The recent in-depth investigation by Fortune reporters of 10 years of dysfunctional leadership at Pfizer, the "world's largest research-based pharmaceutical company," raises many issues about leadership and governance in health care (see our post here). To continue what is likely to become a lengthy series, let us now discuss the discrepancy between the markedly dysfunctional leadership performance documented in the Fortune article and the pay given to the leaders involved.
"Hank" McKinnell et al - 2003-2006
Mr McKinell was forced to retire in 2006. The Fortune article described Mr McKinnell as a "desperate CEO" by 2002 because he could find no way to replenish the company's fading drug pipeline; who then became an absent CEO who "left a power vacuum" and then triggered internal political warfare by setting up a "bitter contest" over succession planning.
The 2006 Pfizer proxy statement reported the total compensation received by Mr McKinnell from 2003-2005.
2003 - $10,706,002
2004 - $11,355,317
2005 - $12,767,270
Each line reflects the combination of salary, bonus, other annual compensation, restricted stock awards, securities underly options, LTIP payouts, and all other compensation.
The four other best paid executives were Karen Katen, Vice Chairman and President, Prizer Human Health, David Shedlarz, Vice Chairman, Jeffrey B Kindler, Vice Chairman and General Counsel, and John LaMattina PhD, Senior Vice President, President, Pfizer Global Research and Development. Their total compensation for these years were
Ms Katen
2003 - $4,747,478
2004 - $8,541,220
2005 - $6,663,283
Mr Shedlarz
2003 - $3,722,508
2004 - $6,743,591
2005 - $3,897,293
Mr Kindler
2003 - $3,113,308
2004 - $4,181,817
2005 - $3,338,728
Mr LaMattina
2003 - $2,228,804
2004 - $4,410,130
2005 - $3,558,415
Despite MrMcKinnell's poor performance, he never received less than $10 million a year in the three years before he was forced out. Other top managers, despite never effectively compensating for Mr McKinnell's bad performance earned at least $ 3 million a year in these three years, with one exception, one manager who only made a bit over $2 million in one of the three years.
Jeffrey Kindler et al 2007 - 2010
Kindler was forced to resign in 2010. The Fortune article also described Mr Kindler as "suddenly desperate" after two failures of drugs in development; someone who "just couldn't make up his mind," about acquisitions and spin-offs; "anguished" about research, leading to a "messy" overhaul; and putting "destructive" trust in a subordinate with previously described problems with "character, integrity and divisiveness" leading to loss of the loyalty of the executive team.
The 2010 Pfizer proxy statement revealed the total compensation received by Mr Kindler from 2007-2009.
2007 - $13,075,099
2008 - $15,547,600
2009 - $14,898,038
In this proxy statement, each line included salary, bonus, stock awards, option awards, non-equity incentive plan compensation, change in pension value and non-qualified deferred compensation earnings, and all other compensation.
The four other best paid executives were F D'Amelio, Chief Financial Officer, I Read, Group President, Worldwide Biopharmaceutical Business, M Mackay, President, Pharmatherapeutics Research & Development, and Dr F Lewis-Hall, Chief Medical Officer. Their total compensation for these years was:
Mr F'Amelio
2007 - $12,338,821
2008 - $6,979,111
2009 - $7,858,969
Mr Read
2007 - $4,560,869
2008 - $7,629,185
2009 - $9,447,036
Mr Mackay
2007 - $3,590,158
2008 - $6,718,580
2009 - $5,878,806
Dr Lewis-Hall
2009 - $5,087,263 (hired in 2009)
Despite Mr Kindler's poor performance, he never received less than $13 million a year in the three years before he was forced out. Other top managers, despite never effectively compensating for Mr McKinnell's bad performance earned at least $ 4.5 million a year in these three years, with one exception, one manager who only made a bit over $3.5 million in one of the three years.
Summary
The business oriented leaders of health care, and some of their sympathizers in health care and policy research are given to preach that "pay for performance," (P4P) applied to health care professionals is a solution to the problem of ever rising health care costs, and ever declining health care access and quality.
Pay for performance applied to the top hired leaders of health care organizations has become a cruel joke. The Pfizer example shows a company with chronically bad leadership paid hundreds of times what average workers receive. Despite a parched drug pipeline and languishing stock price, top managers made millions a year, and CEOs who would eventually be forced out for poor performance made tens of millions a year. One cannot help but conclude that the main goal of Pfizer was to enrich its top managers. Managers whose main goal is to enrich themselves, of course, are unlikely to manage well, and unlikely to promote development and manufacturing of drugs whose benefits exceed their harms, and which decrease symptoms, improve function, prevent morbidity, extend life, and generally benefit health.
Now that the scope of the failings of Pfizer's hired leaders has been made clearer, the company has become one of the best, or worst examples of self-interested leadership and its perils for health care.
As I have repeated endlessly,... health care organizations need leaders that uphold the core values of health care, and focus on and are accountable for the mission, not on secondary responsibilities that conflict with these values and their mission, and not on self-enrichment. Leaders ought to be rewarded reasonably, but not lavishly, for doing what ultimately improves patient care, or when applicable, good education and good research. On the other hand, those who authorize, direct and implement bad behavior ought to suffer negative consequences sufficient to deter future bad behavior.
If we do not fix the severe problems affecting the leadership and governance of health care, and do not increase accountability, integrity and transparency of health care leadership and governance, we will be as much to blame as the leaders when the system collapses.
Monday, August 15, 2011
Sunday, August 14, 2011
The National Programme for IT in the NHS: an Aug. 2011 Public Accounts Committee update on the delivery of detailed care records systems
At "2009 a Pivotal Year in Healthcare IT" I linked to summary points of a Jan. 2009 report about the UK's National Program for IT in the NHS (NPfIT) entitled "The National Programme for IT in the NHS: Progress since 2006." The report was prepared by the Public Accounts Committee of the UK Parliament's House of Commons. That report summary (link here) was not pretty.
An August 2011 update has been issued by the same body entitled "The National Programme for IT in the NHS: an update on the delivery of detailed care records systems." The 2011 summary is even less pretty than the 2009 version (link here).
I reproduce it below with almost no added comments, as it speaks for itself relative to the many years of posts on health IT difficulties, failures and mismanagement I've authored at this blog and elsewhere.
(Also see my May 2011 post "NPfIT: National Programme of Failed IT in the NHS" that summarizes a number of press accounts of the project.)
The 2011 report begins:
Here is the updated "progress" summary:
The full 2011 report is at this link (PDF).
This report makes the success of a similar multibillion dollar national health IT initiative in the U.S., a far larger, more complex, and chaotic healthcare system, seem even more unlikely.
-- SS
An August 2011 update has been issued by the same body entitled "The National Programme for IT in the NHS: an update on the delivery of detailed care records systems." The 2011 summary is even less pretty than the 2009 version (link here).
I reproduce it below with almost no added comments, as it speaks for itself relative to the many years of posts on health IT difficulties, failures and mismanagement I've authored at this blog and elsewhere.
(Also see my May 2011 post "NPfIT: National Programme of Failed IT in the NHS" that summarizes a number of press accounts of the project.)
The 2011 report begins:
The National Programme for IT in the NHS (the Programme) was an ambitious £11.4 billion programme of investment designed to reform how the NHS in England uses information to improve services and patient care. The Programme was launched in 2002, and the Department of Health (the Department) has spent some £6.4 billion on the Programme so far.
Here is the updated "progress" summary:
The National Programme for IT in the NHS: an update on the delivery of detailed care records systems - Public Accounts Committee
Conclusions and recommendations
1. The Department has been unable to deliver its original aim of a fully integrated care records system across the NHS. Poor progress since 2002 has meant the Department has had to reconsider what the expenditure can deliver. Many NHS organisations will now not receive a system through the Programme which will not provide for the transmission of individual case records across the whole NHS. The Department should review urgently whether it is worth continuing with all elements of the care records system, to determine whether the remaining £4.3 billion could be used to better effect to buy systems that work, are good value and deliver demonstrable benefits for the NHS.
2. There has been a substantial reduction in how many NHS bodies will receive new systems but the Department failed to secure a comparable reduction in costs. This casts the Department's negotiating capability in a very poor light. In London, the Department's negotiations with BT resulted in far fewer systems to be delivered for only a marginal reduction in fee. We are worried that the Department will fare no better in its current negotiations with CSC [a U.S.-based computer consulting company - ed.], which has delivered only 10 of 166 of its 'Lorenzo' systems in the North, Midlands and East. The Department has been in negotiations with CSC for over a year, and told us that it may be more expensive to terminate the contract than to complete it, although we also note that CSC has informed the United States Securities and Exchange Commission that it may receive materially less than the net asset value of its contract if the NHS exercises its right to terminate the contract for convenience. Given the Department's failure to secure a good deal in its contract renegotiation with BT, and its weak position with CSC, we consider it essential that the Major Projects Authority now exercises very close scrutiny over the Department's continuing negotiations with CSC, and that Government gives serious consideration to whether CSC has proved itself fit to tender for other Government work. It is important that CSC, particularly given its proposed purchase of iSoft, does not acquire an effective monopoly in the provision of care records systems in the North, Eastern and Midland clusters. This could result in the Lorenzo system effectively being dropped as the system of choice and many Trusts being left with little choice but to continue with out-dated interim systems that could be very expensive to maintain and to upgrade, or to accept a system of CSC's choice. CSC should not be given minimum quantity guarantees or a licence to sell a product other than that procured and selected by the Programme within the LSP contract.
3. The Department is unable to show what has been achieved for the £2.7 billion spent to date on care records systems. The Department failed to meet its commitment to report to the Committee by summer 2010 on the benefits delivered by the Programme. A statement of benefits to March 2010 was not provided to the NAO until May 2011 - more than a year out of date. The Department should, by September 2011, provide us with an updated statement of benefits to March 2011, which we will ask the National Audit Office to audit.
