There They Go Again - Pfizer CEO Compensation Triples, Ordinary Employees' Severance Cut

In mid-March, Pfizer, which used to proclaim itself to be the world's largest research-based pharmaceutical company, announced in a regulatory filing a huge increase in total compensation for its relatively new CEO.  Per the AP, via the Wall Street Journal:

Pfizer Inc. nearly tripled CEO Ian Read's compensation in 2011, his first full year as top executive of the world's largest drugmaker, which has been cutting costs and making other moves to compensate for generic competition hurting sales of top medicines.

Read, 58, received compensation worth a total of $18.12 million in 2011, up from $6.42 million in 2010, according to an Associated Press analysis of a regulatory filing Thursday by the maker of Viagra and cholesterol fighter Lipitor.

The total includes a salary of $1.7 million, up 42 percent, stock awards and option awards totaling about $12.5 million, a $3.5 million incentive award and about $319,000 in other compensation. The last category ranges from use of company aircraft and a car and driver to contributions to Read's retirement savings.

Contrast: Decreasing Research and Development Spending, Facilities, Employment

Mr Read seems to have been rewarded for decreasing the scope of research and cutting research spending:

Over the past year, Read has narrowed the focus of Pfizer's huge research operations to diseases with big sales potential or few existing treatment options, trimming the research budget significantly in the process.

Reuters noted that involved sweeping layoffs and the closure of multiple research facilities:

Pfizer said it had improved its performance during 2011 by reducing research spending by nearly $1 billion. That feat came, however, at the expense of thousands of Pfizer researchers, whose jobs are being eliminated along with numerous laboratories in an effort to ultimately slash Pfizer research spending by up to $2 billion a year.

Contrast: Long-Term Shareholder Value

Read traded research capacity, and presumably the long-term value of the company, for an immediate boost in the stock price,

Pfizer, under Read, has narrowed its focus to five main therapeutic areas and is considering either selling or spinning off its nutritional products and animal health units.

Proceeds from the transactions will likely be used to buy back company shares, Read has said, delighting investors and helping boost company shares almost 27 percent in the past twelve months.

On the other hand, a quick look at Google Finance reveals that while the stock price is higher than it has been since 2009, it is roughly half of what it was from the late 1990s until 2004.

On its web-site, the company still proclaims, however,

we at Pfizer are committed to applying science and our global resources to improve health and well-being at every stage of life.

Contrast: Treatment of Other Employees

Note that Mr Read is an employee of Pfizer, albeit its most highly paid employee by a huge margin.

Other employees are not being treated so well. The massive increase in CEO compensation should also be contrasted with the company's new severance policies, as explained in an article from last week in The (New London, CT) Day,

Pfizer Inc. personnel being laid off at the company's Groton laboratories after May 14 will receive less money than previous waves of departing workers have received.

Pfizer, at the tail end of a planned 1,100 layoffs locally, said in a memo released last week that in the future people leaving the company will receive eight weeks of severance in addition to two weeks for every year served with the company. The pharmaceutical giant had previously offered at least 12 weeks of severance to employees, and before acquiring Wyeth Pharmaceuticals in 2009 had handed out three weeks of pay for every year served.

Summary

While Pfizer recently has made an amazing series of ethical missteps (look here), a decreasing drug pipeline, lost half of its stock price since its peak, and decreased its ability to develop new products, it has quickly returned to its previous ways of making its top hired executives very rich. (No matter, by the way, that Mr Read ought to bear some responsibility for the company's previous problems, since as the AP pointed out, he "has spent his entire career at the New York-based drugmaker, became Pfizer's CEO in December 2010 after running its worldwide pharmaceutical business since 2006.")

This is just the latest of many, many examples of how top hired executives of health care organizations are not like you and me. Whatever is happening to their organization, whatever its faithfulness to its mission, its performance, its value, its treatment of employees in general, many CEOs just get to take more and more off the top. Given this perverse incentive structure, is there really any question why most health care organizations do not always seem to put patients' or the public's health, or health care professionals' values, or their employees' welfare, or even their owners' financial interests (when they are publicly held for-profit corporations) first?  Or why health care costs steadily increase while quality and access decrease?
Repeat after me - we will never solve the problem of health care dysfunction until we assure that the leaders of health care organizations are well-informed about the context of health care, uphold health care professionals' values, put patients' and the public's health first, are accountable and transparent, and receive reasonable incentives based on all the above.

The Pittsburgh Experiment - II - Another Echo of the Fall of AHERF

We recently started a series of posts about the battle for domination of health care in western Pennsylvania.  The contenders are the UPMC hospital system, the dominant hospital system in the region, and Highmark, the dominant health insurer in the region.  While these two health care behemoths fight, patients, health care professionals, and the public seem to be caught in the crossfire.

There is something of history repeating itself in this battle.

The biggest bone of contention in it is Highmark's attempt to purchase the struggling West Penn Allegheny hospital system.  UPMC leadership seemed to feel that this would put the insurer in direct competition with it, even though UPMC already provides a health insurance product, the UPMC Health Plan.

West Penn Allegheny, in turn, is struggling because it is a remnant of a previous attempt by a single organization to dominate the health care system in this area.  As we wrote in 2011,  West Penn Allegheny was formed from some components of what used to the be the Allegheny Health Education and Research Foundation, AHERF.   AHERF was a large integrated health care system formed out of multiple mergers.  AHERF went bankrupt in 1998, leading to massive layoffs, hospital closures, and the near dissolution of a medical school (which ended up taken over by Drexel University).

As we noted in 2008, although the AHERF bankruptcy appears to be the largest failure of a not-for-profit health care corporation in US history, its story has produced remarkably few echoes for doctors, other health care professionals, health care researchers, and health policy makers. I often use the fall of AHERF as major example in talks, at least the few talks I am allowed to give on such unpleasant subjects. Rarely have more than a few people in the audience heard of AHERF prior to my discussion of it. I only could locate one article in a medical or health care journal that discussed the case in detail, albeit incompletely since it was written before Abdelhak's guilty plea [Burns LR, Cacciamani J, Clement J, Aquino W. The fall of the house of AHERF: the Allegheny bankruptcy. Health Aff (Millwood) 2000; 19: 7-41.] I doubt the case is used for teaching in most medical or public health schools. (There is a new book out about the case, Merger Games, by Judith Swazey, available here as  a set of PDF files from Project Muse for those with the proper password, but it has not yet had much of an impact, and I confess I have not yet read it.)  The lack of discussion of such a significant case is a prime example of the anechoic effect.

Therefore, let me summarize some of important points about AHERF not found above (see also this narrative, starting on page 5):

• AHERF, one of the largest health care systems of its day, was built by the poster-boy for health care imperial CEOs, Sherif Abdelhak.
• Abdelhak, who started as food services purchasing manager at Allegeheny General Hospital, was repeatedly hailed as a "visionary" (in the March, 1997, ACP Observer) a "genius," and the like. His plans to create a huge integrated health care system were part of the wave of the future. Abdelhak was even invited to give the prestigious John D Cooper lecture at the annual meeting of the American Association of Medical Colleges (AAMC), which was published in Academic Medicine [Abdelhak SS. How one academic health center is successfully facing the future. Acad Med 1996; 71: 329-336.] He proclaimed that "we will need to create new forms of organization that are more flexible, more adaptive, and more agile than ever before." And he announced that "my aim as chief executive has been to unleash the creativity and productive potential of every individual and to provide an environment that encourages teamwork"
• While Abdelhak was making these grandiose promises, he paid himself and his associates very well. For example, he received $1.2 million in the mid-1990s, more than three times the average then for a hospital system CEO. He lived in a hospital supplied mansion worth almost $900,000 in 1989. Five of AHERF's top executives were in the top 10 best paid hospital executives in Philadelphia.
• Although Abdelhak talked of teamwork, he warned the combined faculty of the new Allegheny University of the Health Sciences (AUHS): "Don’t cross me or you will live to regret it."
• As AHERF was hemorrhaging money, Abdelhak continued to pay himself and his cronies lavishly.
• After the AHERF bankruptcy, which was at the time the second largest bankruptcy recorded in the US, Abdelhak was charged with numerous felonies involving receiving charitable assets. In a plea bargain, he pleaded no contest to misusing charitable funds, a misdemeanor, and was sentenced to more than 11 months in county prison.

