Monday, December 31, 2018

Dander Up, Down, and All Around

Today's topics: VA health care politics; a clear-eyed and sane report from a bastion of managerialism, with related observations on innovators trying to create real bottom-up value.

It's the last day of the year, so let's get this done. Owing to various largely unforeseen challenges, happily now largely behind us, this "Dander" series was interrupted for some time. Apologies to anyone who noticed. In any case, to refresh: as Chief Blogger and FIRM president Dr. Poses has indicated often enough in these pages, health care developments raising our dander are still everywhere, all the time, and on the increase. Nothing particularly new here. Certainly not new since the 2016 election.

Except that in our current situation--inter-woven social (read: inequality) and political (read: everything inside the Beltway morphing from mere swamp to crazed greased pig trough)--the health sector is triply hard-hit. Really, it gets old to keep on playing nay-saying Cassandra. It's not normal.

Thus today in America the patient can't catch a break. It's probably true here more than in any other first world country. Others' budgets are as overstretched as ours, not to mention much lower as %GDP; their technology is just as uncooperative. Will yellow-vests to come out on the streets over it here, as they recently did over social engineering whence we got our Freedom Fries? (That may be up to just three guys: John Roberts and Trump's two new USSC nominees, as ACA makes its way to them yet again.)

No need to hyperlink the following examples. Everyone's immersed in them.
  • Obamacare imperiled by twisted politics and jurisprudence, even though its recent mild decline in enrollments probably means little or nothing and the body politic wants it.
  • Ultra-right wingnuts flexing muscle by urging the dismissal of the capable (and quite religious) head of the National Institutes of Health. Why? Stem cell research, a promising technology that's run afoul of some ideological right wing evangelical cant.
  • Net-net, IT's impact on health care, coming as much from the well meaning elitist left as from the elitist right, still negative. It enriches tech- and health-organizational CEOs while patient satisfaction, provider satisfaction and life expectancy all three tank. (I know, it's complicated--we also got that opiate crisis.)
  • Corruption in government, tech, hospitals and big pharma: can you spell "conflict of interest"? Read pretty much any recent posting in Health Care Renewal.
I could waffle on and on. But instead of that let me focus today on one thing that's got my dander up and another that's actually tamped it down a bit.

The VA, yet again. No doubt, forever. Or, Why's the VA Such a Punching Bag?

Dr. Poses has been feeding me troves of data and news about the VA. I'm happy now to report just a few highlights. Oh, wait: more like lowlights. Dreary as ever. Ever since the capable David Shulkin was fired, the question rings louder, "how bad can it get?" We now know the answer: bottomless pit.

Here are some of the lowlights. Bear in mind that, rightly or wrongly (we think mostly wrongly), Shulkin is now being blamed for all these deficiencies at the VA. Despite the facts that he was hamstrung from the get and that the VA was, like the EPA and others, one of the places where tge White House allowed chaotic privatization to run amok. We're in a fun-house mirror version of Ronald Reagan's "government is the problem."
  1. Suicide Watch. Under this administration, while suicality remains rampant among veterans of recent Forever Wars, the VA has fallen down grievously on the job of addressing it. Last month's report from the government's own GAO confirms this.
  2. Privatization Writ Large. Privatization initiatives, so dear to the hearts of cronies and lobbyists, are already in big trouble. Trump's own hand-picked successor to Shulkin recently had to admit to Contress the “The [VA] was taken advantage of because of the hasty nature that took place when the program was put together." Not budget dust, either: the agency paid out nearly $2B-with-a-'B' in unnecessary fees for these private booking "services."

    (In fairness let's put a little parenthetical note in here. As a former employee I know the VA itself causes unnecessary care delays. Service-connected disability ratings impede scheduling, as do salaried physicians' myriad ploys for putting the brakes on their own performance.)
  3. Privatization Writ Small. Still, this privatization thing is a great example of two-wrongs-don't- make-a-right. ProPublica informs us that what's "actually happened in the four years since the government began sending more veterans to private care: longer waits for appointments and, a new analysis of VA claims data by ProPublica and PolitiFact shows, higher costs for taxpayers." Can the VA claim better outcomes using any parameter at all? I think not.
  4. Mar-A-Lago. Lots more VA stories are leaking out. None are especially edifying. But in some ways the most alarming and tawdry among them is that surrounding the troika of unelected Florida golfing buddies. For months or more now they've been calling a lot of that agency's shots. Direct line to the White House, demonstrable responsiveness on the part of VA apparat. Maybe the crowning glory in this administration's reputation for cronyism, this group--comics mogul Ike Perlmutter (you can't make this stuff up), Palm Beach MD Bruce Moskowitz and lawyer Marc Sherman, collectively known as the "shadow rulers"--have pushed a lot of policies and expenditures for the VA with zero expertise.

    Unless a lousy golf handicap counts as expertise. Democrats have vowed a response in the new Congress, and we can only hope Speaker Pelosi prioritizes that. I think when it comes to Pelosi versus Ike's Marvel Avengers, the lady wins hands down. The conservative (and probably still somewhat Moonie) Washington Times reports this will happen in the first half of 2019--both from the GAO and the House Oversight Committee. These guys are super bad COI news, having weighed in with their scant expertise on way too much down to VA job candidates.
  5. The worst-of-the-worst for this poor agency is how the Shadow Rulers have gummed up its use of technology, especially IT. A little background: the VA was the one organization within the entire US Government that developed, back in the day with its VISTA technology, a fairly creditable in-house electronic medical record. VISTA, along with DOD's AHLTA (get it?) were supposed to play nice together but, despite billions in earlier expenditures, never did. VISTA might have survived but, starting with Shulkin (and probably predecessors) got deep-sixed by the bogus attractiveness of private-side EMRs.

    GE had its hands in there for a while: it deserves what it got (with AHLTA). Now since ~2015, thus pre-dating the current White House, it's Cerner. The main vendor rival to the privately-held Wisconsin cult vendor Epic, Cerner got the inside track to craft a workable EMR for the VA and DOD. But the Boys from Mar-A-Lago want to micro-manage this? Why? Earlier this month ProPublica disclosed part of the reason based upon FOIA-obtained emails. The doc among the troika has his own mobile app. Here's how it went down.
[N]ewly released emails also detail Moskowitz’s effort to get the VA and Apple to adapt his app. As a VA IT official described it in a May 2017 email, 'We are utilizing the native iOS mobile app, Emergency Medical Center Tracker, that Dr. Moskowitz developed.' VA health officials offered their own ideas for how a collaboration with Apple could benefit veterans, such as working on credentialing, data exchange and analytics, and suicide prevention research. But Moskowitz rejected the VA doctors’ ideas in favor of his own. 'These are good areas but not the emergency ones which my group of experts have identified,' he said in a May 2017 email. 'I sent an email to outline the recommendations.'
 'Nuff said. As someone who cared for thousands of veterans, I can't begin to describe how galling this is, even if the new guy, Wilkie, says he's trying to right the ship. While blaming his predecessors.

If these gentlemen from Florida--that bastion of fair elections and cost effective medicine--were instead gumming up Medicare, threatening the health of parents and grand-parents of business leaders, dot-commers, millennials and trust-funders, we'd have heard a lot more hue and cry about the VA and its shadow rulers.

Now I Pat Down my Dander. Soothing Words from Unlikely Places. 

Oddly enough, the worlds of IT--absent the shameful events described above in connection with the VA--and management are beginning to pull themselves out of their torpor. Under the dual impact of the HITECH and ACA enactments, the IT and management communities strove for years to accommodate to this brave new world of individual mandates and EMR meaningful use.

The result was rather anechoic. Unless you were right down there in the trenches, you heard little complaining about the baleful effects of the IT pall dropped into the doctor-patient relationship. Typical statement from EMR vendor CEOs: "my job is change management." (Ram it down their throats.) Typical statement from provider CMOs and CMIOs: "I only get to play with the Lego Blocks they give me."

That's changing now, and the signs are everywhere, though sometimes hard to parse. Nailing down the how and why of this change can be difficult, but the effects of "unusability" are emerging into a vocal majority consensus. Folks known as "thought leaders," such as Robert Wachter and Donald Berwick, have exerted part of this impulse to call a spade a spade in the interest of QI, citing, among other things, generational change. Smartphone users and tech-savvy students and house staff are much less likely to tolerate the

Some of those properly impatient young innovators--and I don't mean the septuagenarian Moskowitz--went on to found start-up companies that are starting to move tecnology out of its old, enormously dreary meaningful-use rut. They're bringing patients--"engagement" the new meme--back into the narrative.

