CT Scans to Screen for Lung Cancer, Tobacco Companies, CT Scan Manufacturers, and the NIH

The Wall Street Journal just reported about conflicts of interest affecting a study of chest CT scans to screen for lung cancer financed by the National Institutes of Health (NIH).

On one hand, two of the study's investigators turn out to have had recent financial ties to the tobacco industry. "University of California Los Angeles radiologist Denise Aberle, one of the study's two national leaders" was revealed to have

testified for the American Tobacco Co., now part of Reynolds American Inc., that
'it is reckless or irresponsible to promote' CT screening. Court transcripts in the Louisiana case show that Dr. Aberle's role as co-leader of the government study was highlighted repeatedly. American Tobacco lawyer Gary Long says that what made Dr. Aberle a good witness was 'the fact she could talk about the national lung cancer screening trial that is ongoing.'

Also, "Dartmouth College radiologist William Black, the principal investigator at one of the 30 study sites in the country" was revealed to have

provided an expert report for Philip Morris USA, a unit of Altria Group Inc., in which he warned that CT screening 'may do more harm than good.'

On the other hand, the group that brought up the issue, "the Lung Cancer Alliance, a Washington, D.C., nonprofit that supports screening," turns out to be "funded by individual donations and corporate grants, including $100,000 from General Electric Co...." General Electric makes CT scanners.

On GoozNews, Merrill Goozner posted some pithy comments about the case. To quote Goozner,

Rival industrial interests are funding researchers and patient advocacy groups who square off over the utility of a wildly expensive technology of questionable benefit, and NIH turns a blind eye to how conflicts of interest might undermine its much-needed objective study of the issue. This is a classic example of everything that ails the health care technology assessment field, made more graphic by the presence of the tobacco industry, everybody's favorite whipping boy and for good reason.

The result was,

The expenditure of $200 million in taxpayer money should have resulted in a definitive answer. Now all we'll get is endless bickering over the meaning of the results by self-interested parties whose first line of attack will be the financial ties of the researchers or advocates on the other side.

His suggested solutions?

Congress should create a new institute to test new technologies and compare them to existing technologies.... The new agency must scrupulously avoid all conflicts of interest, with industrial interests kept as far as possible away from the decisions of what to study, how to design the trials, and how to interpret the results. And, the researchers who conduct the studies must follow a simple rule: You can't have had any financial conflict of interest within the past five years to participate in such a study.

Also,

NIH must end its laissez-faire attitude toward monitoring the conflicts of interest of the extramural researchers based at the nation's universities, who absorb 80 percent of its annual $30 billion budget. Universities have proven that they ... aren't up to the task of monitoring their professors. Indeed, the commercialization imperative that now dominates thinking at most major universities (they earn revenue from licensing the patents that come from NIH-funded research) has created a structural conflict of interest that has blinded them to improprieties....

Just so.

BLOGSCAN - More Direct Talk at Aspen Health Forum

On the WSJ Health Blog, this post summarizes the Aspen Health Forum (see my previous post on one session here.) Unfortunately, I had to head to the airport before the end of the last session, so missed some of what was reported here. But I did find that some of the Forum speakers were willing to address major issues in our dysfunctional health care system more directly than what one usually hears at health policy meetings.

BLOGSCAN - Suppressing Research on Occupational Disease

On the Scientific Misconduct Blog, Dr Aubrey Blumsohn summarizes a fascinating and disquieting case of suppression of research, involving occupational disease, a giant computer company, and a huge publishing company.

Managed Care Promises Vs Medicare Audits

Many health care insurance and managed care companies have lofty mission statements. For example, UnitedHealth Group promises to:

- Improve access to health and well-being services;
- Simplify the health care experience;
- Promote quality; and,
- Make health care more affordable.

Similarly, Wellpoint promises to:

- Bring affordable quality health care and coverage to medically underserved communities
- Educate people to take an active role in their own health
- Work with our health care partners to improve quality of care
- Help shape public policy that makes health care more affordable and more accessible

And Humana promises that it

makes health benefits affordable, easy to administer and use, and instills confidence in both employees and employers.

In contrast, Robert Pear, writing in the New York Times, found multiple problems when these companies privately ran Medicare-financed health plans,

Tens of thousands of Medicare recipients have been victims of deceptive sales tactics and had claims improperly denied by private insurers that run the system’s huge new drug benefit program and offer other private insurance options encouraged by the Bush administration, a review of scores of federal audits has found.

The problems, described in 91 audit reports reviewed by The New York Times, include the improper termination of coverage for people with H.I.V. and AIDS, huge backlogs of claims and complaints, and a failure to answer telephone calls from consumers, doctors and drugstores.

Medicare officials have required insurance companies of all sizes to fix the violations by adopting “corrective action plans.” Since March, Medicare has imposed fines of more than $770,000 on 11 companies for marketing violations and failure to provide timely notice to beneficiaries about changes in costs and benefits.

The companies include three of the largest participants in the Medicare market, UnitedHealth, Humana and WellPoint.

The audits document widespread violations of patients’ rights and consumer protection standards. Some violations could directly affect the health of patients — for example, by delaying access to urgently needed medications.

There were a variety of problems.

Medicare officials said that compliance problems occurred most often in two areas: marketing, and the handling of appeals and grievances related to the quality of care.

Many of the marketing abuses occurred in sales of the fastest-growing type of Medicare Advantage product, known as private fee-for-service plans. In June, the government announced that seven of the leading companies in this market, including UnitedHealth, Humana and Coventry, had agreed to suspend marketing of these plans. Medicare recently allowed them to resume marketing after they took steps to monitor their sales agents more closely.

Each Medicare plan has a list of preferred drugs, known as a formulary. Under federal law, patients can request coverage of other drugs that may be medically necessary. But many insurers do not have procedures to handle such requests, auditors said.

Specific problems occurred that seemed to contradict the commercial managed care companies' lofty statements of purpose.

UnitedHealth, which serves more than six million Medicare beneficiaries, did not have an 'effective program' to supervise its marketing representatives, agents and brokers. In some cases, United improperly denied claims without giving any explanation to beneficiaries. Peter L. Ashkenaz, a company spokesman, said, 'We terminated a few agents and brokers for misrepresenting our products.'

WellPoint, one of the nation’s largest insurers, had 'a backlog of approximately 354,000 claims' at certain Medicare plans offered through its UniCare subsidiary. The company’s call center took an average of 27 minutes to answer phone calls from its members and 16 minutes to answer calls from health care providers. More than half the callers hung up before speaking to a company representative. Karen Brown, a spokeswoman for WellPoint, had no immediate comment.

Humana, which covers more than 4.5 million people on Medicare, promised to investigate every complaint about its marketing practices, but it received so many complaints that it could not keep up. Many beneficiaries said they had received incorrect information from Humana agents. Medicare officials said some agents had not been adequately trained or supervised. Thomas T. Noland Jr., a senior vice president of Humana, said the company had taken 'corrective action to improve the situation.'

Humana did not always tell beneficiaries about changes in its list of covered drugs. In some cases, Humana did not explain its reasons for denying claims and did not inform beneficiaries of their appeal rights.

Oops.

So what did the government do to remedy these problems?

Medicare has taken “vigorous action” to halt marketing violations, said Abby L. Block, a Medicare official.

As noted above, that amounted to less than a million dollars worth of fines, apparently spread over 11 companies.

Once again, this nice example of investigative reporting shows that all too often in health care, large organizations make lofty promises, but their actions seem to contradict these claims.

Furthermore, negative incentives for bad behavior by giant health care corporations, in this case, health insurance and managed care companies, are very minimal. $770,000 is not even petty cash for such corporations. Minimal fines are just a minimal cost of doing business. It is doubtful that behavior will change until the people who actually determine that behavior suffer negative consequences.

Wouldn't it be nice of large health care corporations really did try to make health care better, more transparent, and more affordable?

ADDENDUM (8 October, 2007) - See Joe Paduda's take on this in his post on Managed Care Matters.

