

Knowledge and Skills: An overall working knowledge of the clinical development process. Knowledge of database structures and available tools to manage, extract, and report data. A basic knowledge of statistical concepts.

Baccalaureate or masters degrees (but not doctoral or postdoctoral credentials), six-sigma ("management metaphysics") and a "working knowledge of clinical development" are nice credentials, but represent basically the same credentials that might have been sought in, say, the 1970's.

I also note the background of the Wyeth chief counsel for regulatory and research who argues for "focused treatment" of the "system" (which reflects a 'let's not rock the boat too much' philosophy):

Geoffrey Levitt
Vice President and Chief Counsel, WYETH

Mr. Levitt is Vice President & Chief Counsel, Regulatory and Research at Wyeth Pharmaceuticals, Inc., where he is responsible for a wide range of legal/regulatory issues related to FDA compliance and clinical research. Prior to joining Wyeth in April 2001, Mr. Levitt was a partner and co-chair of the food and drug law group at Venable, Baetjer, Howard & Civiletti in Washington, DC. He has written and lectured extensively on food and drug law, and is a past member of the editorial board of the Food and Drug Law Journal.

Impressive legal credentials, but no apparent credentials in the medical and scientific domains, nor in biomedical information science.

As has been mentioned in this blog in the past and at sites such as this, when non-medical personnel decide they know best what's needed to cure healthcare's ills, the results are not often optimal.

I would add that a lawyer employed by industry would likely have significant, inherent conflicts of interest regarding matters of such import where impartial clarity is essential.

-- SS

Conflicts of Interest and Connecticut's Stem Cell Research Program

Connecticut was one of four states to set up its own grant program to promote human stem cell research, funded with $100 million over 10 years. But as the state gears up to start giving away money, the Hartford Courant reported "the state stem cell advisory committee is dominated by members with connections to Yale and UConn [University of Connecticut], the two institutions expected to get the lion's share of the state funds."
A line from the movie Independence Day might be appropriate here, "Oops."
Another day, another conflict of interest.
In 1915, the American Association of University Professor's monumental Declaration of Principles said that the purposes of the university are

• To promote inquiry and advance the sum of human knowledge.
• To provide general instruction to the students.
• To develop experts for various branches of the public service.

And where do we fit the universities' complex relationships with the Connecticut stem cell advisory committee?

More on the Medicare Prescription Plan problems

More on the Medicare Prescription Plan problems, written about in an earlier post here. This does not have the feel of a program whose informational issues were well thought out in advance.

One wonders how many healthcare personnel were involved at leadership levels in the formulation, planning and implementation of this program. (Needless to say, I can with a high degree of confidence assert that those with dual backgrounds in both medicine and IT were not consulted).

Bipartisan Emergency Legislation To Reimburse States for Medicare Prescription Costs Proposed
Published: Jan 19, 2006 at 08:21

In response to problems arising from the implementation of the new Medicare drug plan, a bipartisan group of lawmakers led by Senators Frank R. Lautenberg (D-NJ), Olympia Snowe (R-ME) and Dianne Feinstein (D-Calif.) announced emergency legislation today to reimburse states that have paid millions of dollars for prescriptions for low-income and disabled Medicare beneficiaries.

Senators Chuck E. Schumer (D-NY) and Norm Coleman (R-MN) will also be original co-sponsors of the legislation, which will be introduced tomorrow when the Senate comes back into session. The bill will require the federal government to reimburse States with interest. It also directs the Secretary of Health and Human Services to recover any overpayments made by states to private prescription drug plans and return that money to the Medicare Trust Fund.

"This is a crisis for millions of Americans. The stakes here are life and death. The Federal Government has failed do its job right and the states are left holding the bag," said Senator Lautenberg. "Congress needs to pay the states back for bailing the Federal Government out of this mess."

"Problems with the implementation of the new Medicare drug benefit are occurring nationwide," said Senator Snowe. "In Maine, tens of thousands of our most vulnerable seniors would have lost their prescription drug coverage if the state had not stepped in. States around the country should not have to wait to be compensated by insurance companies for expenses incurred as a direct result of CMS' errors. The federal government should live up to its new responsibility and reimburse states for these costs."

"The faulty implementation of the new drug benefit has caused a major health emergency in California and other states across the nation, particularly for seniors with chronic and debilitating diseases who rely on multiple medications every day to keep them alive. Because of severe glitches in the Medicare database, these individuals are leaving pharmacies without their medications or are making undue sacrifices to pay for costs they should not have incurred in the first place," said Senator Feinstein.

