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Will the Citigroup Ruling Challenge Health Care Leaders' Impunity?

A federal judge's refusal to approve yet another cozy settlement that was supposed to resolve allegations of wrong-doing by a giant corporation has left the financial world atwitter.  It may be that this ruling will also affect the coziness between giant health care corporations and government regulators.  Summary of the Citigroup Case We first discussed this case twp weeks ago <a href="http://hcrenewal.blogspot.com/2011/11/parallels-between-health-care-and.html">here</a>.  Here is a summary of the government's (in this case, the Securities and Exchange Commision's) original allegations <a href="http://www.nytimes.com/2011/11/29/business/judge-rejects-sec-accord-with-citi.html">from the New York Times</a>. <blockquote>According to the Securities and Exchange Commission, Citigroup stuffed a $1 billion mortgage fund that it sold to investors in 2007 with securities that it believed would fail so that it could bet against its customers and profit when values declined. The fraud, the agency said, was in Citigroup’s falsely telling investors that an independent party was choosing the portfolio’s investments. Citigroup made $160 million from the deal and investors lost $700 million.</blockquote>The Problems with the Proposed Settlement Judge Jed Rakoff refused to approve the settlement because of a series of problems, listed below as summarized by <a href="http://www.economist.com/node/21540667">the Schumpeter columnist in the Economist</a>. <blockquote>Mr Rakoff faulted the SEC for prosecuting Citigroup for negligence when a fraud prosecution was warranted; for failing to provide the court with 'any proven or admitted facts upon which to exercise even a modest degree of independent judgment'; for erroneously contending that 'public interest…is not part of [the] applicable standard of judicial review'; and for wrongly arguing that 'if the public interest must be taken into account, the SEC is the sole determiner'.</blockquote>Furthermore, <blockquote>Mr Rakoff also attacked a second condition of the settlement. Citigroup had agreed to operate under a court injunction if it ever violated the deal, which could lead to contempt charges. Whatever threat this carried, Mr Rackoff wrote, it was mitigated because Citigroup, as other financial firms, had been cited similarly over the past decade—and never faced any consequences. </blockquote>The Parallels with Legal Settlements Made by Health Care Organizations Several of the features of the settlement that the Judge found so objectionable are commonly also features of the <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">settlements</a> we have seen involving health care organizations. Government regulators often seem to make much milder charges that were warranted by the apparent facts. They make the organizations party to <a href="http://hcrenewal.blogspot.com/search/label/corporate%20integrity%20agreement">corporate integrity</a> or <a href="http://hcrenewal.blogspot.com/search/label/deferred%20prosecution%20agreement">deferred prosecution</a> agreements, even though sometimes the same corporations were already subject to such agreements when they appeared to misbehave again. The agreements often allow the organizations to neither admit to or deny any charges, leaving the facts of the case forever in doubt. <a href="http://www.rollingstone.com/politics/blogs/taibblog/federal-judge-pimp-slaps-the-sec-over-citigroup-settlement-20111129">Matt Taibi in the Rolling Stone</a> provided some pithy comments on these commonly seen features of legal settlements. <blockquote>By accepting hundred-million-dollar fines without a full public venting of the facts, the SEC is leveling seemingly significant punishments without telling the public what the defendant is being punished for. This has essentially created a parallel or secret criminal justice system, in which both crime and punishment are adjudicated behind closed doors. This system allows for ugly consequences in both directions. Imagine if normal criminal defendants were treated this way. Say a prosecutor and street criminal come into a judge’s chamber and explain they’ve cooked up a deal, that the criminal doesn’t have to admit to anything or plead to any crime, but has to spend 18 months in house arrest nonetheless. What sane judge would sign off on a deal like that without knowing exactly what the facts are? Did the criminal shoot up a nightclub and paralyze someone, or did he just sell a dimebag on the street? Is 18 months a tough sentence or a slap on the wrist? And how is it legally possible for someone to deserve an 18-month sentence without being guilty of anything? Such deals are logical and legal absurdities, but judges have been signing off on settlements like this with Wall Street defendants for years.