Once Again, Oh the Prices We Pay: Acthar for Infantile Spasms

We have often discussed how in today's dysfunctional health care system there seem to be few restraints on the pricing of goods and services. At least when the pricing is of new, high-technology, and innovative items, those selling same often justify their prices by the expense of developing innovative technologies, and the values these items provide to patients. These arguments, however, are often hard to judge, since production expenses are rarely documented, and value to patients is not always obvious or easy to measure.

Such arguments may be particularly hard to swallow when an old, low-tech drug is re-packaged as new and innovative. For example, we discussed how thalidomide, originally marketed as a tranquilizer (and never marketed in the US because it produced birth defects when given to pregnant women), is now used to treat malignancies. However, although the drug is available outside of the US for pennies a dose, for its new use the price will be about $25,000 a year.

The Philadelphia Inquirer recently reported another similarly extreme example of drug pricing.

There's one drug most doctors turn to first when babies have catastrophic seizures: a natural hormone sold under the name H.P. Acthar. It's the gold standard to stop seizures that can ruin a child's chance for a normal life.

On Aug. 27, the lone maker of that drug raised the price from $1,650 a vial to more than $23,000 a vial, sending the price for an average patient to $100,000 or more.

Acthar is actually a very old, and familiar biological.

What sets apart Acthar is that it is an old drug. The compound (Adrenocorticotropic hormone) was first synthesized in the 1940s by Armour & Co., the canned-meat firm, which harvested it from pigs' pituitary glands.

The drug, used for years to treat Infantile Spasms, was made by Rhone-Poulenc Rorer Inc. and then by its successor, Aventis. It was never a big seller, and the former owner nearly stopped making it in the mid-1990s - only to see it brought back after a storm of pediatricians complained that there was no substitute.

Questcor bought the rights to the drug in 2001. The company sought formal approval for Infantile Spasms from the Food and Drug Administration, but it issued a 'non-approvable' letter in May. The agency did not think the existing clinical trials were good enough, Cartt said, adding that the firm is exploring what kind of tests the FDA will need.

Even without formal FDA approval, Acthar remains the drug of choice for babies with Infantile Spasms. It is the most likely drug to end the seizures, which, if not stopped, make the chances of normal development remote at best.

Acthar is also one of several drugs that helps with sudden flare-ups in multiple sclerosis patients, though its use is small.

Actually, the evidence supporting the use of ACTH in infantile spasms is weak, to be charitable. The latest Cochrane Collaboration review of infantile spasms found no strong evidence supporting the use of ACTH. [Hancock E, Osborne J. Treatment of infantile spasms. Cochrane Database of Systematic Reviews 2002, Issue 2. Art. No.: CD001770. DOI: 10.1002/14651858.CD001770.] There is similarly little evidence supporting its use in childhood epilepsy. [Gayatri NA, Ferrie CD, Cross H. Corticosteroids including ACTH for childhood epilepsy other than epileptic spasms. Cochrane Database of Systematic Reviews 2007, Issue 1. Art. No.: CD005222. DOI: 10.1002/14651858.CD005222.pub2.]

There has been opposition to the new pricing of Acthar.

'It's an obscene increase. I could almost see doubling or tripling the price but [14] times seems ridiculous,' said Sarah Erush, clinical manager of pharmacy at the Children's Hospital of Philadelphia.

Acthar is 'one of the most expensive drugs on the market,' said Frank Lichtenberg, a business professor at Columbia University. 'This raises the question: Are the clinical benefits commensurate with that extremely high cost? The burden will be on the company to demonstrate this will extend life, it will improve quality of life, and it will reduce other medical expenditures.'

However, the Inquirer story noted some economists attempts at apologia.

Prescription drugs are 'a legal monopoly. We expect monopolists to behave like monopolists,' said Mark V. Pauly, a health economist at the Wharton School. "The argument is the higher profits will stimulate further beneficial research."

Experts say it is not uncommon for new drugs, especially for those that treat rare diseases, to cost more than $100,000 a year. The high price is needed, economists say, so the firm can be encouraged to enter the field.

Several economists said the firm, whose shares closed at 75 cents yesterday, up 12 cents on the American Stock Exchange, needs to find a balance on price. 'From the company's point of view, if the company charged too high a price, nobody would buy it,' said William Comanor, director of the UCLA program on Pharmaceutical Economics and Policy. 'And if they charge too low a price, they'd be leaving a lot of money on the table.'

And as often seems to happen in these cases, health insurers and managed care organizations, which seem to be pretty good at restricting what physicians charge for such services as deciding whether Acthar would be a good or bad option for a particular patient, do not seem put off by its new high price.

[Questcor Executive Vice President for Corporate Development Steve] Cartt said. 'We're seeing greater than 90 percent insurance coverage at the new pricing,' he said. Some state Medicaid programs have balked, he said, but big insurers, such as WellPoint Inc., United HealthCare and Kaiser Permanente, are covering it.

Darryl Richard, a United HealthCare spokesman, confirmed that the insurer is covering Acthar at the higher cost. But he said the insurer was requiring a new pre-authorization process to make sure the drug is used only when necessary.

I wonder how they will do that, given the state of the evidence, or lack thereof, about this drug?

This case illustrates again how pricing of health care goods and services, particularly drugs, seems unrelated to their costs of production, and to their value to patients. Furthermore, it demonstrates that insurers and managed care organizations do not seem adept at putting pressure even on the most extreme prices, despite their claims to, for example, "make health care more affordable," made by UnitedHealth. Yet they seem very good at cutting prices paid to physicians, particularly for "cognitive services," such as deciding whether or not a patient might need an expensive drug. It's your dysfunctional health care system at work.

ADDENDUM (15 October, 2007) - See this post on Brass and Ivory questioning Questcor's financial justification for this pricing decision.

The Main Stream May be a Little Wider Than We Thought

I just attended a health policy session on addressing rising health care costs. The four speakers emphasized these points, in order:

• We need to better address not just patients with chronic disease, but those with complex and/or multiple chronic diseases. We need to provide the practitioners who care for such patients the time and resources do so well.
• One reason for ever rising health care costs is that the current system often very generously reimburses particular services, treatments, and tests without any evidence that the services do very much good for patients. Instead, we need to make reimbursement proportionate to the value (presumably benefits/ harms) patients accrue.
• Unfortunately, we do not often actually know what the benefits and harms of services, treatments and tests are for particular patients under realistic conditions, and do not know the relative value of different management options for particular kinds of patients. We need to promote methodologically sound comparative effectiveness research to figure out what these absolute and relative benefits and harms are.
• Finally, despite lip-service, we have not promoted simple preventative measures and a public health approach. Doing so would likely do good for patients at comparatively modest expense, and forestall the need for expensive acute services or management of chronic disease for some patients.

Such a health policy session might now be considered mainstream at some more cutting edge primary care oriented meetings, e.g., those of the Society of Medical Decision Making. We have addressed, at least obliquely, most of these points on Health Care Renewal. We addressed complexity here, but the issue certainly has been covered more eloquently on Medical Rants, e.g., here. We have also certainly covered the related issue of how primary care and generalist physicians, who are in the best position to address the management of complex and multiple chronic diseases, are being driven out of business by declining reimbursement for such work, e.g., here and here.

We have addressed particular instances of pricing, particularly drug pricing, that seems wildly disproportionate to the value of the drug, e.g., here and here.

Recently, we have addressed comparative effectiveness studies, focusing more on the questionable arguments used by some of their detractors, e.g., here.

But I did not hear these presentations at a primary care meeting. Instead, I heard them at the Aspen Health Forum, the first ever health policy oriented meeting run by the Aspen Institute. And the presenters were not grumpy bloggers, but, in order, Dan Crippen PhD, Former Director of the Congressional Budget Office, Peter Orszag PhD, Director of the Congressional Budget Office, Ezekiel Emanuel MD PhD, Director, Department of Bioethics, NIH, and last but not least, Bill Frist MD, former Senate Majority Leader.