What is this new narrative? The rather staid and managerialist health IT society, HIMSS, has this to say, couched in classic bureau-speak jargon, in its 2019 conference agenda, "6 Health Information and Technology Topics to Immerse Yourself in at HIMSS19." Translations into English follow each bullet.
  • Strategic Patient Experience Improvement (help the doctor with her workflow)
  • Aim for Secure Accessibility (make everything more secure)
  • Mapping a Vision to the New Consumer Landscape (improve revenue cycles)
  • Moving Precision Medicine into Primary Care (make "precision" medicine, whatever that is, or at least AI, work better--maybe with smart guidelines--for primary care providers)
  • Contextualizing AI for Healthcare (ok, we know that AI is really important)
  • Exploring the Pharma-Provider-Payer Relationship: the Last Step to True Value-Based Care (get everybody working together better now that fee-for-service care is giving way to bundling)
Stripping away the cant, however, these are actually pretty lofty goals. They show HIMSS coming into its own. Charge capture, upcoding, and dashboards for managers watching 30-day readmission tallies begin to sound so 20th century. Care coordination from the bottom up, not just the top down, begins to appear more attractive as studies start to show that top down doesn't always work all that well. (Caveat: find a way to read the whole JAMA piece, not just the online abstract. The journal's behind a paywall.) Leadership for such shifts is coming in many cases from outside classic health IT vendor-land, notably in innovation centers cropping up among many providers and payers.

Meanwhile, on just about a daily basis I learn about a new start-up addressing these issues, often based on newer concepts and approaches to workflow as ecological reflection of a unified community-wide integrated health care system.

Let's now move from specific health care realities and IT start-ups to the more general and philosophical matter of why it's taken so long to get to this place. Let me conclude by drawing the reader's attention to some recently emerging, and highly salutary, public intolerance to bullshit. (Can this be a result more broadly speaking of an emerging disgust toward insufferable politicians ?)

The recognition of obfuscation through bullshit goes well back into the mid-20th century. It was perhaps most famously addressed well over a decade ago in the elegant short book On Bullshit by emeritus Princeton philosopher Harry Frankfurt. But a much more recent vocal objection to nonsense in health care comes from a source that some might've considered heretofore unlikely: a couple of senior Wharton management professors. Though Lawton Burns and Mark Pauly barely mention their Princeton forebear in a secondary footnote, they nonetheless deserve an enormous shout-out for bringing attention to Detecting BS in Health Care. No paywall: use the link and download it now.

Burns and Pauly bring out all the other B's: to start with, buzzwords, bullets (silver), best (practices) and bandwidth. Lots of others. There's one B, however, that they espouse: bottom-up. Hard to know how firmly the Burns and Pauly tongues were planted in the Burns and Pauly cheeks, but for heaven's sake they know they're right about this. Common sense solutions so clearly and frequently give way to self-dealing and managerialist me-tooism in health care. Those who benefit from such nonsense have been called out often in this blog. But we can hope they now know not only are a few doctors now on to them, but some clear-headed individuals from the management establishment as well.

Saturday, December 22, 2018

The Demise of the Trump Foundation, an Extreme Example of Elite "Do-Gooding" to Prop Up the "Broken System" that Benefits Them

Big foundations often claim that they are out to improve society.  For example, the Robert Wood Johnson Foundation claims to be

the nation’s largest philanthropy dedicated solely to health.

Its goal is to improve health care for all, that is,

help raise the health of everyone in the United States to the level that a great nation deserves, by placing well-being at the center of every aspect of life.

Yet, as we discussed here, large foundations with an interest in health rarely address the sorts of issues we discuss on Health Care Renewal, particularly problems with health care organizational leadership and governance, most particularly leadership that is ill-informed, incompetent, self-interested, conflicted, or even corrupt.  One explanation was provided by Anand Giridharadas, author of  Winner Take All: Elite Charade of Changing the World, as summarized in an August, 2018, op-ed ine New York Times.

His thesis was that society has handed over the responsibility for reform to those who benefit most from the status quo. Thus,charitable foundations, one vehicle for reform, are now largely run by people with business management background, and financial ties to big corporations.  The foundations thus largely propose minimal, if not fake reforms, representing change "the powerful can tolerate." So, 

American elites generally seek to maintain the system that causes many of the problems they try to fix — and their helpfulness is part of how they pull it off. Thus their do-gooding is an accomplice to greater, if more invisible, harm.

What their 'change' leaves undisturbed is our winners-take-all economy, which siphons the gains from progress upward.

In a recent interview with the Guardian, Giridharadas explained how his concerns evolved while he was a fellow of the Aspen Institute,

a thinktank that organizes exclusive ideas conferences for the wealthy and powerful, as part of a program designed to raise up a 'new breed of leaders' and solve 'the world’s most intractable problems'.

Aftr being selected as a fellow, along with a bunch of corporate leaders, he realized that the Institute was carrying out its view that

the people best-equipped to protect the interests of the poor are the rich and rich adjacent.

In a 2015 talk to an Institute audience, he

delivered an electrifying critique, arguing the 'change makers' and 'thought leaders' in America’s winners-take-all economy – once again, the very people he was speaking to – are less helping the world through their various philanthropic efforts than propping up the broken system that made them.

The 2015 audience was apparently "aghast," but it is not clear whether Giridharadas' insight led them to change their ways.   Instead, foundations continue to prop up the "broken system," but in often subtle ways.   It is likely that those that benefit from the current status quo continue to promote little reforms around the edges, while failing to face the real issues, because doing so could "could implicate powerful people, or perhaps even themselves."

Foundations may continue to fund projects that promote small incremental changes, while avoiding those that could lead to questions about aspects of the system that benefit its current top leaders, or suggest changes in the policies that allow this.  For example, as we wrote here, the Bill and Melinda Gates Foundation's is currently led by a former top pharmaceutical executive who had defended extremely high drug prices which presumably helped fuel her extravagant compensation.   Meanwhile, the Foundation has been accused of "ideological commitment to promote neoliberal economic policies and corporate globalisation."

Example: the Demise of the Trump Foundation

Now in 2018, three years after Giridharadas confronted the Aspen Institute with little effect, we witness a truly extreme example of a non-profit foundation supposedly set up to do good for society, instead propping up the system, and specifically the supposedly generous philanthropists who founded it.  However, rather than funding marginal reforms, this example demonstrates much more direct, crude efforts to prop up the system which supported the founders of the "charity" in question, that being the Trump Foundation, the creature of our current US dear leader.

Major questions were first raised about the Foundation in 2016, when the Washington Post published an article by David Farenthold entitled, "Trump Boasts About His Philanthropy.  But his Giving Falls Short of his Words."  The Post continued its investigation of the topic, leading to an investigation by the New York Attorney General.  This week, that investigation resulted in an agreement to shut down the Trump Foundation, as again reported Farenthold in the Washington Post.  In announcing this agreement, Barbara Underwood, the New York AG, said the investigation found

a shocking pattern of illegality involving the Trump Foundation — including unlawful coordination with the Trump presidential campaign, repeated and willful self-dealing, and much more.

Transactions Benefiting Trump and Family

Basically, the Foundation was alleged to have made transactions that resulted in direct personal benefit to Donald Trump and his family.  For example,

The largest donation in the charity’s history — a $264,231 gift to the Central Park Conservancy in 1989 — appeared to benefit Trump’s business: It paid to restore a fountain outside Trump’s Plaza Hotel. The smallest, a $7 foundation gift to the Boy Scouts that same year, appeared to benefit Trump’s family. It matched the amount required to enroll a boy in the Scouts the year that his son Donald Trump Jr. was 11.

One suspicious transaction could be construed as a bribe meant to forestall investigation of another shady Trump venture, Trump University.  Per an opinion piece in USAToday, the Foundation made a "donation" to

Florida Attorney General Pam Bondi's re-election campaign in September 2013, years before Trump decided to run for office. According to Florida campaign finance records, the Trump Foundation contributed $25,000 to And Justice for All, a section 527 political organization associated with Bondi.

Charitable foundations like the Trump Foundation, however, are prohibited from political activity. On its tax forms, the Trump Foundation claimed it did not transfer any money to a 527 organization or engage in any political activity, and did not report any contribution to And Justice for All. Instead, it reported a contribution to a similarly named nonprofit organization. The foundation cited 'coincidences and errors,' but it looked like a ham-handed attempt to hide the illegal political contribution.

In fact, something more sinister than improper political activity may have been going on. The Trump Foundation made its contribution three days after it was widely reported that Bondi's office was reviewing joining the New York attorney general's lawsuit against Trump University. Following the donation, Bondi's office decided not to join the suit or open an investigation. It is possible the contribution was meant to influence Bondi's decision, and it is possible that it worked. Whatever the intent, the payment was illegal, and the IRS ultimately sanctioned the foundation, levying a fine for the violation.