Senator Schumer said, "This Medicare bill is the biggest government fiasco in recent memory. Not only is the Medicare bill confusing, and nearly impossible to navigate, but it's now costing states hundreds of millions of dollars for low income seniors who fell through the bureaucratic cracks. Every kid learns that if you break it, you buy it. And the federal government broke this drug bill big time. The federal government should pay the states back – with interest for their trouble, and that's what this bill will do."

"I find it inexcusable that six million dual eligible beneficiaries and their community pharmacists have been denied coverage and reimbursement because of a computer glitch with the implementation of the Part D program," said Senator Coleman. "I understand the difficulties of this transition but am very thankful that many states, including Minnesota, have stepped up to the plate to make sure these beneficiaries, the low-income and disabled, have their prescriptions filled. I have no doubt this responsibility falls on the Federal government and our legislation will help States recoup funds spent during this period."

Currently, 25 states have moved to pick up the cost of these prescriptions. The MEDICARE STATE REIMBURSEMENT ACT would require the Federal Government to reimburse the states for the cost of prescriptions for low-income seniors and people with disabilities ("dual eligibles") who were eligible for coverage under Medicare Part D, but were improperly denied Federal coverage.

Reimbursement would be through an equivalent reduction in funds owed by each state under the "claw back" provision of the new Medicare law. It would be at a rate equal to 100 percent of all State costs plus an interest rate equal to the market rate on 3-month Treasury Securities plus 0.1 percent.

The Secretary of the Department of Health and Human Services would be directed to recover overpayments by states to private prescription drug plans and return that money to the Medicare Trust Fund.

-- SS

Legislators challenge Tenncare managed care rules

Tenncare, a health care reform program, essentially replaced the Medicaid program in Tennessee. TennCare was designed as a managed care model. It extended coverage to uninsured and uninsurable persons who were not eligible for Medicaid.

It has had its share of problems. It seems the legislature is now at odds with the officials who manage this program, resulting in "[poor] people being run over by the system."

This issues are symptomatic of healthcare being taken over by governmental officials, whose incentives are often not aligned with that of clinicians or patients. The 191,000 patients cut from the system as part of a "financial overhaul" does ring of a rather severe 'reform' that is likely not within the values of the healthcare professionals at the core of the program.

The legislators in this state fortunately seem to know that the program has stepped beyond certain bounds into the realm of patient abandonment.

-- SS

Legislators challenge TennCare rules

Citing concerns about enrollees' rights, they do not OK rigid process for appeals

By ANITA WADHWANI
Staff Writer

Lawmakers refused yesterday to approve rules that place strict limits on TennCare enrollees who appeal being cut from the program.

Instead, lawmakers on the Government Operations Committee told state officials they needed to provide more evidence about why these rules are necessary.

The lawmakers questioned the officials about whether the appeal rules violated enrollees' rights to prove they were being wrongly cut from TennCare.

"We're hearing stories about people being run over by the system. That's the thing we don't want to see and that's the thing I know you don't want to see," Rep. Beverly Marrero, D-Memphis, told the state officials. "Our concern is that people being dis-enrolled be given the benefit of the doubt."

New appeal rules have been in effect since the state began cutting about 191,000 people from TennCare this summer as part of Gov. Phil Bredesen's overhaul of the financially troubled health-insurance program for the poor.

State officials want the rules to be permanent and apply to anyone turned down for TennCare coverage in the future.

... Officials with TennCare and the Department of Human Services, which administers the appeal process, said the rules were fair.

A state official first determines whether an appeal presents a "valid factual dispute" before determining if it can advance to a hearing, said Lee Ann Bruce, an assistant DHS commissioner.

If state officials can see no facts in the appeal that would warrant a hearing, it is turned down, she said.

"If it's simply because you have a dispute with policies in place or can't afford" to pay for your own health care, "that's not a valid factual dispute," she said.

However, lawmakers remained skeptical of the process.

The time lines set by the state for people to provide documents showing they should remain on the program — from 10 days in certain instances — may not be enough time for people who are mentally ill or who have a debilitating illness, Marrero said. Rep. Mike Kernell, D-Memphis, was among lawmakers who recounted anecdotes of constituents turned down for hearings.

... Michele Johnson, an enrollee lawyer with the Tennessee Justice Center, told lawmakers that in about 40% of the hearings they had observed, people who qualified for TennCare were told that evidence they provided was "not relevant." Some were told to reapply, which can take up to three months.

Lawmakers at times appeared frustrated when state officials said they could not answer questions and referred them to other state officials who were not at the hearing.

At the start of the meeting, Harper asked why DHS officials, who had been specifically requested to answer questions about the appeal process, were not present.

"I'm going to dispatch someone to the governor's office," Harper said. "It appears they (DHS) are the ones who created the rules. They should be here to defend them."

DHS Commissioner Gina Lodge and Bruce hurried in to the meeting shortly afterward.