Some of the issues we talk about on Health Care Renewal seem to be becoming more mainstream than we think (although comments by one of the speakers suggested that not everyone has been happy to hear them.)

Kudos to the Aspen Institute for providing a forum for some people who are willing to go beyond the conventional wisdom and think about the unpleasant truths that underlie our current health care dysfunction.

BLOGSCAN - How the Principle of Social Justice Conflicts with the Principles of Patient Welfare and Patient Autonomy

On the Covert Rationing blog, this post discusses how the two principles traditionally recognized as central to physicians' ethics and professionalism, the principle of patient welfare, and the principle of patient autonomy, are in conflict with what DrRich calls the more newly promoted principle of social justice, i.e., the idea that doctors are somehow responsible for the fair distribution of society's resources. I would add that it may be hard to figure out what would be the best possible clinical management for a single patient, or what a single patient really wants, but it doesn't seem impossible to do so. On the other hand, the definition of the "fair distribution of social resources" is, shall we say, somewhat flexible. And often such a definition is politically defined, by those with the most political power at a given time. This is an important issue and DrRich's post deserves thoughtful consideration.

BLOGSCAN - The Limits of Clinical Trial Registries

On the Clinical Psychology and Psychiatry Blog, this post points out why we should not be too optimistic that clinical trials registries will on their own solve all the problems due to manipulated clinical research.

Medical Informatics still round peg in square hole?

As I have written in many prior posts, medical informatics specialists often face significant challenges in leveraging their expertise. At a time of a national EHR initiative and ample documentation of costly difficulties in healthcare IT projects (e.g. here), this is somewhat of a paradox, but that's the way it is.

Several years ago I took a position as Asst. Professor of Healthcare Informatics at Drexel University in Philadelphia, based in the College of Information Science and Technology. Drexel, an engineering school, had acquired the Hahnemann/Medical College of Pennsylvania medical school which was orphaned and nearly bankrupted as a result of the huge AHERF scandal of the late 1990's (Pittsbugh Post-Gazette newspaper article series on AHERF is at this link).

Unfortunately, the Hahnemann Hospital (where, ironically, I'd acquired my interests in both computing and medicine via NSF programs for high school students in the early 1970's) was not acquired by Drexel. It was acquired by Tenet, and has been having a hard time in the difficult Philadelphia medical market, which made applied informatics collaborations in the (private) hospital harder to organize.

As a result, to stay involved in applied informatics at the time I came to Drexel I sought an advisory role in the Drexel College of Medicine Faculty Practice Plan's (DUCOM FPP) EHR initiative, which was under the aegis of the university.

The DUCOM FPP desired an EHR for the usual reasons - improved efficiency, better care quality, reduction of errors, decreased costs, and so forth. The CIO of the DUCOM FPP was quite happy to have me as a consultant based on my informatics knowledge and experience as a CMIO at a nearby regional medical center, Medical Center of Delaware (now known as Christiana Care Health System) several years prior, although I did not hold an appointment at the College of Medicine itself. That is a story for another time. I started attending the DUCOM FPP EHR planning committee meetings, which were by invitation only.

Unfortunately, for a number of reasons of which I am not entirely aware, the CIO left the organization a few months later. There had been some issue with a crash of email that clinicians were quite bitter about and blamed, fairly or unfairly, on the CIO, although clearly more must have been going on. A new CIO was hired.

Even more unfortunately, the new CIO no longer invited me to the EHR implementation planning meetings. I asked on a number of occasions to attend, but invitations were not forthcoming. Having the attitude that when people do not seem to want my help, I respect their wishes, I put my involvement in the EHR project on the back burner.

Fast forward two years: the result is this multimillion dollar lawsuit by Drexel against the EHR vendor AllScripts and Allscript's partner Medicomp Systems, a "corporation specializing in the development of point-of-care tools for Electronic Medical Records ... to help overcome physician resistance to adoption." The Medicomp financials component of the EHR system was malfunctioning, requiring much manual labor to assure accuracy, prevention of billing mishaps, etc. - and negating the cost advantages of the EHR.

Here is a link to civil complaint in PDF for breach of contract. The E&M coder was incomplete and did not function properly, among other issues, resulting in major, unplanned increased costs, delays (to avoid just the situation linked to above), and clinician frustration and loss of confidence. The vendor was accused in the complaint of unresponsiveness. The suit went from local civil to federal court, and I do not know the outcome.
Ironically, I had experience with regard to this type of issue. The following story reflected my observations regarding a FPP billing system fiasco at Yale University a decade prior:

Insufficient IT Management Depth Results in Justice Dept. Investigation, Millions of Dollars in Fines

The billing system deficits in this case led to a Justice Department investigation, massive fines, and the scrapping of a multimillion dollar IT investment (although the story is 'anonymized', it drew on publically available sources such as the New Haven newspaper and other media reports, so there are no secrets being revealed here).

Perhaps this experience might have informed the acquisition and/or testing phase of the DUCOM FPP system ... perhaps not. I will never know, since my involvement within my own university was apparently deemed nonessential by the project leads.

Medical informatics is not a strategic priority at Drexel at this time. It may be a truism that without strategic prioritization, and with many other priorities competing for resources and faculty time, medical informatics will just "not happen" in any organization.

I am now seeking new applied medical informatics opportunities, although am remaining an adjunct in the College of Information Science and Technology, an excellent college with excellent people that I have found the antithesis of the toxic Ivy academic environment I'd experienced in the past. I will be writing about the sometimes surprising, annoying, or simply stunning experiences I am having in seeking to return to an applied medical informatics role, some of which have already proven worthy of study.

Here's a short one that is self-explanatory with regard to the issue of IT complexity and difficulty of use, sent to the CEO of this healthcare organization. The online eRecruiting system I encountered is so intrusive and time consuming, one wonders if anyone in this organization's HR department considered human factors, or has a clue as to what that phrase means.

To: tom.royer@christushealth.org
From: MedInformaticsMD
Date: 10/04/2007 11:17AM
Subject: Chief Medical Information Officer position

Dear Dr. Royer,

I am a medical informatics specialist and am the author of the well-known site on healthcare information technology difficulties at http://www.ischool.drexel.edu/faculty/ssilverstein/medinfo.htm . An electronic alert informed me of a posting for a Chief Medical Information Officer (CMIO) at Christus Health.

I am perhaps doing your organization a favor by informing you that your online application process is so intrusive (e.g., entry of a Social Security number into a faceless system of an unknown organization is mandatory) and so arduous (requiring the applicant to go through a multiple-step electronic building of a "resume" rather than submission of a document) that it simply discouraged me from applying. I am certain it will be found discouraging by others in this field as well.

As a clinical computing expert, I can only hope your EHR efforts pay more attention to interaction design and good first impressions.

-- SS

Three Rants Worth Reading

Some of our fellow bloggers have been inspired about issues important to the readers of Health Care Renewal.

On Retired Doc's Thoughts, Dr James Gaulte ranted about external threats to physicians' professionalism, concluding that many threats arise because most of the players in health care are playing with other peoples' money.

On the Clinical Psychology and Psychiatry Blog, the anonymous author ranted about how the academic peer-review system for assessing scholarly manuscripts, which grew up in an earlier and more honorable era (see above), is inadequate now when so much is written for publication by people who may be motivated by marketing as much as science.

On the Carlat Psychiatry Blog, Dr Daniel Carlat ranted about the small, but numerous conflicts of interest that physicians often accrue from their relationships with pharmaceutical sales representatives, and how they push physicians to believe that marketing equals education.

Bristol-Myers Squibb Settles, Enters "Corporate Integrity Agreement"

And here we go again. Reported first late last Friday afternoon, as these things often are, was the huge settlement made by pharmaceutical manufacturer Bristol-Myers Squibb. This story received surprisingly little coverage in the main stream media, although World News Tonight (ABC) lead with it. The most detailed print version was in the Boston Globe,

Bristol-Myers Squibb and a subsidiary have agreed to pay more than $515 million to settle civil suits over fraudulent drug marketing and pricing schemes, including illegally promoting an anti-psychotic drug to children and the elderly, US Attorney Michael J. Sullivan said yesterday.

