Thursday, January 31, 2013

US Senate Subcommittee Asks What the RUC is About

It has been a long time coming, but the issue of how the US Medicare and Medicaid system sets the fees it pays doctors, and hence sets the incentives on doctors that drive their health care decisions, finally got some public attention again.

 The background is complex, and may glaze the eyes of readers hoping for simple solutions to simple problems.  One wonders if the complexity was deliberately created to discourage solutions.  Yet we have created a complex, obscure, opaque health care system.  If we want to meaningfully improve it, we must address its "inside baseball" qualities.  Those already familiar with and interested in the topic, skip the following section.

Background - the Resource Based Relative Value System Update Committee (RUC)

We have frequently posted, first here in 2007, and more recently here,  here, here, and here, about the little-known group that controls how the US Medicare system pays physicians, the RBRVS Update Committee, or RUC.

Since 1991, Medicare has set physicians' payments using the Resource Based Relative Value System (RBRVS), ostensibly based on a rational formula to tie physicians' pay to the time and effort they expend, and the resources they consume on particular patient care activities. Although the RBRVS was meant to level the payment playing field for cognitive services, including primary care vs procedures, over time it has had the opposite effect, as explained by Bodenheimer et al in a 1997 article in the Annals of Internal Medicine.(1) A system that pays a lot for procedures, but much less for diagnosing illnesses, forecasting prognoses, deciding on treatment, and understanding patients' values and preferences when procedures and devices are not involved, is likely to be very expensive, but not necessarily very good for patients.

As we wrote before, to update the system, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee. The RUC is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments.

However, the identities of RUC members were opaque for a long time, and the proceedings of the group are secret.  As Goodson(2) noted, RUC "meetings are closed to outside observers except by invitation of the chair." Furthermore, he stated, "proceedings are proprietary and therefore not publicly available for review."

In fact, the fog surrounding the operations of the RUC seems to have affected many who write about it. We have posted (here, here, here, and here) about how previous publications about problems with incentives provided to physicians seemed to have avoided even mentioning the RUC. Up until 2010, after the US recent attempt at health care reform, the RUC seemed to remain the great unmentionable. Even the leading US medical journal seemed reluctant to even print its name.

That changed in October, 2010.  A combined effort by the Wall Street Journal, the Center for Public Integrity, and Kaiser Health News yielded two major articles about the RUC, here in the WSJ (also with two more spin-off articles), and here from the Center for Public Integrity (also reprinted by Kaiser Health News.) The articles covered the main points about the RUC: its de facto control over how physicians are paid, its "secretive" nature (quoting the WSJ article), how it appears to favor procedures over cognitive physician services, etc.

In 2011, after the "Replace the RUC" movement generated some more interest about this secretive group, and its complicated but obscure role in the health care system, the current RUC membership was finally revealed.  It was relatively easy for me to determine that many of the members had conflicts of interest (beyond their specialty or sub-specialty identity and their role in medical societies that might have institutional conflicts of interest, and leaders with conflicts of interest).  

Then that year a lawsuit was filed by a number of primary care physicians that contended that the RUC was functioning illegally as a de facto US government advisory panel.  It appeared that things might change.  However, it was not to be.  A judge dismissed the lawsuit in 2012, based on his contention that the law that set up the RBRVS system prevented any challenges through the legal system to the mechanism used to set payment rates.  The ruling did not address the legality of the relationship between the RUC and the federal government.  And then everything was quiet again, until....

A Senate Committee Takes Up the RUC

Meanwhile, after the attempt at health care reform made by the Affordable Care Act (aka "Obamacare"), which aimed to increase insurance coverage, there has been growing concern that there will not be enough primary care physicians available to manage the larger insured patient population.  So, as reported by the Washington Times, a US Senate committee published a report on this issue:

The United States needs 16,000 more primary care physicians to meet its current health care needs, a problem that will only get worse if nothing is done to accommodate millions of newly-insured residents under President Obama’s health care law in the coming decade, according to a Senate report released Tuesday.

Mirable dictu, the report cited the influence of the RUC as part of the problem:

Mr Sanders said some of the blame appears to rest with a board of 31 physicians who make reimbursement recommendations to the Centers for Medicare and Medicaid Services (CMS), which private insurers frequently adopt as well.

The American Medical Association's Relative Value Scale Update Committee, or RUC, is populated by many more specialists that primary care physicians, multiple witnesses said Tuesday.

'Therefore, it should come as no surprise that it has accelerated higher payments — larger paychecks — to specialists over primary care doctors,' Mr Sanders' report said.

Senator Sanders' subcommittee then held a hearing during which the RUC came up for more criticism, as reported by MedPage Today:

Sen. Bernie Sanders (I-Vt.), chair of the Senate Health, Education, Labor and Pensions Subcommittee on Primary Health and Aging, criticized the American Medical Association's Relative Value Scale Update Committee (RUC), which develops annual recommendations on physician pay updates for Medicare.

Sanders noted that the RUC is dominated by specialists, whose opinions are accepted by Medicare more than 90% of the time.

'Specialists sitting on the committee determine reimbursement rates,' he said during the hearing on the physician shortage that is anticipated as more people become insured under the Affordable Care Act (ACA). 'We have to look at that.'

Several witnesses identified problems with the RUC:
Andrew Wilper, MD, acting chief of Medicine at the Department of Veterans Affairs Medical Center in Boise, Idaho, told the senators that Congress could mandate further oversight of the RUC and create greater separation between physicians and the boards that dictate their payment rates.

'At a minimum, the public deserves transparency in decision making from the RUC,' Wilper said. 'We should set a process for rate-setting that is not encumbered by conflicts of interest and is not favoring specialties. A rational observer might conclude that the federal government and AMA are plotting to bring an end to the primary care workforce in the U.S.'

Also Modern Healthcare reported (subscription required) that Dr Wilper

described the RUC as 'a secretive group of physicians that wield tremendous influence.'


Uwe Reinhardt, economics professor at Princeton University, said in addition to adding primary care physicians to the RUC, the panel needs a third party to perform outside audits of the AMA panel's recommendations

However, the AMA was there to provide their usual defense of the RUC, as per Medpage Today,

'The RUC is an independent group of physicians from many specialties, including primary care, who use their expertise on caring for Medicare patients to provide input to CMS [the Centers for Medicare and Medicaid Services],' RUC chair Barbara Levy, MD, said in a statement. 'More than 300 people participate in a typical RUC meeting and information on the panel is publicly available.'