The story of AHERF is not merely that of an unlucky bankruptcy. It shows what can go wrong when health care adopts business practices such as jumping the latest management band-wagons and genuflecting before imperial CEOs.  It also shows what happens when a single health care organization, and the person who leads it, becomes too powerful.

If either UPMC or Highmark definitively wins their current battle, the winner will become at least as locally dominant as AHERF.  As we shall see in the posts to come in this series, the leadership of both organizations has already demonstrated a certain arrogance.  Yet since 2008 we have not progressed to the point of controlling the tendency of a laissez faire health care system to approach monopoly, nor the monopolist's tendency to put his self-interest ahead of all else. 

If nothing else, maybe the messiness of the fight between UPMC and Highmark will remind more people of AHERF, hence the need not to let our health care leadership and governance problems remain anechoic, hence the need for true health care reform that would constrain health care leaders to put patients' and the public's health before their narrow self-interest. 

The Pittsburgh Experiment - I - Caught in the Crossfire

In our increasingly dysfunctional health care system, patients, health care professionals and the public are often caught in the crossfire between big health care organizations.  Such organizations are often led by people who do not seem to put the interests of patients and the public, and the values of professionals first.  (Note that we have been writing about this since at least 2003, when the concept appeared in my article: Poses RM. A cautionary tale: the dysfunction of the American health care system. Eur J Int Med 2003; 14: 123-130. Link here.)

Last week, Anna Wilde Matthews and John W Miller wrote in the Wall Street Journal about an amazing example of such a crossfire that pitted the two dominant health care organizations in Western Pennsylvania against each other.  The case turns out to touch on many of the most dysfunctional aspects of US health care.  So rather than try to cram it into an overly long blog post, I plan to periodically discuss it over the next few weeks, starting now with an overview of the grappling titans.

The Basic Conflict

Per the Wall Street Journal article,

In Pittsburgh, the acrimonious battle between Highmark, the region's most powerful health insurer, and UPMC, the dominant health-care provider, is drawing national attention as a test case on the impact of consolidation in the health-care industry.

At the heart of the dispute is Highmark's effort to acquire a financially troubled local hospital group, West Penn Allegheny Health System, as the centerpiece of what it says will be a lower-cost and more efficient health-care operation. UPMC, which has its own insurance arm as well as 19 area hospitals and 3,240 doctors, says it doesn't want to bolster a company it now considers a direct rival. It has vowed not to sign a new contract to treat patients covered by Highmark, which would mean those patients generally would pay high out-of-network rates to use UPMC hospitals and doctors.

As we will see, the dispute is between a dominant hospital system that is trying to muscle into the insurance business, and a dominant insurer that is trying to muscle into the hospital business. If either were to succeed, it would become the dominant health care organization in the Pittsburgh area.

A Personal Fight Amongst Two CEOs

However, the fight soon seemed to be more among the CEOs of the two organizations. Per the WSJ,

In Pittsburgh, the battle has become unusually bitter, spearheaded by the two companies' chief executives, UPMC's Jeffrey A. Romoff, 66, and Highmark's Kenneth Melani, 58. Mr. Romoff, who has built UPMC into a $9 billion juggernaut and put its initials on the tallest skyscraper in the city, calls Highmark a 'monopoly.' Dr. Melani uses the same term in warnings about UPMC's power and referred to Mr. Romoff in a local newspaper as 'trying to rape the commercial marketplace to build his empire.'  (A spokesman for Mr. Romoff said the comment 'lacked both substance and dignity.')

An article from December, 2011 in the Pittsburgh Tribune-Review had illustrated other aspects of the bitterness about and between the CEOs.

UPMC CEO Jeffrey Romoff's satiric, fake Twitter profile lists his favorite games as Monopoly and Risk.

In recent tweets, the anonymous author wrote under his name, 'New York State, here we come!' and said he wants to take Highmark CEO Dr. Kenneth Melani 'outside to settle things -- but it would be unfair competition if (we) could BOTH use our fists.'

The month-old Fake Jeffrey Romoff persona, whose author declined to be interviewed but said it's 'no laughing matter,' depicts the head of Western Pennsylvania's dominant health care system as a greedy tyrant with an angry avatar. It counts fewer than 40 followers, but its existence points to a public relations failure for UPMC in its fight with Highmark Inc., media experts say.

'Nobody feels sorry for Romoff,' said Andrea Fitting, president of Downtown marketing firm Fitting Group. 'If you ask anyone on the street, they'll say Romoff is a monster. There's no person who's trustworthy and sympathetic who they've enlisted as a spokesman.'

Romoff could not be reached for comment.

UPMC spokesman Paul Wood said he is not concerned about the profile's effect on the hospital network's image.

'Not something that has virtually no followers,' he said.

There's no fake Twitter handle lampooning Melani, but experts say the state's largest insurer is not doing a great job of managing its public image either.

As found in the WSJ article,

'There's no white hat here,' says Don White, a Republican who chairs the state Senate committee overseeing insurance. 'They're both concerned about their self-preservation and domination.'

Neither CEO seems satisfied that his organization has become dominant in its field, and both seem to resent the success of the other organization in another field. Let us briefly review the backgrounds of both systems.

UPMC as Dominant Hospital System

The WSJ article started to probe the complexity of the situation:

The struggle in Pittsburgh has roots that go back decades. UPMC, led since 1992 by Bronx native Mr. Romoff, has grown on his watch to $9 billion in annual revenue from $797 million when he took over. Today, UPMC has around 58% inpatient market share in Allegheny County and a brand buoyed by its identification with nationally known research and treatment centers like Hillman Cancer Center, where Ms. Wyckoff is being treated. The nonprofit system, with around $406 million in operating income in its most recent fiscal year ended June 30, is also Pennsylvania's biggest private employer.

UPMC's initials dominate the Pittsburgh skyline from the top of the U.S. Steel Tower, the city's tallest building. The nonprofit leases a private jet that is used to fly executives and doctors to its facilities in Ireland and Italy. Mr. Romoff has become one of the city's most prominent business leaders. Poking fun at a local nickname for his boss, a staffer once presented Mr. Romoff with a Darth Vader action figure. In 2009, UPMC published a glossy history of its own expansion titled 'Beyond the Bounds.'

Highmark as Dominant Insurer

On the other hand,

As UPMC grew, its main hospital rival, West Penn Allegheny, withered. The five-hospital group emerged from the ashes of a Pennsylvania hospital system that filed for bankruptcy in 1998 after piling on too much debt and acquiring money-losing assets. It struggled for years.

By 2011, West Penn Allegheny was in the red, with heavy debt and pension obligations. To cut costs, it shut down much of its Western Pennsylvania Hospital. At one point, filmmakers took over its empty intensive-care unit to film a scene for a coming Tom Cruise movie.

In June, Highmark's Dr. Melani unveiled his plan to acquire West Penn Allegheny for a combination of loans and grants valued at as much as $475 million. Like UPMC, nonprofit Highmark was a dominant presence in its market, formed from the merger of a Blue Cross and a Blue Shield plan in 1996. By 2011, it had market share of around 60% in Allegheny County, with annual revenue of $14.8 billion, and it was sitting on reserves of about $4.1 billion.

