In the Spotlight
In Pursuit of Fewer Medicines and More Lawsuits
Benjamin Zycher, Ph.D., Medical Progress Today, 7-29-05
That politics is the art of wealth redistribution is a truth both eternal and adverse, in that it provides a vehicle for the "public interest" political class to demonstrate its compassion by spending Other People's Money. In the latest manifestation of this process, those Other People are the shareholders of pharmaceutical firms: An initiative (Proposition 79) on the forthcoming ballot in California this November, ostensibly intended to help ordinary citizens of the Golden State with their prescription drug bills, would mandate discounts both steep and, perhaps ironically, unobtainable, for about half (or more) of the state's population.
Continue reading . . .
Industry Hails Its Medicine Subsidies for Poor; Drug firms 'are getting it,' says a lobbyist, citing their program's aid to about 250,000 -- part of an effort to head off a prescription import bill.
Los Angeles Times, 7-27-05
America has a health-insurance problem masquerading as a prescription-drug problem. While prescription drug prices are only a fraction of total health expenditures - about 10% - drug companies are routinely lambasted for pricing policies that place some prescription drugs beyond the reach of Americans without health insurance. This is true, but it is no less true for the price of a chest x-ray, MRI, or single-night stay in a hospital. While the pharmaceutical industry is viewed by some consumer advocates as the modern equivalent of medieval leeching - bleeding patients to no good purpose - few pundits or policymakers seem to have grasped the fact that the lack of affordable health insurance makes some prescription drugs unaffordable.
The pharmaceutical industry, nonetheless, has responded to the barrage of criticism by expanding programs whereby uninsured, low-income Americans can receive vital medicines for little or no cost:
The pharmaceutical industry said Tuesday that a clearinghouse set up by drug companies had helped about a quarter of a million lower-income people obtain free or deeply discounted prescriptions in its first 100 days.
The giveaway program and the upcoming unveiling of self-imposed limits on pharmaceutical advertising are part of an industry effort to repair its image and head off legislation that would allow consumers to import low-cost prescription drugs from certain industrialized countries. …
But supporters of the import bill said the industry's philanthropy would not slow the legislation, which recently cleared the Senate Commerce Committee, 14 to 8, and awaits action by the full Senate
Legalizing prescription-drug importation is definitely a case of the tail wagging the dog: rather than take action to make health insurance more affordable and accessible, politicians are punishing the companies who make lifesaving medicines. Bashing corporations always makes good press, we suppose, but in this case it makes very little sense.
The Next Phase In Psychiatry --- Largest-Ever Studies on Drugs for Depression, Schizophrenia Could Transform Treatment
Wall Street Journal, 7-27-05
Human beings share about 99.9% of their DNA. When it comes how individual patients respond to the same medicine, however, that last .1% might cause a fatal drug reaction—or none at all. This is particularly problematic when it comes to drugs for mental illness, because doctors and patients often have to experiment with several drugs, or even drug cocktails, before they find one that works. The National Institute of Health is trying to give doctors more guidance in treating mental illness by launching large clinical trials for several types of mental illness:
The results of the largest studies ever conducted of depression and schizophrenia will be released in coming months, potentially transforming the way patients are treated and shaking up some of the drug industry's most lucrative markets.
The federally funded studies are part of a six-year push by the mental-health division of the National Institutes of Health to come up with reliable scientific data on the differences between drugs and treatment strategies for the major psychiatric illnesses. The project comprises four trials, in serious depression, bipolar disorder, schizophrenia and adolescent depression. The aim is to fill the information gap that plagues psychiatry, and hurts the quality of care given to patients. Clinical trials that companies do to get drugs approved aren't designed to provide the answers that doctors say they really need. For one, these trials don't compare one drug with another, because they are designed to show only whether a particular drug is effective against an illness. Thus, psychiatrists have little guidance on whether one drug works better than another or has fewer side effects than another.