4. We are very concerned at the lack of evidence of risk management of security issues which may arise as a result of medical records being held electronically. The Department must address possible compromises in data security.
5. Weak management and oversight of the Programme have resulted in poor accountability for project performance. Sir David Nicholson has not been able to fulfil his duties as the Senior Responsible Owner for the Programme effectively, given his significant other responsibilities, weakening accountability for the Programme's extensive delays and increasingly poor value for money. It is essential that there is proper accountability for the Programme, especially since the current health reforms, according to Sir David, make it "quite difficult to shift a system like that into that environment"[2]. [Of course, planned U.S. healthcare reforms are also highly complex, making "shifting systems into that environment" a predictable nightmare - ed.] Sir David should now expect much closer scrutiny and oversight of his actions by the Major Projects Authority, but he must remain Senior Responsible Owner for the Programme so there is a clear line of accountability and responsibility for performance as well as continuity in managing the substantial risks that remain.
6. NHS trusts will take over responsibility for care records systems from 2015-16, but they do not currently have the information they need about potential future costs. After the implementation of forthcoming health reforms, the organisations currently managing the Programme will no longer exist and the risks will transfer to NHS trusts. However, at present these trusts have no direct contractual relationship with existing suppliers and no information about the likely cost of using care records systems beyond 2015. The Department should write to every NHS Trust making clear the detailed implications of their future responsibilities for care record systems, and in particular the financial liability to which each trust will be exposed. This information should include information about exit costs from the LSP contracts and future maintenance and running costs for those Trusts that continue with the Programme, and this information must be provided within two months. It should also specify the support that the centre will provide to Trusts procuring outside the Programme, particularly where such systems can be shown to represent value for money to the NHS or greater functionality.
7. It is unacceptable that the Department has neglected its duty to provide timely and reliable information to make possible Parliament's scrutiny of this project. Basic information provided by the Department to the NAO was late, inconsistent and contradictory. We are surprised that in its memorandum to us of 7 June 2011, two weeks after our hearing, the Department did not mention that it made an advance payment to CSC of £ 200 million in April 2011. The Department must provide timely and reliable information in future to support effective accountability to Parliament. [One wonders if the U.S. ONC office (Office of the National Coordinator for health IT) in HHS will perform any better - ed.]
8. According to Sir David Nicholson, the Department may have to think about an interim step - a transitional body of some description- creating the impression of major uncertainty about how this work should be managed in the future. We will return to this issue in the future.
The full 2011 report is at this link (PDF).
This report makes the success of a similar multibillion dollar national health IT initiative in the U.S., a far larger, more complex, and chaotic healthcare system, seem even more unlikely.
-- SS
Friday, August 12, 2011
Congresswoman Renee Ellmers on Health IT Concerns
A letter on Health IT from Congresswoman Renee Ellmers, (R) NC, Chairwoman of the U.S. House of Representative's Committee on Small Business, Subcommittee on Healthcare and Technology was just sent to Secretary of the Dept. of Health and Human Services Kathleen Sebelius.
The themes in the letter will be familiar to readers of Healthcare Renewal.
A PDF copy of the letter can be downloaded by clicking below, and the text follows.
Here is the text, along with several comments:
I find this letter from a leading member of the House of Representatives remarkable. Importantly, Chairwoman Ellmers has a medical background (HHS Secretary Sebelius, to my knowledge, does not). Here is part of Chairwoman Ellmer's background from Wikipedia:
The only other letters like it asking questions like this that I know of came from a Republican Senator to the HIT vendors, Sen. Grassley of Iowa (see here and here). Sen. Grassley also wrote directly on HIT problems to HHS Secretry Sebelius on Feb. 24, 2010; see the letter here.
-- SS
The themes in the letter will be familiar to readers of Healthcare Renewal.
A PDF copy of the letter can be downloaded by clicking below, and the text follows.
Here is the text, along with several comments:
August 11, 2011
The Honorable Kathleen Sebelius
Secretary
U.S. Department of Health and Human Services
200 lndependence Avenue, S.W.
Washington, DC 20201
Via Facsimile: 202. 690.7380
Dear Secretary Sebelius:
The House Small Business Committee, on which I serve, is required by the Rules of the House to study and investigate the problems of all types of small businesses. This jurisdiction extends to matters concerning small businesses and health care. I chair the Committee’s Subcommittee on Healthcare and Technology.
On June 2, 2011, the Subcommittee held a hearing on the barriers to health information technology that are encountered by physicians and other providers in small practices. At the hearing, physicians testified that the cost to purchase and maintain a health IT system, is addition to staff training and downtime during the transition to health IT, are significant burdens for small practices. These barriers mere mentioned even by physicians who believe health IT would ultimately benefit their practices. Providers at the hearing also stated their concern about the Medicare reimbursement penalties that will be assessed against providers who do not demonstrate “meaningful use” of health IT by 2015.
One of the frequently mentioned benefits of health IT has been a reduction in medical errors. However, recent news reports have noted incidents of health IT errors. An article in Sunday’s Pittsburgh Post-Gazette [a series, actually, here and here- ed.] cited a baby who was killed while computerized IV equipment prepared a lethal dose of an intravenous sodium chloride solution. The machine did not catch the pharmacy technician’s error. The article also noted that when a hepatitis C-positive kidney was accidentally transplanted from a live donor into a recipient, the physician team missed the electronic records alert, and the physicians complained that their electronic records system is cumbersome and difficult to adjust to any one physician’s needs.
[You can be sure that my writings on health IT mission hostility, poor quality, lack of regulation, etc. as well as the cases of health IT-related injury and death I know of, including that of my own relative, will find their way to Rep. Ellmer's office - ed.]
The Journal of the American Medical Association recently published a study of almost 4,000 computer-generated prescriptions that were received by a pharmacy chain. The report found that 12 percent of the prescriptions contained errors, which, the report said, is consistent with error rates with handwritten prescriptions. [I wrote about that here - ed.]
A modern, well-equipped office is critical to the practice of medicine, and health IT offers promise to all medical professionals. [But only when done well - and there is massive complexity behind those simple two words "done well" that is poorly recognized and/or ignored - ed.] Health IT has the potential to improve health care delivery, decrease medical errors, increase clinical and administration efficiency, and reduce paperwork.
We most do all we can to ensure a commitment to our health care system and patient care. As technology rapidly evolves, I ask that you consider a study of health IT’s adoption, benefits and cost effectiveness.
[Cart before the horse when being done AFTER a national multi-billion dollar rollout is put into law, as I wrote here, but better late than never - ed.]
As part of the study, I hope you will also consider medical error rates — both human and technological --so that all errors can he better assessed and prevented.
[I have been calling for this for years now - ed.]
Sincerely,
Renee Ellmers
Chairwoman
Subcommittee on Healthcare and Technology
House Committee on Small Business
I find this letter from a leading member of the House of Representatives remarkable. Importantly, Chairwoman Ellmers has a medical background (HHS Secretary Sebelius, to my knowledge, does not). Here is part of Chairwoman Ellmer's background from Wikipedia:
In 1990, she graduated with a Bachelor of Science degree in Nursing. Ellmers worked as a nurse in Beaumont Hospital's surgical intensive care unit. In North Carolina, she was clinical director of the Trinity Wound Care Center in Dunn.
The only other letters like it asking questions like this that I know of came from a Republican Senator to the HIT vendors, Sen. Grassley of Iowa (see here and here). Sen. Grassley also wrote directly on HIT problems to HHS Secretry Sebelius on Feb. 24, 2010; see the letter here.
-- SS
Tuesday, August 09, 2011
Now a Mainstream Notion: "Profit-seeking Players in Finance and Health Care Have Captured Congress"
We have been writing - some might say wailing Cassandra-like - about health care dysfunction since I published about it in the European Journal of Internal Medicine in 2003.(1) However, while our dismal warnings were inspired by fears of health care professionals who saw bad things happening in their local health care environments, the notion that things were really bad in health care really did not get a lot of traction. After all, we were in the second decade of a prolonged economic "great moderation," the good times were rolling, so who was really worried by a few whiners and complainers in health care?
However, after the fall of Lehman Brothers ushered in the global financial collapse, or great recession, this complacency was disturbed, and it began to appear that our problems in health care were not unique, but were linked to much bigger problems in the general political economy. However, the stock market rebounded, the bankers went back to making money, and economists declared the great recession over, reassuring those on the right, although the middle class continued to whine and complain about unemployment, stagnant wages, and mortgage foreclosures. Furthermore, a Democratic administration legislated both financial and health care reform, reassuring those on the left.
We on Health Care Renewal went on and on that things were not better, and health care reform no more than barely scratched the surface.
Now with stock markets falling around the world, it appears that the great recession/ global financial collapse may not really be over. In this increasingly dismal era, the notion that health care dysfunction has not really improved, and may in fact be an important component of the larger political economic problems may be getting more mainstream.
To wit, last week, David Wessel wrote in the Wall Street Journal:
Furthermore, his diagnosis of the problem sounds like something we might have written on Health Care Renewal, if we wrote as well as he does:
In any case, we have written repeatedly about the linkages between finance and health care,(2) and how the current corrupt culture of finance has affected health care; that true health care reform will be very difficult because it will be resisted by those who have been made wealthy by the current system;(3) that they were made wealthy by the increasing commercialization of health care accompanied by the abandonment of previous regulations and safeguards;(4) and about their use of regulatory capture and embedded networks of influence(5) to further their aims.
You heard it here first.
Wessel's solution is:
My general suggestions maybe are complementary.