After the shut down of the Foundation was announced, Trump boasted on Twitter that at least his charity had not paid him directly, as reported by Politico,

The Trump Foundation has done great work and given away lots of money, both mine and others, to great charities over the years - with me taking NO fees, rent, salaries etc.

It seems like a distinction without a difference  

The Foundation Functioned as an Arm of the Trump Campaign

In recent years, the Foundation mainly worked to benefit Trump's presidential campaign. Per the Washington Post,

In 2016, state investigators allege, Trump effectively 'ceded control' of his charity to his political campaign. He raised more than $2 million at a fundraiser in Iowa that flowed into the foundation. Then, the state said, Trump campaign manager Corey Lewandowski determined when and where it would be given away.

'Is there any way we can make some disbursements . . . this week while in Iowa?' Lewandowski wrote in an email cited in Underwood’s lawsuit.

Trump gave away oversize checks from the foundation at campaign events in the key early-voting states of Iowa and New Hampshire, pausing his campaign rallies to donate to local veterans’ groups.

Federal law prohibits charities from participating in political campaigns. As president, Trump has called repeatedly for that law to be repealed.

Again, the Foundation was acting directly to promote Donald Trump's interests.

The Foundation Had No Meaningful Governance Structure Beyond Trump's Whims

Finally, the Foundation seemed to have no meaningful governance structure that could counter its use as a family "piggy bank"

The attorney general’s investigation turned up evidence that Donald Trump Jr., Eric Trump and Ivanka Trump — all listed as officers of the charity — had never held a board meeting. The board hadn’t met since 1999. The charity’s official treasurer, Trump Organization executive Allen Weisselberg, told investigators that he wasn’t aware that he was on the board.

State investigators asked him what the foundation’s policies were to determine whether its payments were proper.

'There’s no policy, just so you understand,' Weisselberg said.

So, thanks to the investigations that have swirled around Donald Trump and company since he began his campaign for the presidency, we have seen an amazingly blatant example of a non-profit charitable foundation used not to improve society, but to support the "broken system," and particularly the advantageous position of the charity's founder within the system.

Further Discussion

This example may be extreme, but it may not be unique.  Vox just published an opinion piece entitled,"The Trump Foundation shows just how preposterously light our oversight of charity is." It noted,

As the political theorist Rob Reich explains in his new book Just Giving, we really don’t expect much from foundations as a matter of public policy.

They don’t have to have a website or some other way for interested charities to contact them about funding. They don’t have to make their giving strategy publicly available or accessible in any way. They do have to fill out 990-F tax forms, which are public and provide some information on their assets, spending, and grant recipients. But those take the form of long, difficult-to-parse tax documents, and crafty philanthropists can get around these requirements by starting up offshore foundations. And there are basically no requirements to speak of beyond filing a 990-F and spending at least 5 percent of assets every year.

'Foundations are often black boxes, stewarding and distributing private assets for public purposes, as identified and defined by the donor, about which the public knows very little and can find out very little,' Reich writes.

Maybe the revelations about the Trump Foundation will inspire a more skeptical look at "do-gooder" foundations.  We need to know the extent to which they are devoted to the interests of rich insiders rather than of society at large.  Per Giridharadas, shining more light on their obscure operations might inspire them to start

listening to more of society’s losers, and fewer winners. 'The powerful are very good at disseminating their own bullshit,” he says. 'They don’t need the intellectual reputation laundering of ideas festivals to make their heavily marketed bullshit smell even sweeter.'

'I sincerely believe,' he says, 'that had more of the institutions of this country – and particularly those involved in thinking and ideas, not just conferences but all kinds of things – been more skeptical of elite fantasies and more mindful of what was actually going on in other people’s lives in this country, I think it’s very possible we wouldn’t have orange Mussolini in the White House.

We also could have had real health care reform.

Saturday, December 15, 2018

Johnson and Johnson's Latest Ethical Misadventures: Settled Kickback Allegations, Reportedly Concealed Knowledge of Adverse Effects of a "Sacred Cow" Product

Giant pharmaceutical/ biotechnology/ device company Johnson & Johnson has its famous "credo" which starts with

We believe our first responsibility is to the doctors, nurses and patients, to mothers and fathers and all others who use our products and services.  In meeting their needs everything we do must be of high quality..
Nonetheless, the company has a long history of ethical misadventures (look here, and see appendix below).  Now late in 2018,  we note two more Johnson & Johnson misadventures. In chronological order,

$360 Million Settlement of Allegations of Kickbacks to Medicare/ Medicaid Patients to Support Use of Extremely Expensive Drug

The story, per the New York Times, was that Actelion, a drug maker purchased by Johnson & Johnson in 2017, in 2014-2015 had

raised the price of its main drug, Tracleer, by nearly 30 times the rate of inflation. Tracleer, which is prescribed to treat pulmonary arterial hypertension, sells in pharmacies for an average cash price of about $14,500 for 60 tablets, according to the website GoodRx.

But to facilitate charging such high prices, pharmaceutical companies

often help patients pay their out-of-pocket costs through coupons or other financial assistance. These payments are not just about benevolence — they also help blunt the outrage over rising drug prices by limiting how much patients have to pay. Insurers then cover most of the cost.

But federal anti-kickback laws prohibit companies from giving such financial assistance to Medicare and Medicaid beneficiaries because doing so is considered an inducement to buy their drugs. For years, drug makers have skirted those laws by instead donating to nonprofit charities, which then give the money to Medicare patients. Such arrangements are legal as long as there is no direct coordination between the pharmaceutical company and the nonprofit organization.


Federal prosecutors said Actelion violated the law by collecting detailed data in 2014 and 2015 about the patients receiving help from a nonprofit, the Caring Voice Coalition, and using the data to budget for future donations. As a result, Actelion ensured that the money it donated would be used only to assist patients who used its drugs, and not competing companies’ treatments for the pulmonary condition.

Prosecutors said Actelion kept up the practice even after the charity itself warned the company against it.

Actelion also steered Medicare patients to the Caring Voice Coalition who would have otherwise qualified financially for the company’s free drug program. By directing them to the nonprofit, the company avoided having to provide the drug to eligible patients and left Medicare to cover the cost instead, prosecutors said.


Actelion Pharmaceuticals has agreed to a $360 million settlement stemming from an investigation into whether the company illegally funneled kickbacks through a patient-assistance charity, federal prosecutors said Thursday.

But keep in mind that Actelion is now a Johnson & Johnson subsidiary, and by buying it, Johnson & Johnson bought its financial, and ethical and legal liabilities.. So ultimately it will be Johnson & Johnson which pays the settlement.

Johnson & Johnson Alleged to Have Concealed Knowledge that its Baby Powder Contains Asbestos

The first reporting on this story was a lengthy investigative report from Reuters published December 14, 2018, based on newly released documents produced during a variety of lawsuits.  The report stated

that from at least 1971 to the early 2000s, the company’s raw talc and finished powders sometimes tested positive for small amounts of asbestos, and that company executives, mine managers, scientists, doctors and lawyers fretted over the problem and how to address it while failing to disclose it to regulators or the public.

The documents also depict successful efforts to influence U.S. regulators’ plans to limit asbestos in cosmetic talc products and scientific research on the health effects of talc.

Note that since the 1970s, exposure to asbestos has been recognized as an important health hazard.  In 1972, the US agency OSHA limited occupational exposure to asbestos.  Also,

The World Health Organization and other authorities recognize no safe level of exposure to asbestos.

Johnson & Johnson has been sued by

11,700 plaintiffs now claiming that the company’s talc caused their cancers — including thousands of women with ovarian cancer.

After three major jury verdicts that found Johnson & Johnson liable for cancers caused by asbestos in its baby power,

J&J has said it will appeal the recent verdicts against it. It has maintained in public statements that its talc is safe, as shown for years by the best tests available, and that the information it has been required to divulge in recent litigation shows the care the company takes to ensure its products are asbestos-free. It has blamed its losses on juror confusion, 'junk' science, unfair court rules and overzealous lawyers looking for a fresh pool of asbestos plaintiffs

However, there now seems to be substantial evidence that the company's public posturing is a smokescreen. While in the past Johnson & Johnson internal documents about its management decision making related to talc and asbestos were used in litigation,

Many were shielded from public view by court orders that allowed J&J to turn over thousands of documents it designated as confidential. [But] Much of their contents is reported here for the first time.

These showed,

The earliest mentions of tainted J&J talc that Reuters found come from 1957 and 1958 reports by a consulting lab. They describe contaminants in talc from J&J’s Italian supplier as fibrous and 'acicular,' or needle-like, tremolite. That’s one of the six minerals that in their naturally occurring fibrous form are classified as asbestos.