The NIH’s program isn’t necessarily a bad idea in itself—more large-scale studies conducted in diverse patient groups may help physicians better understand underlying trends in mental illness and treatment. But the future of medicine lies in unraveling the mysterious .1% that makes all the difference in how patients metabolize drugs. Paying more attention to the underlying genetic and environmental factors affecting drug treatment will pay bigger dividends than pursuing more population based studies that inevitably leave doctors guessing how to treat individual patients.
INTERVIEW-WHO will fail to meet AIDS drugs goal
Reuters News, 7-26-05
The World Health Organization has failed to hit its target of having three million people on anti-retroviral drugs by 2005. As a matter of fact, it missed its target by two-thirds, i.e. two million people. Nonetheless, the WHO is still confident that it will be able to provide “universal access” to ARV drugs by 2010:
Dr. Jim Yong Kim, director of the WHO's HIV/AIDS department, said its three million target would not be reached due to a slow start because of disagreement on whether poor nations had the capacity to administer HIV treatment programs. But he said that having one million people now on the program was major progress and he expected there would be more by late 2005.
He also praised Brazil's free treatment program as well as the G8 nations' endorsement of universal access to HIV treatment by 2010. This could mean as many as 10 million people would be covered, he said. "I think all the activity that we see now about treatment is thanks to Brazil," he told Reuters on the fringes of an international AIDS conference in Rio de Janeiro. "If Brazilians did it, then I'm going to put everything I have into reaching that target for everybody by 2010," he added.
It is hard to take WHO’s optimism about ARV treatment very seriously since there were 3.2 million new AIDS infections in Africa in 2003. Estimates of new AIDS cases by 2010 range from just a “few” million to 30 million—making it very possible that the WHO program will be swamped by new cases. It is also hard to look at relatively wealthy Brazil (which has low infection rates) as a model for AIDS treatment in Africa, where countries are significantly poorer and infection rates are much higher. In short, universal access to affordable AIDS drugs in Africa is a noble goal—but it is more important to focus on prevention, which will make that goal significantly more attainable.
Personalized Approach to Cancer; Genitope hopes its custom-made vaccines for lymphoma will lead to extended remissions.
Los Angeles Times, 7-25-05
Cancer isn’t just one disease with one underlying mechanism. It is really a shorthand description of a number of mutations in the genetic machinery responsible for regulating cell division and cell death. Once those genes atrophy, uncontrolled cell growth leads to cancer. These mutations can vary from individual to individual, or even in the same patient over time. The variability and adaptability of cancer is what makes the disease so fearsome and the search for successful treatments so challenging.
In order to fight cancer more effectively, patients need medicines that are every bit as individualized as the disease itself. Thankfully, companies are becoming ever more adept at creating targeted therapies, ranging from drugs like Herceptin (which targets cancers expressing the HER/neu gene) to more experimental therapies like cancer vaccines:
…Genitope Corp. of Redwood City, Calif., [has been] toiling to commercialize a [cancer] vaccine invented at Stanford University in the late 1980s.
More than 200 patients have been given MyVax, the vaccine produced by Genitope. What each patient received was not mass-produced, but customized to attack his or her specific tumor….A small study completed four years ago was encouraging, and although the latest trial of 300 patients was not scheduled to end until 2007, the company believes that it could see results -- and get the vaccine to market -- sooner. …
While cancer vaccines may never offer patients a total cure, they could become useful adjuncts in a multi-front war on cancer that bombards rogue cells with several different therapies and helps a patient’s own immune system control the disease.
Long-Term-Care Insurance: How Much Is Too Much?
The New York Times, 7-24-05
What do car insurance, health insurance, and homeowner’s insurance all have in common? Answer: Americans have embraced them as tools to ward off rare but potentially devastating financial setbacks. Unfortunately, many aging Americans have yet to enter the market for long term care insurance to protect themselves (and their estates) against the high costs associated with nursing homes or other assisted living environments:
After more than two decades on the market, long-term-care insurance remains a tough sell. Only 10 percent of people over 65 own policies, with many holdouts saying that they are intimidated by high costs and the bewildering array of benefit levels, deductible periods and other features.