Still, it was a bold and risky stroke for Dr. Melani, a blunt-spoken internal-medicine physician who himself trained at West Penn.

Marketing Rather than Substance

The two sides launched a marketing and public relations battle which did not seem to have much to do with quality of, access to, and cost of health care. As the WSJ article noted,

The spat quickly got nasty. Highmark highlighted UPMC's rate request in ads, and hired a Washington lobbying firm to pull together a coalition of churches, patient groups and others that would press for a deal. UPMC's own ad campaign urged patients to 'Keep your doctor. Check your plan.' Highmark sued, arguing the ads were misleading. UPMC bought Google ads that called up its site when a user searched for 'Highmark.'

The Pittsburgh Tribune-Review article included,

Public relations experts agree that Highmark faces a daunting challenge: People might see UPMC -- and by extension, Romoff -- as a bully, but they don't want to lose access to the system's 19 hospitals and 3,000 doctors in Western Pennsylvania.

UPMC's 'Keep Your Doc' ad campaign, produced by South Side agency GatesmanMarmion+Dave, is successful because it furthers the organization's business objectives, said Dale Leibach, an associate with Prism Public Affairs in Washington. This year, for the first time, UPMC gave four national insurers full access to its facilities and doctors, an arrangement previously granted only to Highmark.

'I would give points to UPMC for consistency and transparency, in promising more competition and then delivering on that promise by giving people in Pittsburgh and in the region many more options in terms of insurance providers,' said Leibach, who reviewed news accounts about the dispute.

David Kosick Sr., senior associate at KMA Public Relations in Canonsburg, takes the opposite stance, saying Highmark receives greater sympathy from a public that views UPMC as an insensitive corporate titan. Mullen Advertising in the Strip District produces Highmark's 'Accepted. Everywhere' ad campaign for TV, radio, publications, billboards and the Internet.

'Highmark's winning the PR battle,' Kosick said, citing threats by state lawmakers to intervene and public criticism directed at UPMC, including Allegheny County Council's refusal last month to issue $335 million in bonds for UPMC because of public opposition.

Wood said the health system recognizes its reputation 'may have taken a bit of a short-term hit locally,' but 'UPMC is focused on the longer term.'

'We've used our PR and marketing to fundamentally change the health care market in Western Pennsylvania,' Wood said.

Gene Grabowski, senior vice president of Washington-based public relations firm Levick Strategic Communications, said that strategy could backfire.

Also,

In addition to online social media, the public relations campaigns have ramped up on television and in other advertising.

UPMC placed its TV ads on major networks and cable and estimates they will reach the average Pittsburgh viewer four times a week, Wood said. He declined to say how much UPMC is spending on the ad campaign or what it budgets for advertising, but he said the budget has not changed since last year.

The ads, Fitting said, target 'what people are really worried about.'

Highmark stepped up its campaign in response to UPMC's, Weinstein said. He would not say how much Highmark pays Mullen Advertising or what it budgets for advertising.

'UPMC launched an aggressive, multifaceted misinformation campaign targeted at employers and consumers who subscribe to Highmark's health plans,' Weinstein said.

Caught in the Crossfire

Meanwhile, of course, patients and doctors are trying to avoid being stomped by the wrestling titans. The Wall Street Journal article opened with this theme,

Trish Wyckoff is struggling with stage-four breast cancer, but now the 53-year-old Pittsburgh resident has another worry: a possible divorce between the hospital system that is treating her, the University of Pittsburgh Medical Center, and Highmark Inc., the health insurer that pays for her care. If the two companies can't agree, she fears she won't be able to keep seeing the doctors who she believes are keeping her alive.


'We are absolutely stuck in the middle,' she says. This is a really scary time.'

Here is another anecdote,

With local newspapers chronicling each tit-for-tat, Pittsburgh residents like Dan Glasser say they have been acutely aware of the battle. Mr. Glasser, a 46-year-old lawyer, says he is alarmed and annoyed at the potential split between his insurer and UPMC. If forced to choose a side, he says, he would switch health plans to ensure access to UPMC. He has been seeing the same doctor there since he graduated from law school. 'That's almost my whole adult life,' he says.

Doctors are equally unhappy.

For his part, Kenneth Gold, Mr. Glasser's primary care physician, says he has been telling worried patients that 'all of us are pawns in this fight,' which he hopes gets resolved. If Highmark and UPMC do break up, 'it is going to be mass chaos,' he says.

Even employers are unhappy,

Employers, for their part, say they feel trapped in the middle, worried about health-care costs and also under pressure from employees to lock in access to UPMC. Cheryl Melinchak, director of benefits at Pittsburgh-based Westinghouse Electric Co., says the firm is likely to offer a new health plan this fall, in addition to Highmark and a high-deductible Aetna version, to ensure workers can use UPMC.

The standoff is 'frustrating,' she says. 'We need competition on both sides,' insurers and health providers.

Summary

So here we have the brave new world of the US health care system, a system that some people in other countries seem to think is worthy of emulation. Increasing concentration of power has lead to health care dominated by ever larger organizations lead by ever more egocentric executives. Organizations that are dominant in one area seek to dominate other areas. Caught in the crossfire are patients, doctors, employers, and the public. While more money goes to advertising, public relations, and lawyers, nothing about the fight seems to be about improving care or making it more accessible.

Further considering how this particular fight came to be will reveal various interlocking facets of health care dysfunction. If we can start to address them, we may be able to accomplish real health care reform.  Clearly we need health care organizations to concentrate on health care, not on increasing their power and domination.  We need them using most of their resources for health care, not on marketing, public relations, legal services, administrative support, and executive compensation. 

Stay tuned to Health Care Renewal as we continue this series.

More "You're Too Negative, And You Don't Provide The Solution To The Problems You Critique", This Time re: Pharma

I think it worth noting that critical writers about both health IT and pharma attract a similar phenomenon: the anonymous attack accusing them of 'negativity' and not providing 'solutions.'

One excellent blog I read, as a former director of a pharmaceutical R&D department that supported, among others, medicinal chemists, is Derek Lowe's "In the Pipeline."

In the comment thread at his 'In the Pipeline' understatement-of-the-year post "Taking the Ax to the Scientists Is Probably a Mistake" (link), I posted numerous links to various Healthcare Renewal posts on pharma's current travails related to that theme, and to other forms of pharma mismanagement. The comment thread is below the post itself at the aforementioned link.

I post as "MIMD" and frequently link here and to my Drexel academic site, so I am anything but anonymous.

Invariably, a response (anonymous, of course!) of the type we've seen here at Healthcare Renewal (such as here and in a more extreme example, here) has appeared. Various logical fallacies are used as a form of argument.

Emphases and red comments mine:

74. Reply to MIMD [how's that for anonymity - a screen name of "Reply to MIMD"? - ed.] on April 4, 2012 3:44 AM writes...

MIMD, you have commented at length on this post blaming various parties for the industry's woes [i.e., you're too negative - ed.], dismissing other points of view [that are almost always unsubstantiated; I provide hyperlinks to posts at this blog and others regarding pharma mismanagement and malfeasance to justify my views - ed.] out of hand [well, no, actually - ed.] and offering nothing in the way of new ideas or solutions.

[Except for the myriad aforementioned links and clearer identification of the problems - ed.]

And then, this:

"If I were still in pharma and had kids in college and a mortgage, and a hope for a pension, I'd literally be keeping my head low. And certainly not writing the types of posts I do here and on the blog I often link to!"

[Pharma is as retaliatory of its internal critics and "whistleblowers" as is clinical medicine, except doesn't even bother with sham "peer review"; they just send people out the door. I do not believe pharma management understands or cares about the implications to people who are not wealthy. Discreetness and timing are everything for putative internal medchem change agents in this environment - ed.]