At various times from then into the early 2000s, reports by scientists at J&J, outside labs and J&J’s supplier yielded similar findings. The reports identify contaminants in talc and finished powder products as asbestos or describe them in terms typically applied to asbestos, such as 'fiberform' and 'rods.'

In 1976, as the U.S. Food and Drug Administration (FDA) was weighing limits on asbestos in cosmetic talc products, J&J assured the regulator that no asbestos was 'detected in any sample' of talc produced between December 1972 and October 1973. It didn’t tell the agency that at least three tests by three different labs from 1972 to 1975 had found asbestos in its talc – in one case at levels reported as 'rather high.'

The article shows that the company repeatedly found evidence that asbestos was present in the raw talc that went into its baby powder, first in 1957, and could be found at times in samples of the finished product since 1971.  Since the 1970s, Johnson & Johnson managers realized that the asbestos was a problem.  For example,

J&J research director DeWitt Petterson visited the company’s Vermont mining operation. 'Occasionally, sub-trace quantities of tremolite or actinolite are identifiable,' he wrote in an April 1973 report on the visit. 'And these might be classified as asbestos fiber.'

J&J should 'protect our powder franchise' by eliminating as many tiny fibers that can be inhaled in airborne talc dust as possible, Petterson wrote. He warned, however, that 'no final product will ever be made which will be totally free from respirable particles.' Introducing a cornstarch version of Baby Powder, he noted, 'is obviously another answer.'
Slightly later on December 14, 2018, the New York Times published its own story on asbestos in Johnson & Johnson talcum powder.  It corroborated the Reuters report while adding informative detail.  It started with:

An executive at Johnson & Johnson said the main ingredient in its best-selling baby powder could potentially be contaminated by asbestos, the dangerous mineral that can cause cancer. He recommended to senior staff in 1971 that the company 'upgrade' its quality control of talc.

Two years later, another executive raised a red flag, saying the company should no longer assume that its talc mines were asbestos-free. The powder, he said, sometimes contained materials that “might be classified as asbestos fiber.”

The carcinogen, which often appears underground near talc, has been a concern inside the company for decades. In hundreds of pages of memos, executives worried about a potential government ban of talc, the safety of the product and a public backlash over Johnson’s Baby Powder, a brand built on a reputation for trustworthiness and health.

Executives proposed new testing procedures or replacing talc outright, while trying to discredit research suggesting that the powder could be contaminated with asbestos, according to corporate documents unearthed by litigation, government records obtained by The New York Times through the Freedom of Information Act, and interviews with scientists and lawyers.

In one instance, Johnson & Johnson demanded that the government block unfavorable findings from being made public. An executive ultimately won assurances from an official at the Food and Drug Administration that the findings would be issued only 'over my dead body,' a memo summarizing the meeting said.

Thus, despite these warnings of asbestos in talcum powder, Johnson & Johnson continued to sell it.  There is certainly now strong reason to suspect that for decades Johnson & Johnson management has been denying its own fears about asbestos contamination of its baby powder, and doing its best to hide evidence of its hazards, thus benefiting the corporate bottom line, but allowing continued exposure of large number of people to a potentially hazardous, even fatal product.

The Business World Tries to Shrug It Off

Responding to the Reuters and New York Times story, many business pundits stated their confidence in Johnson & Johnson as an investment.  For example, Charley Grant wrote in the Wall Street Journal,

But while investors should be wary, they needn’t panic. J&J’s strong finances and diverse revenue base are good coping mechanisms.

Wells Fargo, per CNBC, opined

the selling based purely on the outcomes of any talc litigation is likely overstated.

But does Johnson & Johnson's management really act on its belief that its "first responsibility is to "doctors, nurses, and patients, to mothers and fathers?" On CNBC,  Bill George wrote,

It is not plausible that these leaders knew nearly five decades ago that their iconic baby powder caused cancer and continued to market the product. This is a company whose leaders consistently try to do the right thing, admit their mistakes, and continue to develop life-saving products that restore the health of millions of people around the world.

While the plaintiffs' attorneys may continue to pursue their cases, I feel confident that J&J will be shown to put the interests of its customers first, and maintain its reputation for the highest integrity.

I wonder if Mr George's confidence was boosted by his previous work as a paid speaker for Johnson & Johnson, and former chairman and CEO of Medtronic, a company which has had its own share of ethical misadventures (look here)?  In any case, some recent history calls into question Johnson & Johnson's "reputation for the highest integrity."

Johnson & Johnson's Long History of Ethical Misadventures

So, recent reports suggested that Johnson & Johnson willfully acquired a company that appears to have provided kickbacks to patients in apparent violation of US law in an effort to support high drug prices.  Furthermore, Johnson& Johnson appears to have concealed considerable evidence that one of its primary products might be dangerous in order to support the sales of a "'sacred cow,' as one internal email put it (per the Reuters report).

These are but  the latest in a long string of misadventures by the company, as we have been documenting over years.  (Our collected posts on Johnson & Johnson are here.  An updated version of their legal record since 2010 is at the end of this post.)

Perusing the list suggests that this giant company (with about $70 billion in yearly revenue) is a poster child for bad behavior by health care organizations.  It has faced a multitude of allegations leading to settlements, and sometimes findings of guilt.  The charges included many instances of deceptive and unethical marketing, some that promoted drugs or devices for use in situations in which they may have had harms outweighing their benefit, some that involved concealing knowledge of their risks, and some of selling adulterated drugs or defective products. 

So the new allegations of deceptive marketing meant to conceal a hazardous product are just the latest in the series.

What is striking is that the company and its management have not faced more consequences for this sorry track record.

Although the company has paid multiple fines and made numerous monetary settlements over the years, none have been big enough to affect its immense revenues.  Furthermore, ultimately the monies used to pay them came from all Johnson & Johnson employees in the form of smaller paychecks; customers, patients and the public at large in the form of higher prices; and only to some extent by investors in the form of slightly lower profits.  Meanwhile, it appears that the company's top managers made an awful lot of money, possibly in part as rewards for the revenues produced by the misadeventures.

Former Johnson & Johnson CEO William Weldon, upon his retirement in 2014, was to receive a retirement package estimated to be worth from $143 to $197 million (look here).  In 2010, his total compensation was $29 million (look here).   According to the 2012 Johnson and Johnson proxy statement, his 2011 total compensation was greater than $26 million. As far as I can tell, Mr Weldon never suffered any negative consequences for his company's sorry record, and retired a very rich man. (look here).

Current CEO Alex Gorsky received  $25 million total compensation in 2014 (look here).  More recently, the New York Times reported his 2017 total pay was $22.8 million, making him the seventh highest paid health care executive in that year, by their accounting. 

While management made so much money, very rarely has anyone at the company who was involved in authorizing, directing, or implementing any of the bad behavior had to suffer any negative consequences, therefore appearing to enjoy impunity.

So what was to deter management from embarking on further misadventures, as long as the results might be enlarging management's personal wealth?  

This is all in line with what we have been discussing for years.  In general, we have seen many legal settlements made by health care organizations of alllegations like fraud, bribery, and kickbacks.  Despite the unsavory nature of the behaviors revealed by most settlements, which often appeared to risk patient harms, the companies involved usually have had to pay fines that were tiny relative to their multi-billion dollar revenues.  They companies only seldom have had to admit responsibility, and almost never did a settlement cause company managers and leaders to  suffer any negative consequences for enabling, authorizing, directing or implementing the bad behavior.

This adds to the evidence suggesting that US health care is rigged to benefit top insiders and their cronies, and as such, is part of a larger rigged system.  We have previously discussed how market fundamentalism (or neoliberalism) led to deregulation, which enabled deception, fraud, bribery, and intimidation to become standard business practices, and allowed increasing concentration of power by large corporations. Managerialism allowed the top leaders of these corporations and their insider cronies to amass increasing power and money. Everyone else, other employees, stockholders of public corporations, customers, vendors and suppliers, and the public at large lost out.   In health care, these changes led to an increasingly costly system which produced increasingly bad results for patients and the public. 
We have called for true health care reform to derig the system. Unfortunately, despite our hopes, perceptions of a rigged system may not always inspire honest reform. Instead, they can enable the rise of demagogues and wouldbe dictators who promise only they can solve the problem.  Donald Trump cried out that only he could fix our problems and drain our swamps.  However, at least in terms of policing white-collar crime, particularly in health care, he seems to be letting the swamp waters rise.  And now he seems to have had his own record of impunity (look here).  

While we thus have bigger problems to solve than the impunity of health care leaders, let us remember the need for wholesale, real health care reform that would make health care leaders accountable for what their organizations do, particularly when these organizations misbehave.

