Bending the Curve Through Cures: Dr. Kenneth L. Davis and the Further Turning of the Wheel of Healthcare Policy

The wheel of healthcare policy continues to turn. The wheel is turning, that is, from the Cut Strategy to the Cure Strategy. The latest evidence came earlier today, on CNBC, when Dr. Kenneth L. Davis, President and CEO of the Mt. Sinai Medical Center, appeared on that cable news channel to talk a language on healthcare that few have talked in recent years: the language of cures.

Dr. Davis appeared on a segment with Carly Fiorina, the former HP CEO, along with other panelists. Here is a part of the discussion, in which Dr. Davis outlines a larger vision of uniting medical, financial, and political resources to cure disease.

Davis: [We need] the kind breakthrough drug and we would identify the break-throughs to bend the health curve. 

Fiorina: It's common sense, and as a  cancer survivor I'm delighted to hear you say you're excited about progress in cancer but it's such common sense when you say let's align the scientific agenda of the nation with the big cost drivers in medicine.  Yes.  And of course patent law,  what would it take to align the scientific agenda and the cost drivers in health care? Who would do that? Who would cause that to happen? 

Davis: Well, the congress has been very responsive to patient groups that meet with him and make I think a compelling case for why their disease is special. I think if we can get those groups to also talk with an administration, also talk with the NIH, form some kind of consensus between what the country needs and what the patients need, perhaps we could do it. because there's now at least unanimity it would seem to me about very little but there appears to be unanimous agreement about the top five diseases, chronic diseases, that are cost drivers in health care. 

The key point here is at the beginning: The best way to bend the cost curve is through cures. A cure is cheaper than care, and so if we could cure Alzheimer's, for example, we could save hundreds of billions, even trillions, of dollars in Medicare and Medicaid expenditures over the coming decades. The whole video, and the complete transcript, can be found here.

Meanwhile, as another indicator, we might consider a recent side-by-side summation of the science policies of the two presidential candidates, Barack Obama and Mitt Romney. On Saturday, a group called, a consortium of more than a dozen science groups, published the answers that it had received, from the two candidates, on a dozen science-policy questions.

The answers to questions #3, 4, 7, and 14 show that the Romney campaign is taking seriously the issue of streamlining the FDA; on question 3, for example, concerning overall scientific-research policy, the Romney campaign notes that "the FDA's slow and opaque approval process is rated less than one-fourth as effective as its European counterpart." By contrast, in its answers, Obama campaign does not mention FDA reform, which can be taken to be good news for the status quo if Obama is re-elected.

In addition, Romney calls for "robust" funding for the NIH, another topic not mentioned by the Obamans, who seem content mostly to take credit for the passage of the Affordable Care Act.

On the other hand, as noted here last week, the Obama administration has set in motion--or at least announced plans to set in motion--a plan for doubling the output of new medicines over the next 10 to 15 years. This outline, set forth by the President's Council of Advisors on Science and Technology (PCAST), involves coordinating industry, academia, and the federal government. In other words, in its own way, it is similar to what Mt. Sinai's Dr. Davis has in mind.

Now of course, some will say that Dr. Davis is just one man, and that Carly Fiorina is just one woman, expressing opinions, as opposed to making policy. But in fact, a look at the video segment shows that the whole panel was nodding in agreement as Dr. Davis spoke. In other words, that, right there, is a Zeitgeist indicator.

And some might also say that the answers to the presidential questionnaire are just words on a paper. But in fact, those answers were drafted by the experts, and on the Romney side, those pro-FDA-reform voices are likely to have more than a little influence on Romney administration policy.

And some might say that PCAST is just a third-level agency in the Executive Office of the President. And that might be the case, but if the policy Zeitgeist moves in the direction of cures, then PCAST and its pro-science views will inevitably rise.

So we should not underestimate the significance of these shifts. For decades now, the healthcare discussion has been dominated by questions of finance--that is, who should pay, and how. Yet it wasn't always like this: In the 40s and 50s, we focused on polio, and we gained the polio vaccine. In the 70s, we focused on cancer, and while some insist that the "war on cancer" was lost, others insist that not every war is won right away. Indeed, as Dr. Davis said on CNBC today:

In cancer there're extraordinary developments. Decades ago we started a war on cancer and people have been appropriately disappointed with where are the big break-throughs. The big breakthroughs are about to happen.

And in the 80s and 90s, of course, we focused on AIDS, and that was a great medical success as well.

Yet as we have seen, the nation has been less focused recently on science and more focused on finance. The results of this extended financial debate have been both predictable and unpredictable.

The predictable result was that we have had a robust discussion of finance, culminating in the passage of the Affordable Care Act.

The unpredictable result has been the decay of another aspect of medicine, an aspect actually more important: science. That is, we have been so busy fighting over finance that we forgot the science, leaving it to the depredations of the FDA and the tort bar. As The Economist noted recently, the number of new drugs approved by the FDA over the last 15 years has plummeted by more than two-thirds. So now we see that healthcare costs are still rising, for one simple reason: People are still getting sick. And sickness, in the absence of rapidly advancing technology, is inevitably labor-intensive. And labor-intensivity, of course, is always expensive, always falling victim to the inexorabilities of Baumol's cost disease.

In other words, in the face of rising illness, healthcare costs will inevitably rise, too--no matter what sort of financial controls or market mechanisms are put in place. It's as simple as that. Or, to put it another way, rising healthcare costs are as simple as the democratic process in action; people will always vote to take care of themselves.

Perversely, the only variable that price controls really can affect is future scientific research, because the future, unseen as it is, often lacks a solid voting constituency. Meanwhile, in the here-and-now, nobody is going to cut chronic care, because that care, and its beneficiaries, can be seen. Therefore, as Bastiat explained a century-and-a-half ago, such chronic care is safe from budget cuts, no matter how futile the care involved might be. And so, lacking a cure for Alzheimer's, nursing homes in the coming decades will fill up with dementia patients, a sad zombie nation that will always be able to vote, if little else.

So now, as the Cut Strategy falters in the face of public opinion, a new and better opportunity beckons to whoever is sworn in as president on January 20, 2013: the Cure Strategy. With a Cure Strategy solidly in place, the Cuts will come later--and come relatively painlessly. That's the happy cost-cutting story of all technological advancement and productivity growth, and it's finally circling back to medicine.

It's about time.

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