Published CommPro.biz 2014.02.10

Legally But Not Medically Necessary

Depending on whose numbers you look at, somewhere between 5% and 40% of the cost of healthcare in America is spent on “Defensive Medicine.”  In 1994 the Congressional Office of Technology Assessment defined it: “Defensive medicine occurs when doctors order tests, procedures, or visits, or avoid high-risk patients or procedures, primarily (but not necessarily or solely) to reduce their exposure to malpractice liability.”

The body formally known as the Trial Lawyers Association, the barracuda bar that strikes fear into the hearts of all in the medical world, says that defensive medicine does not exist. They see it as a big scam that the medical types use as an excuse to ratchet up their income. And while we don’t buy that, there is a certain amount of truth in what they say. Testing facilities owned by doctors, hospitals and others in the game certainly benefit. As do those who consult to affirm the decisions made by their colleagues.

The leading solution is Tort Reform, restrictions on the legal profession. And/or limitations on the amount those harmed by the medical system can collect. Some of those reforms have been set up by state governments, however, and they don’t seem to help. That either means the lawyers are right, that unnecessary medical stuff reflects greed among medical providers, or that the practice is so ingrained that fear makes it near impossible for them to stop.

A totally different approach is now under consideration in Florida and Georgia, a concept that eliminates the possibility that any medical player could be sued. The Patients’ Compensation system would take medical errors out of our legal system entirely. Panels of experts would be tasked with evaluating claims and awarding the injured party funds to cover their losses. It would be quick and fair.

We spend more per-capita than other countries on healthcare but our outcomes rank below third world nations. We fail to make it into the top twenty-five in most cases. On the other hand our VA Health Care system provides excellent care at 40% less per patient than the national average. That’s an impressive number made even more impressive when you look at their patients. Mostly a bunch of beat up old folks, with some really beat up younger folks from our recent wars. Compare that to the national patient base; it includes all those folks under forty who are in relatively good health.

Oh yes, the VA enjoys a few other advantages. Their people don’t have to worry about lawsuits. And they don’t have to spend a lot of time filling out paperwork for insurers. They were among the first to go digital; any Vet can go into any VA facility in the world and they can pull up their records in seconds. All this allows them to focus on prevention. And the VA can negotiate to hold down drug costs, unlike Medicare that is prohibited by Big Pharma who has our Congress bought and paid for.

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-"What do you think?"--"Do you agree?"

Published CommPro.biz 2014.02.04

The Bad Apples

Every year Harris Interactive surveys Americans on our level of trust in a group of nineteen industries. Over the last ten years a dismal outlook has gotten worse. Harris asks, "Which of these industries do you think are generally honest and trustworthy – so that you normally believe a statement by a company in that industry?" Not a single industry met that standard in the minds of even half of Americans, not one in the last decade. Most businesses are trustworthy, it’s the few bad apples that drag everyone down

Supermarkets did best at 30%. That means 70% of us do not trust supermarkets. The list gets worse quickly. All but one of the remaining 18 industries scores in the teens or a single digit. Oil and tobacco companies are at the bottom of the list. Oil comes in at 4%, putting their distrust level at 96%, tobacco scores 3% putting their distrust level at 97%. Fitting for a couple of industries that have fed the grim reaper millions of people around the world? Tobacco is at the bottom. We can’t imagine how anyone could have a positive outlook when it comes to tobacco. It’s more like a criminal enterprise that has killed more people than all the dictators of the 20^th century combined. Imagine, more than the big three –Mao Zedong, Jozef Stalin and Adolf Hitler– plus all the minor tyrants of the last century. 

Hospitals came in second at 28%, dropping from 36% in 2012, a result of the wide range of healthCARE entities that have become healthGreed entities. Banks come in at number four with a trust level of 18%. That means eight out of ten Americans have no trust in anything our bankers say. In 2004 the banks had a 40% trust level. That collapsed with the recession and recognition by the public that the monster banks are out of control. We would guess the 18% who trust banks are referring to their local community bank. In the same poll the number of Americans who say banks should face stronger regulation jumped 50% in the last decade. No surprise given what’s happened since the banksters lobbied away the regulations that protected us for almost a century. 

