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Healthy Skepticism Library item: 14647

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

 

Publication type: news

Goozner M.
Healthcare reform: dead on arrival?
Guardian.co.uk 2008 Nov 17
http://www.guardian.co.uk/commentisfree/cifamerica/2008/nov/17/healthcare-drug-companies-obama-baucus


Abstract:

Obama hasn’t even taken office, but US drug companies are already starting their campaign against healthcare reform


Full text:

Healthcare reform’s kumbaya moment didn’t last long. The Pharmaceutical Research and Manufacturers Association will roll out a multi-million-dollar advertising campaign this week that aims to make “people aware of the importance of preserving your free-market healthcare system,” as a senior executive told the Washington Times.

Drug makers fear losing $30bn a year in sales if Medicare, the US senior citizen healthcare programme, begins negotiating drug prices like any other purchaser in the market. Big Pharma is still for insuring the uninsured, of course. Just not at its expense.

You can multiply that sentiment many times over by perusing the fine print of a comprehensive and well-reasoned healthcare reform plan issued last week by Max Baucus, the easy-going Democrat from Montana who chairs the powerful Senate finance committee. The press picked up on its broad strokes: expand existing poverty and children’s insurance programmes; allow early buy-in to Medicare for 55- to 64-year-olds, and an individual mandate (using a Massachusetts-style insurance connector) to buy insurance coupled with subsidies for the working poor and tough new rules prohibiting discrimination against the sick or previously ill. The goal: universal high-quality healthcare coverage, made affordable by holding down costs.

Ah, but there’s the rub. How would the Call to Action: Health Reform 2009 (pdf) cut some of the $700bn in annual healthcare spending that, according to the Congressional budget office, does nothing to improve the overall health of the US population?

Baucus outlines a number of areas ripe for savings, including eliminating waste, fraud and abuse in public programmes and making providers, especially drug and device makers, disclose their payments to physicians that “may lead to biased decision-making”. The finance chairman would also change the healthcare deduction (benefits are currently excluded from income) to “promote smarter spending of healthcare dollars by consumers themselves”.

Would these payment reforms really put the government in a fiscal position to draw up a universal system? Let’s start with the big-ticket item in the plan: eliminating waste, fraud and abuse. The National Healthcare Anti-Fraud Association estimates WF&A costs Medicare $60bn a year – enough to cover half the cost of covering the uninsured. Yet the feds, dozens of state attorneys general and a small army of trial lawyers bearing qui tam suits have been working on ferreting out it out for decades with limited success.

Why? What the government and most rational outside observers call waste, providers (physician-owned outpatient clinics, hospitals, drug and device companies, durable equipment makers, nursing homes, dialysis clinics) call paycheques. Some operators are unscrupulous. Some even go to jail. But just as many accused of billing fraud challenge the allegations, often successfully. The government could police its programmes better, but I wouldn’t count on collecting much of that $60bn any time soon.

The transparency issues are even less promising as a way of holding down spending. Requiring disclosure of payments to physicians doesn’t eliminate the effect of those payments. While it is tempting to ascribe physicians’ decisions on what drugs to prescribe for patients to the pens and notepads distributed by industry salesmen, the reality is that clinical practice is driven by a comprehensive system of physician education that has been largely taken over by healthcare industry suppliers.

For instance, most US-based medical societies and patient advocacy groups like the American Heart Association or National Kidney Foundation accept fees from drug and device companies to help write clinical practice guidelines for members. Most of the physicians who write these guidelines are paid consultants to firms that have a stake in their outcome.

Those guidelines wind up in medical journals, get emphasised at professional meetings and get ballyhooed at continuing medical education seminars, more than half of which are funded by industry. This system, coupled with fee-for-service reimbursement, drives medical practice.

To get around this system, the report, like every reform proposal, called for the government to set up an objective source of comparative clinical evidence that payers could then use to set payment guidelines. But it shied away from calling for making use of such information mandatory, which doctors disparagingly refer to as “cook book” care.

Under the best of circumstances, it will take years to generate new information comparing the effectiveness and cost-effectiveness in medicine, and even then it remains to be seen how well it will insinuate itself into the day-to-day practice of physicians, whose fee-for-service practices depend on providing more care, not better or cheaper care.

Which brings up a final point about the laudable Baucus report. The hard-working staffers who put it together get high marks for tackling the thorniest question in contemporary medical practice: reforming how physicians are organised and paid.

Every year, Congress tinkers with Medicare physician payment schedules (which drive all insurance industry schedules), and at the end of day agrees that no doctor should get paid less. It also sets rates for the relative pay of physicians. Decades of such manipulations have left primary care physicians earning between $150,000 and $200,000 a year, while radiologists, surgeons and oncologists earn well over $400,000 on average. Is it any wonder that preventive medicine is undervalued while patients get lots of images, operations and pricey drugs that don’t improve outcomes?

The report lays out a few alternatives, including paying more to group practices (where physicians are more likely to be paid an annual salary) that achieve better outcomes for patients. Arnold Relman, the former editor of the New England Journal of Medicine called for similar reforms in his recent book titled A Second Opinion. But, like Big Pharma, the American Medical Association and the specialty societies are not likely to embrace such reforms, especially if the government and insurers put them on the table as a way of saving money.

On the other hand, the AMA, like Pharma, has also endorsed universal coverage. Why not? Everyone is for healthcare reform until you actually get around to reforming it. The Democrats, who now control Congress and the White House for the first time since 1993-4, will find that out soon enough.

 

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There is no sin in being wrong. The sin is in our unwillingness to examine our own beliefs, and in believing that our authorities cannot be wrong. Far from creating cynics, such a story is likely to foster a healthy and creative skepticism, which is something quite different from cynicism.”
- Neil Postman in The End of Education