Levy noted that 'CMS recently adopted RUC recommendations for the creation of codes to recognize the value of the work, often done by primary care providers, in transitioning patients from one care setting to the next.'

The AMA also added two primary care-related seats to the RUC last February: a representative from the American Geriatrics Society and a rotating seat for a practicing primary care physician.

Note that this brief response did not add anything to the more voluminous response the AMA made in 2009 to some of my posts on the RUC, all of which were easily countered (look here).  

 After the hearing, per MedPage Today,

The problems with the RUC are 'one of the more important issues that arose out of this hearing,' Sanders told MedPage Today after it was over. 'I don't think we have the transparency we need.'

Legislation to address the RUC -- as well as other factors exacerbating the PCP shortage -- is expected to come 'quickly' said Sanders.


I salute Senator Sanders and his subcommittee for addressing the obscure and often quite anechoic topic, getting it some public attention, and at least raising the possibility of a legislative solution.

However, this is just a baby step.  The hearing and report generated minimal media coverage (I included links to the most visible above).  Given that Senator Sanders is widely regarded as well to the left of most of his legislative colleagues, the likelihood that any measure he would craft on this would be passed is minimal.

Meanwhile, questions we have raised again and again, most recently here in 2011, remain unanswered.

 - How did the government come to fix the payments physicians receive? Government price-fixing has not been popular in the US, yet this has caused no outcry.
- Why is the process by which they are fixed allowed to be so opaque and unaccountable? Why are there no public hearings on the updates, and why is there no input from practicing physicians or organizations other than those related to the RUC?
- How did the RUC become de facto in charge of this process?
- Why does the AMA [keep the membership of the RUC so opaque, and] give no input into the RUC process to its general membership?
- Why is the RUC membership so dominated by procedural specialists? Why were primary care physicians, who made up at least a sizable minority of physicians when the update process was started, not represented according to their numbers?
- Why has there been so little discussion of the RUC and its responsibility for an extremely expensive health care system dominated by high-technology, expensive, risky and invasive procedures?

Economists have beaten us over the head with idea that incentives matter.  The RUC seems to embody a corporatist approach to fixing prices for medical services to create perverse incentives for physicians to do more procedures, and do less conversing with and examining patients, examining the best clinical research evidence about their problems, and rigorously thinking about how best to help them.  More procedures at higher prices helps physicians who do procedures.  It may help even more the corporations that provide the devices and drugs whose use is necessitated by such procedures, and the hospitals who can charge a lot of money as sites for performance of procedures.  It may even help insurance companies by driving ever more money through the health care system, and thus allow rationalization for higher administrative expenses as a function of overall money flow.

Yet incentives favoring procedures over all else may lead to worse outcomes for patients, and more costs to patients and society.  If we do not figure out how to make incentives given to physicians more rational and fair, expect health care costs to continue to rise, while access and quality continue to suffer.  

ADDENDUM (1 February, 2013) - see also comments by Brian Klepper on the Care and Cost blog.

ADDENDUM (3 February, 2013) - see also comments by Austin Frakt in the Incidental Economist blog.


1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. (Link here.)

2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. (Link here.)

Wednesday, January 30, 2013

AMIA: Enhancing patient safety and quality of care by improving the usability of EHR systems, but ... no sympathy for victims of bad health IT?

A panel of experts from the American Medical Informatics Association have written a paper "Enhancing patient safety and quality of care by improving the usability of electronic health record systems: recommendations from AMIA."

The paper is publicly available at this link in PDF.

The authors are  Blackford Middleton (Harvard Medical School),  Meryl Bloomrosen (AMIA),  Mark A Dente (GE Healthare IT),  Bill Hashmat (CureMD Corp.), Ross Koppel (Dept. of Socology, Univ, of Pennsylvania), J Marc Overhage (Siemens Health Services), Thomas H Payne (U. Washington IT Services),  S Trent Rosenbloom (Vanderbilt Informatics), Charlotte Weaver (Gentiva Health Services) and Jiajie Zhang (University of Texas Health Science Center at Houston).

The paper states what has been obvious to this author - and many others - for many years:

ABSTRACT:  In response to mounting evidence that use of electronic medical record systems may cause unintended consequences, and even patient harm, the AMIA Board of Directors convened a Task Force on Usability to examine evidence from the literature and make recommendations. This task force was composed of representatives from both academic settings and vendors of electronic health record (EHR) systems. After a careful review of the literature and of vendor experiences with EHR design and implementation, the task force developed 10 recommendations in four areas: (1) human factors health information technology (IT) research, (2) health IT policy, (3) industry recommendations, and (4) recommendations for the clinician end-user of EHR software. These AMIA recommendations are intended to stimulate informed debate, provide a plan to increase understanding of the impact of usability on the effective use of health IT, and lead to safer and higher quality care with the adoption of useful and usable EHR systems.

The paper is a respectable start at acknowledgement of the issues ... albeit years late.

That said:

I noted some typical language in the article characteristic of the reluctance of the health IT industry and its friends to directly confront these issues.  I wrote a letter to the authors that, as I indicate below, not unexpectedly went unanswered except for one individual -- not even a physician -- who's gone out on a limb professionally in the interest of patient's rights, and as a health IT "iconoclast" (i.e., patient advocate) suffered for doing so (link).  The lack of a response to the letter is itself representative, in my opinion, of a pathology that renders more rights to the healthcare computer and its makers than patients.   More on this below.

First, I note I am rarely if ever cited by the academics.  They are not prohibited from doing soI've probably been writing on these issues -- poorly done health IT, improper leadership, the turmoil created, etc., publicly for longer than anyone else in the domain.

I also note that the paper is somewhat in the form of an analytical debate.  Analytical debates are relatively ineffective in this domain.  They are like popcorn thrust against a battleship.  The paper, also, appearing as it does in a relatively obscure specialty journal (Journal of the American Medical Informatics Association), will probably get more exposure from this blog post than the entire readership of that journal.  The authors need to be relating these issues in forums that are widely read by citizens and government, not in dusty academic journals - that is, assuming they want the messages to widely diffuse.

In my review of the article, I note the following:

... In an Agency for Healthcare Research and Quality (AHRQ) workshop on usability in health IT in July 2010, all eight participating vendors agreed that usability was important and many suggested it was a competitive differentiator, although some considered that usability was in the eye of the beholder and that the discipline of usability evaluation was an imperfect science, with results that were not useful.

A paper like this should have clearly repudiated antiquated viewpoints like that, not merely made note of them.   Not taking a stand is a sign of weakness...or sympathy.