</blockquote>As we have said numerous times before, (starting <a href="http://hcrenewal.blogspot.com/2008/07/amerigroup-settles.html">here</a> in 2008) the current manner of regulation, in which organizations pay fines (and sometimes submit to corporate integrity or deferred prosecution agreements), rarely admit any guilt, but in which individuals who directed, authorized or implemented the alleged misbehavior almost never suffer any negative consequences, fails to deter future bad behavior. We have noted that the costs of the settlements are paid by the organization as a whole, and thus simply regarded as costs of doing business by executives. The leaders' impunity will allow the bad behavior to be repeated again and again. Here is how Taibbi and Rakoff put it: <blockquote>these crappy settlements have evolved into a kind of cheap payoff system, in which crimes may be committed over and over again, and the SEC’s only role is to take a bribe each time the offenders slip up and get caught. If you never have to worry about serious punishments, or court findings of criminal guilt (which would leave you exposed to crippling lawsuits), then there’s simply no incentive to stop committing fraud. These SEC settlements simply become part of the cost of doing business, as Rakoff notes: <blockquote>As for common experience, a consent judgment that does not involve any admissions and that results in only very modest penalties is just as frequently viewed, particularly in the business community, as a cost of doing business imposed by having to maintain a working relationship with a regulatory agency, rather than as any indication of where the real truth lies. This, indeed, is Citigroup's position in this very case.</blockquote> That line, 'a cost of doing business imposed by having to maintain a working relationship with a regulatory agency,' is one of the more brutally damning things you’ll ever see a judge write. Rakoff is essentially saying that these fines are payoffs to keep the SEC off the banks’ backs. They’re like the pad that numbers-runners or drug dealers pay to urban precinct-houses every month to keep cops from making real arrests. That's what he means when he refers to 'maintaning a working relationship.' It's heavy stuff.</blockquote> What the Judge appears to be saying is that the whole system stinks of <a href="http://hcrenewal.blogspot.com/search/label/regulatory%20capture">regulatory capture</a>, and that the settlements paid by the organizations are the moral equivalent of bribes paid to government officials. That is indeed "heavy stuff." Now that Occupy Wall Street has made it socially acceptable to discuss the economic dysfunction that lead to the great recession or global financial collapse, I can only hope that this discussion will lead to a parallel discussion about health care dysfunction. It certainly seems that the regulatory capture that seems to be part of the dismantling of regulation of finance is similar to regulatory capture affecting health care. But I await someone beyond us few lonely bloggers to take up this topic. I might as well end with this sentiment<a href="http://hcrenewal.blogspot.com/2009/09/biovail-settles-and-judge-explains-why.html"> from 2009</a> regarding another case over which Judge Rakoff presided: Again, in my humble opinion, until the people responsible for the bad behavior experience negative consequences from that behavior, they will continue to perform, direct, and condone bad behavior. We will not achieve real health care reform in the US until we effectively deter unethical, self-serving behavior by leaders of health care organizations.