Appendix - Johnson and Johnson Legal Record since 2010

- Convictions in two different states for misleading marketing of Risperdal
- A guilty plea for misbranding Topamax

- Guilty pleas to bribery in Europe  by Johnson and Johnson's DePuy subsidiary
- A guilty plea for marketing Risperdal for unapproved uses  (see this link for all of the above)
- A guilty plea to misbranding Natrecor by J+J subsidiary Scios (see post here)

  - Testimony in a trial of allegations of unethical marketing of the drug Risperdal (risperidone) by the Janssen subsidiary revealed a systemic, deceptive stealth marketing campaign that fostered suppression of research whose results were unfavorable to the company, ghostwriting, the use of key opinion leaders as marketers in the guise of academics and professionals, and intimidation of whistleblowers. After these revelations, the company abruptly settled the case (see post here).
-  Johnson & Johnson was fined $1.1 billion by a judge in Arkansas for deceiving patients and physicians again about Risperdal (look here).
-  Johnson & Johnson announced it would pay $181 million to resolve claims of deceptive advertising again about Risperdal (see this post).

-  Johnson & Johnson settled case by shareholders alleging that management made misleading statements and withheld material information about manufacturing problems (see this post)
-  Johnson & Johnson Janssen subsidiary pleaded guilty to a charge of misbranding Risperdal, and settled for a total of $2.2 billion allegations that it promoted the drug for elderly demented patients and adolescents without an indication, and despite evidence of its harms (see this post).
 -  Johnson & Johnson DePuy subsidiary agreed to settle with multiple plaintiffs for $2.5 billion allegations that it sold defective mental-on-metal artificial hip, and hid evidence of its harms .
- Johnson & Johnsonn Janssen subsidiary was found by two juries to have concealed harms of its drug Topamax (see this post for this and above case).
- Johnson & Johnson Ethicon subsidiary's Advanced Surgical Products and two of its executives agreed to settle charges by US FDA that is sold mislabeled products used to sterilize equipment such as endoscopes (see this post).
- Johnson & Johnson fined by European Commission for anticompetitive practices, that is, collusion with Novartis to delay marketing generic version of Fentanyl (see this post).

- Johnson & Johnson DePuy subsidiary settled Oregan state charges that it marketed the ASR XL metal-on-metal hip joint prosthesis without disclosing its high failure rate (see this post).

-  Johnson & Johnson found by jury to have concealed harms of Risperdal.
-  Johnson & Johnson Ethicon subsidiary found by jury to have concealed harms of its vaginal mesh device.
-  Johnson & Johnson McNeil subsidiary pleaded guilty to marketing adulterated Tylenol. (see this post for three items above.)

- Johnson & Johnson subsidiary Aclarent settled allegations that it sold its Stratus device for unapproved uses.  Two former executives of that subsidiary also were found guilty of distributing misbranded and adulterated devices (see this post

Sunday, December 09, 2018

Mission-Hostile Hospital Management: Quieter, but Still Pernicious After All These Years

Hospitals exist to take care of sick people, with the goal of making them better.  Hospitals employ and work with health care professionals, again who are sworn to put taking care of patients ahead of all other concerns.

However, since we founded Health Care Renewal, we have noted striking examples of hospital leaders threatening their hospitals' fundamental mission and/or health care professionals' core values, which we dubbed mission-hostile management.  We also saw mission-hostile management affecting the broader health care industry, particularly pharmaceutical and device companies.  Most recently, the most striking examples of mission-hostile health care related management appearing in the press have come from the Trump administration.

While journalists attention is focused on Trump et al, and coverage of other topics fades, bad management of hospitals has received less attention.  However, the problem has not vanished, nor become less important.  So here is my round-up of cases of mission-hostile hospital management from the recent past.

Hospitals Offering Better Care to Wealthier Patients

Hospitlas generally proclaim that they endeavor to care for all patients, regardless of their personal characteristics, or worthiness for care  Yet we have seen non-profit hospitals offering better care to those who can pay more.  

Preferential Treatment for Wealthy Foreign Nationals Seeking Organ Transplants 

A story from November, 2017 in ProPublica documented how some US hospitals seem to give preferential treatment to wealthy people coming from overseas specifically for organ transplants.  

Little known to the public, or to sick patients and their families, organs donated domestically are sometimes given to patients flying in from other countries, who often pay a premium. Some hospitals even seek out foreign patients in need of a transplant. A Saudi Arabian company, Ansaq Medical Co., whose stated aim is to 'facilitate the procedures and mechanisms of ‘medical tourism,’' said it signed an agreement with Ochsner Medical Center in New Orleans in 2015.

In particular,

Foreign patients generally are not entitled to the same discounts as those with private insurance or Medicare, the federal insurance program for seniors and the disabled. In 2015, for instance, the average sticker price for a liver transplant at NewYork-Presbyterian was $371,203, but the average payment for patients in Medicare was less than one-third of that, $112,469, according to data from the Centers for Medicare and Medicaid Services, which runs Medicare. In the case of Saudi Arabia, its embassy in Washington often guarantees payment for patients.

This is actually not a new pheonomenon. 

There have been scandals in the past about foreigners and organ transplants. In 2005, a liver transplant center in Los Angeles shut its doors after disclosing that its team had taken a liver that should have gone to a patient at another hospital and instead had implanted it in a Saudi national. The hospital said its staff members falsified documents to cover up the incident.

The University of California, Los Angeles, came under fire in 2008 for performing liver transplants on a powerful Japanese gang boss and other men linked to Japanese gangs, and then receiving donations afterward from at least two of the men. The hospital and its surgeon said they do not make moral judgments about patients.

We discussed the case of the Yakuza transplants most recently here.

Note that while foreign nationals seem to end up on the same waiting lists that US citizens may be on, the operation of these medical tourism programs implies that they are virtually guaranteed an organ, while US citizens are not. The preferential treatment of the medical tourists does not seem to stem from compassion, but rather from the larger fees they are willing to pay. 

Discouraging Organ Transplants for Patients Unable to Afford Expensive Anti-Rejection Drugs and Other After Care

A story from December, 2018 from Kaiser Health News published in the New York Times, suggested that most organ transplant centers will not take care of patients until they can show their ability to pay, usually to pay the "sticker prices." One case made public in November, 2018, brought this issue to light

Hedda Martin, 60, of Grand Rapids, was informed that she was not a candidate for a heart transplant because of her finances. It recommended 'a fund-raising effort of $10,000.'

The Times reporters found that this was not unusual.

Two years ago, Mr. Mannion, of Oxford, Conn., learned he needed a double-lung transplant after contracting idiopathic pulmonary fibrosis, a progressive, fatal disease. From the start, hospital officials told him to set aside $30,000 in a separate bank account to cover the costs.

Mr. Mannion, 59, who received his new lungs in May 2017, reflected: 'Here you are, you need a heart — that’s a tough road for any person,' he said. 'And then for that person to have to be a fund-raiser?'

Ms. Martin’s case incited outrage over a transplant system that links access to a lifesaving treatment to finances. But requiring proof of payment for organ transplants and postoperative care is common, transplant experts say.

'It happens every day,' said Arthur Caplan, a bioethicist at the New York University Langone Medical Center. 'You get what I call a ‘wallet biopsy.’'

Virtually all of the nation’s more than 250 transplant centers, which refer patients to a single national registry, require patients to verify how they will cover bills that can total $400,000 for a kidney transplant or $1.3 million for a heart, plus monthly costs that average $2,500 for anti-rejection drugs that must be taken for life, Dr. Caplan said.

Note again that the 'sticker prices' quoted above are much higher than those paid by US government health insurance programs, so this insistence on having enough money or coverage available to pay the sticker prices appears to discriminate against poorer patients who may not have the most deluxe insurance coverage.  Futhermore, it is likely that the actual costs to do the transplant and provide follow-up care are lower than the discounted prices, suggesting that the hospital are putting their revenue ahead of the mission to provide care to patients according to the patients' needs.

Expensive Concierge Care at Non-Profit Academic Medical Centers

We have previously discussed cases of non-profit academic hospitals offering deluxe services to patients able to pay hefty fees, despite their idealistic mission statements about serving the whole coummunity.  In March, 2018, the Michigan Daily discussed the latest version of such care offered by Michigan Medicine,

Michigan Medicine at the University of Michigan is currently launching Victors Care, a concierge medical care model aiming to deliver tailored health care access to a limited number of patients. These patients will receive specialized, convenient and optimized care with purchase of an annual membership fee to cover primary care services without copays or deductibles.

A number of faculty members took exception to this program in a letter addressed to top Michigan Medicine executives,

grievances listed in the faculty letter include: being unaware in the content of the Victors Care program invitation letter, video and website; discriminating against the underserved; promotional materials suggesting Victors Care patients will 'receive preferential treatment at Michigan Medicine based on ability to pay'; implication that if receiving Victors Care is quality care, receiving care from traditional primary care physicians is not quality; and a concern that Victors Care promotional materials and website recommend care that is not evidence based.