As a matter of fact, if leaders such as this had paid attention to the 'iconoclasts' and their 'anecdotes', my own mother might not have gone through horrible suffering and death, with me as sad witness as I related to them in my letter below.

... End-users of EHR systems are ultimately accountable for their safe and effective use, like any tool in clinical care.

I see a linguistic sleight of hand via use the word "tool" to describe HIT and trying to blend or homogenize this apparatus with other "tools" in clinical care.  The HIT "tool" is unlike any other since no transaction of care can occur without it going through this device, and as such, all care is totally dependent on it.  Further, unlike pharma and medical devices, this "tool" is unvetted and unregulated but its use forced upon many users.

... [AMIA] subcommittees reviewed the literature on usability in health IT, current related activities underway at various US Federal agencies, lessons learned regarding usability and human factors in other industries, and current federally funded research activities.

Did they speak with the source of the most candid information?  The plaintiff's and defendant's Bars?

Need I even ask that question?

... Recent reports describe the safe and effective use of EHR as a property resulting from the careful integration of multiple factors in a broad sociotechnical framework

This is not merely 'recent' news.  The field of Social Informatics (link), that has studied IT in its social contexts for decades now, has offered observations on the importance of considering multiple factors in a broad sociotechnical framework.   The authors all know this - or should know this, or should have made it their business to know this The statement sounds somewhat protective of the HIT and hospital industries for their longstanding negligence towards those issues.

... User error may result in untoward outcomes and unintended negative consequences. These may also occur as a result of poor usability, and may also be an emergent property only demonstrated after system implementation or widespread use.

I note the use of the term "user error" and lack of the term "use error" with significant disdain.  As I wrote here regarding the views of a HIT industry exexcutive holding the mystical "American Medical Informatics Certification for Health Information Technology" NIST itself now defines "use error" (as opposed to "user error") as follows:

“Use error” is a term used very specifically by NIST to refer to user interface designs that will engender users to make errors of commission or omission. It is true that users do make errors, but many errors are due not to user error per se but due to designs that are flawed, e.g., poorly written messaging, misuse of color-coding conventions, omission of information, etc. From "NISTIR 7804: Technical Evaluation, Testing and Validation of the Usability of Electronic Health Records." It is available at (PDF).

In the article, indefinites were exchanged with what should have been stronger, declarative statements, and vice versa:

User error ... may also represent a potential health IT-related error yet to happen.

I most decidedly wish they'd stop this "may" verbiage in policy papers like this.

... Anecdotal reports suggest that these application differences [where clinicians use more than one commercial EHR system] result in an increased training burden for EHR users.

"Anecdotal"?  How about "obvious to a third grader?" 

"Anecdotal" in academic papers often is a term of derision for inconvenient truths such as reports of health IT problems.  Its use often reflects a need for authors using the term (per a senior clinician from Victoria, Australia on the 'anecdotes' issue, link) "to attend revision courses in research methodology and risk management."

... Some suggest that the expected gains sought with the adoption of EHR are not yet realized.

"Some"?  How about "credible experts?"  "Suggest?"  They merely hint at it?  How about "opine?"
... The design of software applications requires both technical expertise and the ability to completely understand the user’s goal, the user’s workflow, and the socio-technical context of the intent

In the meantime, AMIA has been promoting national rollout of a technology where, most often, the latter does not apply.

To ... transform our healthcare delivery system ... clinicians need to use usable, efficient health IT that enhances patient safety and the quality of care.

This is the typical hyperenthusiast mantra.  Where's the proof?  And, transform into what, exactly?  Vague rhetoric like this in allegedly scientific papers is most unwelcome.

Some experts suggest that improving the usability of EHR may be critical to the continued successful diffusion of the technology.

More weak talk.  Why not come right out and say "Credible experts opine that ...."?

... While some EHR vendors have adopted user-centered design when developing health information technologies, the practice is not universal and may be difficult to apply to legacy systems.

From the patient advocacy perspective, that's their's a risk of being in this business.  Patients should not be expected to be used as experimental subjects while IT sellers figure out what other industry sectors have long mastered.   Further, they should be held accountable for failures that result in harm.  Another risk of doing business in this sector that clinicians have long learned to live with...

... Some believe it is difficult or impossible to reliably compare one product with another on the basis of usability given the challenges in assessment of products as implemented.

Nothing is "impossible" and again, if it's "difficult", that's the industry's problem.  There is risk of being in the business of medicine or medical facilitation; nobody promised a rose garden, and a rose garden should not be expected.

... Many effects of health IT can be considered to be ‘emergent’ or only discovered after monitoring a system in use

One might ask,  where's the industry and AMIA been regading postmarket surveillance (common in other health sectors) for the past several decades?

... AMIA believes it is now critical to coordinate and accelerate the numerous efforts underway focusing on the issue of EHR usability.

Only "now?"

... Establish an adverse event reporting system for health IT and voluntary health IT event reporting

No, no, no ...voluntary reporting doesn't work.  Even mandatory reporting is flawed, but it's better than voluntary.

I am invariably disappointed by recommendations like this.  I've observed repeatedly, for example, that "volunatary reporting" of EHR problems already exists - in the form of the FDA MAUDE database - and most HIT sellers' reports are absent.  See my posts on MAUDE here, here and here(Also, the only one that seems to report may have ulterior motives, i.e., restraint of trade.)

... A voluntary reporting process could leverage the AHRQ patient safety organizations (PSO) ... This work should be sponsored by the AHRQ.

These folks clearly don't want any teeth in this.  AHRQ is a research-oriented government branch, not a regulator, nor does it have regulatory expertise.

AMIA recommends:

Research and promote best practices for safe implementation of EHR

In 2013 this is valuable information in the same sense that advice to use sterile technique during neurosurgery is valuable.

"Promoting best practices" has been done for decadesNot mentioned is avoiding worst practices.   I've long written these are not the same thing, as toleration of the inappropriate leadership by health IT amateurs (a term I use in the same sense that I am a Radio Amateur, not a telecommunications professional), politics, empire-building and other dysfunction that goes on in health IT endeavors negates laundry lists of "best practices."

What is required is to research and abolish worst practices, including the culture and dynamics of the 'health IT-industrial complex.'  I made this point in my very first website in 1998.  It appears the authors don't get it and/or won't admit to the dysfunction that goes on in health IT projects.
... The adoption of useful and usable EHR will lead to safer and higher quality care, and a better return on investment for institutions that adopt them.