Will the Citigroup Ruling Challenge Health Care Leaders' Impunity?

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29 Nov 2011

Will the Freeze of the Global Fund Finally Put Health Care Corruption on the Agenda?

In February, 2011, we <a href="http://hcrenewal.blogspot.com/2011/02/after-publicity-about-losses-from.html">posted</a> about problems with corruption affecting the Global Fund to Fight AIDS, Tuberculosis and Malaria. At the time, the Fund promised to better detect fraud and corruption affecting its grants programs. We later <a href="http://hcrenewal.blogspot.com/2011/05/global-fund-will-not-suppress.html">posted</a> about how after an internal debate, the Fund promised to make more information public about any losses to fraud and corruption. Now it has made more such information public, but it also appears that further problems with corruption have lead to the freezing of the Fund. The New Findings of Corruption First, as <a href="http://www.bloomberg.com/news/2011-11-01/disease-funds-may-have-gone-to-home-renovations-blood-diamonds.html">reported</a> by Bloomberg on 1 November, <blockquote>A $22 billion disease-fighting fund backed by Microsoft Corp. (MSFT) founder Bill Gates found that money intended for people with life-threatening illnesses was used for home renovations in India and diverted to a person linked with money laundering and so-called blood diamonds in Nigeria. The Global Fund to Fight AIDS, Tuberculosis and Malaria is seeking to recover as much as $19.2 million from grants in eight countries, the Geneva-based organization said in a set of reports today. As much as $1.3 million was misused by the head of a non-governmental AIDS organization in India to buy a car and renovate his apartment, one report said. In Nigeria, money was siphoned to a person arrested in 2003 for money-laundering and smuggling diamonds that are mined and sold to support war. </blockquote> This amount was in addition to previous amounts disclosed before: <blockquote>The organization said last year it was seeking the recovery of $44.2 million in four nations for 'grave misuse of funds.'</blockquote> It is not clear how much money the Fund has lost to corruption in total. According to an AP report, <a href="http://www.cbsnews.com/8301-501714_162-20128601/global-health-fund-probe-uncovers-$20m-in-losses">via CBS News</a>, <blockquote>Earlier probes by the fund's internal watchdog, the inspector general's office, had detected about $53 million in losses, according to fund documents, some unpublished, provided by senior officials. The fund's board chairman Simon Bland told The Associated Press it has now reviewed about one-seventh of $14 billion in grants disbursed.</blockquote>Whether similar amounts of corruption affected the other six sevenths of grants is unclear. The Freeze on Grants This week, several reports that the Fund would stop funding new grants appeared in the media. As <a href="http://www.businessweek.com/news/2011-11-25/gates-backed-fund-halts-new-grants-as-crisis-hurts-giving.html">reported</a> by BusinessWeek, <blockquote>The world’s biggest disease-fighting fund canceled its next round of grants as the global financial crisis crimps donations and threatens its ability to curb the spread of the world’s deadliest infections. The Global Fund to Fight AIDS, Tuberculosis and Malaria, which has spent or committed to spending $22 billion since 2002 on preventing and treating disease, will only have enough money to pay for essential services for existing programs through the end of 2013, the Geneva-based fund said in a statement today. It will not make new grants until 2014,...</blockquote> The reason for this freeze on grant making was, <blockquote>The fund faces 'accelerating deterioration' in its finances for the next three years because of economic distress in donor nations, combined with corruption in some of the poor countries it helps,...</blockquote> A NY Times <a href="http://www.nytimes.com/2011/11/24/health/global-aids-fund-cancels-fund-raising-and-seeks-new-manager.html">article</a> implied that one reason for the financial shortfall was that some donor nations withheld money due to their concerns about corruption: <blockquote>Several countries, including Djibouti, Mali, Mauritania and Zambia, lost their grants or had new safeguards put in place after officials were accused of stealing. The Global Fund’s own inspector general exposed the fraud and earlier this month was trying to recover about $20 million that had been stolen; that amount is less than 1 percent of the $13 billion that has been disbursed. There have been reports of friction between Dr. Kazatchkine and the inspector general, John Parsons. They each report separately to the board. Some major donors, including Germany and Sweden, expressed their dismay by freezing their donations.</blockquote> Also, CBS News <a href="http://www.cbsnews.com/8301-202_162-57331033/global-health-fund-halts-new-programs">reported</a>, <blockquote>Germany, the European Commission and Denmark withheld hundreds of millions of euros in funding pending reviews of the fund's internal controls. Germany — the fund's fourth-largest donor- has since restored its funding.</blockquote> Summary and Comment In summary, the uncovering of specific instances of corruption that wasted the assets of the Global Fund, and the concerns of international donors about the effects of corruption on the Fund have been some of the causes of a freeze in funding that will preclude new initiatives at least until 2014. This is a dramatic illustration of how corruption can undermine health care. We <a href="http://hcrenewal.blogspot.com/2011/02/after-publicity-about-losses-from.html">wondered</a> previously whether the realization that corruption was subverting the Fund's activities would lead the Fund to actively address corruption.  