I'd just like to get your thoughts on the delicious irony of this post in the middle of your long-winded and boring commentary.

[Approaching ad hominem - ed.]

As far as I understand, you're advocating that pharma scientists blame anything that breathes for the problems whilst [seems to be from UK or related country - ed.] actively avoiding attempting to find a solution.

[Classic strawman argument - ed.]

Weirdo [another anonymous poster, possibly the same person as this - ed.] commented on this, and you laughably dismissed it out of hand so I expect no more.

[I opined that a naïvely idealistic and/or cruel Marie Antoinette-like suggestion that laid-off medicinal chemists simply just set up their own drug discovery shops to show Big Pharma how it 'should be done', as if doing so were a realistic option financially for mostly middle class people strapped by being laid off mid-career, was a useless suggestion - ed.]

But if you do fancy dropping a few more 'pearls of wisdom' our way I'd be fascinated to read them!

I think it was Homer Simpson that said "It's everybody's fault but mine". Seems apt, no? [No, in fact - ed.]

Permalink to Comment

My reply was:

75. MIMD on April 4, 2012 9:49 AM writes...

Re: #74

Regarding your comments, I offer a hearty "so what?"

In your comment I see no meaningful critiques of any of the volumes of writing I've posted links to, other than the hackneyed, quasi-ad hominem, without-merit statement about "dismissing other points of view out of hand and offering nothing in the way of new ideas or solutions."

That's disappointing.

I also must point out this classic example of the strawman fallacy:

you're advocating that pharma scientists blame anything that breathes for the problems whilst actively avoiding attempting to find a solution

I do believe they teach better debating skills in the Commonwealth realms.

Finally, when you come out from behind your cloak of anonymity, I'll consider answering in more depth. Who are you? What agenda are you hiding?

My bio is on the site I often link to, as well as at here.

Permalink to Comment

Derek Lowe's blog is a serious site for medicinal chemists and like-minded scientists currently being discarded by pharma; a perfect place for anonymous pharma sockpuppets to intersperse their materials.

Although I doubt it, it will be interesting to see if the anonymous poster reveals exactly who they are and what their agenda is.

I add that in an industry plagued with scientific ghostwriting, suppression of negative research, misleading marketing, an endless parade of "legal settlements" for various forms of malfeasance, mass layoffs and other troublesome practices, I find "ghost commenters" who attack the industry's detractors from behind cloaks of anonymity quite suspect. (Unless, of course, and ironically, the writer is afraid of pharma retaliation.)

Finally, I can understand how pharma executives might find detailed stories about pharma mismanagement and leadership thought errors profoundly disturbing. They are usually protected from such candid material in their dystopic, highly remunerative cocoons surrounded by ear-pleasing consultants and employee sycophants rightly fearing career termination.

-- SS

Divide by Zero: Weird Math in CMS Clinical Quality Measure (CQM) Criteria

From the CMS "Medicare Electronic Health Record (EHR) Incentive Program - ATTESTATION USER GUIDE For Eligible Professionals (EPs)" (warning: large PDF), page 41/64:

... Step 25 – Core Clinical Quality Measures (CQMs 1 of 3)

EPs must report calculated CQMs directly from their certified EHR technology as a requirement of the EHR Incentive Programs. Each EP must report on three core CQMs (or alternate core) and three additional quality measures. If one or more core CQMs is outside your scope of practice, you will have to report on an equal number of alternate core CQM(s).

If the denominator value for all three of the core CQMs is zero, an EP must report a zero denominator for all such core measures, and then must also report on all three alternate core CQMs.

If the denominator value for all three of the alternate core CQMs is also zero an EP still needs to report on three additional clinical quality measures. Zero is an acceptable denominator provided that this value was produced by certified EHR technology.

Now, while I had an "800" in the math section of the SAT, where I believed that a fraction with a denominator of zero had a value of either infinity or 'undefined', that was many moons ago. Perhaps my knowledge of mathematics is now obsolete...

Wait - I tried this simple program on an old Microsoft MS-DOS GWBASIC interpreter, ported ca. 1981 to the Intel 8086/88 from Bill Gates' original 8080-based MBASIC, that I have laying around on my PC:

10 INPUT X
20 LET Y=X/0
30 PRINT Y
40 END

and got this warning/error message, right from Bill Gates:

"Division by zero"

and the answer: 1.701412E+38 (infinity in the 8/16-bit world from where GWBASIC sprang).

So ... allow me to say I find CMS math just a bit puzzling.

Wait ... now I understand.

Infinite quality! :-)

But thank heavens the zero denominator is only accepted when produced by 'certified' health IT.

Uncertified health IT is liable to produce a denominator of "i" (that is, the square root of -1).

-- SS

Addendum: since I am not a government math genius, I checked with Wikipedia:

... A common fraction (also known as a vulgar fraction or simple fraction) is a rational number written as a/b or , where the integers a and b are called the numerator and the denominator, respectively.^[1] The numerator represents a number of equal parts and the denominator, which cannot be zero, indicates how many of those parts make up a unit or a whole.

-- SS

Addendum:

This post is partly satire. I was a day late for April 1 but...

-- SS

University of Arizona Medical Center, $10 million in the red in operations, to spend $100M on new EHR system

In my Oct. 2006 post "$70 million for an Electronic Medical Records system?" I wrote:

... healthcare doesn’t have the capital for clinical IT misadventures, and I believe when the issues become more public in this industry sector and information flows about mismanagement and abuses (as is happening in the UK ’s Connecting for Health project) [now abandoned as described here - ed.], the fallout won’t be pretty.

Here's an example of an organization in profound ardent technophile-driven Ddulite mode:

UA Medical Center to spend $100M on new records system

Tucson's largest health-care organization expects to spend upward of $100 million on getting its two hospitals talking to each other.

Right now, the inpatient medical record systems at the University of Arizona Medical Center's two campuses aren't speaking to each other.

The lack of communication is resulting in more work for healthcare providers in the University of Arizona Health Network.

[How much more work, exactly, and how much would a non-cybernetic solution cost? These issues seem never to be mentioned - ed.]

The $1.2 billion, nonprofit company employs nearly 7,000 people.

The network is installing a new, uniform electronic medical records system for all patients at its two hospitals - UA Medical Center - University Campus and UA Medical Center - South Campus - and at outpatient centers as well.

... Project leaders predict it will result in a more efficient organization with fewer medication errors and better patient care.

... The new system's benefits will certainly trickle down to patients, said Clint Hinman, an experienced pharmacy director within the network who is directing the computer upgrade program.

[Note once again the absolutist statements of deterministic benefit and beneficence, based on scant supportive evidence and increasing contradictory evidence, that I bolded above - ed.]

I note that $100 million+ is probably enough to pay for AN ENTIRE NEW HOSPITAL or hospital wing ... or a lot of human medical records professionals.

Executives and project leaders have probably never read any of the literature at the reading list here or at my academic site here, or if they have, choose to be blind to it and trusting of literature such as ONC's sloppy-science "should not have been published in its present form" health IT cheerleading here.

Most important of all:

It's not advisable to gamble with $100 million in that fashion, especially under these conditions:

... BUDGET ISSUES

Spending $100-million-plus on electronic medical records is a lot of money for a network that as of mid-January was at $10 million in the red in operations, BUT network spokeswoman Katie Riley said the electronic medical records are not to blame.

[Capitalization and emphasis of the "but" mine - ed.]

This statement is both representative of a healthcare system gone overboard - you don't spend on luxuries when you're $10 million in the red - and is a non-sequitur.

Who cares if the EHR's are not to blame for the system being $10 million in the red? That does not seem like a good reason to go ahead and spend $100 million (which will probably balloon to several times that figure, hence I will use $100 million++) on a very risky gamble.