"Will?"  With respect to my observation above about the paper's prominent misuse of indefinites vs. stronger declarative terms, the word "may" would have been the appropriate term hereAs I wrote about similar statements from ONC in the NEJM in my 2010 post "Science or Politics? The New England Journal and The 'Meaningful Use' Regulation for Electronic Health Records", I'm quite disappointed seeing speculation and PR presented as fact from alleged scientists and scientific organizations.

Finally, I wrote the following email letter to the authors, to which (except for Ross Koppel) I received no reply.  While Dr. Koppel (a PhD) graciously expressed sympathy for my me and mother, the others (many MD's) were silent.

Perhaps the silence is the best indicator of their concern for the rights of computers and HIT merchants relative to the rights of people:

Mon, Jan 28, 2013 at 1:12 PM
Dear authors,

I've reviewed the new paper "Enhancing patient safety and quality of care by improving the usability of electronic health record systems: recommendations from AMIA" and wanted to express thanks for it.

It's a good start.  Late, but a good start at returning the health IT domain to credibility and evidence-based practice.

It's too bad it didn't come out years earlier.  Perhaps my mother would not have gone through a year of horrible suffering and death, with me as sad witness, due to the toxic effects of bad health IT. 

Perhaps you should hear how horrible it was to hear my mother in an extended agitated delirium; to hear her cry hysterically later on when the rehab people told her that her weight was 95 pounds; to have to make her a "no code" and put her on hospice-care protocols, and then to have watched her aspirate a sleeping pill when she was agitated, and die several days later of aspiration pneumonia and sepsis ... in the living room of my home ... and then watch the Hearse take her away from my a result of bad health IT.

I will be writing more thoughts on your article at the Healthcare Renewal blog, of course, but wanted to raise three issues:

1.  The use of "may" and "will" is reversed, and conflating the term "anecdote" with risk management-relevant case reports. 

  • They may also represent a potential health IT-related error yet to happen.  --->  They likely represent a potential health IT-related error yet to happen
  • Anecdotal reports suggest that these application differences result in an increased training burden for EHR users.  ---> Credible reports indicate...
  • Some suggest that the expected gains sought with the adoption of EHR are not yet realized. ---> Credible experts opine ....
  • Some experts suggest that improving the usability of EHR may be critical to the continued successful diffusion of the technology. --->  "Credible experts opine that ..."
  • The adoption of useful and usable EHR will lead to safer and higher quality care, and a better return on investment for institutions that adopt them. ---> The adoption of useful and usable EHR may lead to safer and higher quality care

You really need to show more clarity ... and guts ... in papers like this, and drop the faux academic weasel words.

2.  You neglected to speak to the best source for information on EHR-related harms, evidence spoliation, etc... med mal attorneys.

3.  You also neglected to speak to, or cite, the writings of a Medical Informaticist on bad health IT now going back 15 years - and whose mother was injured and died as a result of the issues you write about - me.  In fact I am rarely cited or mentioned by anyone with industry interests.

An apparent contempt for 'whistleblowers' such as myself makes me wonder ... what kind of people are the leaders of health IT, exactly? 

Do they value computer's rights over patients'?

It is not at all clear to me which has been the primary motivator of many of the health IT leaders.

I think the rights which I value are quite clear.


Scot Silverstein

I neglected to mention the horror of seeing my mother put in a Body Bag before being taken to the Hearse in my driveway.

-- SS

Tuesday, January 29, 2013

Broken Promises: Latest HCA Settlement Suggests Skepticism about the Next Big Thing in Health Care

A long time ago in the US, most people got care from physicians who were self-employed, or part of physician partnerships.  If they had to be hospitalized, it was at hospitals that were community or academic non-profit organizations.   If they had health insurance, it was likely from a non-profit Blue Cross Blue Shield affiliate.  However, with the rise of market fundamentalism, we have heard the promises of increased efficiency and innovation from for-profit health care.  So hospitals, insurance companies, and now increasingly physicians' practices have been bought up by for profit corporations.

Many politicians and policy-makers seemed to believe the promises, and often joined the cheering sections for the latest and greatest for-profit conversions.  Should they have done so?  Let us look at a case that recently hit the news again and think about it..

Background - HCA Acquired Health Midwest

Way back in 2002, large for-profit hospital chain HCA, formerly Columbia/HCA, acquired a sizable non-profit hospital system, Health Midwest.  As the Los Angeles Times then reported,

In a setback for Tenet Healthcare Corp., rival hospital giant HCA Inc. said Wednesday that it has agreed to buy Health Midwest, a 14-hospital chain based in Kansas City, Mo., for $1.13 billion.

Santa Barbara-based Tenet and HCA were the two finalists in a rare opportunity to acquire, in one swoop, a dominant hospital system in a growing urban market. The 20-member board of Health Midwest, a nonprofit company that has been struggling financially, said it voted unanimously to go with HCA.

The biggest factor in the decision by the Health Midwest board to accept the HCA offer was apparently the almighty dollar.

 'HCA's bid was much higher,' [Tenet spokesperson Harry] Anderson said, noting that he could not disclose Tenet's offer because of a confidentiality agreement.

But in addition to cash, HCA made some promises that sounded attractive to the board.

 In addition to the cash price, HCA said it would spend $450 million for capital improvements over the next five years.

That promise came from the top of HCA, as reported by the Nashville post,

 HCA Chief Executive Jack Bovender said: 'This has been a comprehensive, thorough process with a lot of community participation. We are ready to get to work to improve these hospitals through significant capital infusion and by making long term operational improvements.'

 Furthermore, as the Los Angeles Times also reported

Health Midwest spokesman Chris Whitley said price was not the only factor in the decision.

'As important to the board was to find a party that would offer a strong commitment to maintain and honor the various religious, cultural and charitable traditions,' he said.
There were objections by people who did not have decision making authority, but they apparently did not carry much weight

Labor and community activists in Kansas City have opposed a takeover of a nonprofit health system by an investor-owned corporation, raising concerns that such a conversion would lead to cuts, hurting employees and consumers.

In retrospect, why Health Midwest was so trusting of HCA at the time was unclear.  HCA, after all, did not have a track record then that should have inspired trust.  The HCA acquisition of Health Midwest was approved only a few years after what was then Columbia/ HCA settled allegations of extensive Medicare fraud.  the $1.7 billion the company paid made it the largest Medicare fraud case settled up to that time (and was larger than the amount it later spent on this acquisition.    See this post for some details and sources.)  This certainly could have raised a "red flag" before the deal was concluded.  But it did not. 