The settlement between the federal government and Bristol-Myers Squibb and Apothecon Inc. is the third-largest between a pharmaceutical company and the US Attorney's Office in Massachusetts....

The company said it has ... entered into a five-year 'corporate integrity agreement' with the Office of the Inspector General of the Department of Health and Human Services that requires it to develop programs to ensure compliance with the law.

The most notable charges involved unethical marketing practices.

The agreement says Bristol-Myers Squibb gave kickbacks to physicians and healthcare providers from 2000 through mid-2003 to get them to prescribe the company's drugs. The kickbacks came in several forms, including consulting fees and trips to luxury resorts.

From 2002 through 2005, Bristol-Myers Squibb promoted the sale of Abilify, an anti-psychotic drug, for pediatric use and to treat dementia-related psychosis, both "off-label" uses, prosecutors said. The Food and Drug Administration has approved Abilify to treat adult schizophrenia and bipolar disorder but not for the uses marketed by Bristol-Myers Squibb.

Nonetheless, Bristol-Myers Squibb created a special longterm-care sales force that called on nursing homes and promoted off-label use of Abilify, prosecutors said.

A sales force also visited child psychiatrists and other pediatric specialists and urged them to prescribe Abilify.

There were also allegations of pricing hanky-panky.

Bristol-Myers Squibb participated in pricing schemes, including one involving its anti-depressant drug Serzone, that defrauded the Medicaid program, prosecutors said.

Bristol-Myers Squibb and Apothecon also inflated prices for a wide assortment of cancer-fighting and generic drugs, deceiving federal healthcare programs that established reimbursement rates based on those prices, prosecutors said.

Not surprisingly, the company wants to put it all behind it.

Bristol-Myers Squibb is pleased to have resolved these matters from the past and is proud of its commitment to conduct business with the highest standards of integrity in its mission to extend and enhance human life.

Critics of the industry were not impressed.

Dr. Jerome Kassirer, a professor at Tufts University School of Medicine and outspoken critic of drug companies, is skeptical.

'A lot of these companies, when they get sued for a few million dollars, they just consider it loose change,' he said. 'I haven't seen any let-up in what they're doing. Most of the time, when they're caught, they'll often say, 'It was a renegade, someone who wasn't following the instructions. Our policy says we shouldn't do that.' '

Similarly, Thomas M. Greene, a Boston lawyer representing one of the whistleblowers, said the allegations are serious because off-label use has the potential to harm patients.

'What happens when you promote a drug that is not effective?' he said. 'You're depriving sick people of some other effective treatment.'

As in the recent case involving orthopedic device manufacturers, (see post here), so far, despite the huge corporate fine, it is not clear that any individuals, either at the drug company, or physicians, will pay a penalty.

As we noted before, corporate payments of huge fines may not be much of a negative incentive to corporate executives because the impact of the fines can be spread across the entire organization. And such fines clearly have no direct effect on physicians, and will not discourage them from accepting "consulting fees and trips to luxury resorts" on behalf of drug marketers.

How many more examples like this do we as a society need before we conclude that there is a systemic problem with unethical behavior by leaders of health care organizations, and that we need a systemic solution to this problem that goes past civil lawsuits, corporate compliance monitoring, and deferred prosecution agreements?

ADDENDUM - See also comments on BrandweekNRX, and on the Wall Street Journal Health Blog.

Stryker, Biomet, DePuy Orthopedics, Zimmer, and Smith & Nephew Settle, Agree to Deferred Prosecution

It's fall, the season for settlements, deferred prosecution agreements, and federal monitors. Reported by numerous reporters was a large settlement made by five companies that manufacture orthopedic devices, Stryker Orthopedics (a unit of Stryker Inc), Biomet, DePuy Orthopaedics (a unit of Johnson & Johnson), Zimmer Holdings, and Smith & Nephew. As reported by Barnaby Feder in the New York Times,

Under the settlements, which were announced by the United States Attorney in Newark, N.J., the four companies were charged with criminal conspiracy to violate anti-kickback laws. But they will not be prosecuted if they follow new compliance procedures under federal monitoring for the next 18 months.

“This industry routinely violated anti-kickback statutes by paying physicians for the purpose of exclusively using their products,” said the Christopher J. Christie, the United States Attorney in Newark. “Prior to our investigation, many orthopedic surgeons in this country made decisions predicated on how much money they could make — choosing which device to implant by going to the highest bidder.”

A fifth big maker of orthopedic devices, Stryker Orthopedics, accepted federal supervision for the next 18 month. But was not subject to criminal charges because it was the first to cooperate in the investigation, according to the government.

The Times story made it clear that the major issue was payments the companies made to physicians.

Although no doctors were cited in the settlements, the investigation is continuing, Mr. Christie said.

The inquiry began in March 2005 when Mr. Christie’s office sent subpoenas to the companies, requesting documents related to their consulting and “professional service” agreements with doctors from 2002 on. Later, the inquiry expanded backward into relationships with doctors starting in the late 1990’s and included matters like the terms of research grants.

Relationships between orthopedics companies and their customers are among the most complicated — and potentially conflicted — in health care. Unlike with drugs, which are typically developed in company laboratories, many orthopedic devices and related tools originate from inventions by doctors, who often retain a financial stake in their market success.

Even when devices are invented by companies, they often are extensively modified during development in consultation with leading doctors, whom the device companies then turn to for help in commercializing the products and training other doctors to use them.

The costs of the devices are usually charged to a hospital or clinic rather than the surgeons, even though the surgeons have control over which are used. And while some orthopedic devices are highly specialized, others are mature products that vary little from company to company.

As a result, as surgeons select among devices, companies have strong incentive to court them with paid consulting agreements or other financial inducements.

Physicians swear oaths to put the interests of their patients ahead of all other concerns. For physicians to pick treatments based on how much the treatments' manufacturers pay the physicians is just plain wrong - unethical conduct by all parties concerned. Although whether the conduct is illegal is up to the courts, it seems to fit the definition of corruption found in Transparency International's 2006 Global Report on health care: "abuse of entrusted power for private gain."

One striking facet of this case is that it took federal prosecution, deferred prosecution agreements, and the imposition of federal monitors for the companies involved to reconsider what they were doing.

As David Dvorak, the President and CEO of Zimmer said, “Importantly, the resolution agreements clearly define how we and our key competitors will interact with physician collaborators, thereby establishing a standard of conduct across the industry." It seems that common sense would have indicated to both the physicians and the corporations that payments to physicians to induce them to use the corporations' products on their patients were unethical on their face.

Another striking facet of this case, like so many others, is that at least so far, no individuals have paid any penalties or suffered any adverse consequences. Corporate payments of huge fines may not be much of a negative incentive to corporate executives because the impact of the fines can be spread across the entire organization. And such fines clearly have no direct effect on physicians.

They may not even have an indirect effect if physicians never hear about them. Yet most cases like this barely if at all make it into the medical news, and never are discussed in the medical, health care, and healthy policy literature. Let's see if this one is.

The Transparency International 2006 report indicated how widespread health care corruption hurts patients, saps resources available for health care, and reduces access. Failure to appreciate that corruption is widespread and systemic in health care, even in the US and other developed countries, will let its bad effects continue.

BLOGSCAN - More Detailed Allegations About Intimidating an Avandia Whistle-Blower

On PharmaLot, this post adds some detail to previous allegations (which we most recently discussed here), that top executives, now including the top-most executive at GlaxoSmithKline tried to silence an academic physician who had doubts about the safety of rosiglitazone (Avandia). This is another reminder of the lack of transparency of the pseudo-market in pharmaceuticals. As we have said before, of course, intimidating people who blow the whistle about drug safety concerns is bad not only for the whistle-blowers, but for patients and doctors whose decisions about which treatments to give ought to be based on critical review of the best possible clinical evidence, not evidence that is filtered by secrecy and intimidation to only reflect vested interests of the makers of the treatments.