True health care reform would help physicians and other health care professionals uphold their traditional values, including, as the AMA once stated, "the practice of medicine should not be commercialized, nor treated as a commodity in trade." True health care reform would put health care "delivery" back in the hands of mission-focused, not-for-profit organizations, which put patients' health, safety and welfare first.
Health care organizations need leaders that uphold the core values of health care, and focus on and are accountable for the mission, not on secondary responsibilities that conflict with these values and their mission, and not on self-enrichment. Leaders ought to be rewarded reasonably, but not lavishly, for doing what ultimately improves patient care, or when applicable, good education and good research.
If we do not fix the severe problems affecting the leadership and governance of health care, and do not increase accountability, integrity and transparency of health care leadership and governance, we will be as much to blame as the leaders when the system collapses.
Notes:
1. Poses RM. A cautionary tale: the dysfunction of American health care. Eur J Int Med 2003; 14: 123-130. Link here.
2. Medical school leaders become stewards (as members of boards of directors) of for-profit health care corporations - An example is here, and a summary of how we discovered this phenomenon in 2006 is here. The conflict of interest is severe because directors of for-profit corporations are supposed to have unyielding loyalty to the interests of the corporation and its stockholders, although they are frequently accused of acting mainly as cronies of the top hired executives (see here and here).
Leaders of failed finance firms become stewards of academic medicine - We have found numerous examples, e.g., here, here, and here, of top executives and/or board members of the finance firms who helped bring on the global financial collapse also being trustees of medical schools, academic medical centers, or their parent universities. Such "stewards" may bring to the academic environment the "greed is good" culture now pervasive in finance.
3. For example, see this post and its links
4. In the US, a Supreme Court decision was interpreted to mean that medical societies could no longer regulate the ethics of their members. Until 1980, the US American Medical Association had ruled that the practice of medicine should not be "commercialized, nor treated as a commodity in trade." After then, it ceased trying to maintain this prohibition. The result was increasing, now rampant commercialization. See posts here and here. Furthermore, the notion that information asymmetry, uncertainty and ambiguity, and inability of patients to make coldly rational decisions about disease and its management made it impossible for health care to be an ideal free market, necessitating mechanisms to compensate for market failure became passe. Such mechanisms were then abandoned, with disastrous results. For further discussion, see this post
5. For example, see this post
However, after the fall of Lehman Brothers ushered in the global financial collapse, or great recession, this complacency was disturbed, and it began to appear that our problems in health care were not unique, but were linked to much bigger problems in the general political economy. However, the stock market rebounded, the bankers went back to making money, and economists declared the great recession over, reassuring those on the right, although the middle class continued to whine and complain about unemployment, stagnant wages, and mortgage foreclosures. Furthermore, a Democratic administration legislated both financial and health care reform, reassuring those on the left.
We on Health Care Renewal went on and on that things were not better, and health care reform no more than barely scratched the surface.
Now with stock markets falling around the world, it appears that the great recession/ global financial collapse may not really be over. In this increasingly dismal era, the notion that health care dysfunction has not really improved, and may in fact be an important component of the larger political economic problems may be getting more mainstream.
To wit, last week, David Wessel wrote in the Wall Street Journal:
Two big sectors of the U.S. economy have been on steroids: finance and health care. If anything is crowding out more productive activities, it's them, as ... [New York University economist Paul] Romer argued in a recent National Academy of Sciences lecture.
The bloated financial sector—all those brains lured by big bucks who might otherwise have been employed in science, software, engineering or other fields—has harmed the U.S. economy more than any of our post-World War II communist adversaries did.
The American health system costs more per person than any other, but isn't delivering the world's healthiest people. The U.S. isn't getting its money's worth from either sector.
Furthermore, his diagnosis of the problem sounds like something we might have written on Health Care Renewal, if we wrote as well as he does:
Profit-seeking players in finance and health care have captured Congress, resisted regulation that would curb their excesses and exploited antiquated rules and policy for private gain.My only quibble is that while those who have personally profited from health care and finance have exploited antiquated rules, they also cannily managed to dispose of many time-proven rules that stood in their way.
[Paul Romer said,] 'The legislative process may just be too vulnerable to manipulation by very well-financed entities with an enormous amount of wealth and income at stake,' he said. 'Congress is for sale at bargain-basement prices.'
In any case, we have written repeatedly about the linkages between finance and health care,(2) and how the current corrupt culture of finance has affected health care; that true health care reform will be very difficult because it will be resisted by those who have been made wealthy by the current system;(3) that they were made wealthy by the increasing commercialization of health care accompanied by the abandonment of previous regulations and safeguards;(4) and about their use of regulatory capture and embedded networks of influence(5) to further their aims.
You heard it here first.
Wessel's solution is:
Congress should tie its own hands more often, retaining power to investigate and vote proposals up or down but avoiding the detailed crafting of legislative provisions that influence the flow of money.
In other words, he wants more bodies such as the Base Closure and Realignment Commission (to decide which military bases to close), the Independent Payment Advisory Board (to identify ways Medicare can save money) and, perhaps, the new Joint Select Committee on Deficit Reduction (to find $1.5 trillion in deficit-reduction cuts).
Maybe that's an answer. But it's clear that future prosperity depends on the U.S.—its government, business, people and universities—coalescing behind a strategy for growth and creating incentives so talent and capital flow to promising sectors where the U.S. still has an edge in an increasingly competitive global economy.
My general suggestions maybe are complementary.
True health care reform would help physicians and other health care professionals uphold their traditional values, including, as the AMA once stated, "the practice of medicine should not be commercialized, nor treated as a commodity in trade." True health care reform would put health care "delivery" back in the hands of mission-focused, not-for-profit organizations, which put patients' health, safety and welfare first.
Health care organizations need leaders that uphold the core values of health care, and focus on and are accountable for the mission, not on secondary responsibilities that conflict with these values and their mission, and not on self-enrichment. Leaders ought to be rewarded reasonably, but not lavishly, for doing what ultimately improves patient care, or when applicable, good education and good research.
If we do not fix the severe problems affecting the leadership and governance of health care, and do not increase accountability, integrity and transparency of health care leadership and governance, we will be as much to blame as the leaders when the system collapses.
Notes:
1. Poses RM. A cautionary tale: the dysfunction of American health care. Eur J Int Med 2003; 14: 123-130. Link here.
2. Medical school leaders become stewards (as members of boards of directors) of for-profit health care corporations - An example is here, and a summary of how we discovered this phenomenon in 2006 is here. The conflict of interest is severe because directors of for-profit corporations are supposed to have unyielding loyalty to the interests of the corporation and its stockholders, although they are frequently accused of acting mainly as cronies of the top hired executives (see here and here).
Leaders of failed finance firms become stewards of academic medicine - We have found numerous examples, e.g., here, here, and here, of top executives and/or board members of the finance firms who helped bring on the global financial collapse also being trustees of medical schools, academic medical centers, or their parent universities. Such "stewards" may bring to the academic environment the "greed is good" culture now pervasive in finance.
3. For example, see this post and its links
4. In the US, a Supreme Court decision was interpreted to mean that medical societies could no longer regulate the ethics of their members. Until 1980, the US American Medical Association had ruled that the practice of medicine should not be "commercialized, nor treated as a commodity in trade." After then, it ceased trying to maintain this prohibition. The result was increasing, now rampant commercialization. See posts here and here. Furthermore, the notion that information asymmetry, uncertainty and ambiguity, and inability of patients to make coldly rational decisions about disease and its management made it impossible for health care to be an ideal free market, necessitating mechanisms to compensate for market failure became passe. Such mechanisms were then abandoned, with disastrous results. For further discussion, see this post
5. For example, see this post
Monday, August 08, 2011
Retreat Back to Regulatory Capture: US FDA, NIH, Department of Health and Human Services All Back Off
After some brave words about transparency, integrity and all that, US government officials seem to be running back to the arms of the health care corporate CEOs.
Weakening FDA Conflict of Interest Rules
As reported by Reuters,
This was not purely an initiative of legislators, but was egged on by a top FDA administrator
The rationale was that those paid by drug and device companies are the most expert:
Of course, the drug and device companies have been touting their paid "key opinion leaders" as the best and the brightest for a long time. There is plenty of evidence, however, that they are mainly those whom those companies find the most compliant, and in many cases, those who are willing to be stealth marketers on those companies' payrolls. (See this post about those who recruit KOLs regarding them as salesmen, and more here.) "Key opinion leaders" supported by commercial grant funding may seem like experts to academic medical institutions' leadership who now value outside funding more than teaching and research excellence (see this post).
Furthermore, as reported by Politco, the Project on Government Oversight, a watchdog group, chastised FDA leadership for exaggerating the difficulty of finding unconflicted experts, concluding in their letter to the FDA Commissioner, "to gain the public trust, we must ensure that the FDA relies on the best available information for its policies, rather than personal opinions and biases."
So far, government officials seem to be more worried about the opinions of corporate leaders than the public trust.
Weakening NIH Conflict of Interest
As discussed in Nature,
In more detail,
But of course the medical schools decided that it would just be too much trouble to do all this:
Given how academic medical institutions have expanded their administrations and bureaucracy, the enormous amounts they spend on management, and the huge compensation they give their executives, and further given how much of their revenues come from government sources (Medicare, Medicaid money for patient care, Veterans Administration money supporting many faculty members, Medicare money funding graduate medical education, and NIH and other government research grants), the notion that getting a few staffers to process disclosures would be administratively or financially burdensome is just laughable.
At least Iowa's Republican Senator Charles Grassley, seemingly one of the last politicians in Washington who cares about the integrity of government programs and spending, is upset. As reported again by Nature,
Furthermore, he wrote:
We will see if his protest does any good, but again it appears that government officials are more worried about the revenues of big health care organizations than the needs of the public.