Industries sharing a low trust level and support for more regulation are topped by two that are literally killing us, tobacco and oil. The health care industries follow close behind. Driving costs out of control are Big Pharma, insurers and hospitals focused on money in this industry group that is immune to competition. Any fix is being blocked by those we elect to protect our interests. Our legislative bodies, in the states and at the national level are controlled by the lobbyists who pour money into their pockets. That leaves all of us out in the cold, spending more by far than on healthcare any nation on earth and getting third world outcomes.  

"Am I wrong?"--"Am I Nuts?"--

"What do you think?"--"Do you agree?"

Published in CommPRO.biz 2014.01.24

 

Big Pharma Has Congress 

by the Jugular

Andrew Witty, Glaxo Smith Kline CEO, announced last month (December 16) that Glaxo will stop paying doctors to promote their products and stop paying their sales representatives based on the number of prescriptions doctors write. It would be nice to think that this action results from an epiphany on Glaxo’s part. It’s more likely a duck-and-cover move triggered by a nasty bribery mess in China and an upcoming Affordable Care Act disclosure requirement.

It is, however, welcome. This, we hope, will trigger moves (don’t hold your breath) by other Pharma Monsters to fall in line. Pay-to-prescribe -along with Pharma advertising- make up two of the more egregious practices Pharma uses that drive healthcare costs sky high in the United States. The biggie by far is the hold they have on our Congress. Their “K” Street lobbyists lay bucks by the bushel on members of the Congress. In return, those sworn to work in our interest instead work for the drug companies.

By manipulating patent laws and exempting Pharma from anti-trust laws, drug companies have driven costs for their products beyond belief. A drug that costs a few hundred dollars to make, costs a desperate cancer patient close to a hundred grand for each dose. The patient goes bankrupt and the taxpayers pick up the tab. There is no other drug. The doctor says take it or die.

Pharma would have us believe that these drugs cost over a billion dollars to bring to market. A cruel and blatant lie; a study published in the British Medical Journal shows that the average $1.3 billion dollars the drug companies claim it costs, is actually about $90 thousand dollars. The rest is part BS and mostly marketing expenditures. Worse, most of their research funds go to tweaking existing drugs in an effort to stretch out patents on their best sellers.

We keep hearing about how much cheaper it is to buy drugs in places like Canada. Why is that? Because they have a single payer healthcare system that negotiates lower prices. In America, our Congress has forbidden Medicare to do anything like that. So a nation with fewer people than live in California can muscle the drug companies and we can’t. To make it worse the Congress has so limited fraud investigative funds that Medicare catches only a fraction of the bad guys. Like one doc in California who games the system by prescribing name-brand drugs to thousands of low income patients. Drugs’ costing as much as 30 times equally effective generic versions. There are thousands of these docs milking Medicare for Big Pharma and costing the taxpayers billions.

Big Pharma’s pill bill is killing us. Government controlled healthcare serves over half of Americans. With that kind of clout we can negotiate lower costs. Lower costs in drugs, lower costs in every aspect of our out-of-control healthcare sector. We spend more per-capita than any other nation on earth and yet our outcomes don’t even rank in the top 25%. We need to clean out the Congressional medicine chest.

"Am I wrong?"--"Am I Nuts?"--"What do you think?"--"Do you agree?"

Published – CommPRO.biz 2013.10.18

Shortages That Kill

It seems that every time we try to get something right, some scumbag figures out a way to game the system. While this fact of life is annoying wherever it shows up, it’s deadly when it rears its viperous head in life and death situations. So it is with generic drugs. Once we get past the inflated profits Big Pharma reaps -based on the phonied-up costs to develop a truly new drug- our expectation is that generic versions will serve us at reasonable costs.