The Comparative Effectiveness Kerfuffle: An Argument for Restoring Control of Clinical Research to Doctors

Introduction: How to Make the Best Clinical Decisions?

Physicians spend a lot of time trying to figure out the best treatments for particular patients' problems. Doing so is often hard. In many situations, there are many plausible treatments, but the trick is picking the one most likely to do the most good and least harm for a particular patient. Ideally, this is where evidence based medicine comes in. But the biggest problem with using the EBM approach is that often the best available evidence does not help much. In particular, for many clinical problems, and for many sorts of patients, no one has ever done a good quality study that compares the plausible treatments for those problems and those patients. When the only studies done compared individual treatments to placebos, and when even those were restricted to narrow patient populations unlike those patient usually seen in daily practice, physicians are left juggling oranges, tomatoes, and carburetors.

Comparative effectiveness studies are simply studies that compare plausible treatments that could be used for patients with particular problems, and which are designed to be generalizable to the sorts of patients usually seen in practice. As a physician, I welcome such studies, because they may provide very useful information that could help me select the optimal treatments for individual patients.

Because I believe that comparative effectiveness studies could be very useful to improve patient care, it upsets me to see this particular kind of clinical study get caught in political, ideological, and economic battles.

The Comparative Effectiveness Kerfuffle

Therefore I have been dismayed to see the concept of comparative effectiveness studies get trashed in the main stream media. It is, of course, possible that some people are promoting comparative effectiveness studies for their own political, economic, or ideological reasons. And maybe such promotion deserves rebuttal. But just because some people may promote comparative effectiveness studies for the wrong reasons does not mean that such studies are a bad idea. In my humble opinion, as a physician, stifling such studies will stifle an opportunity to improve clinical decision making and improve patients' outcomes.

So when an op-ed piece in the Washington Times asserted that comparative effectiveness studies "can kill," and then based that argument on complete misunderstanding of several clinical issues and misinterpretation of clinical research studies, I felt that I should respond.

Rebutting the DrugWonks Rebuttal

Robert Goldberg, Vice President of the Center for Medicine in the Public Interest, has just rebutted my response, in a comment on my original post, and on his own blog, DrugWonks.com.

His reply, like his op-ed, seemed to be based on misunderstandings of the clinical context, and misinterpretation of the clinical research literature.

His first main point was:

1. You treat congestive heart failure with anti-hypertension drugs. Ask any doctor.

It is true that many drugs used to treat congestive heart failure (CHF) are also used to treat hypertension. These include diuretics, used to treat all forms of CHF, and angiotensin-converting enzyme inhibitors (ACEIs), beta-blockers, and angiotensin-receptor blockers (ARBs), used to treat CHF with systolic dysfunction (decreased pump function of the heart, as opposed to diastolic dysfunction, increased wall stiffness). But many drugs used to treat hypertension have not been demonstrated to benefit patients with CHF. For example, calcium-channel blockers have not been shown to be of benefit in CHF with systolic dysfunction.

Some treatments of CHF are not useful for hypertension, most notably digoxin and similar drugs, which seem to decrease symptoms and improve physical functioning (although they don't improve longevity) for CHF and systolic dysfunction.

In any case, just because some drugs work both for hypertension and for CHF does not mean that studies of the drugs of patients with one of these conditions provide results that can be extrapolated to patients with the other condition.

So Goldberg's sentence is at best partially true, but even so, is not relevant to the arguments he made in his original Washington Times op-ed.

Regarding his second sentence: 1 - I am a doctor, licensed in multiple states, and board-certified in Internal Medicine. 2 - I have written several research reports on CHF that were published in major journals. (1-3)

His second main point was:

I will refer you to the A-HeFT study and it's design which included BiDIl with OTHER anti-hypertensives to prolong survival from congestive heart failure.

I agree that the study compared BilDil, a fixed combination of isosorbide dinitrate and hydralazine, to placebo for CHF among African-American patients. Patients continued to take other CHF medications, including diuretics, ACEIs, ARBs, beta-blockers digoxin, and spironolactone.(4) But that is irrelevant to Goldberg's argument in his Washington Times article, which seemed to be based on the notion that BilDil should be used to treat hypertension, not CHF.

His third main point was to provide a quote, out-of-context and whose origin was unclear, attacking the ALLHAT study with adjectives and generalities. However, this quote does not support the specific criticisms of the ALLHAT study that Goldberg made in his Washington Times article. He asserted that patients were allowed to switch from the original assigned therapy only if they suffered a severe adverse effect, and that the primary result of the study was that diuretics were the most cost-effective drug. Both these assertions are not supported by the published reports of the ALLHAT study, as I discussed in detail in my previous post.

Goldberg concluded with a personal attack on me, one that is fairly ridiculous given my background and experience as briefly mentioned above. Goldberg also mounted a shrill attack on the comparative effectiveness movement, asserting that it arises from people "hating drug companies, "places the cost of drugs over the quality of human life," is based on hostility to "corporate capitalism," and is an example of "the end justifies the means."

Perhaps some people advocate comparative effectiveness research for these reasons. I certainly don't.

Summary: the Real Reason to Do Comparative Effectiveness Research

I advocate comparative effectiveness research because it has the potential to improve the decisions that us doctors make on behalf of patients, increasing the likelihood that patients will have good effects from treatment, and minimizing the possibility of side-effects.

If we allow clinical studies that realistically compare plausible therapies of conditions for various sorts of patients to become a political football, we will lose a major opportunity to improve patient care.

The current kerfuffle suggests it is time to return more control of medical research to physicians, who, after all, swore oaths to put the needs of patients ahead of other concerns, and let those with vested political, ideological, or economic interests argue over something else.

ADDENDUM (1 October, 2007) - On 27 September, I attempted to add comments on the DrugWonks.com post to which I referred above. As of today, those comments have not appeared.

Also, another post on DrugWonks.com on 27 September included "I guess taking money from organizations that switch people from one molocule to another without telling patients is okay for bloggers like Health Care Renewal." I have never, and I don't think any Health Care Renewal blogger has ever suggested they approve of switching patients without their (or their physicians') permission from one medication to another. Furthermore, a quick perusal of Health Care Renewal would indicate that we are as skeptical and critical of health care insurers and managed care organizations as we are of pharmaceutical companies, and we have been critical of conflicts of interest related to either type of company.

References

1. Poses, RM, Smith WR, McClish DK, Huber EC, Clemo FLW, Schmitt BP, Alexander-Forti D, Racht EM, Colenda CC, Centor RM. Physicians’ survival predictions for patients with acute congestive heart failure. Arch Int Med 1997;157:1001-1007.
2. Poses RM, McClish DK, Smith WR, Huber EC, Clemo FLW, Schmitt BP et al. Results of report cards for patients with congestive heart failure depend on the method used to adjust for severity. Ann Intern Med 2000;133:10-20.
3. Smith WR, Poses RM, McClish DK, Huber EC, Clemo FLW, Schmitt BP et al. Prognostic
judgments and triage decisions for patients with acute congestive heart failure. Chest 2002;121:1610-1617.
4. Taylor AL, Ziesche S, Yancey C et al. Combination of isosorbide dinitrate and hydralazine in blacks with heart failure. N Eng J Med 2004; 351: 2049-2057. Link here.

Haunted Health Care: the Scope of Ghost Management

An important new article in PLoS Medicine expanded thinking about the involvement of pharmaceutical companies (and possibly other health care corporations) in the shaping of clinical research. [Sismondo S. Ghost management: how much of the medical literature is shaped behind the scenes by industry? PLoS Med 4(9): e286 doi:10.1371/journal.pmed.0040286]

Sismondo defined ghost management of medical research and publishing:

when pharmaceutical companies and their agents control or shape multiple steps in the research, analysis, writing, and publication of articles. Such articles are 'ghostly' because signs of their actual production are largely invisible—academic authors whose names appear at the tops of ghost-managed articles give corporate research a veneer of independence and credibility. They are 'managed' because those companies shape the eventual message conveyed by the article or by a suite of articles.