Retreating from Threats to Disbar Forest Laboratories CEO
We previously posted about how the US Department of Health and Human Services threatened to disbar the CEO of Forrest Laboratories from dealings with the government after his company pleaded guilty to obstruction of justice and misbranding, and paid a $313 million fine.
Now, per Alicia Mundy writing for the Wall Street Journal, things have changed:
We have discussed - some might say endlessly - how despite numerous publicly reported cases of wrongdoing by health care organizations, hardly any individual who authorized, directed or implemented the bad behavior has ever faced any negative consequences. There have been recent fulminations by some government officials that this is going to change. The case of the Forest Laboratories CEO appeared to be an example of such change, but no more.
The Wall Street Journal went on to discuss why the government may have changed course:
Of course it was unusual. That is the whole problem.
In any case, it looked like the government was much more concerned about the coddling of corporate CEOs and their lobbyists' and cronies' opinions than about deterring bad behavior by large health care organizations.
Summary
After a bit of blustering by the current US administration about transparency and integrity it appears to be back to business as usual in the US capital. Over the last 20 years, government has increasingly answered to corporate CEOs instead of "we, the people." Protecting patients' and the public's health has given way to protecting the financial health of large health care organizations, and the compensation of rich CEOs. Federalism is giving way to corporatism. As long as this continues, expect our health care system to continue its slow collapse. Eventually, expect the CEOs to get in their private jets and escape while the rest of us picks up the pieces.
Until we dispel the fog of corporatism that has spread over the government that was once supposed to be of the people, by the people, and for the people, expect no real health care reform, and expect continuing rising costs, declining access, and worsening patient care. Obviously, true health care reform would start with the government and its officials putting patients' and the public's health first, way ahead of the financial comfort of corporate CEOs.
See also comments by Alison Bass.
Weakening FDA Conflict of Interest Rules
As reported by Reuters,
U.S. lawmakers likely will change the criteria for advisers reviewing new medicines next year because of complaints that the rules meant to prevent conflicts of interest make it harder to find real experts.
Congressional lawmakers may require the Food and Drug Administration to relax the rules that bar advisers from reviewing a drug if they have even indirect financial ties to related manufacturers, as part of an FDA funding bill.
This was not purely an initiative of legislators, but was egged on by a top FDA administrator
The agency often must delay panel meetings while it searches for experts without conflicts, lawmakers and FDA officials say. Top doctors are usually the ones drugmakers hire as speakers or consultants.
'We have had difficulty in recruiting highly qualified people. And we've had delays in having panels because of this,' Dr. Janet Woodcock, head of the FDA's drugs center, told a House of Representatives hearing earlier this month.
The result is that 23 percent of FDA advisory panels have vacancies, more than double the agency's stated goal, according to the FDA's quarterly report at the end of May.
The rationale was that those paid by drug and device companies are the most expert:
The FDA tightened guidelines in 2007 to minimize industry ties that could sway a panelist's view, partly inspired by the scandal with Merck's pain reliever Vioxx.
Ten of the 32 panelists advising the FDA on the drug consulted for drugmakers. Nine of the 10 recommended putting the drug back on the market after it was pulled in 2004 over concerns about heart risk.
The restrictions go too far, say lawmakers who want the FDA to approve more new medicines, in part because they promote American jobs.
'No longer can we deny experts simply because they have ties to industry,' said Georgia Representative Phil Gingrey during a House of Representative hearing on FDA funding last month. The committee's chairman, Fred Upton from Michigan, called the conflict of interest rules 'rigid and unrealistic.'
Industry executives, who want the FDA to speed drug approvals, also support relaxing the rules. Biogen Idec CEO George Scangos said the guidelines 'exclude a lot of people who would be the best qualified.'
Of course, the drug and device companies have been touting their paid "key opinion leaders" as the best and the brightest for a long time. There is plenty of evidence, however, that they are mainly those whom those companies find the most compliant, and in many cases, those who are willing to be stealth marketers on those companies' payrolls. (See this post about those who recruit KOLs regarding them as salesmen, and more here.) "Key opinion leaders" supported by commercial grant funding may seem like experts to academic medical institutions' leadership who now value outside funding more than teaching and research excellence (see this post).
Furthermore, as reported by Politco, the Project on Government Oversight, a watchdog group, chastised FDA leadership for exaggerating the difficulty of finding unconflicted experts, concluding in their letter to the FDA Commissioner, "to gain the public trust, we must ensure that the FDA relies on the best available information for its policies, rather than personal opinions and biases."
So far, government officials seem to be more worried about the opinions of corporate leaders than the public trust.
Weakening NIH Conflict of Interest
As discussed in Nature,
Francis Collins hailed it as a 'new era of clarity and transparency in the management of financial conflicts of interest' (S. J. Rockey and F. S. Collins J. Am. Med. Assoc. 303, 2400–2402; 2010). But the director of the US National Institutes of Health (NIH) may have spoken too soon when he described a new rule, proposed last year, that would require universities and medical schools to publicly disclose online any financial arrangements that they believe could unduly influence the work of their NIH-funded researchers.
Nature has learned that a cornerstone of that transparency drive — a series of publicly accessible websites detailing such financial conflicts — has now been dropped.
In more detail,
The NIH's parent agency, the Department of Health and Human Services (DHHS), proposed the new rule in May 2010, after congressional and media investigations revealed that prominent NIH grant recipients had failed to tell their universities or medical schools about lucrative payments from companies that may have influenced their government-funded research. The DHHS called the proposed websites 'an important and significant new requirement to … underscore our commitment to fostering transparency, accountability, and public trust'. Under the proposal, institutions with NIH-funded researchers would determine, grant by grant, if any financial conflicts existed for senior scientists on the grant. For example, these would include receiving consultancy fees, or holding shares in a company, 'that could directly and significantly affect the design, conduct, or reporting' of the research. The institutions would post the details online, where they would stay for at least five years.
But of course the medical schools decided that it would just be too much trouble to do all this:
'The websites don't appear out of nowhere,' says Heather Pierce, senior director of science policy at the Association of American Medical Colleges (AAMC) in Washington DC. They would 'require employees to not only create the website but to pull the information, review it, and make sure it is up to date and accurate'.
That is not the only objection from the powerful academic lobbies. During the public comment period last summer, the Association of American Universities and the AAMC submitted a joint statement saying: 'There are serious and reasonable concerns among our members that the Web posting will be of little practical value to the public and, without context for the information, could lead to confusion rather than clarity regarding financial conflicts of interest and how they are managed.'
Given how academic medical institutions have expanded their administrations and bureaucracy, the enormous amounts they spend on management, and the huge compensation they give their executives, and further given how much of their revenues come from government sources (Medicare, Medicaid money for patient care, Veterans Administration money supporting many faculty members, Medicare money funding graduate medical education, and NIH and other government research grants), the notion that getting a few staffers to process disclosures would be administratively or financially burdensome is just laughable.
At least Iowa's Republican Senator Charles Grassley, seemingly one of the last politicians in Washington who cares about the integrity of government programs and spending, is upset. As reported again by Nature,
The US Senate's leading advocate for government transparency wrote today to the White House's budget office, demanding that it protect a proposed rule that would obligate universities to post their publicly-funded biomedical researchers' financial conflicts on a publicly accessible website.
'The public's business should be public... I urge OMB to follow through and approve a rule that includes a publicly available website,' Senator Charles Grassley, Republican of Iowa ..., wrote in in this letter to Jacob Lew, the director of the White House's Office of Management and Budget (OMB).
Furthermore, he wrote:
I am troubled that taxpayers cannot learn about the outside income of the researchers whom the taxpayers are funding, and this flies in the face of President Obama's call for more transparency in the government.
We will see if his protest does any good, but again it appears that government officials are more worried about the revenues of big health care organizations than the needs of the public.
Retreating from Threats to Disbar Forest Laboratories CEO
We previously posted about how the US Department of Health and Human Services threatened to disbar the CEO of Forrest Laboratories from dealings with the government after his company pleaded guilty to obstruction of justice and misbranding, and paid a $313 million fine.
Now, per Alicia Mundy writing for the Wall Street Journal, things have changed:
The U.S. government dropped efforts to force the resignation of a prominent pharmaceutical-company chief executive, reversing course after protests from the company and major business groups.
The about-face on Forest Laboratories's longtime leader, Howard Solomon, represents a significant retreat by the Department of Health and Human Services, which has said it wants to step up punishments against drug-company executives when wrongdoing happens on their watch.
Forest agreed last year to plead guilty to misdemeanors involving marketing of its drugs including the antidepressant Celexa, and it paid $313 million to resolve the matter.
Mr. Solomon wasn't personally accused of any wrongdoing. Nonetheless, the government notified him in April that it was considering excluding him from jobs at health-care companies that sell to the U.S. government. It invoked a little-used clause in the Social Security Act that allows such an action against corporate leaders of companies found guilty of criminal misconduct, even if the leaders had no knowledge of the misconduct.
The exclusion move would have effectively forced Forest to remove Mr. Solomon from office, because Forest and other drug companies rely on business from U.S. government agencies such as Medicare and the Veterans Administration.
In a letter to Mr. Solomon on Friday, the office of the inspector general of the Department of Health and Human Services said, 'Based on a review of information in our file, and consideration of the information your attorneys provided to us both in writing and in an in-person meeting, we have decided to close this case.'
We have discussed - some might say endlessly - how despite numerous publicly reported cases of wrongdoing by health care organizations, hardly any individual who authorized, directed or implemented the bad behavior has ever faced any negative consequences. There have been recent fulminations by some government officials that this is going to change. The case of the Forest Laboratories CEO appeared to be an example of such change, but no more.