We know all about the inexplicably legal game Big Pharma plays where they get to pay off the generic manufacturers to hold off production until they can squeeze the last drop of bloated profit out of the original patented version. As if that isn’t bad enough, it turns out there’s another equally ridiculous legal loophole allowing drug buying groups to bribe their way to higher profits at a cost of billions (out of our pockets) and -more important- at the cost of life itself.

This situation, according to published reports from medical and pharmaceutical practitioners, has its roots in 1987. You remember the “eighties” when “K” Street lobbyists seemed able to write any crazy thing into a law and find one of those we elected to serve us, willing to serve their special interest – for cash. Well, in 1987 Congress passed the “Medicare Safe Harbor Act” giving pharmaceutical buying groups a get-out-of-jail-free card to take vendor kickbacks (AKA bribes).

Since then these huge entities have controlled the manufacturers of generics that are mostly injectables used in hospital settings, antibiotics, pain meds, chemo drugs and anesthetics among others. These buying groups have in some cases limited manufacture to a single company. They have driven pricing so low, that eventually no competitors to their “Favored One” are left standing.

How are low prices bad for us? When a dominant buyer is able to drive pricing below the level of reasonable profits for the producers, there is no longer a truly competitive marketplace. That’s exactly what’s happened in the generic pharma world, resulting in unacceptable and dangerous shortages. A buying group source claims that they “encourage the free market by competitive bidding and multiple rewards for the best supplier performance.” We are with him until the multiple rewards part (sounds like bribes to us).

All of this was thought to be addressed in a 2012 law. Instead by mid-2013 drugs in short supply had soared from near two hundred to near three hundred, a fifty percent surge in one year. How did that happen? While we have no details, we’re betting it had to do with the buying group lobbyists. While we don’t pick up these drugs from our family drug store, we all have a vital stake. It is past time for this perverse law, the innocent sounding 1987 “Medicare Safe Harbor Act,” to have its quarter century of greed driven rule brought to an end. It is time to restore ethics and a true free market to this vital healthcare sector.

Published in CommPRO.biz 2013.09.17

Good News “IS” News, Occasionally

We find ourselves largely focused on a minority. The majority, most of us, are trying to do the right thing everyday. By nature we are an honest hard-working people. And most businesses understand that an ethical model is a roadmap to long-term strong profitability. Take care of your customers, employees, vendors, community, and the environment; and the bottom line takes care of itself.

In our weekly pursuit of ethical issues, we find ourselves largely commenting on players who choose to ignore the ethical model. Those not interested in long-term growth. Then there are those who operate in a non-competitive market. A market that is structurally immune to competition such as healthcare. When was the last time someone struck a deal with a surgeon whilst headed for the operating room?

More disturbing are those made immune to failure through their lobbying efforts. Take the monster banks. They have created a world where they are not only too-big-to-fail; they are permitted to take part in unimaginably outrageous practices. They make huge bets –outright gambling– on anything they can label “investing;” even with depositors’ funds insured by the United States taxpayers. Worse, our Department of Justice is afraid to go after these scumbags; a monumental failure.

So between big pharma, predatory healthcare entities, and smarmy bankers, we have lots of unethical issues. We aren’t forgetting that the scumbags make up a tiny minority. Most folks in healthcare are there for the right reasons, executing herculean efforts everyday. Most bankers focus on depositors and businesses in their community. They guard depositors’ savings; make loans to keep businesses growing, homes building, and dreams evolving.

However, good news rarely makes “The” news. That’s what we like when we find a major story about a newsworthy ethical happening. IBM, a pioneer in personal computers, sold that business in 2005 to Lenovo, a Chinese company most of us never heard of. Since then Lenovo has grown their share of the home computer market, recently surpassing Hewlett-Packard. Ninety days ago Lenovo opened an assembly plant in North Carolina. 

All of that is nice, but the icing on the cake came earlier this month (2013.09.02) when Lenovo CEO, Yang Yuanqing, announced that he was splitting $3.25 million –most of his annual bonus– with his workers. For the workers in North Carolina the $300 bucks they received was a nice surprise. For the vast majority in China the $300 is roughly a month’s pay.