'We ask that the institution stop recruiting our patients to this program and advertising it as providing much better care than all the rest of our primary care clinics, the letter reads. 'Victors Care purports to offer ‘better’ health care to those with enough money to pay a large access fee. The University of Michigan is a public institution and our commitment is to serve the public, not a private few.'

The letter also includes direct quotations from Michigan Medicine faculty, one of which notes: 'This reinforces UM as an elitist institution catering to the wealthy.'
Note that Michigan Medicine is a creature of the University of Michigan, a non-profit, state-supported institution, although I cannot determine whether legally Michigan Medicine is a government entity, a non-profit corporation, or something else.  The mission statement on the organizational website is:

We advance health to serve Michigan and the world

It says nothing about providing better service to wealthier patients 

Hospital Spending Priorities Put Patients and Health Profesionals Last

Increasing Market Dominance Rather than Improving Affordability of Health Care

The problem was described in a February, 2018, NBC News article, entitled with the question:"Hospitals made $21B on Wall Street last year, but are patients seeing those profits?"

Some medical economists say that nonprofit hospitals are using lucrative Wall Street portfolios to fatten their bottom lines rather than lower what patients pay for health care.

'The tenor and the responsibility of hospital CEOs has now changed over time,' said Gerard Anderson, a professor of health policy, management and international health at the Johns Hopkins University Bloomberg School of Public Health. 'They focus on the bottom line and … they get performance ratings based on profitability,' he said.

In particular, the article suggested rather than using investment earnings to lower costs to patients,

Hospitals have an incentive to reinvest Wall Street income into growing their networks in order to compete. 'To acquire hospitals you need to have money. If you want to be the biggest hospital system in your community you have to have a lot of money,' Anderson said.

But bigger hospital networks don’t necessarily mean better, or cheaper, health care for patients.

Luxury Hotel Like Accoutrements Rather than Direct Patient Care Services

Furthermore, while the patients may literally see the results of lavish hospital spending, much of that spending has scant relationship to patient care. An  article in the Spectator, March, 2018, described the lavish ways many big non-profit academic medical centers spend their money.

The Emperor Nero would have felt at home in our hospitals.

At St. Vincent’s Hospital in Worcester, Massachusetts, visitors immediately encounter a waterfall, trees, massive rocks, and a pathway for hospital-goers interested in a stroll all located underneath a glass atrium. The massive indoor nature preserve of sorts appears about half the size of a football field. It provides peace and tranquility in a place in need of such comforts.


IU Health in Indianapolis boasts a monorail-like People Mover that shuttles patients, families, employees, and anybody else who cares to ride between hospitals for free. Cedars-Sinai in Los Angeles offers deluxe maternity suites featuring such perks as access to a 'personal doula,' 'soft colors and recessed lighting to offer a soothing environment for laboring women,' and an 'in-room refrigerator stocked with complimentary chilled juices and bottled water.' Even hospitals labeled 'struggling' struggle to avoid lavish spending. The New York Post reported in 2016 that Brooklyn’s SUNY Downstate Medical Center paid consultants $83,000 for such frills as 'pricey rooms at the Carlyle Hotel on the Upper East Side, a booze-infused ‘team dinner’ at the Docks Oyster Bar in Midtown, and sticker-shock limo bills.'

True to the publication's ideology, the article blamed the spending on the government.  Obviously, though, it was hospital managers who made the spending decisions.

Hospital Board Members Meet in Cayman Islands While Budget for Employee Benefits Threatened

Hospital managers, even in hospitals meant to serve the poor, like to use the hospital budget for lavish perks.  For example, according to a report from Newsday from March, 2018, Nassau University Medical Center, is a "safety net" hospital which

treats low-income people, receives state aid even though Nassau County ended its subsidy several years ago. However, the county is liable for more than $242 million in hospital long-term debt if NHCC defaults.

Its finances have been challenged:

hospital finances continue to be tight as NuHealth faces tens of millions of dollars in liabilities for accrued employee time, health care and pensions.

'This is a cash cow without the cash,' [Chairman of the Board George] Tsunis said. 'We have a very perilous position here.'

Yet until then, hospital management continued

the practice of sending three hospital officials to the Cayman Islands for a week during Thanksgiving and a week in February to discuss the health care corporation’s offshore self-insurance facility, Tsunis said.

Like other hospitals, NuHealth set up a limited liability company called NHCC LTD in the Cayman Islands for tax purposes to self-insure for malpractice and general liability claims. The hospital’s chief executive officer, chief financial officer and chief operating officer are the company board members. To maintain the Cayman location, company officials must meet at least once a year outside the United States.

The hospital usually sent all three board members to the Cayman Islands twice a year, Tsunis said.

Now the hospital will send two people once a year to a meeting at an airport hotel ... in Canada.

So even when the bottom line was threatened, Caribbean jaunts for board members continued, apparently until they were caught 

Eliminating Faculty Retention Bonuses to Pay for Legal Liability Due to Alleged Mismanagement

While hospital managers may get lavish perks, when expenses go up they do not shrink from cutting the pay of their employees, even their most well-trained medical professionals.  For example, in January, 2018, McClatchey reported (here via the Charlotte Observer) that the University of New Mexico suspended its retention bonuses for anesthesia faculty because of the settlement it had to pay for a suit brought by 'a former dismissed problem resident.' However,

The woman said in the wrongful termination lawsuit filed in 2011 that she was raped in June 2009 by a post-doctoral fellow and anesthesiologist at the university. Afraid she’d face repercussions, she waited until September to report it to department higher-ups, the lawsuit said.

The lawsuit said officials 'discouraged' her from reporting the alleged assault to law enforcement officials to avoid damaging the school’s reputation.

The suit accused the university of failing to conduct an investigation into the allegations and of eventually terminating the resident, violating state laws, in 2011. The case was thrown out in 2013 but reinstated on appeal in 2015. UNM’s attorneys agreed to settle for an undisclosed amount in November, according to the NM Political Report.

So the suit alleged considerable bad management, as well as bad behavior by one anesthesia trainee,  but the money to settle it had to come out of senior physicians' compensation, not management's pockets.

Hospitals Threatening Health Care Professionals who Call for Patient Care Improvements that Might Cost Money

Hospitals depend on health care professionals to actually take care of patients. Health professionals swear to put patients and patient care first, while hospital managers have no such professional values, unless they are also health professionals.  Yet hospital managers have been known to threaten health professionals who dare differ with them on matters pertaining to patient care, particularly professionals who call for changes that would cost more money.

In Medscape, from October, 2017, Dr John Mandrola described the plight of employed physicians who dare protest actions by their hospitals' managers:

The need to keep one's job decreases a worker's candor. Seniority offers little protection. Look at what happened to an esteemed surgeon who spoke out on double-booking in the OR. Hospital leaders fired him.

The irony of the employed-clinician model is that many embraced it for job security but have ended up feeling more vulnerable than before. And feeling vulnerable means making less noise. The danger is obvious: Clinicians become clock-punching workers rather than leaders; bad policies persist; outlier doctors continue working unabated, and low morale becomes the new normal.

In November, 2018, the New York Daily News reported a graphic example of a hospital CEO threatening to fire a nurse who complained about staffing levels:

Brooklyn Hospital CEO Gary Terrinoni, along with several other executives and department heads, were updating the nursing staff about the hospital's future a month ago when Terrinoni launched into what sources described as a nasty screed.

'Are you all tired?' Terrinoni mockingly asked the nurses, according to a letter distributed by the New York State Nurses Association.

When no one offered a response, Terrinoni singled out one veteran RN, who at first politely tried to deflect his question. After more prodding, she answered that the biggest problem they faced was understaffed shifts.

'That's what I'm talking about! Look at your attitude!' Terrinoni allegedly erupted. 'Then you don't need to be here. Go find another job!

When the 13-year Brooklyn Hospital vet noted she had more than a decade on the job, Terrinoni only grew more agitated, the union said.

'I don't care if you've been here ten years or 30 years,' he allegedly said. 'You can leave if you don't like it here.'


Recently we have seen many examples of mission-hostile management by political appointees to health care related leadership positions in the Trump administration.

However, while the political conflagration in Washington, DC has pulled journalists away from the health care beat, we continue to see examples of bad, and particularly mission-hostile management of non-profit hospitals that threatens care of vulnerable patients. Such management tends to prioritize hospital revenues, and the financial self-interest of management over patient care.

Some recent examples of related posts included one from 2017 in which we discussed a New York hospital CEO who seemed to put revenue generation in support of his own very generous paycheck ahead of quality of care and patient safety (look here).  Also, the revered Mayo Clinic seemed to let patients with more remunerative commercial insurance coverage get attention before poor patients who have only government insurance, despite its stated mission "providing the best care to every patient" (look here).