In fact, the Fund seems to have investigated previous corruption affecting its work more aggressively than have many other health care organizations.  However, the Fund did not appear to have instituted any initiatives to prevent, forestall, or challenge corruption.  In that, it is typical of nearly every health care organization in the world. Transparency International defines corruption as "abuse of entrusted power for private gain."  By that definition, many of the cases discussed on Health Care Renewal are about corruption.  For example, if a pharmaceutical company pays physicians as part of a deceptive marketing campaign that exaggerates the benefits or minimizes the harms of a drug, and that campaign increases sales and hence executive compensation, one could argue that the case involves corruption of both of physicians and of company management.  We have discussed many such cases on <a href="http://hcrenewal.blogspot.com/">Health Care Renewal</a>.  One striking example was the stealth marketing campaign for Neurontin as described in posts <a href="http://hcrenewal.blogspot.com/2006/08/stealth-marketing-of-neurontin.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/10/did-pfizer-marketers-suppress-and.html">here</a>, <a href="http://hcrenewal.blogspot.com/2009/11/editorial-that-wasnt-evidence-for.html">here</a> and <a href="http://hcrenewal.blogspot.com/2010/04/pfizer-settles-one-lawsuit-loses.html">here</a>. Thus, there are many examples of corruption affecting health care professionals and academics, and all sorts of health care organizations, hospitals, health care insurers, pharmaceutical and device companies, health care information technology companies, medical education and communication companies, contract research organizations, etc, etc, etc  In 2006, <a href="http://www.transparency.org/publications/gcr/gcr_2006">Transparency International's Global Corruption Report</a> asserted in its executive summary, " the scale of corruption is vast in both rich and poor countries."  As we summarized <a href="http://hcrenewal.blogspot.com/2011/02/after-publicity-about-losses-from.html">here</a>, the report discussed the scale and diversity of health care corruption, and the severity of its adverse effects. However, at least for a generation, there has been almost no opposition to such corruption.  In fact, as we have noted, health care corruption, and the problems and leadership and governance that lead to it, have been nearly <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic</a>.  Specifically, there is almost no teaching or research on corruption in health care academics (including medical and public health schools, and programs in health care research and policy.)  There is almost no mention of corruption by health care professional associations.  There are almost no initiatives to fight corruption on the part of health care charities and donors.  There is almost no interest in corruption among patient advocacy organizations.  (See previous discussion <a href="http://hcrenewal.blogspot.com/2011/02/after-publicity-about-losses-from.html">here</a>.) Why do they all ignore such a huge problem?  Most likely it is because of <a href="http://hcrenewal.blogspot.com/search/label/institutional%20conflicts%20of%20interest">institutional</a> and <a href="http://hcrenewal.blogspot.com/search/label/conflicts%20of%20interest">individual conflicts of interests</a>.  Most of the these organizations are substantially funded by health care corporations, including corporations most involved in corruption, (and parenthetically, by financial firms whose corruption was likely a major cause of the global financial collapse / great recession, the other ostensible cause of the freeze of Global Fund grants.)  Many prominent health professionals and academics, and health care organizational leaders themselves have individual financial relationships with such companies.  For example, a majority of US medical school department chairs have significant financial relationships with health care corporations (see post <a href="http://hcrenewal.blogspot.com/2007/10/medical-school-leaders-conflicts-of.html">here</a>).  We have shown how top medical school leaders may simultaneously serve on the boards of directors of health care corporations (see post <a href="http://hcrenewal.blogspot.com/2006/03/new-species-of-conflict-of-interest-in.html">here</a>).  People who are personally profiting from relationships with health care corporations are unlikely to question such relationships.  The leaders of organizations which depend on funding from such corporations are unlikely to question whether conflicts of interest might lead to corruption.  People whose colleagues, friends, family members, or supervisors are personally benefiting from conflicts of interest may hesitate to challenge such relationships. So will the freeze of new grants at the Global Fund at least get health care corruption on the agenda?  One can only hope.  I personally hope that there are enough honest and unconflicted people remaining who will raise their voices above a murmur, even if that might discomfit those around them. Of course, one reason we started <a href="http://hcrenewal.blogspot.com/">Health Care Renewal</a> was to make these issues less anechoic. So hear we go again. PS - If anyone in our vast audience does know about any additional anti-corruption or conflict of interest, or pro-accountability, integrity, transparency, honesty and ethics initiatives, courses, meetings relevant to health care, please let me know and I will do my best to disseminate the information.