Hats off to Yang. He gave away $3 million of his bonus last year. It wasn’t news here until Lenovo built their plant and Yang announced that he would split his time between two headquarters in Beijing and Morrisville, NC. Those who see this as a marketing ploy may have a point, but the impact on Lenovo workers in twenty countries is still there. Unlike other big players, Lenovo produces their computers, phones, laptops and tablets in their own factories. And we’ll bet they don’t have nets stretched around them to prevent the workers from jumping to their death.

Published in CommPRO.biz 2013.08.22

Greedy Hospitals

Nothing illustrates the runaway cost of medical care in America quite as starkly as the rush to build proton therapy centers. Hospitals and even private entities are racing to build these facilities that run better than $200 million bucks, $100+ million on the cheap. While it is true that for some cancers proton therapy shows real promise, the number of patients who might benefit is tiny. None are in need of this treatment at the emergency room level.

So why are hospitals across the land rushing to invest this kind of money when it doesn’t serve many patients? Well, it turns out that while there are only a few that can really benefit, there are lots of patients who can be convinced that this latest most-up-to-date medical gadget will help them. Patients that impartial studies show can be as effectively treated on existing proton radiation equipment at half the cost.

There is certainly a need for proton therapy. Studies show it is “Promising” for youngsters with rare tumors in their brain and on their spine. Its focused beam is not as likely as standard radiation to damage their tiny developing organs near the cancer. Beyond that, proton therapy has not been shown to be better than proton radiation. That has not stopped hospitals across America from rushing to sink hundreds of millions into proton therapy centers.

Nothing illustrates better why America spends more on healthcare than anybody and we still rank way down the list in almost every measurable. According to the World Health Organization we rank first in expenditures per-capita and 38^th in outcomes. The latest (2008) per-capita number comes in at $7,538.00 and rising; close to double in the eight years following 2000. Growth in healthcare costs has slowed over the last two years; some see the effects of the Affordable Care Act -others see the recession. In either case we are still spending tons of money and not getting our money’s worth.

The proton therapy issue illustrates the cause perfectly. The Washington, DC – Baltimore area has three proton therapy centers on track at a cost of well over a half billion dollars. One in Baltimore is already under construction, a football field sized dome that will house a 90-ton machine. The docs there have offered to share their proton therapy monster with the docs in the Washington area just 40 miles away. Not a chance. Why? Could it be the estimate by one of the hospitals in DC that their proton center will generate nearly $16 million dollars a year in profits by the end of this decade?

Take a look at NY City; with a vastly larger population base they will have one proton therapy center, more than enough to meet the need. There, the NY State Hospital Review and Planning Council held the region to a single unit. In the Washington area two hospitals three miles apart and 40 miles from the proton therapy center in Baltimore, are adding unneeded and unnecessary treatment equipment. Disgusting! Ethically inexcusable.

Published in CommPRO.biz 2013.07.08

Ethical Marketing

 

Marketing genius Seth Godin brought us up sharp with an on-the-mark blog post. He pointed out that many marketers blithely peddle goods or services that they know – or should know – are anything but good for those they entice into using them. It’s easy to look askance at those who market tobacco and other well known threats to our well-being. Godin zeros in on fast food, actually food in general, and our obesity epidemic along with the array of woes it brings with it.

It’s too easy to point out that the occasional burger and fries, or pile of pancakes with maple syrup does not make one obese. Nor that some individuals find it a lot harder to control their weight than others. Neither of those points amounts to a whole lot when we all know that there’s no way to limit what a food maker offers unless we do it, unless we show them a better and more profitable option.

There is another face on this coin, health insurance. Or more accurately benefits, since this sector veered from the insurance model years ago. No one expects a life insurance company to offer a policy to those in their nineties; in fact most policies cut off well before the applicant turns eighty. Nor is it expected that a life policy will be issued to an individual with severe health issues. While we as a people are not going to deny health benefits to those who do not act to care for themselves, some boundaries need to be established by the underwriters, the government and the medical community; the doctors and healthcare facilities.