Mission-hostile management in hospitals, pharmaceutical companies, or government agencies seems to have been enabled by several factors. 

Managerialism is the belief that trained managers are better leaders of health care, and every other sort of organization, than are than people familiar with the particulars of the organizations' work.  Managerialism has become an ascendant value in health care over the last 30 years.  The majority of hospital CEOs are now management trained, but lacking in experience and training inmedicine, direct health care, biomedical science, or public health.  And managerialism is now ascendant in the US government.  Our president, and many of his top-level appointees, are former business managers without political experience or government experience.  

The rise of the manager-leader occurred at a time when management schools increasingly preach the dogma that maximizing shareholder value, usually equivalent to maximizing short-term revenue, should be the first, if not the only goal of all managers (look here).  A recent article on the miseducation of Sheryl Sandberg, Facebook's chief operating officer, asserted that

Harvard Business School, like much of the M.B.A. universe in which Sandberg was reared, has always cared less about moral leadership than career advancement and financial performance.

The article recounted a recollection of a case discussion which included Jeff Skilling, the now disgraced former CEO of Enron

in which the students were debating what the C.E.O. should do if he discovered that his company was producing a product that could be potentially fatal to consumers. 'I’d keep making and selling the product,' he recalled Skilling saying. 'My job as a businessman is to be a profit center and to maximize return to the shareholders. It’s the government’s job to step in if a product is dangerous.' Several students nodded in agreement, recalled LeBoutillier. 'Neither Jeff nor the others seemed to care about the potential effects of their cavalier attitude. . . . At H.B.S. . . . you were then, and still are, considered soft or a wuss if you dwell on morality or scruples.'
Boards of directors or trustees, which are now often dominated by managers, are inclined to financially reward organizational managers for increasing revenue.  Hospital boards rarely are so interested in improving patient care or public health.  So the result is mission-hostile management, which is very bad for patients' and the public's health

As I have said before,  true health care reform would put in place leadership that understands the health care context, upholds health care professionals' values, and puts patients' and the public's health ahead of extraneous, particularly short-term financial concerns. We need health care governance that holds health care leaders accountable, and ensures their transparency, integrity and honesty.

But this sort of reform would challenge the interests of managers who are getting very rich off the current system.  And these days, such reform would also challenge the interests of many people in top positions in the US government.  So I am afraid the US may end up going far down this final common pathway before enough people manifest enough strength to make real changes.

Sunday, December 02, 2018

The Perils of CEO Worship - What Happens When the Leader Becomes Demented?

Introduction: the Cult of the CEO

Although the US and most developed countries are nominally democratic, many of us seem to be again yearning for a man on a white horse, and in the current era, the horse ridden is corporate.
On Health Care Renewal, we having been talking about this pheonomenon for a long time. We have written about it in terms of the messianic (or visionary, or charistmatic) CEO, CEO disease, and the imperial CEO.

These concerns are diffusing into the broader media.  For example, from the introduction to a revent Vox article entitled "The Problem with CEO Worship"

Society has always had heroes, be those of war or art or politics. But entrepreneurs are particularly suited for our current moment, in which success in business is our primary marker of achievement. Business acumen doesn’t just get you money anymore; it can make you the most powerful man in the world.

The signs of CEO worship are everywhere: unprecedented venture capital funding for founders, media overemphasis on company leaders, and to use the most extreme and obvious example, the election of Donald Trump.

That article noted that CEO worship may overestimate the importance of leaders; create "secular fundamentalists" out of individuals; perpetuate destructive neoliberal ideologies; encourage CEOs to make worse decisions; and be bad for business

Those are not the only consequences.  CEO worship makes it possible for a progressively impaired leader to go unconstrained. Unfortunately, we may be seeing the ultimate example of this in the US.

Incoherent Verbal Utterances

Even before he was elected, we noted that Donald Trump sometimes was completely incoherent when describing his health policy ideas.  In early 2016 we raised questions about Donald Trump's cognition.  At that time, a conservative columnist labelled as "word salad" Trump's attempts to sketch a position on health care, specifically the "mandate" provision of the Affordable Care Act (ACA).  We found other examples of his utterances on health care policy that could be characterized as gibberish.  This one was short, if not sweet

I want to keep pre-existing conditions. I think we need it. I think it’s a modern age. And I think we have to have it.

How could anyone understand this while listening in real time? A close reading suggests that maybe this was meant to suggest that some people ought to have  insurance coverage for pre-existing conditions. However, Trump seemed to befuddled by that concept.  Furthermore,  note that pre-existing conditions are not desireable, so that one would not want to "keep" them, nor can one choose not to.  To what the word "it" in the second sentence and again in the fourth refers is unclear.  The third sentence seems to be a complete non sequitur. 

We found additional examples of incoherent verbal responses about health care in 2017, and early 2018.  In the last six months, things have only gotten worse.  Examples of verbal incoherence have multiplied, although most were not related to health care. 

In July, 2018, MediaIte reported Trump's incoherent comments at a political rally,

I have broken more Elton John records, he seems to have a lot of records. And I, by the way, I don’t have a musical instrument. I don’t have a guitar or an organ. No organ. Elton has an organ. And lots of other people helping. No we’ve broken a lot of records. We’ve broken virtually every record. Because you know, look I only need this space. They need much more room. For basketball, for hockey and all of the sports, they need a lot of room. We don’t need it. We have people in that space. So we break all of these records. Really we do it without like, the musical instruments. This is the only musical: the mouth. And hopefully the brain attached to the mouth. Right? The brain, more important than the mouth, is the brain. The brain is much more important.

Perhaps this was meant to suggest that the president drew a larger crowd to an arena than did Elton John.  However, note the non-sequiturs: from "Elton has an organ" to "lots of other people helping" to "we've broken a lot of records," "They need much more room, for basketball, for hockey..." Who are the people helping whom are they helping, and to do what? What records were broken by whom, and how is this relevant to Elton John, etc.  To whom does they refer, and why do they need a lot of room? Etc, Etc.  Again, in real time this would have made no sense at all

In September, 2018, CNBC reported that speaking at a meeting about preparations for Hurricane Florence, Trump said

This is going to be a very large one ... It's tremendously big and tremendously wet. Tremendous amounts of water

Maybe he meant to say this will be a very large hurricane, bringing a tremendous amount of rain.  However, he seemed to be unable to convey the concept of rain.

In September, 2017, the Hill had reported that Trump had defended difficulties in providing relief for Puerto Rico after Hurricane Maria thus,

This is an island, surrounded by water. Big water. Ocean water

Again, to be charitable, he seemed to handle the concept of an island in a vast ocean as would a three-year old.

Media articles also suggested that normal people cannot follow or understand what Trump says in real time.  For example,  on November 8, 2018, a Bloomberg op-ed said this about a recent Trump news conference,

In fact, the president was difficult to follow because he simply doesn’t make any sense half the time.

More specifically,

Trump was asked one specific question about health care, and good luck to anyone who tries to figure out what his answer meant. He pretty clearly has just as little idea what he’s talking about on most major policy issues as he did when he first started running for president. On Jamal Khashoggi, waivers on Iranian sanctions, North Korea and Russia, he either ducked the questions with non sequiturs or just babbled.

On November 11, 2018, an article in Slate noted that Trump confused Baltic states with Balkan states in a way that could have foreign policy repercussions,

When President Donald Trump met with Dalia Grybauskaitė of Lithuania, Kersti Kaljulaid of Estonia and Raimonds Vējonis of Latvia earlier this year, he started with a criticism. At the White House in April, Trump opened by chastising the Baltic leaders for starting the war in the 1990s that ended with the breakup of the former Yugoslavia. The Baltic leaders were apparently very confused and it took them 'a moment' to realize that the commander in chief was confusing Baltic states with the Balkans

this case is particularly notable considering Melania Trump is originally from the Balkans. The first lady was born in Slovenia, which gained independence in 1991 at the start of the Balkan wars. As Le Monde wrote, Trump remained 'apparently uneducated in the matter by his wife, Melania, originally from the former Yugoslavia.'

This suggests at best that at times Trump may be unable to distinguish words that sound vaguely alike but have quite different meanings. 