Will the Freeze of the Global Fund Finally Put Health Care Corruption on the Agenda?

In February, 2011, we posted about problems with corruption affecting the Global Fund to Fight AIDS, Tuberculosis and Malaria. At the time, the Fund promised to better detect fraud and corruption affe…

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28 Nov 2011

Two Opposing Views of EHR: InformaticMD vs. NextGen's Holder of "American Medical Informatics Certification for Health Information Technology"

The AMA's publication American Medical News recently quoted me following comments from IOM EHR Safety committee member Richard Cook in the Nov. 21, 2011 article "<a href="http://www.ama-assn.org/amednews/m/2011/11/21/psa1121.htm">IOM calls for monitoring and probe of health IT hazards</a>" by Kevin O'Reilly: <blockquote>... Not everyone on the panel agreed with delaying FDA regulation. [Per the IOM report on health IT safety released Nov. 10, 2011, see <a href="http://hcrenewal.blogspot.com/2011/11/iom-report-on-health-it-safety-nix-fda.html">here</a> - ed.] Committee member Richard I. Cook, MD, filed a dissent in the report in which he recommended that health IT systems be regulated as class III medical devices. "It is quite remarkable that we're in this situation," said Dr. Cook, associate professor of anesthesia and critical care at the University of Chicago Pritzker School of Medicine. [Also, an expert in Medical Informatics - ed.] "It's not surprising that such adverse events are being found related to health IT, and it's not surprising that those promoting these systems have neither looked for them nor anticipated them. To make large-scale investments in these systems and only now be looking at the impact on patient safety borders on recklessness."Scot M. Silverstein, MD, agreed. "The bone I have to pick with the IOM report is that the action agenda is weak," said Dr. Silverstein, a consultant in medical informatics at the Drexel University College of Information Science and Technology in Pennsylvania. It is unethical to expand health IT so dramatically without understanding the precise nature of the risks it poses to patients, Dr. Silverstein said.</blockquote> Ironically, right below my statement was the following from HIT industry figure Charles Jarvis, blaming the user: <blockquote>Users faulted Leaders in the health IT industry also had their share of objections to some of the IOM panel's conclusions. "We don't think there's a great deal of data to substantiate that there are major safety problems with the majority of electronic health records systems in use today," said Charlie Jarvis, executive committee vice chair of the EHR Assn., a trade group that represents 46 organizations that supply most of the EMR systems implemented in medical practices. "These products are safe, dependable, time-tested and display a lot of the safety features we think are necessary to prevent problems going forward." Jarvis, also a vice president at the health IT firm <a href="http://www.nextgen.com/">NextGen</a>, said vendors and the government should work to help physicians and other health professional users understand systems, take advantage of their safety features and avoid errors. [Charitable translation: computers are infallible, so medical errors due to HIT are the user's fault, <a href="http://hcrenewal.blogspot.com/2011/10/nist-on-ehr-mission-hostile-user.html">the Sept. 2011 National Institute of Standards and Technology (NIST) report on usability</a> be damned. Clinicians should spend their valuable time learning to compensate for and then actually wading through <a href="http://www.tinyurl.com/hostileuserexper">mission hostile user experiences</a>. If only those stupid doctors and nurses would use our cybernetic miracle tools the way we want, the members of the EHR Association could be making even more money. Oh, and by the way, the NIST's concept of "use error" [1] is nonsense. - ed.]</blockquote> I presume the "EHR Assn." is the <a href="http://www.himssehra.org/ASP/index.asp">HIMSS EHR Association</a>, with <a href="http://www.himss.org/ASP/index.asp">HIMSS</a> itself being a gargantuan "cause-based, not-for-profit organization exclusively focused on providing global leadership for the optimal use of information technology and management systems for the betterment of healthcare":<blockquote> The HIMSS Electronic Health Record (EHR) Association is a trade association of Electronic Health Record (EHR) companies, addressing national efforts to create interoperable EHRs in hospital and ambulatory care settings. The EHR Association operates on the premise that the rapid, widespread adoption of EHRs will help improve the quality of patient care as well as the productivity and sustainability of the healthcare system. </blockquote> I observe that there are no conflicts of interest here that could cause Mr. Jarvis' stated opinions to be skewed towards the rights of computers and away from the rights of patients ... right? First, Mr. Jarvis makes a logical error related to the error illustrated in my earlier post today "<a