Godin makes the point that marketing is one of the few professions that does not have boundaries. Law, medicine, real estate, retailing, even food manufacturing all have boundaries. The only fence surrounding the marketing world is a truth in advertising rule. Of course many marketers have ethical boundaries. They won’t work for companies who do not adhere to high ethical standards. But even those individuals and agencies might not feel that a food manufacturer presents an ethical issue.

On the contrary such a company might present an opportunity, an opportunity to create a set of boundaries. Boundaries that never show oversized portions; that offer only healthy recipes and serving suggestions. Boundaries that limit the potential for harm from legitimate efforts to create revenue for the company. There is reason to believe that this is a solid marketing concept. Consumers are moving more and more to products that offer healthy options. So rather than selling more to a limited number of customers, create more customers.

Beyond marketing, medicine and government have work to do on the obesity front. And marketing needs recognize that food and obesity are but a single color on its palette. There’s hardly a company that does not present ethical issues when it comes to creating their sales messaging. We owe Godin thanks for reminding us of our responsibility to follow the ethical model whatever we peddle.

Pharma, Where Ethics is a No-Brainer

It would be hard to imagine any element of our business community where ethical behavior is more important than healthcare. We aren’t surprised when some smarmy little guy is caught conning folks with some medical scam. What we should not be seeing are the big guys engaging in off-the-chart ethical no-nos. Last week’s announcement that Pharma giant, AstraZeneca would split a half billion dollar fine between Medicare and Medicaid was a stunner.

The company issued the usual “Without admitting any wrongdoing” settlement statement. Right! They are going to cough up that kind of money just for kicks. They were charged with “aggressively” pushing a psychiatric drug, Seroquel, that was FDA approved for schizophrenia and bi-polar disease. A class of drugs with a history of dramatic side effects.

AstraZeneca turned this drug into a cure-all for a host of diseases for old folks, veterans, and even kids. They played down the added weight and diabetes that showed up. Actually they acknowledged these problems to Japanese doctors in 2002, years before they stopped dismissing the same potentially deadly side effects in North America.

It turns out that this half billion is only half of the story. Last fall –October 2009– AstraZeneca paid out a half billion to settle two federal investigations and two whistle-blower lawsuits. That’s a billion dollars in less than a year. And there’s going to be more, there are close to 20,000 lawsuits lined up from folks who took Seroquel and believe they were harmed.

Makes one wonder how they can afford those kinds of payouts – until you look at the sales numbers. Worldwide sales of Seroquel are astronomical; it is the best selling psychiatric drug in the United States. How did AstraZeneca build this blockbuster? Well that’s reason AstraZeneca is in this mess. Basically they talked a lot of docs into prescribing Seroquel for all kinds of stuff that it wasn’t intended to treat. They took advantage of a loophole. Once a drug is approved by the FDA, doctors can prescribe it for anything they wish. Or in this case, anything the drug company can talk them into.

All drug companies push their products on the docs. Anyone who has ever spent time in a doctor’s waiting room has seen the Pharma sales folks. They come breezing in and too often head right back to the doc’s inner sanctum, the place you’ve been waiting hours to access. They are young, very well dressed, and as smart as they are attractive. They have a case full of goodies, samples, literature, pens, notepads - whatever pleases.

However, what AstraZeneca did went way beyond that. Even way beyond their sales people pushing docs to use Seroquel for conditions that it certainly wasn’t intended to treat. Some docs who slid into that rabbit hole were paid to give speeches at posh soirées urging their colleagues to do likewise. These thinly disguised bribes are at the heart of the government’s AstraZeneca settlement.

The whole thing reeks of unethical behavior; unethical behavior on the part of AstraZeneca, unethical behavior on the part of the docs who took the bucks, and unethical behavior on the part of the docs who wrote Seroquel scripts for conditions that it simply was not suited. AstraZeneca should never have allowed it to rise to a legal issue. And by the way, who is looking at the docs who played along.