A November 28, 2018, Vox summary article about Trump's recent interview with the Washington Post provided this quote from Trump about economics,

And I’m not blaming anybody, but I’m just telling you I think that the Fed is way off-base with what they’re doing, number one. Number two, a positive note, we’re doing very well on trade, we’re doing very well — our companies are very strong. Don’t forget we’re still up from when I came in 38 percent or something. You know, it’s a tremendous — it’s not like we’re up — and we’re much stronger. And we’re much more liquid. And the banks are now much more liquid during my tenure. And I’m not doing – I’m not playing by the same rules as Obama. Obama had zero interest to worry about; we’re paying interest, a lot of interest. He wasn’t paying down — we’re talking about $50 billion lots of different times, paying down and knocking out liquidity. Well, Obama didn’t do that. And just so you understand, I’m playing a normalization economy whereas he’s playing a free economy. It’s easy to make money when you’re paying no interest. It’s easy to make money when you’re not doing any pay-downs, so you can’t — and despite that, the numbers we have are phenomenal numbers.

The author of the article stated,

I have basically no idea what Trump is talking about here, and I’m pretty sure he doesn’t either.

On repeated close reading, I still do not have any idea what Trump meant.  I would add the following questions:  38 percent of what? Who is much more liquid, and how is liquid defined?  Who is paying a lot of interest? What does "paying down and knocking out liquidity" mean? What is a "normalization economy?"  Note that this was coming from someone who claims to be a brilliant business manager.

Furthermore, consider what Trumps aid about the climate,

And when you’re talking about an atmosphere, oceans are very small. And it blows over and it sails over. I mean, we take thousands of tons of garbage off our beaches all the time that comes over from Asia. It just flows right down the Pacific, it flows, and we say where does this come from. And it takes many people to start off with.

Oceans are "small?" What "blows over and sails over?" Over what? What "flows?" What "takes many people?"

In 2017, StatNews published an article describing how 

STAT reviewed decades of Trump’s on-air interviews and compared them to Q&A sessions since his inauguration. 

To summarize the conclusions.

The differences are striking and unmistakable.

Research has shown that changes in speaking style can result from cognitive decline. STAT therefore asked experts in neurolinguistics and cognitive assessment, as well as psychologists and psychiatrists, to compare Trump’s speech from decades ago to that in 2017; they all agreed there had been a deterioration, and some said it could reflect changes in the health of Trump’s brain.

In 2018, Trump's verbal communications at times are even more garbled.  Parts of the passages above suggest the word salad produced by somebody with fluent aphasia versus the nonsensical responses produced by patients suffering from acute delusional states. That Trump is capable of producing this sort of word salad at times, without realizing he is making no sense, suggests the intermittent symptoms seen early in progressive dementia.  

Lack of Insight About Cognition

Furthermore, Trump appears to lack insight about his difficulties commicating.  

In July, 2018, after the NATO conference,  Politico reported, that Trump seemed to have no insight about why much of what he says appears unbelievable to others.  The article noted
leaders who spent the first 18 months of Trump’s presidency thinking there might be a method to his chaos creation — and struggling to discern what it might be — now seem to have concluded that it’s just chaos, and that Trump himself may not understand what he’s doing.

More specifically, European officials commented on what Trump was saying:

A senior NATO official said leaders had concluded that they simply could not rely on anything Trump said.

'You know the way he speaks, you cannot take him literally,' the official said.

Another EU official echoed the point. 'He speaks a language that doesn’t match with diplomacy,' the second official said. 'We were used to the Brits, who speak a more frank diplomatic language, but this is another thing.'

These officials again seemed to be stating that Trump's verbiage can be completely incoherent, albeit they were doing so diplomatically.  After the conference, however, when confronted with a question about the inconsistency of his remarks,

When a Croatian journalist confronted Trump about his inconsistencies, the president flatly denied there were any, and he repeated a defense of his own sanity that he had made when previously questioned about his fitness for the presidency.

'We understand your message, but some people ask themselves, will you be tweeting differently once you board the Air Force One?' the reporter said.

Trump, speaking at his news conference before leaving the summit, replied: 'No, that's other people that do that. I don’t. I’m very consistent. I’m a very stable genius.'

Not to belabor the point, but the examples noted above suggest neither consistency nor stability.  And true geniuses almost never boast about their intellect.

In September, 2018, The Hill reported an interview with Trump in which he said his personal health and management style were reasons that Republicans might do better than expected in the 2018 elections,

'You know, I took that test when I got my last physical, and the doctor said that’s one of the highest scores we’ve ever seen,' Trump said. 'I did that not because I wanted but I did it, I was always good at testing.'

He continued: 'But if there’s anything great about me it’s stability, and I’m a good manager. Always been a good manager, but you know, I have a vision,'

Note that above Trump was presumably referring to the screening test for dementia he took during his official physical examination.  High scores on the test are common, and do not signify great intelligence, just the probable absence of dementia.

In addition, this interpretation assumes that the test was administered in an unbiased way.  However,  there are reasons to question whether Trump's physical was unbiased.  In retrospect, we now know that soon after taking the test, Trump nominated the physician who administered it to be Secretary of Veterans Affairs.  Later the physician withdrew his name after allegations of his questionable personal behavior appeared (look here).  

At least Trump's boast about having "a vision" does correspond to the language often used by public relations spokespeople to justify their CEOs' lack of accountability and high compensation (look here)

Similarly, in the Vox summary of the November, 2018, Washington Post interview (see above for link), Trump stated
a lot of people like myself - we have very high levels of intelligence

Finally, a November 18, 2018 article in MediaIte described this interchange between Trump and interviewer Chris Wallace on Fox News, starting with his response to a question about how he makes decisions

'I don’t think about them,' Trump replied. 'I don’t think about, you know, how I make them....'

However, he responded to a question about Federal Reserve policy

They're making a mistake because I have a gut, and my gut tells me more sometimes than anybody else's brain can ever tell me

This suggests that Trump has lost insight into his own thinking. 

External Observers Suggested Trump Is Cogitively Impaired

In August, Vanity Fair reported:

More than ever, Trump is acting by feeling and instinct.  'Trump is nuts,' said one former West Wing official. 'This time really feels different.' Deputy Chief of Staff Bill Shine has privately expressed concern, a source said, telling a friend that Trump’s emotional state is 'very tender.' Even Jared Kushner and Ivanka Trump are unsettled that Trump is so gleefully acting on his most self-destructive impulses as his legal peril grows.

In September, 2018, Newsweek reported two instances in which apparent Trump insiders sought psychiatric or medical help for Trump's perceived cognitive problems

[Dr] Lee told Salon that two Trump administration officials approached her after the book was published to express their concern about the president’s mental health, saying he was 'scaring' them because he was 'unraveling.'

In comments to Newsweek over email, Lee said 'it appeared that the officials (if they were officials at all) were at least frequently in [Trump’s] presence.

She continued, 'They were definitely calling from within the White House, which I confirmed by calling back their number. However, I did not ask about their rank. There was no reason for me to doubt they were high-ranking enough to have regular access to the president.'

Lee also said that a 'person [who] was a friend of his entire family, since his childhood” had also been in touch with her at the same time in October 2017, as people in the White House were “stating concern about the president (this was an observation from afar).'

Also in September, 2018, a Politico review of the new book by Robert Woodward based on numerous White House interviews suggested that Trump's inner circle called him a "dope," "idiot," or "moron."


Donald Trump is the chief executive officer of arguably the most powerful country in the world.  Starting during his campaign for the US presidency, we noted that his utterances about health care were at times so incoherent as to suggest cognitive dysfunction.  In the two years since then, especially in the last six months, he has increasingly been noted to be verbally incoherent or confused, has seemed to lack insight about these episodes, and has been observed by close allies and associates to be cognitively impaired.

However, there have ben few, at best, public attempts to link these suggestions of cognitive impairment together, nor to discuss their implications.  The most recent of those that I have found was in January, 2018 (look here and here).  Yet the problems appear to have been getting worse since then.  

While patients with worsening cognitve impairment deserve accurate diagnosis, compassionate care, and access to what few effective, safe treatments may be available for their condition, they obviously should not be in a position to make consequential decisions.  They certainly should not be in charge of large organizations, particularly powerful countries with nuclear weapons.

Yet President Trump's apparent cognitive decline remains anechoic.

For this we may blame CEO worship, which we have too often seen in health care. We have seen many health care leaders praised for their brilliance and paid royally despite leadership resulting in financial distress, threats to the organizations' health care missions, poor patient care, unethical behavior, or even crime. Yet health care CEOs, like other corporate CEOs, and like politicians are just people, sometimes smart, but almost never brilliant.  Promoting them as messianic to bewitch key constituencies, justify the remuneration of other top managers, and the hiring of more public relations flacks is likely to lead to the sort of organizational disasters and system-wide dysfunction we discuss on Health Care Renewal.  The rise of the falsely messianic leader may allow the entry of the most dangerous false messiahs, the psychopathic ones.  (We discussed the likelihood that some health care leaders are actually psychopaths here.)

We must get quickly past our worship of CEOs.  We may not long survive in a world where leaders of nuclear armed nations have no cognitive clothes.