href="http://hcrenewal.blogspot.com/2011/11/magical-thinking-on-health-it-from.html">Magical Thinking on Health IT from ModernMedicine.com</a>." His error is that of "proof by lack of evidence" [2]. No need to actually study the issue rigorously, despite repeated risk management-relevant incident reports (as opposed to the industry's preferred and highly erroneous term "anecdotes"). Just one recent, highly alarming example of an "anecdote" affecting probably tens of thousands of patients due to programming malpractice and grossly negligent quality assurance, at both vendor and end user hospitals, is illustrated <a style="font-weight: bold;" href="http://hcrenewal.blogspot.com/2011/11/lifespan-rhode-island-yet-another.html">here</a>. Since it's an "anecdote", perhaps Mr. Jarvis would agree there's nothing to see there, so we should all move along. (See the Aug. 2011 post "<a href="http://hcrenewal.blogspot.com/2011/08/from-senior-clinician-down-under.html">From a Senior Clinician Down Under: Anecdotes and Medicine, We are Actually Talking About Two Different Things</a>" which puts the misuse of the "anecdotes" label in its proper place - the garbage can.) Not only is "proof by lack of evidence" in the face of hair-raising incident and defects reports (e.g., as in <a href="http://hcrenewal.blogspot.com/2011/01/maude-and-hit-risk-mother-mary-what-in.html">FDA's MAUDE database</a>) a prima facie logical fallacy unfitting in medicine, and in fact alien to medical ethics, but the <a href="http://www.ischool.drexel.edu/faculty/ssilverstein/Patient%20Safety%20and%20Health%20IT%20prepub.pdf">IOM report</a> specifically stated in no uncertain terms that nobody really knows the magnitude of the risks. This is due in part to numerous inhibitory factors in evidence diffusion. From the IOM report: <blockquote>... Several reasons health IT–related safety data are lacking include the absence of measures and a central repository (or linkages among decentralized repositories) to collect, analyze, and act on information related to safety of this technology. Another impediment to gathering safety data is contractual barriers (e.g., nondisclosure, confidentiality clauses) that can prevent users from sharing information about health IT–related adverse events. These barriers limit users’ abilities to share knowledge of risk-prone user interfaces, for instance through screenshots and descriptions of potentially unsafe processes. In addition, some vendors include language in their sales contracts and escape responsibility for errors or defects in their software (i.e., “hold harmless clauses”). The committee believes these types of contractual restrictions limit transparency, which significantly contributes to the gaps in knowledge of health IT–related patient safety risks. These barriers to generating evidence pose unacceptable risks to safety.</blockquote> Imagine such a situation in, say, the pharmaceutical, automotive, aviation, or nuclear power industries. The responsible individuals would likely be hauled off to jail. However, this all may be irrelevant. After all, who can argue with the expert personal opinion of someone who holds "<a href="http://web.archive.org/web/20100103141103/http://nextgen.com/about-nextgen/leadership-structure.html#15">the American Medical Informatics Certification for Health Information Technology</a>?" That astonishing credential could conceivably elevate Mr. Jarvis' opinion over all others - even mine, with my meager background in the domain. I don't know if he still claims that credential, but he did as I described in my post about prior interactions with Mr. Jarvis and NextGen (dating back to 2004) in my Feb. 2009 post "<a href="http://hcrenewal.blogspot.com/2009/02/nextgen-and-vendordoctor-dialog-yet.html">NextGen and Vendor/Doctor Dialog: Yet Another Patronizing EHR Company of Certified HIT Experts?</a>" I guess the fact I'd never heard of such a qualification represents my dearth of familiarity with the field of Medical Informatics and healthcare information technology. -- SS Notes: [1] “Use error” is a term used very specifically by NIST to refer to user interface designs that will engender users to make errors of commission or omission. It is true that users do make errors, but many errors are due not to user error per se but due to designs that are flawed, e.g., poorly written messaging, misuse of color-coding conventions, omission of information, etc. From "NISTIR 7804: Technical Evaluation, Testing and Validation of the Usability of Electronic Health Records." It is available at <a href="http://www.nist.gov/healthcare/usability/upload/Draft_EUP_09_28_11.pdf" rel="nofollow">http://www.nist.gov/healthcare/usability/upload/Draft_EUP_09_28_11.pdf</a> (PDF). [2] Example of proof by lack of evidence, courtesy <a href="http://www.packetslut.co.uk/weblog/archives/00000053.htm">Scott Adams</a>: "I've never seen you drunk, so you must be one of those Amish people. " More on these issues is at the site "<a href="http://www.ischool.drexel.edu/faculty/ssilverstein/cases/">Contemporary Issues in Medical Informatics: Common Examples of Healthcare Information Technology Difficulties</a>."