Further, all it will take is a few of these mishaps to put the system further in the red.

I should also ask: will medical and other staff be laid off to afford the new systems, in effect trading people for computers?

To spend $100 million++ on HIT when you're already $10 million in the red on operations is, in my view, financially reckless.

-- SS

Don't Worry, Your Electronic Medical Records Are Getting Safer With Every Passing Day

At my Oct. 2011 post "Still More Electronic Medical Data Chaos, Pandemonium, Bedlam, Tumult and Maelstrom: But Don't Worry, Your Data is Secure" and others in this query link on medical record privacy, http://hcrenewal.blogspot.com/search/label/medical%20record%20privacy I wrote:

"Don't worry, your medical data's safe."

In Jan 2012 I then posted about Joseph Conn of ModernHealthcare.com's article "2011 Closes on a Note of Electronic Medical Record Privacy Breach Shame."

Don't worry, though; the IT industry's leader, finance, to which medicine is always compared, has gotten closer to getting the situation under control:

From MSNBC:

MasterCard, Visa confirm credit card data theft described as 'massive'
March 30, 2012
By Bob Sullivan

Law enforcement officials are investigating what appears to be a massive theft of U.S. consumers' credit card data, MasterCard and Visa confirmed Friday. The computer security expert who first reported the theft said it might involve as many as 10 million MasterCard and Visa accounts, making it one of the largest known credit card heists.

"MasterCard is currently investigating a potential account data compromise event of a U.S.-based entity and, as a result, we have alerted payment card issuers regarding certain MasterCard accounts that are potentially at risk," that association said in a statement. "Law enforcement has been notified of this matter and the incident is currently the subject of an ongoing forensic review by an independent data security organization."

The theft was first reported by well-known computer security journalist Brian Krebs on his blog, KrebsonSecurity.com. Krebs said the crime involves compromise of a credit card payment processor — a "middle man" that handles transactions between retailers and banks [like these middlemen in medicine? - ed.]

The name of that institution is unknown, but processors have long been a target of identity thieves because of the enormous amounts of data they control. In 2008, Princeton, N.J.,-based Heartland Systems was hacked, exposing tens of millions of credit card account numbers to theft.

Krebs reported that hackers had access to the unknown processors data from Jan 21 through Feb 25, and were able to siphon off enough data to easily create counterfeit cards. His sources called the leak "massive."

... Gartner security expert Avivah Litan said she's been told that the stolen data is already being used on the street by identity thieves.

"I’ve spoken with folks in the card business who are seeing signs of this breach mushroom. Looks like the hackers have started using the stolen card data more recently," she said.

Read the whole article at the link.

Don't let this trouble you, however. The problem is getting closer to a solution with each mega-break in.

They'll have it fixed any day now, so have no fear telling your EHR-equipped doctor all your private and most sensitive medical business.

-- SS

Conflicts of Interest or Bribes? - Biomet, Smith & Nephew Settle

More justifications of physicians' and other health care professionals' financial arrangements with industry have been appearing in the media and the medical literature (for recent examples, look here and here). Most commonly, the relationships they defended could be characterized as health care professionals consulting or sitting on advisory boards for industry, or receiving royalties from industry for their intellectual property.

In the last two months, two device manufacturers, Biomet and Smith & Nephew, accepted penalties for less defensible financial relationships with physicians. They entered into deferred prosecution agreement and settled charges that they bribed doctors employed by foreign governments. Some of these relationships, especially those involving Biomet, would have been prospectively indistinguishable from the sorts of conflicts of interest that have been so fervently defended.

Background

Starting in 2007, we posted (here, here, here, here and here) about the payments, often huge, that five manufacturers of prosthetic joints, Biomet, DePuy Orthopaedics,a unit of Johnson & Johnson, Stryker Orthopedics,a unit of Stryker Inc, Zimmer Holdings, and Smith & Nephew, revealed they made to orthopedic surgeons and various academic and other organizations in the US. All companies except Stryker were charged with "criminal conspiracy to violate anti-kickback laws," and all were subject to deferred prosecution agreements.  (Stryker entered into a voluntary compliance agreement.)  According to a US Department of Justice news release, the agreements required:

• A federal monitor will be in place at each company to review compliance with the DPAs and NPA and all new and existing consulting relationships with the companies;
• Each company is required to conduct a needs assessment to determine the reasonable needs for educational consulting services, and new product-development consultants.
• All new consulting agreements shall require physicians to disclose their financial engagements with any company to their patients and require the companies to disclose the name of each consultant and what they have been paid on the company website.

These agreements ended in 2009.

The Latest Settlements

As we noted, in 2011, Johnson and Johnson admitted its subsidiaries, including DePuy, had been bribing doctors in Europe through 2007, and agreed to yet another deferred prosecution agreement.

Smith & Nephew

Last month, Bloomberg reported:

Smith & Nephew Plc, Europe’s biggest maker of artificial hips and knees, agreed to pay $22.2 million to settle allegations by the U.S. Justice Department and Securities and Exchange Commission that it engaged in a scheme to pay bribes in Greece.

Smith & Nephew admitted in filings today in federal court in Washington that two of its units were involved in a scheme for more than a decade to make 'illicit payments' to doctors employed by government hospitals or agencies in Greece in violation of the Foreign Corrupt Practices Act.

The London-based company, which entered into a deferred prosecution agreement with the U.S., agreed to pay a $16.8 million fine to settle the criminal allegations and another $5.4 million to settle a civil suit filed by the SEC.

The colorful specifics were:

Smith & Nephew admitted that from 1997 until June 2008, its U.S. and German units bribed public doctors in Greece to win business. The bribes were paid through a person described in court documents as a 'Greek distributor.' This person used shell companies that masked bribes as 'marketing services,' according to the statement of facts filed in the criminal case.

The document cites a March 2002 e-mail from the Greek distributor to a Smith & Nephew vice president in Memphis, Tennessee, complaining that the 'marketing services' payments weren’t enough, noting that competitors were paying 30 percent to 40 percent more.

'I absolutely need this fund to promote my sales with surgeons,' the distributor said in the e-mail, according to prosecutors.

Reforming a corrupt and dysfunctional public health system was one of the conditions of Greece’s acceptance of a European Union and International Monetary Fund bailout package in 2010. Doctors also supplement their income with payments from patients, called 'fakelaki,' small envelopes with cash for prompt treatment.

In the SEC complaint, the payments made to the physicians were described as "commissions."
Note that the company made the usual sort of statement,

'We have what I believe to be a world-class compliance program, having enhanced it significantly since this investigation began in 2007,' Olivier Bohuon, Smith & Nephew’s chief executive officer, said in a statement. 'These legacy issues do not reflect Smith & Nephew today.'

He did not mention why the payments were continuing at a time when the company was already supposedly operating under the previous deferred prosecution agreement that arose out of the charges in the US discussed above.

Biomet

This week, the Indianapolis Star reported,

To sell its products abroad, medical device maker Biomet at times bribed doctors with cash, travel and meals, the federal government says.

The Warsaw, Ind.-based company agreed Monday to pay nearly $23 million to settle allegations that its payments to doctors violated the federal Foreign Corrupt Practices Act. The Securities and Exchange Commission alleges that Biomet, acting through four subsidiaries and its distributors, paid bribes from 2000 to 2008 to doctors in Argentina, Brazil and China in order to win business.

The settlement includes a $17.3 million criminal fine and $5.6 million to the SEC, the government and company said in separate news releases.

The details were,

he SEC accused Biomet of writing phony invoices to cover kickbacks as high as 20 percent of sales to push its products.

In other instances, Biomet provided doctors with money and travel in exchange for implanting artificial joints and other Biomet products in their patients, says the SEC complaint, which was filed in federal court in Washington. In China, Biomet vendors gave doctors cash upon completion of surgeries using Biomet implants, the lawsuit says.