The Wall Street Journal went on to discuss why the government may have changed course:
The government's retreat came after a barrage of complaints from Forest and business groups including the U.S. Chamber of Commerce and the Pharmaceutical Research and Manufacturers of America, the drug industry's leading trade group.
In July, Forest spent $80,000 to hire former Louisiana Sen. John Breaux to lobby the government regarding exclusion, according to Senate records. Mr. Breaux didn't return a call requesting comment. Forest said earlier that it was just trying to make its case that this was a highly unusual action by the U.S. government.
Of course it was unusual. That is the whole problem.
In any case, it looked like the government was much more concerned about the coddling of corporate CEOs and their lobbyists' and cronies' opinions than about deterring bad behavior by large health care organizations.
Summary
After a bit of blustering by the current US administration about transparency and integrity it appears to be back to business as usual in the US capital. Over the last 20 years, government has increasingly answered to corporate CEOs instead of "we, the people." Protecting patients' and the public's health has given way to protecting the financial health of large health care organizations, and the compensation of rich CEOs. Federalism is giving way to corporatism. As long as this continues, expect our health care system to continue its slow collapse. Eventually, expect the CEOs to get in their private jets and escape while the rest of us picks up the pieces.
Until we dispel the fog of corporatism that has spread over the government that was once supposed to be of the people, by the people, and for the people, expect no real health care reform, and expect continuing rising costs, declining access, and worsening patient care. Obviously, true health care reform would start with the government and its officials putting patients' and the public's health first, way ahead of the financial comfort of corporate CEOs.
See also comments by Alison Bass.
Sunday, August 07, 2011
Why EHR's Are Mission Hostile
From "Revisiting E&M Visit Guidelines — A Missing Piece of Payment Reform" (free PDF as of this writing), Robert A. Berenson, M.D., Peter Basch, M.D, and Amanda Sussex, M.P.H., N Engl J Med 364;20 nejm.org May 19, 2011.
Excerpt:
Then why are they popular? Here's why:
Partial list of references cited in the excerpts above:
[3] Park T, Basch P. A historic opportunity: wedding health information technology to care delivery innovation and provider payment reform. Washington, DC: Center for American Progress, 2009. (http://www.americanprogress.org/issues/2009/05/health_it.html.)
[4] Hartzband P, Groopman JG. Off the record — avoiding the pitfalls of going electronic. N Engl J Med 2008;358:1656-8.
In fact, I'd made similar observations about an ED EHR in a hospital where a relative was treated. I wrote:
The outputs of inpatient EMR's are far worse. See my Feb. 2011 post "Two weeks, two reams." The thousands of pages of data-dumped legible gibberish I've seen has been stunning, both in terms of the ignorance of basic information science and the wasted effort and dangers to patients represented when other physicians need to refer to these old records in caring for sick people.
Berenson et al. add to our understanding of these phenomena.
-- SS
Excerpt:
... Numerous problems have resulted. [From the CPT codes, Current Procedural Terminology codes used by physicians in billing, covering evaluation and management (E&M) services - ed.] The detailed guidelines often cause clinicians to overdocument, making the medical record an ineffective source of communication.
... A fundamental concern is that the office-visit descriptors and interpretive guidelines emphasize often-irrelevant elements of patients’ clinical histories and examinations, rather than decisionmaking and care-management activities. This is particularly problematic in the case of clinicians caring for patients with multiple chronic conditions.
Now EHR experts argue that the priority placed on documentation has diverted software designers’ focus from more important activities that would improve the quality and efficiency of care. [3] The current focus produces EHR-generated data dumps, including repetitive documentation of elements of patients’ histories and physical examinations, that merely result in electronic versions of clinically cumbersome, uninformative patient records. [4]
Then why are they popular? Here's why:
Studies show that EHRs pay for themselves within a few years and then generate profit partly because of facilitated coding, not greater practice efficiency. [EHR's saving the government money? A pipe dream - ed.]
Partial list of references cited in the excerpts above:
[3] Park T, Basch P. A historic opportunity: wedding health information technology to care delivery innovation and provider payment reform. Washington, DC: Center for American Progress, 2009. (http://www.americanprogress.org/issues/2009/05/health_it.html.)
[4] Hartzband P, Groopman JG. Off the record — avoiding the pitfalls of going electronic. N Engl J Med 2008;358:1656-8.
In fact, I'd made similar observations about an ED EHR in a hospital where a relative was treated. I wrote:
... I reviewed a printout from the ED system myself, and found a collection of what I call “legible gibberish” (a mass of information as if the EMR system is just a warehouse for clinical data) but no diagnosis of her problem. A nonspecific and non-useful diagnoses of “abdominal pain” was all I could find – and that was on page 8 of an 12 page printout.
... These observations and events cause me to believe your electronic medical records systems are not serving the patients and the physicians properly and could result in patient harm.
The outputs of inpatient EMR's are far worse. See my Feb. 2011 post "Two weeks, two reams." The thousands of pages of data-dumped legible gibberish I've seen has been stunning, both in terms of the ignorance of basic information science and the wasted effort and dangers to patients represented when other physicians need to refer to these old records in caring for sick people.
Berenson et al. add to our understanding of these phenomena.
-- SS
Friday, August 05, 2011
Medical Data Mix-up, Major System Error Down Under - But Nobody Harmed, Of Course
This from Down Under. Apparently an American IT system by Cerner was involved:
Medical data mix-up, major system error
Kate Hagan | August 5, 2011
MELBOURNE hospitals have sent incorrect patient records to GPs due to an error with Victoria's troubled health technology program over the past two months.
The discharge summaries from Eastern Health and the Royal Victorian Eye and Ear Hospital mixed patients' names with other patient data, including test results and diagnoses.
[A major patient misidentification error - ed.]
The data was faxed to GPs under the HealthSMART program, which Health Minister David Davis has described as ''the myki of health''.
[I think 'myki' refers to the contactless smartcard ticketing system being introduced on public transport in Victoria, Australia. Did I mention I despise comparisons of healthcare to public transit, having started my career in the latter industry? - ed.]
Mr Davis yesterday said: ''This latest error raises further concerns about [former health minister] Daniel Andrews's judgment when designing the HealthSMART system.''
The Health Department was alerted to the record mix-up last month after two GP clinics raised the alarm.
Department spokesman Graeme Walker yesterday confirmed the bungle and said an investigation found that 13 incorrect discharge summaries were sent out over a seven-week period.
''There was an intermittent error in terms of the sending of discharge summaries in a small number of cases to GPs,'' he said. ''It was the link up between the software and the fax which caused some incorrect collating of material attached to the discharge summaries.''
Mr Walker said no patients suffered as a result of the bungle, which had since been fixed.
AMA Victoria president Harry Hemley said the mix-ups were a major concern. ''When patients are admitted to hospital often their medication is changed and they are given a diagnosis,'' he said. ''Discharge summaries influence our ongoing treatment of the patient. If our [incorrect understanding] is that a patient is on a certain medication, that could have serious implications.''
[Well, yes. How about - injury and death? - ed.]
Mr Davis said yesterday he had been advised of a software fault that led to some patient discharge summaries being distributed to the wrong GP clinics.
''I have sought and received assurances that patient safety has not been compromised,'' he said.
[Patients are NEVER harmed by IT foulups thanks to the Lords of Kobol overseeing the universe of Cybernetica - or something like that - ed.]
Mr Davis told The Age in January that he was considering abandoning the HealthSMART program, which is five years late and has cost the state $405 million, including an $80 million cost overrun.
[He should see what the UK just did with their NPfIT here - they pulled the plug - ed.]
The program, introduced by the former Labor government in 2003, is supposed to link computer systems in hospitals and give doctors immediate access to patient records. But clinical applications are only partially running in four hospitals and doctors say they are costly, outdated and difficult to use.
[That is, they present a mission hostile user experience - ed.]
Victoria's Ombudsman and Auditor-General are currently examining a string of failed information technology projects in Victoria, including HealthSMART, which have run over budget and fall short of their goals despite repeated warnings by the watchdogs.
[Repeated warnings by watchdogs ignored - that is quite familiar to me since my writings on these issues began - in 1999 - ed.]
Dr Hemley said the government needed to take urgent action to implement a system that allowed doctors ready access to patient records, test results and medication details. ''We're sick of hearing how bad [HealthSMART] has been, we're waiting for the Ombudsman to come out with that report so we can get on with this IT business and start it happening so that we can communicate with each other,'' he said.
[I wish them luck. Einstein on insanity: doing the same thing over and over again and expecting different results. - ed.]
''We've got to look at where mistakes have been made, eradicate them and move forward.''
[Yes, it's that simple. Of course, achieving nuclear fission on your kitchen table is easy as long as you have the right components and a pamphlet by Dr. Alfred E. Neuman on the topic - ed.]
Asked whether affected patients had been notified of the error, the Health Department's Mr Walker said that would be done ''at the discretion of either the hospital or GP involved''.
The Eye and Ear Hospital did not return calls from The Age yesterday and Eastern Health referred inquiries to the Health Department.
-- SS
Why Radiologists Should Review Reports Carefully , and Why Health IT Causes Screwups
Another way computers in medicine can lead to maimed and dead patients:
That might be sage advice for all doctors using computer-based equipment.
-- SS
By Arun Krishnaraj, MD | August 2, 2011
Mrs. Anderson called her doctor and spoke with pressured speech: “I think there is a mistake. That cannot be my ultrasound. I don’t have a gallbladder.”
Mrs. Anderson was accessing our hospital’s open EHR, which allowed her to view her radiology reports, and noticed a discrepancy. An ultrasound had been performed which identified “multiple hypoechoic lesions, incompletely characterized.” Because the lesions discovered were indistinguishable from metastatic deposits by ultrasound an MRI was correctly recommended for more definitive characterization. However, the dictating radiologists overlooked a “canned” normal finding in his final report noting the presence of a normal appearing gallbladder. Mrs. Anderson’s gallbladder had been removed surgically 10 years prior.