This deal was typical of many deals in which for-profit corporations, some backed by private equity firms, took over sometimes struggling non-profit hospitals, while promising great things for their communities.  For example, see our posts about the take-over of a health care system called Caritas Christi, by Cerberus Capital Management.  Caritas Christi was given the reassuring name of Steward Health Care, and then proceeded to take over, or try to take over additional hospitals. (Click the links for this long story.)  

Broken Promises - the New HCA Settlement

A new legal settlement by HCA suggests that such takeovers of non-profit hospitals by for-profit corporations ought to be regarded with much greater skepticism.  This time, per the New York Times,

HCA, the nation’s largest profit-making hospital chain, was ordered on Thursday to pay $162 million after a judge in Missouri ruled that it had failed to abide by an agreement to make improvements to dilapidated hospitals that it bought in the Kansas City area several years ago. 

Thus the new HCA settlement suggested that those fine promises made by HCA executives and their cheer leaders when HCA was seeking to take over Health Midwest were broken.

The trouble in the Kansas City area began a year after HCA acquired a dozen hospitals from Health Midwest in 2003 for $1.125 billion. As part of the deal, HCA agreed to make $300 million in capital improvements in the first two years and an additional $150 million in the following three. The hospital chain also agreed to maintain the levels of care that had been provided to low-income individuals and families in the area for 10 years. 

But when the members of the Health Care Foundation of Greater Kansas City, a nonprofit created from the proceeds of the sale of the hospital, received their first report from HCA in 2004 they discovered the hospital was already way behind.

Of the $300 million it was supposed to spend in the first two years, its own documents showed it had spent only about $50 million, according to Mark G. Flaherty, one of the founding members of the foundation and its general counsel.

HCA’s reports to the foundation also indicated that the level of charitable care it provided at the system’s large inner-city hospital had fallen while charitable care provided at the more affluent suburban hospital had risen sharply, Mr. Flaherty said.
'That was a big red flag to us,' he said.

After repeatedly asking HCA executives for explanations but receiving none, the foundation sued HCA in 2009. The case went to trial for several weeks in 2011.

 Note that there were alleged violations of two key provisions of the original deal, improvements to existing hospitals and guarantees of charitable care.  So here is at least one case, involving the largest US for-profit hospital corporation, showing violation of the sorts of promises that those promoting for-profit take-overs tout as showing at least the goodwill of the new corporate owners.

Should the HCA Track Record Have Led to Questions About Trustworthiness?

It is unclear how often anyone has bothered to check whether similar promises made in other deals were fulfilled.  It appears that such inquiries might actually involve a lot of bother.  Note that in this case it took almost six years for the community foundation to obtain enough information to conclude that HCA had not met its obligations and file a lawsuit, and another almost four years to get the case resolved.

The New York Times hinted that there was at least one other inquiry about a contemporaneous HCA deal.  While "a judge ruled in HCA's favor, deciding that Portsmouth Regional Hospital [in New Hampshire] would remain part of HCA after community leaders tried to regain control," the court proceedings did produce

 testimony in a 2011 trial, [in which] a former hospital official claimed he had difficulties getting HCA to pay for what he and others described as critical equipment and facility upgrades.

Meanwhile, there have been other recent events that should raise further questions about the trustworthiness of HCA going forward.  Last year extensive reporting suggested that HCA hospitals put short-term revenue ahead of patients' welfare through overuse of lucrative cardiac procedures and and undertreatment of poor patients in emergency departments and debilitated patients with bed sores (see this post).   Also last year HCA settled allegations it provided kickbacks to physicians at some of its hospitals to refer patients to its hospitals (see this post).     

Moreover, the record over the long term raises a big question as to why the good people of Missouri, the "show me" state, trusted HCA sufficiently for hospital acquisition deal to go forward in 2003.  As we wrote above, HCA was only a few years out of making the biggest settlement for federal health care fraud known at that time. 


 In 2010, we suggested that the take-over of non-profit hospitals by for-profit firms owned by private equity ought to be viewed with extreme skepticism.  In 2010, in Deadly Spin, former CIGNA public relations chief Wendell Potter showed how the conversions of non-profit Blue Cross Blue Shield health insurance plans to for-profit corporations were justified by the need to gather more capital to provide services comparable to new for-profit competitors, but were really motivated by the greed of executives who "would earn bigger pay packages for managing larger businesses, and if they could convert them to for-profit companies, they stood to earn even more." 

I submit that if anyone were able to look carefully at the results of the various deals that allowed for-profit corporations to take over hospitals, other organizations that directly take care of patients, health insurance companies, and now even physicians' practices, they would likely find that a lot of fine sounding promises made were broken and assurances made were false.  

From now on, I can only hope that health care professionals, policy-makers, politicians, but mainly the public at large will be appropriately skeptical of the fluffy promises made by those who stand to personally gain from the latest big thing in health care.  In particular, we all should be acutely skeptical the next time someone promises lower costs, better care, innovation, etc, etc by converting a community non-profit hospital to a subsidiary of a big for profit corporation.  

How the HIT zealots and profiteers have harmed physicians and nurses, not to mention patients, taxpayers, and the government

Any new technology introduced into a complex system, especially when introduced recklessly, has the potential to produce unexpected consequences, and the problems introduced can be worse than the problems the technology was attempting to solve.  This is a fundamental precept and empirical observation in the field of social informatics, a domain that studies information and communication tools in their cultural or institutional contexts.

Idealism combined with zealotry (excess of zeal; fanatical devotion) and/or hyper-enthusiasm that ignores the downsides of an intervention, and silences credible critique,  has also proven to be a dangerous combination.

Characteristic of the health IT hyper-enthusiasts been zealotry, silencing of credible critics, and spreading of illusory memes and technologies not yet fit for purpose; the characteristics of HIT profiteers is similar but for a different motive.  The end result in either case is harm to the interests and well-being of patients, physicians and nurses and other clinicians, taxpayers, and the government.

(Doctors and nurses ... after reading the findings below, be prepared to countersue the health system officers who mandated your use of EHR's for breach of fiduciary responsibilities, including due diligence, if you are sued for EHR-caused medical malpractice.)


Business of Medicine
Malpractice 'Discovery' Dangers in Your EHR
Leslie Kane, MA
Jul 16, 2012


Picture this: You've been sued, and now the plaintiff attorney has the right to send in an expert to sit at your computer and examine information in your electronic health record (EHR). Besides any mistakes you might have made, system-wide bugs or design flaws that lead to data inconsistencies could be found and held against you in the discovery phase of a malpractice lawsuit.