'I've got to send him to Switzerland to visit his daughter,' a Biomet distributor wrote in a 2001 email to the company, describing a trip given as a reward to a Chinese doctor who implanted 10 Biomet hips and knees a month in patients.

The SEC said Biomet's compliance and internal audit functions failed to stop the practices even after determining they were illegal.

Note how Biomet accounted for the payments,

The payments were falsely recorded on company books as 'commissions,' 'royalties' and 'scientific incentives,' the Justice Department said.

Furthermore, the Fort Wayne Journal-Gazette added,

With the settlement announced Monday, the Justice Department found that Biomet and its subsidiaries covered up bribery payments by officially recording them as 'consulting fees' or 'commissions.'

Note that Biomet's official response was similar to Smith & Nephew's, as reported in another article from the Fort Wayne Journal-Gazette,

Jeffrey Binder, Biomet’s president and CEO, didn’t address the company’s guilt or innocence in a written statement released Monday.

Biomet has 'significantly enhanced' its procedures worldwide in recent years to ensure employees’ conduct is legal and ethical, he said.

'Moving forward, we intend to continue to adhere to our enhanced global compliance procedures, and to promote the company’s commitment to the highest ethical standards in all the markets that we serve,' Binder said.

Again, he did not explain why this time the enhanced compliance procedures are likely to work, given that the questionable conduct was still going on after the company had already entered into the 2007 deferred prosecution agreement.

Summary

Some Apparent Conflicts of Interest are Actually Bribes

In these cases, two medical device corporations paid doctors in several countries for implanting their products into patients. The resulting legal proceedings allow us to characterize these actions as bribes. Clearly both the companies' and the physicians' actions were unethical, since they lead to decisions that put the enrichment of the decision makers and those bribing them ahead of the patients' interests.

Some of the most common financial arrangements between health care professionals and industry that are thought of as conflicts of interest are paid consulting and payment of royalties for intellectual property. As we have discussed, e.g. here, conflicts of interest in medicine and health care are generally thought to raise the likelihood of corruption, but not necessarily to indicate corruption in specific instances. In the cases above, bribes were sometimes called "consulting payments or royalties." This suggests that some consulting payments and royalties which may commonly be thought of as conflicts of interest are outright bribes, that is, outright health care corruption.

Those who fervently defend conflicts of interest as inevitable, and necessary for collaboration and hence innovation (e.g., look here), often minimize the adverse effects of these conflicts (e.g., look here). In fact, any putative benefits of such conflicts ought to be contrasted with their possible harms. These cases make it clear that these harms include outright corruption which may be disguised as mere conflicts of interest.

This adds strength to arguments that conflicts of interest ought to be minimized or eliminated, not tolerated and "managed."

Current Measures to Enforce Laws Against Bribes and Kickbacks are More Theatre than Deterrent

The current cases are just the latest members in the march of legal settlements. We have noted that misbehavior in large health care organizations rarely leads to any negative consequences for the people who authorized, directed or implemented the offending actions. Instead, the penalties are, at most, fines paid by the organizations, not the people involved, and variants of deferred prosecution and/or corporate integrity agreements. We and others have previously argued without negative consequences affecting the people who authorize, direct or implement unethical actions, such actions will continue.

The current cases corroborate this. Corporations that had already paid fines and accepted deferred prosecution agreements for bribes to physicians continued to bribe other physicians. The failure of the offending corporations to admit any wrongdoing, or the need for specific changes of behavior in the future, suggests that the current fines and deferred prosecution agreements will not be any more effective than the previous ones. The current fashion of punishing behavior within health care organization with fines and agreements to behave better in the future appears to be more law enforcement theatre than serious deterrent.  

As we have said before, true health care reform would make leaders of health care organization accountable for their organizations' bad behavior.

Gartner: Famous Last Words on National Health IT - "Don't Fear Progress"

From time to time I review old articles about health IT via Google and other search engines.

Found this analysis/prediction/statement of confidence, by a research analyst at IT consultant company Gartner Group. Emphasis mine:

Don’t Fear Progress

by Brian Burke | April 17, 2009 | 1 Comment

In an open letter blog to President Obama, Burton Group Senior Analyst Joe Bugajski opines that President Obama is spewing “delusional visions of a nation-covering, interoperable, secure, private, reliable, accurate, and instantaneous electronic healthcare data network is at best terrifying and at worst pernicious.” OK – I had to look up ‘pernicious’. It’s not good.

Mr. Bugajski goes on to relate a horrifying personal experience in which he ended up in a clinic and then a hospital that both used electronic health records. He relates the story of his stay in which electronic health records hindered rather than helped and concludes that most health care professionals “longed for handwritten charts hanging at the foot of every patient’s bed.” While I don’t doubt his experience, and I disagree that building a national health information network is an unsound idea.

In fact, the National Health Services (NHS) in the UK is several years into its ‘Connecting for Health‘ program and has already built a nation-covering, interoperable, secure, private, reliable, accurate, and instantaneous electronic healthcare data network. The UK is reaping the benefits of improved treatment and cost savings. You can read additional background in my research note, Toolkit: Enterprise Architecture for the U.K.’s National Health Service (Case Study)

Mr. Bugajski is correct that the initiative will be large and costly and I also agree that the US government should approach the program with caution. But the benefits are enormous – it’s about saving lives! While I sympathize with Mr. Bugajski’s unfortunate experience, I believe moving forward on this initiative is truly one of the bright spots in President Obama’s stimulus plan.

Problem is, the NHS program to build a "nation-covering, interoperable, secure, private, reliable, accurate, and instantaneous electronic healthcare data network" failed, as I wrote at my Sept. 2011 post "NPfIT Programme goes PfffT."

The success of this program was long in doubt, as expressed by the UK's own House of Commons public accounts (audit) committee as here, published 27 Jan 2009 (four months before the optimistic Gartner piece) entitled "The National Programme for IT in the NHS: Progress since 2006 - Public Accounts Committee."

In fact, I had been writing skeptically about that program for years, including at this query link and at my academic site.

I don't fear progress.

What I fear is cybernetic hyper-enthusiasm masquerading as progress, especially when it wastes money - in this case conservatively estimated at £12.7bn - and harms patients.

-- SS

Another Cautionary Tale about Conflicts of Interest: the CEO's Stretch Limousine, Golden Parachute, and Slush Fund

It remains fashionable in academic medicine to tolerate, if not celebrate conflicts of interest as necessary to support the "collaboration" needed for "innovation," while minimizing their risks (e.g., look here). 

Recently, another cautionary tale about how conflicts of interest signal the risk of all sorts of unpleasantness has appeared in the media.

A Sentinel Event: the First Conflicts Uncovered

In 2009, we wrote about some conflicts of interest at Wyckoff Heights Medical Center in my hometown of Brooklyn, NY.  The New York Daily News had reported that Dr. Addagada Rao, the hospital's chief of surgery was simultaneously the president and part-owner of a Caribbean medical school that funneled medical students to clerkships at Wyckoff.  The hospital's CEO, Rajiv Garg, was an investor in the same school.  At the time, I wrote,

This story illustrates another twist on conflicts of interest affecting the leaders of not-for-profit health care organizations. Many of the smaller not-for-profit hospitals, of which there are thousands in the US, may have minimal conflict of interest policies, which may be minimally enforced, without much transparency or accountability. The coziness of the leadership culture of such smaller institutions may preclude anyone within the culture from asking tough questions. The results may be total confusion as to whose interests particular leaders are serving. In particular, the interests of each hospital's patients may get lost in the shuffle. In this case, the interests of medical students may also get lost in the shuffle. Although the institutions involved may be small, and hence the conflicts may seem small in terms of their monetary value, they aggregate to contribute to the moral miasma that now is the atmosphere of health care.