Like most insurance, policies for long-term care protect against improbable events. But unlike homeowners' insurance and auto insurance, this coverage often requires a lifetime commitment to one insurer; premiums can rise sharply if the policyholder switches. And while health insurance covers immediate issues, buyers of long-term-care insurance can pay premiums for decades with no way to predict if their coverage is what they will need. …
But a new study shows that only a small percentage of policyholders need care for long periods - four years or more. So a growing number of specialists recommend more modest policies for which the policyholder pays a bigger share of the costs.
But what the Times only notes in passing is that many state Medicaid programs have effectively become the insurer of last resort for middle-class Americans who don’t purchase long term care insurance. Consequently, without additional reform, Medicaid provokes a moral hazard. Since consumers expect the government—and taxpayers—to eventually shoulder the burden, Medicaid acts as a disincentive to purchase long term care insurance.
Inefficient Spending Plagues Medicare; Quality Often Loses Out as 40-Year-Old Program Struggles to Monitor Hospitals, Oversee Payments
Washington Post, 7-24-05
Would you return to a mechanic who, every time he fixed one thing, broke something else? This may seem absurd, but it is exactly how the U.S. government compensates doctors and hospitals through its Medicare program, the nation’s largest insurer. For instance,
As far back as 1999, federal and state regulators began to receive complaints that the heart surgery unit at Palm Beach Gardens Medical Center in Florida was a breeding ground for germs. …
State inspectors in 2002 found "massive post operative infections" in the heart unit, requiring patients to undergo more surgery and lengthy hospital stays. In a four-year period, 106 heart patients at Palm Beach Gardens developed infections after surgery, according to lawsuits and government records. More than two dozen were readmitted with fevers, pneumonia and serious blood infections. The lawsuits included 16 patients who died.
How did Medicare, the federal health insurance program for the elderly, respond? It paid Palm Beach Gardens more…Medicare's handling of Palm Beach Gardens is an extreme example of a pervasive problem that costs the federal insurance program billions of dollars annually while rewarding doctors, hospitals and health plans for bad medicine. …
Researchers at Dartmouth Medical School, who have been studying Medicare's performance for three decades, estimate that as much as $1 of every $3 is wasted on unnecessary or inappropriate care. Other analysts put the figure as high as 40 percent.
Shocked? You shouldn’t be. Any pricing system that separates the customer (e.g., patients) from the payer (in this case, the government) is bound to generate misallocation of resources, waste, and fraud. In a true market system, prices for goods tend to decline over time, because competition between producers encourages efficiency. Lower quality producers are driven out of the system because customers send their business elsewhere. Until Americans have more ability to control their own health care spending—through health savings accounts or other mechanisms—Medicare will continue to send good money chasing after bad.
Report highlights high costs of ignoring health tech
Government Health IT, 7-22-05
Critics of America’s health care system like to portray it as a market failure. If only it were a true market to begin with. In reality, American health care is dominated by third-party payers who reimburse hospitals and doctors regardless of the quality of care provided to patients. Some observers think that new information technology systems will help employers, insurers, and the government better direct payments to providers who offer health care to patients:
The U.S. health care industry has neglected widely used systems engineering tools and technologies, and that neglect has contributed to the nearly 100,000 preventable deaths a year, according to a new report from the National Academy of Engineering and the Institute of Medicine.
The health care industry’s collective inattention to systems engineering has a mind-boggling cost of a half-trillion dollars a year due to inefficiency, the report states. The report says tools used for supply chain management, financial engineering and risk analysis could be harnessed to measure, characterize and optimize performance at higher levels of the health care system, such as health care organizations, regional care systems and the public health system.
Private insurers, large employers and the Centers for Medicare and Medicaid Services should all provide incentives for health care providers to use systems engineering tools to improve the quality of care and efficiency of health care…
This is a very interesting idea, and it should certainly be pursued. But efficiency and quality will lag until patients can direct more of their own health-care spending and shop for doctors and hospitals who offer the best value.