Doctors are becoming increasingly aware that EHRs can create certain malpractice risks. However, an expert in EHR and liability says there is a new category of malpractice risks in EHRs that most doctors have never considered. These include EHR system issues that you were never aware of and didn't cause.

You may have been coerced into using the EHR system via threat of Medicare cuts -- embedded without a public comment period in the HITECH section of ARRA thanks to the zealots and profiteers -- or via draconian hospital policies set by senior executives that threaten adverse personnel actions or other retaliation for those who refuse to use or are unable to learn to "effectively" use the corporate-chosen EHR (I have seen such policies in print).

These executives have simply taken the word of the sellers that the technologies are harmless, and have likely negligently signed hold-harmless agreements with the sellers as a symbol of their confidence in the assessment.

"Every aspect of EHR selection, implementation, and use may be examined in the course of medical malpractice discovery to uncover the source of the incident, or undermine the records that are being presented in defense of the malpractice claim," says Ronald B. Sterling, CPA, MBA, national EHR expert, Silver Spring, Maryland, and author of Keys to EMR Success (Greenbranch Publishing; Phoenix, Maryland; second edition, 2010). "Anything could be a malpractice issue, from the product itself, the way it was set up, or how you've been using it."

The same applies, I add, to any technology a clinician or healthcare facility might introduce into practice.

For example, authorized software upgrades can unknowingly cause liability problems. Upgrades to the software can change the historical data presentation you've already worked with. "An EHR upgrade can go back and affect data being stored for a patient," says Sterling. "The upgrade can affect the presentation and the reporting and usage of that information. I'm aware of upgrades in which a large amount of data was lost."

I'm aware of numerous "upgrades" that nearly caused catastrophes - in fact they may have caused catastrophes that were not publicized- such as here.

"Even if the practice does everything perfectly, there could be design flaws in the electronic health record or the way the practices uses it or sets it up. This gets exposed in the light of discovery during a malpractice suit. If the plaintiff attorney spots errors in the record -- even if the system, not the physician, creates them -- it calls into question every record you produce and every statement you make."

Considering the evidence spoliation that can and does occur thanks to electronic systems, of which I am becoming aware of an increasing number of incidents, discrepancies ("errors" in the record) should arouse suspicions.   Those "hold harmless" agreements should look less and less appealing....

... "There are all kinds of issues I can now delve into, more than I'd find in the paper world. In the paper world, there is not a lot of supporting information," he says. "However, with an EHR, you can see what time each event or note happened, whether it was before or after another event. These could become critical points in a trial."

Thank the zealots for this, docs.

Sterling described several types of problems that could create difficulties for a doctor in a malpractice liability case.

... System or product bugs (defects). One doctor was using an EHR that had inherent errors in it. It wasn't documenting information correctly. The information being entered was not being stored in the right location, and the patient's medical note was ultimately incorrect. "This now calls into question anything in the note, even if you did the right thing," says Sterling.

Caveat emptor.

Transferring paper records to EHR. What happens to the patient's history that was stored in the paper medical chart? The new EHR form may not specifically account for or match up with every notation you have in the old medical chart. If some information doesn't get transferred in, the plaintiff attorney may ask, "Did the doctor have the full picture of the patient's condition?" The discovery process may include comparing the patient's old paper record (if you still have it) with the history now in the EHR.

Signing notes. Some doctors don't sign their notes. This creates a problem with billing, but it also could prompt the question of whether the doctor actually provided those services to the patient.

The zealots never considered these issues, or didn't care.   "You're going to use EHR's whether you like it or not, because they WILL transform medicine.  So say we all."

... One physician was inadvertently distributing clinical notes that included inappropriate findings (such as results of tests that would not have been given to that patient). When the note was challenged during a malpractice trial, it called the patient's entire record into question.

"Unfortunately, the physician had been using software that contained the test setups from the vendor," explained Sterling. "He was recording information on the screen and printing it, and the printed copy was appropriate when he gave it to the patient, but the electronic record contained inappropriate findings and events. Because the doctor was using the forms that contained the original test data (even though the data were not quite visible), the EHR incorporated these old findings."

Just a "glitch", of course.  

One template affects other screens. When you use templates and you're charting by exception, you're viewing 1 screen. But when you check off items in the box, it sends those data to 5 or 6 other screens, and you may not be aware that the information is now contained on those screens. A doctor may decide to remove the information on 1 screen, but that deleted information has already populated 6 other areas and is still in the patient's medical record.

Why would one expect that using tools of grossly inappropriate provenance would not create problems?

Usage issues. The vendor stored it one way, but the doctor stored information another way, which changed the location in which information was stored. The historical record actually changed.

"What happened when the doctor could not produce the record he gave to the patient because it no longer existed?" asked Sterling. "The attorney would look at it and say, 'This is not the piece of paper you provided.' "Any of these could be the killer issue that ends your chance of successfully defending yourself in a malpractice trial," he says.

Sure, EHRs will 'revolutionize' medicine, once the EHRs actually don't introduce booby-traps to the practice of medicine exposing clinicians to the revolutionary guillotine.

Vendor Says, "Not My Fault!"

One might think that a product defect or design flaw should be the responsibility of the vendor, and the doctor should be held harmless for those types of errors. But it doesn't work that way.

"The doctor can be held liable because most vendors' contracts (signed by the physician) essentially say, 'We do not practice medicine; it is up to the physician to make sure this EHR is being used correctly.' The practices have to understand what they're using and verify that the system is appropriately set up to document the care they provide."

I note that doctors forced to use hospital EHR's never see nor sign those contracts.

In a trial, the doctor would be held responsible for product problems.

But just as scary, doctors could be held responsible for following vendor instructions. "I've seen situations in which the vendor tells doctors to do something, and doctors are relying on vendor and not doing their own proper analysis and design of the EHR that's tailored for their own practice," says Sterling. "The vendor is not the one responsible for maintaining the patient's medical record."

More than $20 billion of taxpayer "incentive" money has already gone to the accountability-free sellers of this technology, I might add. 

Bad News: You Need to Delve Into Technicalities

Most doctors are unprepared to explore the technical elements of working with an EHR. "Doctors have to understand what happens when you push the buttons," says Sterling. That means they have to take the time to work with the EHR and explore various screens and scenarios before they ever use it with a patient.

It would help to have people who actually know what they're doing around, a lesson hospitals have not yet fully learned when they depend on grossly inappropriate personnel of a business-computing background to lead HIT projects and make critical decisions on vendor contracts.