[In other words, he ticked a "normal" box or template and out came the report of a normal gallbladder - ed.]
Mrs. Anderson’s case came to my attention when I dictated her liver MRI, comparing it to the ultrasound performed earlier in the week. The liver MRI fortunately demonstrated only multiple benign lesions. My report commented on expected post cholecystectomy changes in the right upper quadrant in the findings of the dictation but not in the impression.
I did not read the portion of the prior ultrasound report describing the gallbladder because I was only concerned with the positive finding for which the MRI had been ordered, the liver lesions.
[In other words, most doctors are too busy and distracted by their work to have to deal with computer-generated garbage - ed.]
I received an e-mail the next day from the nurse practitioner (NP) caring for Mrs. Anderson. She said that Mrs. Anderson had called her office frantic that there was some kind of mix up and that her patient wanted to know which of her reports were correct. I reviewed both reports and realized there was a proofreading error on the ultrasound report, paged the dictating radiologist to amend the error, and explained to the NP how such errors occur with our speech recognition software and macros.
[They're lucky this case was not like the infanticide by computer cases here. However, next time, luck may run out and a critical finding might be missed, or an incorrect one added that results in catastrophe - ed.]
The NP understood and said she would explain to Mrs. Anderson that both her studies were accurate except for the oversight on the ultrasound dictation which would be amended.
While the NP realized how such errors may make their way on to finalized reports, I now better understand the impact an incorrect report can have on a patient. [My mother could have told him this, but he'd need a megaphone to talk to her. Her incorrect report has caused her to change her address to a cemetery and she is now six feet under the ground - ed.]
We are entering a new era of health care that is more patient centered. Part of this new paradigm is patient access to their medical records, easily accessible from the Internet.
While physicians possess the ability to distinguish between an occasional proofing error, patients can not, nor should they be expected to.
[And when physicians fail for any reason to distinguish such errors, patients are put in harm's way - ed.]
In order to increase the efficiency of radiology reporting, most institutions have moved to speech recognition (SR) software with templated macros. The potential for typographical errors has been shown to be higher using SR software than traditional transcription services.1
[Wait - technology is supposed to, through cybernetic magic, reduce errors - ed.]
However, there is a paucity of literature regarding how often errors occur because of the use of pre-populated macros. I learned first hand how my words can affect a patient’s mental well being by inducing unnecessary anxiety. More and more pressure is being placed on radiologists to increase their RVUs to maintain their salaries. However, patients will not and should not excuse us from errors in what we report.
In an era of more open access to all medical records, including radiology dictations, it will be critical for radiologists to take pause and examine their finalized reports carefully.
[1] J Digit Imaging. 2008 Dec;21(4):384-9. Voice recognition dictation: radiologist as transcriptionist.
That might be sage advice for all doctors using computer-based equipment.
-- SS
Thursday, August 04, 2011
Debt Ceiling deal could endanger health care law - and it would be beneficial if health IT/HITECH were part of the trimmings
A story about the recent political deal to raise the Debt Ceiling entitled "Deal could endanger health care law" appeared in the Politico (hat tip Drudge Report):
Deal could endanger health care law
By JENNIFER HABERKORN | 8/3/11 11:28 PM EDT
Politico.com
The debt ceiling agreement could jeopardize millions of dollars, and perhaps billions, in initiatives from President Barack Obama’s health care reform law if the super committee can’t come up with required spending cuts.
Many of the pots of money in the law — one of the Democrats’ most prized pieces of legislation — could get trimmed by the debt deal’s sequestration, or triggered cuts. The funds for prevention programs and community health centers, grants to help states set up insurance exchanges and co-ops, and money to help states review insurance rates could be slashed across the board if the panel can’t find enough cuts this fall.
Put health IT and the HITECH Act (the health IT component that 'somehow' found its way into the fantastically-successful American Recovery and Reinvestment Act of 2009) on the table.
Health IT devices are medical devices that are dangerous, unregulated and unproven (e.g., see 'Reading List' here) in their current state of development and lawless environment.
Cutting HIT funding probably would be beneficial in avoiding waste as well.
Note what just occurred in the UK:
Health IT devices are medical devices that are dangerous, unregulated and unproven (e.g., see 'Reading List' here) in their current state of development and lawless environment.
Cutting HIT funding probably would be beneficial in avoiding waste as well.
Note what just occurred in the UK:
Wednesday, August 03, 2011
Time For A Summer Vacation at ONC - And Ethical Education of Health IT Zealots
A Microsoft Developer's Network (MSDN) blogger "Family Health Guy" a.k.a. Sean Nolan writes in a July 31, 2011 post entitled "Time for a summer vacation at ONC" that:
I find this attitude to be somewhat - well, let's just say, in a somewhat negative message, psychopathic.
We're talking about real, live human patients as the subject of our "figuring."
For, during the period of implementation, competition and iteration during which "we" will be figuring out how to deliver on "the promise" of experimental health IT medical devices, we shall be putting at risk and injuring non-consenting patients with our IT lessons-learned, and burying our more serious mistakes.
A far better way to figure out "how to deliver on the promise" would be to follow the protocols and procedures used to figure out how to deliver on the promise of other medical devices. These protocols and procedures, and ethical guidelines as well (link), were developed over decades in response to abuses of the past. (The Tuskegee experiments come to mind.)
That calls for controlled clinical trials under informed consent for safety and efficacy, careful study of the results, weeding out of unproven or dangerous technologies via regulation, and all this even before wide-scale rollouts of these health IT medical devices. Even after rollout, there needs to be a robust post-marketing surveillance process.
That's how it works with other medical devices and with pharmaceuticals. HIT medical devices deserve no special accommodation for any logical or ethical reason I can think of.
A lesson here: computer people, and health IT zealots of any background, need to be kept at arm's length from clinical settings, and on very short leashes in those settings.
-- SS
Aug. 3 addendum: the "period of implementation, competition and iteration to figure out how to deliver on the promise" in the UK did not turn out very well.
I’ve spoken at some length about my enthusiasm for the current leadership at HHS and ONC. President Obama has both directly and indirectly engaged some really gifted individuals to help us address healthcare challenges through the use of information technology --- which is awesome ... I’ve had the good fortune to participate in a few of these, and it’s been some of the most rewarding work of my career.
Truth is, I’m not used to seeing such great work out of government. So I’m a bit reluctant to throw out what could be perceived as a negative message --- but after my own two-week vacation thinking about it I’m convinced the time is right to ask ONC:
PLEASE, TAKE A BREAK!
JUST STOP TALKING FOR AWHILE AND LET US IMPLEMENT STUFF.Why stop now? I think the answer is increasingly clear. Between Meaningful Use Stage 1, the Direct Project and the Health Data Initiative, government has kicked industry out of a funk it’s been in for the previous decade, and we’re seeing a ton of really exciting and positive innovation. But nobody, and certainly not ONC, knows at a detailed level how to turn that innovation into ubiquitous market reality.
What we need now is a period of implementation, competition and iteration to figure out how to deliver on the promise.
I find this attitude to be somewhat - well, let's just say, in a somewhat negative message, psychopathic.
We're talking about real, live human patients as the subject of our "figuring."
For, during the period of implementation, competition and iteration during which "we" will be figuring out how to deliver on "the promise" of experimental health IT medical devices, we shall be putting at risk and injuring non-consenting patients with our IT lessons-learned, and burying our more serious mistakes.
A far better way to figure out "how to deliver on the promise" would be to follow the protocols and procedures used to figure out how to deliver on the promise of other medical devices. These protocols and procedures, and ethical guidelines as well (link), were developed over decades in response to abuses of the past. (The Tuskegee experiments come to mind.)
That calls for controlled clinical trials under informed consent for safety and efficacy, careful study of the results, weeding out of unproven or dangerous technologies via regulation, and all this even before wide-scale rollouts of these health IT medical devices. Even after rollout, there needs to be a robust post-marketing surveillance process.
That's how it works with other medical devices and with pharmaceuticals. HIT medical devices deserve no special accommodation for any logical or ethical reason I can think of.
A lesson here: computer people, and health IT zealots of any background, need to be kept at arm's length from clinical settings, and on very short leashes in those settings.
-- SS
Aug. 3 addendum: the "period of implementation, competition and iteration to figure out how to deliver on the promise" in the UK did not turn out very well.
UK NHS pulls the plug on its £11bn IT system
You saw it here first. Or, at least well before the pundits admitted this.
I've been predicting this event for quite awhile at this blog (e.g., see posts about the UK NPfIT at this blog query link). From the Independent:
Note that some of the major players are American:
It should also be mentioned that US HIT supplier Cerner Corp. was a prime supplier of HIT medical device software for this failed project.
Professors at Harvard and Nottingham Medical School have warned that the US is going down the same path as the UK (link).
I predict we'll waste hundreds of billions of dollars before we learn the same lesson. National HIT is a wicked problem, not a tractable one. It is unsolvable by run-of-the-mill bureaucrats, pundits and IT ignorazzi, especially those without clinical experience.
A list of other IT disasters is at the end of the Independent article cited above. It would appear this industry and its pundits/experts are incapable of learning from mistakes, or unwilling to learn.
In the case of HIT, however, people end up being maimed and killed rather directly.
-- SS
Aug.9, 2011 addendum:
An anonymous HC Renewal commenter on August 4, 2011 9:46:00 PM EDT had written: "There are some successes being reported with Cerner: http://www.guardian.co.uk/healthcare-network/2011/aug/03/newcastle-clinical-implementation-medical-software."