5 Drug-Importing States Add 2 Countries as Sources
The New York Times, 7-19-05
Illinois’ Governor Blagojevich has discovered the biggest problem with legalizing drug importation: foreign countries don’t want to see their own prices rise. Canada, for instance, has repeatedly expressed its unwillingness to become “America’s drug store” out of a desire to protect its domestic drug supply.
The importation program Governor Blagojevich supports, I-SaveRx—an importation program used by 5 states, including Illinois—just added Australia and New Zealand to its list of approved countries to compensate for Canadian restrictions:
Canada has been by far the largest of the exporters, but Gov. Rod R. Blagojevich of Illinois said in a statement on Monday: "The drug companies and their allies are turning up the heat in Canada, which has been the primary point of purchase for millions of Americans. We've known for some time that a sound importation program can't rely solely on Canada."
The move comes less than three weeks after Canada's health minister announced plans to introduce legislation limiting bulk prescription drug exports to the United States. The bill is aimed at preventing medication shortages in Canada, where the pharmaceutical industry has suggested that it might counter those exports by curbing distribution.
Australia and New Zealand, however, might not have much to worry about. Since its inception, I-SaveRx has only filled about 10,000 prescriptions. This indicates that demand for imported drugs is lower than the Governor’s rhetoric would suggest, and that low-income, uninsured patients would be better served through existing public and private programs that offer access to free or low-cost prescription drugs.
Cheaper Health Insurance
Wall Street Journal, 7-25-05
This editorial takes up a position that Manhattan Institute Senior Fellow David Gratzer (among others) has long advocated: allowing American consumers to shop for health insurance in a national market rather than being constrained by expensive and often illogical state insurance mandates. Creating a national market for health insurance should not only make it more affordable, it should encourage workers to change jobs without worrying about losing their health care coverage:
Last week the House Energy and Commerce Committee approved a bill that could dramatically reduce the ranks of the uninsured and spur general economic growth -- all without costing a dime to the Treasury.
The idea behind the legislation, sponsored by GOP Representative John Shadegg of Arizona, is disarmingly simple: Allow Americans to buy health insurance from vendors in any one of the 50 states. Right now Americans who aren't lucky enough to get insurance from large employers or poor enough to qualify for Medicaid find themselves at the mercy of the legislators and insurance commissioners of the state in which they happen to live. This can be OK in states that exercise this regulatory function judiciously. But in others, the young and working poor find themselves effectively priced out of the market by special-interest regulations dressed up as consumer protections.
Don't fear the vaccines
The Globe and Mail, 7-25-05
’s editorial weighs in on the controversy we highlighted last week surrounding the supposed link between thimerosal and autism. That link is unproven, the Globe
notes, and fearful parents should trust the weight of scientific evidence rather than fall prey to media scare-mongering:
Understandably, parents worry about rising rates of autism and behavioural disorders. Autism rates rose sharply in the 1990s in the U.S., at the same time that thimerosal, a mercury-based preservative, was being used in childhood vaccines in that country. But no credible evidence has emerged to link thimerosal and autism, notwithstanding the conspiracy-laced theories of Robert F. Kennedy Jr. and some others south of the border. It may be that the apparent increase in the autism rate (to one in 200 children from one in 1,000 three decades ago) owes much to an expanded definition of autism. No one knows. …
Canadians are aghast when, in far-away countries such as Nigeria, diseases on the verge of extinction such as polio rise again after community leaders declare vaccines to be part of a deadly U.S. plot. Canadians need to make sure that knowledge continues to trump irrational fear at home.
Hitting targets, missing dignity
Dr. Eamonn Butler, Adam Smith Institute, 7-24-05
In his blog on the Adam Smith Institute Web site, Dr. Butler decries how Britain’s National Health System ignores the dignity and autonomy of British patients and risks their health in the process:
Britain's health system regulator, the Healthcare Commission, says that (thanks to an injection of tens of billions a year) the state-run National Health Service is now meeting lots of its targets, but is failing to treat taxpaying patients as customers. One figure I saw is that 25% of patients say they are treated 'as if they are not there'.