Sismondo thus went beyond the issue of ghost-writing, the contribution of unnamed authors who may be influenced, or hired, by pharmaceutical companies or other organizations with vested interests. (See recent post here.) He also went beyond the issue of how pharmaceutical companies and other research sponsors may attempt to influence the design and implementation of research studies, the analysis of their results, and/or how the results are reported. (See this post.)

As Sismondo noted,

It has been repeatedly and firmly established that pharmaceutical company funding strongly biases published results in favor of the company's products. Ghost management amplifies that bias, because when one set of commercial interests exerts influence at multiple stages of research, writing, and publication, it will shape the resulting article. In turn, bias affects medical opinion and practice, and ultimately, patients.

Sismondo also attempted to estimate the prevalence of ghost management. This would have been predicted to be a difficult task, because,

it is not in the interests of writers, authors, or sponsors and their agents to reveal ghost management processes; hence a number of the published accounts of ghost management have stemmed from legal proceedings and investigative journalism.

So he set out to review existing evidence and find some new evidence.

First he noted the article by Healey and Cattall, based on documents produced during legal proceedings, that explained how Pfizer Inc ghost managed publications of multiple articles on the drug sertraline [Zoloft], producing 85 manuscripts, and accounting for an important part of the literature on this one drug. (See previous post here.)

An important contribution by Sismondo was what he called his "supply-side analysis."

A survey in 2001 identified 182 MECCs in the United States, up from 153 in 1998. A number specialize in producing, placing, and tracking journal articles, known in the trade as 'publication planning' or 'strategic communication planning.' While these firms hide details of their work—from potential critics and competitors—they also energetically promote themselves and their services.

I spent six hours searching web pages for MECCs offering publication planning or similar or overlapping services to the pharmaceutical industry, and found 23 (list available from the author). This is not an estimate of the number of such firms, but indicates how common they are. There may be many more firms providing publication planning, including some not uncovered in this search, and some not advertising these services on the Internet.

In a primer on publication planning, the director of one MECC defines the activity as: 'gaining product adoption and usage through the systematic, planned dissemination of key messages and data to appropriate target audiences at the optimum time using the most effective communication channels'.

Complete Healthcare Communications (CHC) claims on its banner that it 'has honed the systems and skills needed to develop the intellectual heart of pharmaceutical marketing—the publication plan. The result for your product? A continuum of awareness, interest, and prescriber confidence.'

CHC includes among its clients Pfizer, Sanofi-Aventis, Ortho Biotech, Wyeth, Schering-Plough, Shire, AstraZeneca, and other pharmaceutical companies.

Other agencies offer very similar services. As described in an article by three of its managers, the Medical Knowledge Group starts publication planning with a phase of exploring 'key messages' and 'author/journal options' before designing any publications to incorporate those messages

Another MECC, Envision Pharma, says that 'data generated from clinical trials programs are the most powerful marketing tools available to a pharmaceutical company.' Envision will work from early on in the process to ensure 'consistent message dissemination,' will plan and track the 'data dissemination plan,' and will produce 'scientifically accurate, commercially focused abstracts, posters, and primary and secondary publications'

Several of the publication planning firms identified are owned by major publishing houses. For example, Excerpta Medica is 'an Elsevier business' and writes that its 'relationship with Elsevier allows… access to editors and editorial boards who provide professional advice and deep opinion leader networks.'

Wolters Kluwer Health draws attention to its publisher Lippincott Williams & Wilkins, with 'nearly 275 periodicals and 1,500 books in more than 100 disciplines,' and to Ovid and its other medical information providers, emphasizing the links it can make between its different arms

Vertical integration is attractive in the industry as a whole: at least three of the world's largest advertising agencies own not only MECCs, but also CROs.

Ghost management of medical journal publications is clearly a substantial business, employing thousands of marketers, writers, and managers. It is large enough that the industry has established the International Publication Planning Association.

The conclusion is that

Given the amount of data that pharmaceutical companies control, the number of publication planning agencies that openly advertise on the Internet, the number of medical writers, the existence of two associations for publication planners, and meetings organized and reports written for them, we can conclude that ghost management is common.

Why is it so important?

Articles in medical journals have real effects upon physician prescribing behavior, which is why pharmaceutical companies invest so much in their publication. Journal articles are heavily used in detailing, to validate claims and rebut worries. Even independent of detailers, responsible physicians and medical researchers search the literature to gather evidence about the best treatments. Published scientific articles are the sources of medical information with the highest authority. Systematic reviews and meta-analyses almost all start with the published literature—so even fully independent reviews are influenced by ghostly activities.

It is clear that ghost management is a major part of the production of pseudoevidence-based medicine.

Sismondo's article is an important contribution to our knowledge of how research on human beings is manipulated into marketing and propaganda, if not outright disinformation. Such practices break the trust of research subjects who thought they were participating to advance science and medical care. Such practices mock physicians who think they are trying to make decisions based on clinical science. Such practices can harm patients who are subjected to tests and treatments based on hype and manipulation rather than unbiased data.

Sismondo ended with some suggestions for alleviating the problem, but noted,

There are no straightforward solutions, short of large changes to the nature of medical publishing and/or research, changes that would effectively sequester pharmaceutical company funding from research and publishing....

We have now said frequently that there are many reasons to think about whether organizations who have a vested interest having clinical research produce particular results should be banned from funding or other involvement in research on human beings. The probably pervasive practice of ghost management is another strong reason to consider this seemingly extreme step.

In the absence of such a drastic prohibition, all I could suggest is a much strengthened and more comprehensive disclosure policy. Many would now agree that all clinical trials should be registered. Such registration should include details of any involvement of pharmaceutical, biotechnology, device and similar companies in the design and implementation of the research, and the analysis and reporting of its results. Any involvement by contract research organizations, for-profit institutional review boards, medical education and communication companies, and the like should be disclosed in trial registration.

Furthermore, there should be full disclosure of all involvement by any of these organizations accompanying any publication or presentation of study results, including publications in peer-reviewed journals, abstract presentations, etc.

Furthermore, the penalties for concealing involvement of any of these organizations should be severe, all the way up to considering failing to disclose as potential criminal fraud.

Allowing ghost management to continue victimizes people who volunteer to participate in research, mocks physicians who try to base their clinical decisions on the best available evidence, and hurts patients.

Hat tip to the Medical Humanities Blog, and one of our corps of Health Care Renewal scouts.

BLOGSCAN - Review of Fixing American Healthcare

On the Health Business Blog, this post by David Williams favorably reviews the just published book by Richard N. Fogoros, Fixing American Healthcare; Wonkonians, Gekkonians and the Grand Unification Theory of Healthcare. Fogoros blogs on the Covert Rationing Blog.

Banning Logo Coffee-Mugs, Soliciting $5 Million Donations

A story from the Connecticut Business Journal suggests the extent that medical schools now seek money from for-profit health care corporations.

The Yale School of Medicine has mounted an aggressive fundraising campaign targeting drug makers, according to internal university documents recently reviewed by Business New Haven.

The documents, part of a confidential briefing for School of Medicine Dean Robert Alpern, outline an effort to raise more than $40 million in philanthropic dollars through 2008 from pharmaceutical companies.

Fund-raising efforts involving specific pharmaceutical companies included,

• "a suggestion to send Yale President Richard C. Levin to Germany to meet with Bayer Pharmaceutical's president to help secure $5 million in funding for the new Yale Cancer Center."
• "Merck & Co., under fire in recent years in the Vioxx scandal, is targeted for a $5 million appeal for the Yale Mouse Phenotyping Center, Yale officials confirmed. "
• "Yale has a particularly close relationship with Pfizer, which opened a clinical research facility adjacent to the university in 2005. Pfizer and the university also collaborated on the Yale Positron Emission Tomography Center, which opened earlier this year with help from a $5 million gift from the drug maker and a pledge of $2 million a year in research funding. "

The size of the total fund-raising effort is notable.