In checking that Guardian.uk article "Newcastle's clinical implementation of medical software" authored by Sade Laja on Aug. 3, I find this fascinating comment from a Guardian reader (apparently an even more confrontational earlier comment from this Guardian reader had been deleted):
Let's hope this comment stays. I have seen grossly exaggerated PR regarding health IT "success" myself and the themes in this comment resonate with that experience.
-- SS
I've been predicting this event for quite awhile at this blog (e.g., see posts about the UK NPfIT at this blog query link). From the Independent:
The Independent (UK)
NHS pulls the plug on its £11bn IT system
After nine years and with billions already spent, doomed computer system is abandoned
By Oliver Wright, Whitehall Editor
Wednesday, 3 August 2011
A plan to create the world's largest single civilian computer system linking all parts of the National Health Service is to be abandoned by the Government after running up billions of pounds in bills. Ministers are expected to announce next month that they are scrapping a central part of the much-delayed and hugely controversial 10-year National Programme for IT.
Instead, local health trusts and hospitals will be allowed to develop or buy individual computer systems to suit their needs – with a much smaller central server capable of "interrogating" them to provide centralised information on patient care. News of the Government's plans comes as a damning report from a cross-party committee of MPs concludes that the £11.4bn programme had proved "beyond the capacity of the Department of Health to deliver".
[That's a theme in my writings on this blog with respect to the IT community in general. The situation is similar here in the United States. The health IT sector and the hospitals and physician practices who would need to implement this technology do not have the expertise, wisdom and plain common sense to make good on what would be the most massive and complex IT project in the world - ed.]
The Commons Public Accounts Committee (PAC) said that, while the intention of creating a centralised database of electronic patient records was a "worthwhile aim", a huge amount of money had been wasted. [It could have been used on patient care - ed.]
Note that some of the major players are American:
"The department has been unable to demonstrate what benefits have been delivered from the £2.7bn spent on the project so far," Margaret Hodge, chair of the PAC, said. [See my 'reading list' post for more on this issue - ed.] "It should now urgently review whether it is worth continuing with the remaining elements of the care-records system. The £4.3bn which the department expects to spend might be better used to buy systems that are proven to work, that are good value for money and which deliver demonstrable benefits to the NHS." A further £4.4bn was expected to be spent on other areas of the vast IT project.
The nine-year-old NHS computer project – the biggest civilian IT scheme ever attempted – has been in disarray since it missed its first deadlines in 2007. The project has been beset by changing specifications, technical challenges and clashes with suppliers, which has left it years behind schedule and way over cost.
Accenture, the largest contractor involved, walked out on contracts worth £2bn in 2006, writing off hundreds of millions of pounds in the process. Months earlier, the US supplier IDX, contracted to provide software in and around London, had also withdrawn from the project, making a $450m (£275m) provision against future losses from the two contracts.
The PAC said part of the problem had been weak leadership in the department. "The department could have avoided some of the pitfalls and waste if they had consulted at the start of the process with health professionals," it said.
"We are concerned that, given his significant other responsibilities, [NHS chief executive] David Nicholson has not fully discharged his responsibilities as the senior responsible owner for this project. This has resulted in poor accountability for project performance."
The report also criticises the contracts between the department and suppliers – so far, £1.8bn has been paid.
"One supplier, Computer Sciences Corporation (CSC), has yet to deliver the bulk of the systems it is contracted to supply and has instead implemented a large number of interim systems as a stopgap," it said.
It should also be mentioned that US HIT supplier Cerner Corp. was a prime supplier of HIT medical device software for this failed project.
Professors at Harvard and Nottingham Medical School have warned that the US is going down the same path as the UK (link).
I predict we'll waste hundreds of billions of dollars before we learn the same lesson. National HIT is a wicked problem, not a tractable one. It is unsolvable by run-of-the-mill bureaucrats, pundits and IT ignorazzi, especially those without clinical experience.
A list of other IT disasters is at the end of the Independent article cited above. It would appear this industry and its pundits/experts are incapable of learning from mistakes, or unwilling to learn.
In the case of HIT, however, people end up being maimed and killed rather directly.
-- SS
Aug.9, 2011 addendum:
An anonymous HC Renewal commenter on August 4, 2011 9:46:00 PM EDT had written: "There are some successes being reported with Cerner: http://www.guardian.co.uk/healthcare-network/2011/aug/03/newcastle-clinical-implementation-medical-software."
In checking that Guardian.uk article "Newcastle's clinical implementation of medical software" authored by Sade Laja on Aug. 3, I find this fascinating comment from a Guardian reader (apparently an even more confrontational earlier comment from this Guardian reader had been deleted):
ExiledEurophile
9 August 2011 2:10AM
I am very concerned that you saw fit to delete my last post.
Here it is again edited for any judgements and now contains only facts and questions, my opinion derived from carefully reading your article and from my own experience as a clinician who has tried to work with UK Health IT initiatives.
Could you have asked some more penetrating questions?
Why did you not interview 'ordinary' staff about what they think of the system? Were you unable to?
Where is the verified and peer reviewed evidence of benefit of implementation of the system?
Neither the head of IT and the Director of Pharmacy (unless Mr. (?Dr.) Watson is a medically qualified clinical pharmacist) are strictly speaking clinicians. Why were you not introduced to the masses of excited and supportive senior clinicians backing Cerner at the RVI?
Have you understood the nature of a Cerner contract and the clauses relating to any responsibility the company has for medical accidents that occur when the software is used? Does the contract allow staff to communicate publicly about the performance of the system?
Reading your article carefully it is clear that RVI have implemented Cerner's Patient Administration System (PAS) and the electronic ordering of tests and drugs, but it seems fairly clear there is no electronic patient record, nor the chance of one arriving soon.
If all other methods of ordering drugs and tests have been scrapped then the RVI can easily claim ALL medical staff are using the programme, but strictly that is because they have no alternative.
A 'Big Bang' start up would imply implementing all aspects of Cerner together, but it seems all that all the RVI did initially was start the PAS followed by a 'slow down'. Let me tell you about my own experience of the 'slow down';
The Cerner Millenium interface, in my opinion, is so user unfriendly and so difficult to interrogate that when it was switched on in a District Hospital in the South West of England they has to immediately employ 24 extra clerks to manage the appointments in out patients - which brings into question whether the system automatically leads to increased efficiency and cost savings. As far as I know no Cerner based electronic patient record was ever switched on in that hospital because none available was seen to be fit for purpose. Every Department or specialty had to make its own arrangements for e-health, and there was difficulty in talking to the Cerner PAS both technically and because the UK Dept of Health forbade peripheral systems from being able to talk back to the PAS electronically. So much for avoiding 'siloing' of medical information around the hospital.
If you want to know how Cerner clinical systems perform please read this;
A Critical Essay on the Deployment of an ED Clinical Information System ‐ Systemic Failure or Bad Luck?
Not only does it state how poorly the 'First Net' emergency system from Cerner performs in New South Wales but also that majority of staff loathe it , Prof Patrick also has discovered key flaws in the underlying IT architecture of the core code of Cerner's software.
Furthermore it reports on the nature of Cerner contracts and the way the company seeks to avoid responsibility for incidents and restricts staff from talking about the product.
Two further points - look on the BBC and e-Health Insider web-sites about Cerner costs. Why does a Cerner system in Bath cost nearly three times a System C implementation in Bristol?
And as for Patient safety of e-Health intiatives; there is the ultimate irony of the following report of a failure at UPMC, Cerner's 'home' hospital;
http://m.post-gazette.com/local/region/entire-upmc-transplant-team-missed-hepatitis-alert-1159219
To be fair the problem here was one of staff failing to acknowledge a result, but it may have been exacerbated by the level of usability of the system and certainly having a full e-Health IT record did NOT stop the problem occurring.
[In that article: "But some UPMC doctors have complained that the hospital system's acclaimed electronic records system, designed in coordination with Cerner, an electronic records company, is, at best, cumbersome to use and difficult to adjust for any one doctor's particular needs." What we need to see are the actual screens and context in which these alerts appeared, as I find it hard to believe an entire transplant team could be be negligent or fools. See my 9-part series on mission hostile user interfaces for more on this issue - ed.]
By the way the tide of opinion may be turning about how much health and economic benefit e-Health initiatives are delivering around the world;
http://www.post-gazette.com/pg/11219/1165767-114-0.stm?cmpid...xml
"Electronic Records no Panacea for Health Care Industry"
The recent Public Accounts Committee report has amply demonstrated the folly of the NPfIT programme, but unless proper OBJECTIVE evidence of the direct implementation of Cerner systems is provided together with unfettered support from ordinary (ie non-Trust management) NHS staff, I hope you will adopt an approach of scepticism, rather than acceptance of the opinions & oral reports of top-end NHS Trust mangers of the RVI or NHS other hospitals, who have their CEO's, executives and their IT providers to impress.
ps I believe that most NHS Trust Boards are having the wool pulled over their eyes on this issue.
Let's hope this comment stays. I have seen grossly exaggerated PR regarding health IT "success" myself and the themes in this comment resonate with that experience.
-- SS
What the Pfizer (II)? - Lack of Transparency About Dysfunctional Leadership
The recent in-depth investigation by Fortune reporters of 10 years of dysfunctional leadership at Pfizer, the "world's largest research-based pharmaceutical company," raises many issues about leadership and governance in health care (see our post here). To continue what is likely to become a lengthy series, let us discuss the most obvious one, is the discrepancy between what appeared in Fortune and what Pfizer chose to make public about its leadership.
This discrepancy is most apparent when one compares official descriptions of executive performance with what the Fortune reporters found. To illustrate, consider the official descriptions of the performance of former Pfizer CEOs Hank McKinnell and Jeffrey Kindler in the respective years in which they were forced out.