It is this, more than anything else, which defines the failure of state-run healthcare. Sure, when you look at the statistics, you find that some things the NHS does are actually very good, while others (like our performance on killer diseases like cancer and stroke) are pretty poor compared to other countries'. But what the statistics don't pick up is how people are treated as people.
A couple of years back I spent a good deal of time around one of Britain's 'flagship' hospitals, during the last illness of an elderly relative. Since then I've been determined never to set foot in the place again if I can help it. It was filthy, of course: one expects that. But the staff were also stressed out and frankly hadn't the time, or weren't well-managed enough, to handle their elderly patients with the dignity that any of us have a right to expect.
Why we must invest in electronic medical records
Bill Frist, The San Francisco Chronicle, 7-24-05
Senator Frist (R, TN) makes the case that higher quality health care is within our grasp if America invests more in electronic technologies that can help make patient treatment more transparent and effective:
…when the New England Journal of Medicine used 11 measures to compare VA patients treated in the VA's own hospitals with Medicare patients treated in a mixture of private and public hospitals, the VA's patients were in better health and received more of the treatments professionals believe they should. According to the VA's own medical professionals, a computer system called Vista is the key to their success. "I'm proud of what we do here, but it isn't that we have more resources," explains Stanford Garfunkle, the director of the Washington VA Medical Center. "The difference is information."
While the VA has invested a lot in its computer system, most hospitals, clinics and doctors haven't invested enough. Among America's important economic sectors, health care spends the smallest percentage of its revenue on information technology -- only about 3 percent. Industries such as banking spend 10 percent or more.
Profits and the development of drugs
Linda Gorman, Denver Post, 7-24-05
Gorman skewers arguments by some critics that allowing the government to set prices for drugs will lead to more value and better health care for American consumers:
Seriously ill people generally lack political power. When government pays for health care, they are considered financial burdens. In nationalized health care systems, government officials manage drug pricing and pharmaceutical company profits to please healthy interest groups, not to cure the seriously ill. Government also ignores the future. In the long run, someone else will be in office.
For profit-seeking companies, sick people are opportunities. As opportunities, the ill have a far better chance of survival. In Britain, the government controls health care and pharmaceutical profits. Voters are kept happy with visiting nurses and free rides to hospitals. Cancer patients have limited access to modern chemotherapy drugs deemed 'too expensive.' The British breast cancer mortality rate is 46 percent. In the U.S., it is 25 percent.
Two U.S. Studies Report Improved Quality of Care at Least for Specific Measures
Although, as we noted above, there are pervasive problems in American health care that affect the allocation of resources and the quality of care delivered to patients, not all of the news is grim. There are some signs, in fact, that the very effort to track quality outcomes encourages improvement:
"In July 2002, the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) implemented standardized performance measures that were designed to track the performance of accredited hospitals and encourage improvement in the quality of health care," write Scott C. Williams, PsyD, from the JCAHO, and colleagues. "Both qualitative and quantitative studies have demonstrated benefits associated with providing hospitals regular feedback on their performance on quality measures. Comparative feedback has been particularly useful at an organizational level as a guide for improvement-oriented activities."
For a two-year period, the investigators reviewed the performance of more than 3,000 accredited hospitals on 18 standardized indicators of the quality of care for acute myocardial infarction, heart failure, and pneumonia. One measure evaluated the clinical outcome of in-hospital death after acute myocardial infarction, and the other 17 measures evaluated processes of care. All hospitals enrolled in the study received comparative reports for quarterly feedback.
The performance of U.S. hospitals improved…in 15 (83%) of 18 measures and did not deteriorate significantly on any measure. During the eight quarters studied, the magnitude of improvement ranged from 3% to 33%. For 16 (94%) of the 17 process-of-care measures, hospitals with a low baseline level of performance had greater improvements than did hospitals with a high baseline level of performance.
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