Two Opposing Views of EHR: InformaticMD vs. NextGen's Holder of "American Medical Informatics Certification for Health Information Technology"

The AMA's publication American Medical News recently quoted me following comments from IOM EHR Safety committee member Richard Cook in the Nov. 21, 2011 article "IOM calls for monitoring and probe of …

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23 Nov 2011

Magical Thinking on Health IT from ModernMedicine.com

Annette M. Boyle, MBA has an article in the journal ModernMedicine.com that exhibits a severe form of fallacious thinking, approaching magical thinking. It's this type of thinking that gets patients injured and killed: <a href="http://www.modernmedicine.com/modernmedicine/article/articleDetail.jsp?id=749903&cid=PRAC"></a><blockquote><a style="font-weight: bold;" href="http://www.modernmedicine.com/modernmedicine/article/articleDetail.jsp?id=749903&cid=PRAC">Health information technology: Better in long term despite short-term safety risks</a> Publish date: Nov 23, 2011 By: <a href="http://www.modernmedicine.com/modernmedicine/author/authorInfo.jsp?id=55090">Annette M. Boyle, MBA</a> Responding <a href="http://books.nap.edu/openbook.php?record_id=13269&page=2" target="_blank">to a new report that says health information technology (HIT) is creating some short-term safety issues</a>, technology experts say physicians should remember one immutable fact: The new systems are far less dangerous than the old paper-based systems still in use in many practices. </blockquote>Consider that first paragraph in light of the second: <blockquote>Although the magnitude of the problem remains unknown, “serious errors involving these technologies—including medication dosing errors, failure to detect fatal illnesses, and treatment delays due to poor human-computer interactions or loss of data—have led to several reported patient deaths and injuries,” the <a href="http://www8.nationalacademies.org/onpinews/newsitem.aspx?RecordID=13269" target="_blank">Institute of Medicine (IOM) said in a news release</a>.</blockquote> So, "technology experts" proffer that a technology where the "magnitude of the problem remains unknown" are "far less dangerous than the old paper-based systems still in use in many practices." Because they say so, right? Wrong. This is why "technology experts" need to be kept on a very short leash. They cannot think logically, even regarding such a simple issue such as this. They claim as an "immutable fact" (that "physicians should remember") a comparison that has very little data underlying it? This is risible, shameful, patronizing in the extreme, insulting, and an example of the dangers of the invasion of medicine by computer technicians and salespeople. The only "immutable fact" is, if you don't know the magnitude of risk, because it's - ah - unknown, you cannot (or should not) make statements about that very magnitude of risk. (This is K-12 level logic, and more towards the "K" than the 12.) Actually, the evidence for significant risks beyond paper - far beyond paper - come from incidents like I've described on this blog. A very recent example is my Nov. 4, 2011 post "<a href="http://hcrenewal.blogspot.com/2011/11/lifespan-rhode-island-yet-another.html">Lifespan (Rhode Island): Yet another health IT "glitch" affecting thousands - that, of course, caused no patient harm that they know of - yet</a>." Doctors are not in the habit of leaving off suffixes for slow release or long acting drugs (e.g., XR, SR), but a few lines of code can - and did - affect thousands at just one healthcare system. This was a potentially lethal error. Health IT can greatly amplify risk in a manner that paper simply cannot. People who proffer gross illogic in medicine need to do society a big favor and simply remove themselves from any roles that affect medical care, patients, and medical ethics. If they know better, and are simply spinning their statements to promote sales, the need for such individuals to be distanced from healthcare is even more acute. If they don't clean up their act, either way, they may find themselves on the defendant's witness stand, where such illogic will be ripped to shreds by plaintiff's attorneys. -- SS

Magical Thinking on Health IT from ModernMedicine.com

Annette M. Boyle, MBA has an article in the journal ModernMedicine.com that exhibits a severe form of fallacious thinking, approaching magical thinking. It's this type of thinking that gets patients …

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23 Nov 2011

John Wiley and Sons Director Apologizes for Pepper Spray - An Example of the Proximity of the One Percent to the Leaders of Academic Medicine