Corporate and foundation donations make up about 25 percent of Yale's annual fundraising take, [Vice President for Development Inge] Reichenbach says, with the rest coming from alumni donations. The pharmaceutical company push is part of a larger five-year effort, which includes a $100 million campaign for the Yale Cancer Center.

Reichenbach says that development officials often highlight links between ongoing research and a company's interests. Pharmaceutical companies have a natural stake in medical research and fund efforts on all levels at many schools, she adds.

'Basically we are making matches. That's what we do, we provide matches of interest,' Reichenbach says. 'When you have a medical school, it's a pretty obvious match.'

While Yale drums up such corporate funding, it has cracked down on relatively small transactions between individual faculty and commercial health care organizations.

Yale has in fact been at the forefront of cracking down on drug company efforts to influence individual researchers and clinicians, says David Rothman, a professor of social medicine at Columbia University and associate director of the Prescription Project, an effort to limit conflicts of interest in academic medicine.

A former Yale professor serves on the Prescription Project's advisory committee and drafted a series of cutting-edge guidelines for Yale on 'impeccable financial relationships between the pharmaceutical industry and physicians.' The guidelines restrict doctors' access to free meals and samples offered by companies.

There seems to be a striking contrast between how Yale addresses possible conflicts of interest affecting individual faculty, and how it addresses institutional conflicts of interest.

Yale has guidelines and an internal committee that probes for conflict of interest in research, says Stephanie Spangler, deputy provost for biomedical and health affairs. Any research funded by corporations is governed by strict set of rules and subject to peer review.

Much of Yale's formal ethics rules govern doctors and their interactions with pharmaceutical company representatives, long known for handing out free gifts and meals in an attempt to influence prescription-writing habits.

"We work very hard at an institutional level to make sure that any institutional relationships we have don't reach the individual clinician," Spangler says.

But there are no ethical guidelines in place regarding philanthropic gifts and their effects on research priorities. 'There's a spectrum of outside interests,' Spangler says. 'There aren't bright lines and hard and fast rules.'

That struck one external observer, Merrill Goozner, as hypocritical.

'Yale has put itself up for sale,' says Merrill Goozner, director of the Integrity in Science project at the Center for Science in the Public Interest in Washington, D.C. 'That's a fairly sad day for academic medicine.'

'The reality is that pharmaceutical company influence over the nation's medical schools is pervasive and unfortunate because it's skewing research,' Goozner says. 'You would think that medicals schools would take greater precautions, that they would draw a bright line.'

Even Rothman conceives that there is room for improvement.

Rothman of the Prescription Project says it may be time for the focus of concern over drug company influence to shift from individual doctors and researchers to universities as a whole.

'Is it an important issue? Absolutely. Is a frontier issue? Absolutely,' Rothman says. 'This kind of material compels us to go up one notch and start thinking long and hard about institutional conflict of interest.'

We have noted before that academic institutions which seem to be willing to ban financially small conflicts of interest affecting students and faculty seem unwilling to address larger conflicts affecting top leaders and the institution as a whole. Obviously, it is easier for leaders to tell their medical students not to accept coffee mugs or pizza from pharmaceutical company x than to themselves forego lucrative consulting agreements, or memberships in speakers bureaus or even boards of directors.

The temptation of corporate largesse is that it allows the leadership to continue to live in the style to which they have become accustomed. But if leaders are really worried how much a coffee mug may influence how a medical student thinks, they should be much more worried how much a $5 million donation may influence how they themselves think.

Fixing Students Grades at UMDNJ

Here we go again. We have done a long series of posts about the troubles at the University of Medicine and Dentistry of New Jersey (UMDNJ), the largest US health care university.

The university now is operating under a federal deferred prosecution agreement under the supervision of a federal monitor (see most recent posts here, here, here, here and here.) We had previously discussed allegations that UMDNJ had offered no-bid contracts, at times requiring no work, to the politically connected; had paid for lobbyists and made political contributions, even though UMDNJ is a state institution; and seemed to be run by political bosses rather than health care professionals. (See posts here, and here, with links to previous posts.) A recent development (see post here with links to previous posts) was that UMDNJ apparently gave paid part-time faculty positions to some community cardiologists in exchange for their referrals to the University's cardiac surgery program, but not in exchange for any major academic responsibilities. Another was some amazingly wasteful decisions by UMDNJ managers leading to spending millions of dollars for real-estate that now stands vacant (see post here). Another was the indictment of a powerful NJ politician for getting a no-work job in the system, and the indictment of the former dean of the university's osteopathic medicine school for giving him the job (see post here). Most recently, we found out that UMDNJ had named one of its teaching hospitals for a pharmaceutical company in 2001 (see post here).

The very latest story comes to us courtesy of the Newark Star-Ledger,

Paul Mehne was a popular dean on the Camden campus of the state’s medical school, well-liked by the small cadre of students there who felt their satellite program in South Jersey was something special.

What troubled investigators, however, is that none of his students ever seemed to fail. A new report by a federal monitor, scheduled to be released tomorrow, concludes that Mehne doctored the grades of several medical school students, including some now practicing medicine, giving passing test scores to those who came up short on exams needed to begin specialty rotations.

Mehne, 59, associate dean for academic and student affairs who headed the University of Medicine and Dentistry of New Jersey’s Camden campus, was abruptly relieved of his duties three months ago without explanation just weeks before he was scheduled to retire.

In the report, the monitor said some students at Camden were the beneficiaries of what it called 'unethical and inappropriate' activities related to grading.

The report said all grades were first sent to Mehne before being submitted to the registrar. The monitor said Mehne also coerced the directors of medical clerkships - the special rotations taken by third- and fourth-year medical students in areas such as obstetrics or family medicine - to award passing grades to students who did not pass standardized tests.

n one case cited in the monitor’s report, the source said an unidentified student who had failed an exam upon completing a specialty rotation was never retested. The report said Mehne instructed the clerkship director to change the student’s grade on two separate occasions.

According to the sources, no Camden students were brought up before the Academic Standing Committee for grade failures while Mehne was dean, until the monitor began his investigation.

This is a different kind of unethical behavior than that found previously at UMDNJ.

The lesson seems to be that mismanagement and unethical leadership at the top allows all sorts of mischief to flourish among the middle management.

[I must disclose that my first faculty position was at the UMDNJ Camden campus, which I left in 1987.]

ADDENDUM - See also comments on Phi Beta Cons here.

A Web of Deception Ensnares US Nursing Homes

The New York Times just published a report of some important investigative reporting about changes in how US nursing homes are currently managed, or mismanaged, leading to bad effects on patients' outcomes and safety. As an example, the report recounted the case of an elderly women who died in the Habana Health Center in Tampa, FL. The article made a series of key points,

• The homes were acquired by private equity companies not usually associated with health care.
• The companies drastically cut the costs of their acquisitions.
• These cost cuts decreased care, apparently leading to poor outcomes.
• The private equity companies set up complex corporate structures for their acquisitions, hiding their ownership, and thwarting lawsuits and regulation.

I have summarized supporting quotes for each point below.

Acquisition by Private Equity Companies

The changes seem to stem from the acquisition of many nursing homes and nursing home chains by "large Wall Street investment companies .... Those investors include prominent private equity firms like Warburg Pincus and the Carlyle Group, better known for buying companies like Dunkin’ Donuts. As such investors have acquired nursing homes, they have often reduced costs, increased profits and quickly resold facilities for significant gains."

The acquisitions involved were substantial. "But in recent years, large private investment groups have agreed to buy 6 of the nation’s 10 largest nursing home chains, containing over 141,000 beds, or 9 percent of the nation’s total. Private investment groups own at least another 60,000 beds at smaller chains and are expected to acquire many more companies as firms come under shareholder pressure to sell."

Drastic Cost Cutting

The major manifestations of mismanagement seem to be drastic cost cutting.