You heard it here first.

The CEO's Golden Parachute

Fast forward to 2012. In January, the Daily News again reported that CEO Garg had been ousted, but that

Trustees at Wyckoff Heights Medical Center asked to consider a whopping $875,000 severance payout for its former CEO are balking at the package....

It seems that Garg's attorney claimed

They were on the verge of bankruptcy when he arrived. He reduced the debt by tens of millions of dollars.

However,

the hospital’s financial situation remains grim. According to the work group’s final report, Wyckoff’s liabilities are $91 million greater than its assets and it is saddled with $114 million in long-term debt.

So here is yet another example of a CEO personally profiting while his or her organization's finances fester.

The Chauffeured Cars, the Stretch Limousine

The the Daily News began chipping away at the other ways CEO Garg benefited from his leadership of the fiscally troubled hospital. A notable symbol of these benefits was a stretch limousine:

The ousted CEO of a debt-riddled Brooklyn hospital had his security guards ferry friends to the U.S. Open and his wife around town in a stretch limo, the Daily News has learned.

Rajiv Garg, the disgraced honcho of Wyckoff Heights Medical Center, also enjoyed his own commutes in the hospital-issued ride — a sleek, black $33,000 Lincoln Royale.

Garg rolled in style,

The beleaguered hospital bought the fancy car — equipped with a mini-bar, four champagne flutes and a fridge for chilling Dom Pérignon — last summer for Garg It also owned two other cars for his use, sources said.

Several times a week, the limo was dispatched to take Garg’s wife from her job near the hospital to the couple’s midtown apartment, said an employee.

Sometimes, it picked her up and then swung by the hospital to get Garg and whisk them to dinner before dropping them home, sources said. Two or three times a month, the limo picked her up at home and took her shopping.

'I haven’t had a raise in seven years,' said the employee. 'They always tell us they don’t have any money. They spent it on cars.'

The limo has comfy leather seats with room to spare for six passengers and a stereo system capable of drowning out highway noise when Garg and his wife were driven in it to Washington.

More Conflicts of Interest Discovered

Then the Daily News started to reveal conflicts of interest beyond the ones we discussed in 2009:

Then-trustee Frank Chiarello was in a partnership that loaned money to hospital entities, according to a list of board members’ conflicts the Daily News eyeballed. The $2.5 million loan had an 18% interest rate, sources said, costing the hospital hundreds of thousands of dollars.

Chiarello, a real estate exec, resigned from the board last week.

Another trustee who quit the board last week, attorney John Rucigay, serves as a lawyer for other trustees, owns real estate with other trustees, and rents space to the Polish and Slavic Federal Credit Union — whose head of operations is yet another Wyckoff trustee, Agnieszka Poslednik.

Additional trustees on the conflicts list first reported by Crain’s New York Business, include Andrew Boiselle, whose Cebco Check Cashing Corp. does check-cashing business with hospital employees, and attorney Fred Haller, who provides legal services to Wyckoff employees about issues not related to the hospital.

Slush Funds and Bribes

Last week, the Daily News reported about findings by a judge that the CEO kept slush funds used to pay bribes:

Wyckoff Heights Medical Center kept a secret bank account that a former CEO used to bribe a disgraced state assemblyman, an upstate judge said in a court decision.

Orange County Supreme Court Judge Elaine Slobod’s decisionk brought to light new details about the Bushwick hospital’s alleged dealings with Tony Seminerio (D-Far Rockaway), who died in a North Carolina prison last year.

The bank account used for the Stockholm St. hospital’s payoffs to the corrupt pol belonged to 397 Himrod Corporation.

Former Wyckoff board chairman Emil Rucigay originally set up the company to buy real estate for the hospital to turn into a parking lot, the judge’s order said.

The bank account was kept active — though the corporation was dissolved in 2001. The bank account still had approximately $130,000 in it in 2008.

“[Wyckoff’s] CEO was using monies in the Himrod account to bribe Seminerio,” Slobad wrote in her decision last week, referring to Dominick Gio, who was the hospital’s head honcho at the time.

Gio refused to talk a reporter last week. Wcykoff’s interim CEO Ramon Rodriguez also declined to comment.

Money from the Himrod account was used to make payments totaling $15,000 to Seminerio, other court filings charge.

A Lexus, a Bentley, Oh My

Then the story really hit the big time when the New York Times picked it up yesterday. That report added some colorful details about how magnificently the CEO traveled:

In August 2009, Mr. Garg said, he fell asleep at the wheel and crashed his Lexus into a truck. He then lost his license. Asked why in the interview, he said he was not certain, though he offered several explanations, including unpaid tickets and previous accidents.

He then used the hospital’s cars — a Lincoln Town Car and a Cadillac Escalade — for himself and his family around the clock. They were driven by two security guards on overtime, a hospital official said.

He parked his other car, the $160,000 Bentley, at Wyckoff and had the hospital put the vehicle on its own insurance policy.

The limo only came later,

Mr. Garg said in the interview that he suspected that the drivers of the Town Car and the Escalade were eavesdropping on his conversations. So he had the hospital purchase a used stretch limousine for about $33,000.

Yet More Conflicts of Interest Discovered

The Times story also found more conflicts of interest. Some involved CEO Garg:

Mr. Garg introduced hospital officials to Skyscape, a provider of mobile medical references, in which he had a financial interest. Wyckoff signed a contract with the company worth at least $38,700, hospital records show, though the deal eventually fell through.

Others involved hospital trustees. This example might have affected patient care at the hospital:

Dr. Theophine Abakporo arrived at Wyckoff in 1996 from Harlem Hospital to work in emergency medicine. Originally from Nigeria, he said he found his way to the top blocked by what he believed was a clique of doctors at Wyckoff.

In 2009, according to data provided by MapLight.org, Dr. Abakporo, an American citizen, began donating money to the campaign of Representative Edolphus Towns, the Democrat who represents a nearby area. Mr. Towns, a longtime board member of Wyckoff, had by then been replaced by his chief of staff, Albert Wiltshire, on the board.

Dr. Abakporo gave $1,000 to the Towns campaign, then $750, according to election records.

With Mr. Wiltshire’s support, Dr. Abakporo became chairman of emergency medical services.

This example might also have affected patient care:

With his solicitous manner and tailored sport jackets, Gary Goffner, a pharmacist who serves on Wyckoff’s board, has long endeared himself to customers and doctors alike.

He inherited his pharmacy, Kraupner, from his father, a prominent Bushwick landlord as well as a pharmacist, who died recently. It is an old-fashioned store, crammed with supplies, the opposite of an orderly Rite Aid.

It is also a half-mile walk from Wyckoff, a disadvantage Mr. Goffner overcame through a contract that gave him exclusive access to Wyckoff patients as they were being discharged, and allowed him to keep an employee at the hospital to promote his business.

In summary, the Times found,

According to internal hospital documents, 13 of the hospital’s 22 board members declared at least one conflict of interest.

Summary

So, from a single story about conflicts of interest affecting the CEO and a medical leader at the hospital, we have gone to stories about widespread conflicts of interest affecting the hospital's board and leadership, about lavish payments and benefits to the CEO while the hospital's finances suffered, and allegations (by a judge) of bribes and slush funds. 

Recall that the Institute of Medicine's report on conflicts of interest in medicine and health care defined conflicts of interest as “circumstances that create a risk that professional judgments or actions regarding a primary interest will be unduly influenced by a secondary interest.” While no particular conflict of interest is guaranteed to cause someone to abuse entrusted power, conflicts of interest create the risk of such abuse. The case of the leadership and governance of Wyckoff Heights Medical Center shows how such risks may manifest.