In summary, the HIT hyper-enthusiasts and profiteers have successfully conned the government and healthcare sector into using, or coercing clinicians to use, technologies unproven to provide the fantastical levels of clinical and financial benefit claimed (as in many other posts), that introduce booby-traps to users' legal safety, that can be injurious to patient safety, and that suck money from healthcare that could be better used in, say, care of the underserved.

What an enviable arrangement for the enthusiasts.

-- SS

Saturday, January 26, 2013

Senator Stephen H. Martin of Virginia: proposed limitations on use, storage, sharing, & processing of electronic medical record data

Here's a politician who certainly seems concerned with the privacy and confidentiality and flawed-analysis downsides of electronic health records -  Senator Stephen H. Martin of Virginia:

SB 1275 Medical data in an electronic or digital format; limitations on use, storage, sharing, & processing.


Medical data. Prohibits any person that regularly stores medical data in an electronic or digital format from (i) participating in the establishment or implementation of the Nationwide Health Information Network; (ii) performing any analytic or statistical processing with regard to any medical records from multiple patients for purposes of medical diagnosis or treatment, including population health management; or (iii) processing medical data at a facility within the Commonwealth in any instance where a majority of the patients whose medical data is being processed do not reside in the Commonwealth. A database at which medical data is regularly stored in an electronic or digital format shall not store or maintain in a manner that is accessible by the operator or any other person, in an electronic or digital format, at any one time, medical data regarding more than 10,000 patients. 

Of note, the bill also counters the coercive aspects of the HITECH bill, stealthily sneaked into the Economic Recovery Act (ARRA) without so much as a peep of public comment, thanks to the Health IT lobby (as described by Robert O'Harrow Jr. in the WaPo in May 2009, see here):

The measure provides that any health care provider shall not be subject to any penalty, sanction, or other adverse action resulting from its failure or refusal to implement an online computerized medical record system. A patient's consent to the sharing of his health care information shall be presumed not to grant consent to the electronic or digital storing or transmission of the information to any person other than for health care coverage purposes. Finally, the measure prohibits the Commonwealth from authorizing the establishment or operation of a health information exchange.

The proposal seems authoritarian in terms of use of aggregated, de-identified medical data for public health purposes.  In the current environment, however, of health IT hyper-exuberance, misuse of medical data (e.g., putting it up for sale as at link, link) and repeated major security breaches, perhaps a return to sanity requires putting the brakes on - hard - and performing a 'system reset.'

It's clear the hyperenthusiasts will not like this proposed legislation.

-- SS

Wednesday, January 23, 2013

How the "Revolving Door" and Other Aspects of Corporatism Benefited Amgen Just After its Settlement and Guilty Plea

At least here in these United States, our health care corporatism is bipartisan.  Here we present a sorry story of how a company that should have been shamed by dishonest behavior that likely harmed patients instead apparently was awarded special treatment through its cozy relationships with top government leaders
Accusations of Kickbacks and Deceptive Marketing of Aranesp 

Last month, biotechnology giant pleaded guilty to a charge of misbranding and settled civil charges with the US government for $762 million (look here).  Soon after, New York Times article described the unethical practices the company was alleged to have performed.  It opened with a vivid anecdote:

'I hope no one is taping this,' the Amgen manager remarked at a company sales meeting in 2005.

The manager then boasted of how she had given a $10,000 unrestricted grant to a pet project of a doctor who was an adviser to the local  Medicare contractor. In turn, she said, the doctor would help persuade the contractor to provide reimbursement for an unapproved use of Amgen’s anemia drug, Aranesp. 

Since that account appeared to be of a quid pro quo, it did sound like some a kickback or bribery.  In addition,

Amgen is also accused of offering kickbacks to doctors and clinics to induce them to use its drugs. These reportedly came as cash, rebates, free samples, educational and research grants, dinners and travel, and other inducements.   

Of course, since this was the usual sort of settlement we see of health care corporate wrongdoing, in which the reason the company is paying what appears to be a large fine remains ambiguous,

Except for those in the criminal count, Amgen denied the other accusations, though it did issue a statement on Wednesday acknowledging the settlement.

'The government raised important concerns in the criminal prosecution,' Cynthia M. Patton, chief compliance officer at Amgen, said in the statement. 'Amgen acknowledges that mistakes were made, and we did not live up to our standards.'

"Mistakes were made," what a handy phrase to avoid acknowledging that a real person or person made those mistakes.  Why government prosecutors did not leverage instances in which the mistakes were made by an identifiable person, for example, the manager in the anecdote above, to find out who ultimately authorized and directed the kickbacks and deceptive marketing, and then seek to indict them is a mystery.  The US Department of Justice now seems to be disinclined to ever pursue top  health care corporate executives who may have done wrong, while they exuberantly pursue fines from the companies they direct, fines which have almost no personal impact on those who authorized, directed or implemented the bad behavior.
The Times article also included a telling allegation that behind this apparent misbehavior was a changed corporate culture that put short-term revenue ahead of all other considerations.  

the corporate culture changed starting around 2000. That was when new management came in and Aranesp was approved, setting up a fierce marketing battle with Johnson & Johnson and its rival anemia drug, Procrit.

'It was more important to make your numbers than to follow the rules,' said [former Amgen sales representative and now whistle-blower Jill] ...Osiecki, who was based in Milwaukee and sold Aranesp. 

We have discussed how the "make your numbers" culture seems to have resulted from an over-generalization of the prevalent belief in business schools that "maximizing shareholder value," which usually seems to mean maximizing short-term revenue and/or doing whatever it takes to boost stock prices in the short-term (look here).  In companies which make potentially beneficial but also potentially hazardous drugs, the risks of "make your numbers" are obvious.

Shameful Consequences for Patients 

These were disconcerting revelations.  They showed that some unidentified employees, probably including top leaders of a major health care corporation seemed to use kickbacks and lies to deceptively market a drug just to "make their numbers," and thus most likely score healthy bonuses.  Yet this drug is clearly dangerous.  The official Aranesp label states (in a black box warning, in capital letters):


Thus deceptive and unethical marketing practices likely lead to overuse of the drug, and overuse of the drug likely lead to sick (via myocardial infarction [heart attack], stroke, venous thromboembolism or thrombosis of vascular access [drug clots], or tumor progression) or dead patients.

One would think that the consequences of the particular bad behavior alleged in this case would have lead to more zealous prosecution and to the pursuit of actual people who authorized, directed or implemented the bad behavior.  However, it did not.