"Hank" McKinnell -2006
Mr McKinell was forced to retire in 2006. The Fortune article described Mr McKinnell as a "desperate CEO" by 2002 because he could find no way to replenish the company's fading drug pipeline; who then became an absent CEO who "left a power vacuum" and then triggered internal political warfare by setting up a "bitter contest" over succession planning.
The 2006 Pfizer proxy statement explained how the Board of Directors' Compensation Committee assessed Mr McKinnell's performance,
The Compensation Committee then assessed McKinnell's performance thus:
Financial and merger synergy goals
Communicate effectively
More medicines more quickly
Adapting to scale
Promote new directions
Shape a positive environment
Developing people, talent, and the organization
So, according to the Committee, Mr McKinnell's performance was excellent in all areas but one.
Accordingly, based apparently on this stated "General Compensation Philosophy,"
So the present value of Mr McKinnell's total compensation was estimated to be $15,880,989.
Jeffrey Kindler - 2010
Kindler was forced to resign in 2010. The Fortune article also described Mr Kindler as "suddenly desperate" after two failures of drugs in development; someone who "just couldn't make up his mind," about acquisitions and spin-offs; "anguished" about research, leading to a "messy" overhaul; and putting "destructive" trust in a subordinate with previously described problems with "character, integrity and divisiveness" leading to loss of the loyalty of the executive team.
However, in the company's 2010 proxy statement, the Compensation Committee made this general assertion:
Then, Mr Kindler, like Mr McKinnell, was assessed against specific performance standards thus:
Financial Results
Enhancing the Product Portfolio
People Management
Business Model Implementation
Wyeth Transaction
Industry Leadership
In summary,
Based on the same general compensation philosophy noted above, Mr Kindler's total compensation in 2009 was $14,898,038.
Summary
Anyone who depended on these proxy statements to assess the performance of the Pfizer CEOs in 2006 and in 2010 would have likely concluded that both CEOs exhibited exemplary performance. These impressions would have apparently been sharply discrepant with the realities inside the company at those times.
Like the children of Lake Woebegone, we have frequently noted how almost all CEOs seem to appear "above average" or better to their boards of directors or trustees. The case of Pfizer in 2006 and in 2010 shows a board of directors which painted a grossly optimistic view of CEO performance to the public. In both years, these views would almost immediately clash with the fates of the particular CEOs. Now, based on the Fortune investigative report, these views seem even more overblown if not absurd.
This case, which again concerns the "world's biggest research driven pharmaceutical company," suggests one should be very skeptical about evaluations of executive performance in proxy reports. Proxy reports now appear to be a very cloudy window through which to view how corporations are really run. However, in the US, proxy reports have legal standing and are supposed to be sources of definitive information for stockholders and anyone else interested in the corporations that produce them.
Thus, the large organizations that dominate US health care may be even less transparent than they appear. True health care reform requires true transparency, and meaningful deterrence of propaganda disguised as fact.
This discrepancy is most apparent when one compares official descriptions of executive performance with what the Fortune reporters found. To illustrate, consider the official descriptions of the performance of former Pfizer CEOs Hank McKinnell and Jeffrey Kindler in the respective years in which they were forced out.
"Hank" McKinnell -2006
Mr McKinell was forced to retire in 2006. The Fortune article described Mr McKinnell as a "desperate CEO" by 2002 because he could find no way to replenish the company's fading drug pipeline; who then became an absent CEO who "left a power vacuum" and then triggered internal political warfare by setting up a "bitter contest" over succession planning.
The 2006 Pfizer proxy statement explained how the Board of Directors' Compensation Committee assessed Mr McKinnell's performance,
The Committee does not rely solely on predetermined formulas or a limited set of criteria when it evaluates the performance of the Chairman and CEO and the Company's other elected officers.
In 2005, the Committee considered management's continuing achievement of its short and long-term goals versus its strategic imperatives, including Dr. McKinnell's objectives which are shown below:
• Achieve specific revenue, EPS, operating cash flow per share, and merger-related synergy goals
• Effectively communicate strategy and financial results to increase shareholder value
• Deliver more new medicines more quickly to patients, through industry- leading R&D productivity and significant in-licensing activity
• Adapting to Scale
• Promote new directions in health and wellness
• Shape a positive environment for better healthcare
• Developing People, Talent, and the Organization
The Compensation Committee then assessed McKinnell's performance thus:
Financial and merger synergy goals
Overall, the financial targets, which reflected a significant stretch for the organization given the dynamic business environment and the loss of exclusivity for certain key products, were exceeded.
Communicate effectively
However, given the performance of the Company's stock price in 2005 when compared to prior years, the Committee felt that the goal of effectively communicating strategy and financial results to increase shareholder value was not met.
More medicines more quickly
All R&D productivity and licensing goals were met or exceeded, with, notably, five products under priority review at the FDA — an industry first. As the R&D organization continues to establish the industry standard in productivity, the Committee determined that performance against this objective significantly surpassed expectations.
Adapting to scale
In 2005, initiatives related to Adapting to Scale resulted in twice the cost reduction that had been estimated for the year, giving a very strong start to the Company's efforts to reduce the cost base and streamline the organization.So,
the Committee believes that overall performance significantly surpassed the expected outcomes for this objective.
Promote new directions
In promoting new directions in health and wellness, Pfizer's newly launched Healthy Directions program for U.S. based colleagues far exceeded expectations.... the Committee determined that these goals were significantly exceeded.
Shape a positive environment
The Company is also leading efforts to rebuild trust in the industry and large companies in general.So,
Overall, the Committee believes that the Company surpassed expectations of performance against this particularly challenging objective.
Developing people, talent, and the organization
With respect to the final objective for 2005 — Developing People, Talent, and the Organization — the Committee recognized that senior leadership of the Company has been instrumental in developing and implementing new People & Talent strategies related to long-term development planning for key talent, enhancing leadership skills for all 'people managers', and enabling Pfizer to become a global leader in attracting, developing, and engaging a diverse workforce that delivers superior business results. As a result, the Committee determined that the goals of this objective were surpassed.
So, according to the Committee, Mr McKinnell's performance was excellent in all areas but one.
Accordingly, based apparently on this stated "General Compensation Philosophy,"
The Committee believes that compensation paid to executive officers should be closely aligned with the performance of the Company on both a short-term and long-term basis....
So the present value of Mr McKinnell's total compensation was estimated to be $15,880,989.
Jeffrey Kindler - 2010
Kindler was forced to resign in 2010. The Fortune article also described Mr Kindler as "suddenly desperate" after two failures of drugs in development; someone who "just couldn't make up his mind," about acquisitions and spin-offs; "anguished" about research, leading to a "messy" overhaul; and putting "destructive" trust in a subordinate with previously described problems with "character, integrity and divisiveness" leading to loss of the loyalty of the executive team.
However, in the company's 2010 proxy statement, the Compensation Committee made this general assertion:
The Committee believes that Mr. Kindler's leadership was a significant factor in the continued progress made by Pfizer in 2009 in strengthening the foundation for future growth and long-term success.
Then, Mr Kindler, like Mr McKinnell, was assessed against specific performance standards thus:
Financial Results
Despite the unprecedented challenges in the global macroeconomic environment and other challenges, the Company exceeded the target goals for 2009 set by the Committee for annual incentive purposes
Enhancing the Product Portfolio
Under Mr. Kindler's leadership and oversight, during 2009 we improved the product portfolio (early stage through late stage),...
People Management
In 2009, we met or exceeded each of our people management goals,...
Business Model Implementation
the Company remains on track to meet the various research and development goals announced in March 2009. Mr. Kindler also further strengthened the Company's leadership team through strategic hiring and the redeployment of key senior leaders across the Company.
Wyeth Transaction
During 2009, we devoted significant attention to the acquisition of Wyeth. Under Mr. Kindler's leadership, we finalized negotiations, gained regulatory approval and closed the $68 billion acquisition of Wyeth, all in an expeditious manner. During the year, Mr. Kindler oversaw a detailed review of Wyeth and its businesses and the development of an integration plan,...So,
With the completion of the acquisition under Mr. Kindler's leadership, Pfizer is one of the largest biopharmaceutical companies in the world, as well as a more diversified company in the health care industry.
Industry Leadership
During 2009, Mr. Kindler was actively involved, through both Pfizer and external organizations, in developing and advancing U.S. and global public policies that serve the overall interests of our Company and our shareholders
In summary,
In view of Mr. Kindler's accomplishments noted above and the fact that he achieved all of his objectives and exceeded most of them, the Committee believes that Mr. Kindler successfully led the Company toward the achievement of its strategic goals during 2009....
Based on the same general compensation philosophy noted above, Mr Kindler's total compensation in 2009 was $14,898,038.
Summary
Anyone who depended on these proxy statements to assess the performance of the Pfizer CEOs in 2006 and in 2010 would have likely concluded that both CEOs exhibited exemplary performance. These impressions would have apparently been sharply discrepant with the realities inside the company at those times.
Like the children of Lake Woebegone, we have frequently noted how almost all CEOs seem to appear "above average" or better to their boards of directors or trustees. The case of Pfizer in 2006 and in 2010 shows a board of directors which painted a grossly optimistic view of CEO performance to the public. In both years, these views would almost immediately clash with the fates of the particular CEOs. Now, based on the Fortune investigative report, these views seem even more overblown if not absurd.
This case, which again concerns the "world's biggest research driven pharmaceutical company," suggests one should be very skeptical about evaluations of executive performance in proxy reports. Proxy reports now appear to be a very cloudy window through which to view how corporations are really run. However, in the US, proxy reports have legal standing and are supposed to be sources of definitive information for stockholders and anyone else interested in the corporations that produce them.
Thus, the large organizations that dominate US health care may be even less transparent than they appear. True health care reform requires true transparency, and meaningful deterrence of propaganda disguised as fact.
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