Yet we have noted again and again how leaders of supposedly mission-oriented non-profit medical organizations seem to be ignoring these risks while pursuing ever more money from health care corporations. We noted how the Chancellor of the University of California-San Francisco "has no qualms" about faculty's financial relationships with industry. Just this week at Brown University, my alma mater, while discussing a new conflicts of interest policy, we heard,

'People do have conflicts of interest, and it’s not the end of the world,' said Janet Blume, associate dean of the faculty.

Conflicts of interest may not lead to the apocalypse. However, they certainly may lead to all sorts of unpleasantness. As Joe Collier stated, “people who have conflicts of interest often find giving clear advice (or opinions) particularly difficult." Conflicts of interest clearly lead to conflicted, and confused thinking, and such thinking may lead to bad decisions, and hence bad outcomes for patients' and the public's health. Worse, as the IOM asserted, conflicts of interest are a risk factor for outright corruption.

True health care reform might start with a reasoned discussion, based as much as possible on evidence, about the risks as well as the supposed benefits of conflicts of interest affecting those who make decisions about individual patients' health care, and about public health and health care policy.

Experiments on Top of Experiments: Threats to Patients Safety of Mobile e-Health Devices - No Surprise to Me

As noted by columnist Neil Versel at MobiHealthNews.com in a Mar. 14, 2012 post "Beware virtual keyboards in mobile clinical apps":

... Remember the problems Seattle Children’s Hospital had with trying to run its Cerner EMR, built for full-size PC monitors, on iPads? The hospital tried to use the iPad as a Citrix terminal emulator, so the handful of physicians and nurses involved in the small trial had to do far too much scrolling to make the tablet practical for regular use in this manner.

[From that post: As CIO magazine reported last week, iPads failed miserably in a test at Seattle Children’s Hospital. “Every one of the clinicians returned the iPad, saying that it wasn’t going to work for day-to-day clinical work,” CTO Wes Wright was quoted as saying. “The EMR apps are unwieldy on the iPad.” - ed.]

Thank heaven it was a small trial, instead of a typical forced rollout to an entire clinical community. Someone seems to have grasped the experimental nature of the effort.

Well, there may be a greater risk than just inconvenience when tablets and smartphones stand in for desktop computers. According to a report from the Advisory Board Co., “[A] significant threat to patient safety is introduced when desktop virtualization is implemented to support interaction with an EMR using a device with materially less display space and significantly different support for user input than the EMR’s user interface was designed to accommodate.”

The report actually is a couple months old, but it hasn’t gotten the publicity it probably deserves. We are talking about more than user inconvenience here. There are serious ramifications for patient safety, and that should command people’s attention.

Unfortunately, far too little about health IT safety commands people's attention. It's merely assumed that either 1) health IT is inherently beneficent, or 2) the risks are deliberately ignored for - I'm sorry to note - profit and career advancement.

How many CIOs or even end users have considered another one of the unintended consequences of running non-native software on a touch-screen device, that the virtual, on-screen keyboard can easily take up half the display? “Pop-up virtual keyboards obscure a large portion of the device’s display, blocking information the application’s designer intended to be visible during data entry,” wrote author Jim Klein, a senior research director at the Washington-based research and consulting firm.

How many CIO's have considered unintended consequences of such experiments-on-top-of-experiments (i.e., handheld or other lilliputian computing devices on top of the HIT experiment itself)? Probably few to none.

The typical hospital CIO, usually of an MIS background and generally lacking meaningful backgrounds in research, computer science, medicine, medical informatics, social informatics, human-computer interaction, and other research domains, are usually "turnkey-shrinkwrapped software implementers." In fact, most have backgrounds woefully inadequate for any type of clinical device leadership role. They may even lack a degree of any kind, as major HIT recruiters over the past decade expressed the following philosophy ca. 2000:

I don't think a degree gets you anything," says healthcare recruiter Lion Goodman, president of the Goodman Group in San Rafael, California about CIO's and other healthcare MIS staffers. Healthcare MIS recruiter Betsy Hersher of Hersher Associates, Northbrook, Illinois, agreed, stating "There's nothing like the school of hard knocks." In seeking out CIO talent, recruiter Lion Goodman "doesn't think clinical experience yields [hospital] IT people who have broad enough perspective. Physicians in particular make poor choices for CIOs. They don't think of the business issues at hand because they're consumed with patient care issues," according to Goodman. (Healthcare Informatics, "Who's Growing CIO's".)

I wonder just how many CIO's "from the school of hard knocks" were put into action by those groups.

Back to the MobiHealthNews.com article:

... Klein said that users have two choices to deal with a display that’s much smaller than the software was designed for. The first is to zoom out to view the whole window or desktop at once, but then, obviously, users have to squint to see everything, and it becomes easy to make the wrong selection from drop-down menus and radio buttons.

Or, users can zoom in on a small part of the screen. “This option largely, if not completely, eliminates the context of interaction from the user’s view, including possible computer decision-support guidance and warnings, a dangerous trade-off to be sure,” Klein wrote.

In either case, the virtual keyboard makes it even more difficult to read important data that clinicians need to make informed decisions about people’s health and to execute EMR functions as designed.

Good observations. Two points:

1. As far back as the mid 1990's in my teaching of postdoctoral fellows in my role as Yale faculty in Medical Informatics, due to the limited screen real estate I uniformly presented the following 'diagram' regarding my beliefs about handheld devices (then commonly known as PDA's) as tools for significant EHR interaction:

Mid 1990's wisdom: small handhelds as desktop replacements at the bedside - just say "no"

This was before today's hi-res screens on small devices, but the limited real estate and its ramifications were obvious to critical thinkers who knew both medicine and medical informatics, even in the mid 1990's.

Similarly, experiments with HP95 handheld PC's running DOS failed miserably in a similar time frame at the hospital where I later became CMIO. (One benefit: I did get to salvage two of the devices from the trash bin for my obsolete computer collection!):

HP95LX - full DOS computer equivalent to an IBM PC (except, of course, for screen size).

Therefore, IMO the Advisory Report findings of 2012 merely verify what was obvious almost two decades ago.

Small devices are adjuncts only, suitable for limited uses (and only after extensive RCT's with informed consent even then, in my view).

2. Another issue that arises is more fundamental. The article notes:

“It seems clear that running even a well-designed user interface on a device significantly different than the class of devices it was intended to be run on will lead to additional medical errors,” Advisory’s Klein commented.

The critical thinking person's question is: who knows if the "class of device" the app was "intended to run on" is itself appropriate or optimal?

Commercial clinical IT (with the exception of devices that require special resolutions, pixel densities, contrast ratios etc., such as PACS imaging systems) is usually designed for commercially available hardware.

That means the same size/type of computer monitor you obtain at Best Buy or Wal Mart.

Is that sufficient? Is that optimal?

As in my Feb. 2012 post "EHR Workstation Designed by Amateurs", who really knows?

Click to enlarge. A workstation in an actual tertiary-care hospital ICU, 2011. How many things are wrong here besides the limited display size? See aforementioned post "EHR Workstation Designed by Amateurs".

These systems are not robustly cross-tested in multiple configurations, such as multiple-large screen environments vs. single screen, for example.

In summary, performing an experiment with small devices on top of another experiment - the use of cybernetic intermediaries (HIT) in healthcare that is already known to pose patient risk - is exceptionally unwise.

It would be best to decide what the optimal workstation configuration is, as applicable to different clinical environments, in limited RCT's with experts in HCI strongly involved, before putting patients at additional risk with lilliputian information devices that only a health IT Ddulite could love.

Ddulites: Hyper-enthusiastic technophiles who either deliberately ignore or are blinded to technology's downsides, ethical issues, and repeated local and mass failures.

-- SS