One would also think that the nature and consequences of this bad behavior would harm the reputation of the company and its leadership.  Instead, it appears that soon after the settlement was announced, top US elected leaders were fawning over this company and its leadership, and rushing to legislate special treatment for it.

Special Treatment from Legislators

Yet soon after these disconcerting revelations that should have shamed Amgen and its leadership, it appears that the company benefited from legislation narrowly crafted mainly just for to suit its interests, and with the aid of allies from both parties within the US government.  That story was again just reported by the New York Times.  The basics are:

Just two weeks after pleading guilty in a major federal fraud case, Amgen, the world’s largest biotechnology firm, scored a largely unnoticed coup on Capitol Hill: Lawmakers inserted a paragraph into the "fiscal cliff"  bill that did not mention the company by name but strongly favored one of its drugs. 
The language buried in Section 632 of the law delays a set of Medicare price restraints on a class of drugs that includes Sensipar, a lucrative Amgen pill used by kidney dialysis patients.

The provision gives Amgen an additional two years to sell Sensipar without government controls. The news was so welcome that the company’s chief executive quickly relayed it to investment analysts.  But it is projected to cost Medicare up to $500 million over that period.[That would almost make up for the fine the company had to pay for illegal marketing and to settle kickback charges - Ed]

Amgen, which has a small army of 74 lobbyists in the capital, was the only company to argue aggressively for the delay, according to several Congressional aides of both parties. 

But the Times article noted that it was not just the size of its army of lobbyists that did it.  

 Amgen has deep financial and political ties to lawmakers like Senate Minority Leader Mitch McConnell, Republican of Kentucky, and Senators Max Baucus, Democrat of Montana, and Orrin G Hatch, Republican of Utah, who hold heavy sway over Medicare payment policy as the leaders of the Finance Committee. 

In particular, Amgen

has a deep bench of Washington lobbyists that includes Jeff Forbes, the former chief of staff to Mr. Baucus; Hunter Bates, the former chief of staff for Mr. McConnell; and Tony Podesta, whose fast-growing lobbying firm has unusually close ties to the White House.

Amgen’s employees and political action committee have distributed nearly $5 million in contributions to political candidates and committees since 2007, including $67,750 to Mr. Baucus, the Finance Committee chairman, and $59,000 to Mr. Hatch, the committee’s ranking Republican. They gave an additional $73,000 to Mr. McConnell, some of it at a fund-raising event for him that it helped sponsor in December while the debate over the fiscal legislation was under way. More than $141,000 has also gone from Amgen employees to President Obama’s campaigns.

What distinguishes the company’s efforts in Washington is the diversity and intensity of its public policy campaigns. Amgen and its foundation have directed hundreds of thousands of dollars in charitable contributions to influential groups like the Congressional Black Caucus and to lesser-known groups like the Utah Families Foundation, which was founded by Mr. Hatch and brings the senator positive coverage in his state’s news media.

Amgen has sent large donations to Glacier PAC, sponsored by Mr. Baucus in Montana, and OrrinPAc, a political action committee controlled by Mr. Hatch in Utah.

And when Mr. Hatch faced a rare primary challenge last year, a nonprofit group calling itself Freedom Path sponsored advertisements in Utah that attacked his opponent, an effort that tax records released in November show was financed in large part by the Pharmaceutical Research and Manufacturers of America, a trade group that includes Amgen.

In some cases, the company’s former employees have found important posts inside the Capitol. They include Dan Todd, one of Mr. Hatch’s top Finance Committee staff members on health and Medicare policy, who worked as a health policy analyst for Amgen’s government affairs office from 2005 to 2009. Mr. Todd, who joined Mr. Hatch’s staff in 2011, was directly involved in negotiating the dialysis components of the fiscal bill, and he met with 'all the stakeholders,' Mr. Hatch’s spokeswoman said, not disputing when asked that this included Amgen lobbyists.

In addition, a NY Times editorial today pointed out that Mitch McConnell, the Senate Minority Leader, (Republican - Kentucky) who "exerted great influence over the fiscal negotiations and praised the Medicare provisions" presumably including the specific provision that helped Amgen, also has "political and financial ties to Amgen."  Furthermore, Senator McConnell's willingness to use taxpayer's money to pay Amgen more seemed to contradict his "public statements [which] usually emphasize the need to cut federal spending on entitlement programs, as they did in Lexington Friday," as reported by WEKU (the National Public Radio Station at Eastern Kentucky University ).  

Can We Reform Health Care in the Corporatist States of America?  

 In summary, Amgen seems to have leveraged its use of former legislative aides affiliated with both political parties as lobbyists, and its presumed influence over former employees who are currently legislative aides, that is, to people who have transited revolving doors in both directions, to influence policy in its corporate favor.  It has also leveraged its contributions directly to politicians, to political action committees (PACs), and to non-profit advocacy groups to influence policy in its direction for this purpose.  All this leverage apparently resulted in continuing government favoritism to a company the government had just convicted of a crime, and to a company whose actions likely led to sick and dead patients.  Furthermore, legislators who publicly deplore excess government spending and enlarging government deficits supported spending more taxpayer money to favor a particular company that they ought to have shunned. 

The New York Times editorial deplored this case first as

a disheartening example of how intense lobbying and financial contributions can distort the legislative process in Washington

and second as

a classic example of the power of special interests to shape legislation and shows how hard it may be to carry out the reforms needed to cut health care costs. 

But it was really much worse than that.   This case certainly shows the ongoing coziness between big health care organizations and government (this time, mainly legislative) leaders, facilitated by the apparently very common "revolving door" interchange of influential people between corporate management and government.  Note that this coziness has now become bipartisan.  However, this was not merely expensive favoritism.  It was hypocritical expensive favoritism that benefited a corporation that ought to have been shamed and shunned for behavior that did not merely cost the government money, but likely harmed patients, sometimes even fatally. 

President Theodore Roosevelt condemned malefactors of great wealth.  Our current political leaders in both parties seem to put their ties to corporate insiders who work for executives of great wealth ahead of any consideration of what might be good for patients, public health, or the citizenry at large.  

So the US now seems to be run by a soft, informal version of corporatism, the system in which government and big corporations overlap and jointly rule the people.  Since these days big corporations are run largely without accountability by increasingly rich executives, this ends up meaning government by the oligarchs, for the oligarchs, and of the oligarchs.  President Lincoln and President Theodore Roosevelt might be rolling in their graves.  

To meaningfully reform health care, it seems like we need to meaningfully reform our entire political system, and both make leaders of health care organizations accountable, and make government again of the people, by the people, and for the people.