'The first thing owners do is lay off nurses and other staff that are essential to keeping patients safe,' said Charlene Harrington, a professor at the University of California in San Francisco who studies nursing homes. In her opinion, she added, 'chains have made a lot of money by cutting nurses, but it’s at the cost of human lives.'

The Times’s analysis of records collected by the Centers for Medicare and Medicaid Services reveals that at 60 percent of homes bought by large private equity groups from 2000 to 2006, managers have cut the number of clinical registered nurses, sometimes far below levels required by law. (At 19 percent of those homes, staffing has remained relatively constant, though often below national averages. At 21 percent, staffing rose significantly, though even those homes were typically below national averages.) During that period, staffing at many of the nation’s other homes has fallen much less or grown.

Nurses are often residents’ primary medical providers. In 2002, the Department of Health and Human Services said most nursing home residents needed at least 1.3 hours of care a day from a registered or licensed practical nurse. The average home was close to meeting that standard last year, according to data.

But homes owned by large investment companies typically provided only one hour of care a day, according to The Times’s analysis of records collected by the Centers for Medicare and Medicaid Services.

For the most highly trained nurses, staffing was particularly low: Homes owned by large private investment firms provided one clinical registered nurse for every 20 residents, 35 percent below the national average, the analysis showed.

Poor Patient Outcomes

In turn, such cost cutting was associated with poor outcomes.

The typical nursing home acquired by a large investment company before 2006 scored worse than national rates in 12 of 14 indicators that regulators use to track ailments of long-term residents. Those ailments include bedsores and easily preventable infections, as well as the need to be restrained. Before they were acquired by private investors, many of those homes scored at or above national averages in similar measurements.

In addition,

Regulators with state and federal health care agencies have cited those staffing deficiencies alongside some cases where residents died from accidental suffocations, injuries or other medical emergencies.

Federal and state regulators also said in interviews that such cuts help explain why serious quality-of-care deficiencies — like moldy food and the restraining of residents for long periods or the administration of wrong medications — rose at every large nursing home chain after it was acquired by a private investment group from 2000 to 2006, even as citations declined at many other homes and chains.

The typical number of serious health deficiencies cited by regulators last year was almost 19 percent higher at homes owned by large investment companies than the national average, according to analysis of Centers for Medicare and Medicaid Services records.

In the case of Habana Health Center,

Habana’s managers increased occupancy, and cut expenses by laying off about 10 of 30 clinical administrators and nurses, Medicare filings reveal. (After regulators complained, some positions were refilled and other spending increased.) Soon, Medicare regulators cited Habana for malfunctioning fire doors and moldy air vents.

'Those owners wouldn’t let us hire people,' said Annie Thornton, who became interim director of nursing around the time Habana was acquired, and who left about a year later. 'We told the higher-ups we needed more staffing, but they said we should make do.'

Regulators typically visit nursing homes about once a year. But in the 12 months after Formation’s acquisition of Habana, they visited an average of once a month, often in response to residents’ complaints. The home was cited for failing to follow doctors’ orders, cutting staff below legal minimums, blocking emergency exits, storing food in unhygienic areas and other health violations.

Soon after, nursing home inspectors wrote in Centers for Medicare and Medicaid Services documents that Habana was at fault when a resident suffocated because his tracheotomy tube became clogged. Although he had complained of shortness of breath, there were no records showing that staff had checked on him for almost two days.

Five months later, Mrs. Hewitt discovered that her mother had a large bedsore on her back that was oozing pus. Mrs. Garcia was rushed to the hospital. A physician later said the wound should have been detected much earlier, according to medical records submitted as part of a lawsuit Mrs. Hewitt filed in a Florida Circuit Court.

Three weeks later, Mrs. Garcia died.

Complex, Opaque Corporate Structures

Particularly fascinating and disturbing was the evidence that the nursing homes' managers evaded regulation, and legal responsibility for what they were doing by creating immensely complicated and opaque corporate structures.

Private investment companies have made it very difficult for plaintiffs to succeed in court and for regulators to levy chainwide fines by creating complex corporate structures that obscure who controls their nursing homes.

By contrast, publicly owned nursing home chains are essentially required to disclose who controls their facilities in securities filings and other regulatory documents.

The Byzantine structures established at homes owned by private investment firms also make it harder for regulators to know if one company is responsible for multiple centers. And the structures help managers bypass rules that require them to report when they, in effect, pay themselves from programs like Medicare and Medicaid.

For example,

Formation bought Habana, 48 other nursing homes and four assisted living centers from Beverly Enterprises, one of the nation’s largest chains, for $165 million.

Formation immediately leased many of the homes, including Habana, to an affiliate of Warburg Pincus. That firm spread management of the homes among dozens of other corporations, according to documents filed with Florida agencies and depositions from lawsuits.

Each home was operated by a separate company. Other companies helped choose staff, keep the books and negotiate for equipment and supplies. Some companies had no employees or offices, which let executives file regulatory documents without revealing their other corporate affiliations.

Current staff members at Habana declined to comment. Formation Properties I said it owned only Habana’s real estate and leased it to an independent company, and thus bore no responsibility for resident care.

That independent company — Florida Health Care Properties, which eventually became Epsilon Health Care Properties and subleased the home’s operation to Tampa Health Care Associates — is affiliated with Warburg Pincus, one of the world’s largest private equity firms. Warburg Pincus, Florida Health Care, Epsilon and Tampa Health Care all declined to comment.

The example of Habana Health Center showed how the complex and opaque corporate structures thwarted regulators.

Those [government] citations never mentioned Formation, Warburg Pincus or its affiliates. Warburg Pincus and its affiliates declined to discuss the citations. Formation said it was merely a landlord.

'Formation Properties owns real estate and leases it to an unaffiliated third party that obtains a license to operate it as a health care facility,' Formation said. 'No citation would mention Formation Properties since it has no involvement or control over the operations at the facility or any entity that is involved in such operations.'

Florida’s Agency for Health Care Administration has named Habana and 34 other homes owned by Formation and operated by affiliates of Warburg Pincus as among the state’s worst in categories like 'nutrition and hydration,' 'restraints and abuse' and 'quality of care.' Those homes have been individually cited for violations of safety codes, but there have been no chainwide investigations or fines, because regulators were unaware that all the facilities were owned and operated by a common group, said Molly McKinstry, bureau chief for long-term-care services at Florida’s Agency for Health Care Administration.

And even when regulators do issue fines to investor-owned homes, they have found penalties difficult to collect.

'These companies leave the nursing home licensee with no assets, and so there is nothing to take,' said Scott Johnson, special assistant attorney general of Mississippi.

Complex corporate structures also enable nursing home management to evade scrutiny of what they charge.

Government programs require nursing homes to reveal when they pay affiliates so that such disbursements can be scrutinized to make sure they are not artificially inflated.

'The government tries to make sure homes are paying a fair market value for things like rent and consulting and supplies,' said John Villegas-Grubbs, a Medicaid expert who has developed payment systems for several states. 'But when home owners pay themselves without revealing it, they can pad their bills. It’s not feasible to expect regulators to catch that unless they have transparency on ownership structures.'

In the case of Habana Health Center,

For example, Habana, operated by a Warburg Pincus affiliate, paid other Warburg Pincus affiliates an estimated $558,000 for management advice and other services last year, according to reports the home filed.

However, complex corporate structures make such scrutiny difficult. Regulators did not know that so many of Habana’s payments went to companies affiliated with Warburg Pincus.

Summary

We see some very familiar themes in this sorry tale.

Health care is increasingly dominated by large organizations. In this case, some of these organizations are not usually identified with health care, and the identity of other organizations is secret.

The leadership of many health care organizations will put their financial self-interest ahead of patients' interests.

The leadership of many health care organizations will hide what they are doing, evade responsibility, and thwart accountability by deliberate complexity and outright deception.

Until the leadership of health care organizations becomes more transparent and accountable, things are likely to continue to go downhill.

Once again, "sunlight is the best disinfectant."