The title of this post has not been hacked.  All will be revealed soon. Review: the University of California - Davis Pepper Spray Incident We just <a href="http://hcrenewal.blogspot.com/2011/11/uc-davis-pepper-spray-case-as.html">discussed</a> the now infamous pepper spraying of peaceful student protesters at the University of California.  We noted our previous concerns about the leadership of the university Chancellor who presided over this incident because she had previously seemed disconnected from the prime mission of the university (but instead pushed its role as a developer and marketer of biotechnology) (see <a href="http://hcrenewal.blogspot.com/2009/08/university-leaders-goal-taking-new.html">this post</a>), and defended the nearly one million dollar compensation for the medical center CEO at a time when the university's finances became increasingly fragile (see <a href="http://hcrenewal.blogspot.com/2011/09/more-repeats-of-talking-points.html">this post</a>). Since then, the Chancellor, Linda P B Katehi, vaguely apologized for the incident at a student rally where many speakers called for her resignation (see, for example, <a href="http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/11/21/MNK71M2548.DTL">this story</a> in the San Francisco Chronicle). A University Chancellor in Proximity to the One Percent as Director of John Wiley and Sons There is a certain irony to all this.  While the overriding theme of the "occupy" movement has been to advocate for the "99 percent" of Americans who feel increasingly powerless, the original protest at UC-Davis was not so much against the plutocratic one percent, as against "tuition increases and state cuts in higher education," (per the Chronicle)   Yet the person who is now at the focus of the Occupy UC-Davis group's wrath is closer to the one percent than most protesters realized. A quick search on Google revealed that Chancellor Katehi started a new part time job in 2011.  She is now a member of the <a href="http://www.wiley.com/WileyCDA/Section/id-301709.html">board of directors of John Wiley and Sons, Inc</a>, a $2.8 billion market market capitalization "global  publisher of print and electronic products."  Note that this position on not listed on <a href="http://chancellor.ucdavis.edu/about/index.html">her official bio</a> on the UC - Davis web-site as of 23 November, 2011, nor on <a href="http://chancellor.ucdavis.edu/local_resources/pdfs/katehi_vita.10.29.2010.pdf">her official curriculum vita</a> (from 2010) available on that web-site.  As a board member, she can expect over $100,000 yearly as compensation, based on fees paid in 2010 reported in the <a href="http://www.wiley.com/about/corpnews/2011_proxy.pdf">2011 company proxy statement</a>.  Since last year, the board approved compensation for the five highest paid executives ranging from over $1.8 million to over $5.3 million.  So a position on the board certainly put Ms Katehi in the proximity of the one percent. Furthermore, as we have <a href="http://hcrenewal.blogspot.com/2011/06/managers-coup-how-hired-hands-got.html">noted</a> previously, compliant, if not crony board members have been blamed for the huge increase in the compensation of top corporate executives who now make up the majority of the "one percent."  Since most board members seem to be current or retired high-ranking executives, their enthusiasm for raising their fellow hired executives' compensation should not be surprising.  Note that Ms Katehi is effectively the "CEO" of UC- Davis. A Conflict of Interest In some cases, board members' disinclination to challenge the executives they are supposed to be supervising may arise from conflicts of interest.  Note regarding the current example that John Wiley and Sons is a leading publisher of text books and professional journals in medicine, the life sciences, and many other subjects relevant to the curriculum of many of the schools and departments at UC-Davis, and particularly to the medical school and academic medical center.  More importantly, as we noted here, John Wiley and Sons' Wiley-Blackwell subsidiary includes a medical education and communications unit.  On its website, this entity <a href="http://www.wiley.com/WileyCDA/Section/id-310320.html">promises</a>: <blockquote>Our Global Corporate Sales Team of more than 100 people is dedicated to serving the publishing and communication needs of your industry. Through our extensive range of clinical and professional publications, we can develop a customized communications plan to support your promotional strategy, maximizing the impact of your brand. Whether you are looking for global or localized campaigns, for strategic or tactical support, our publishing teams are knowledgeable at all levels and are easy to reach in your time zone by phone, email or in person. We provide an expert service, competitive pricing, dedicated project management and the flexibility to provide peer-reviewed support for your brand from pre-launch to maturity, achieving strong credibility.</blockquote>Among the services provided are "continuing professional development," including "conferences and training schemes," and establishing "advisory boards to provide direction on issues surrounding new products or developing brands. We draw on our close relationships with industry leaders...." Thus, like other <a href="http://hcrenewal.blogspot.com/search/label/medical%20education%20and%20communication%20companies">medical education and communication companies</a> (MECCs), this subsidiary can use a variety of tactics to infiltrate marketing messages into what appears to be medical education.  By accepting a position on the board of directors of an academic and medical publisher that also runs a MECC, Ms Katehi has taken on fiduciary responsibility for the company, and thus seems to have a potentially intense conflict of interest, particularly affecting her leadership of a medical school and academic medical center (see our first discussion of what then appeared to be a "new species" of conflict of interest due to academic medical leaders' membership on a board of a health care corporation <a href="http://hcrenewal.blogspot.com/2006/03/new-species-of-conflict-of-interest-in.html">here</a>.)  Summary I can only speculate that proximity to the one per cent, and the conflict of interest induced by fiduciary responsibility for the stewardship of an academic and medical publisher and a medical education and communication company might have left Ms Katehi feeling distant from protesters who claimed "we are the 99 per cent," and hence more inclined to support clearing them from the campus by whatever means. In any case, it turns out that Occupy UC -Davis took on a more appropriate opponent than they realized.  This case illustrates how the complex web of relationships among the top leaders of society, including leaders of health acre organizations, is more sticky and pervasive than was heretofore apparent.  In any case, it underlines our repeated call....  To reform health care, we must reverse the managers' coup d'etat, and restore leadership of health care organizations that puts the mission, and the health of patients and the population first, and is accountable to corporate owners (when applicable) and to patients and the public.  But that will mean now going up against those who have made themselves the richest and most powerful people in the country and the world, who will not lightly give up their oligarchy.

John Wiley and Sons Director Apologizes for Pepper Spray - An Example of the Proximity of the One Percent to the Leaders of Academic Medicine

The title of this post has not been hacked. All will be revealed soon.Review: the University of California - Davis Pepper Spray IncidentWe just discussed the now infamous pepper spraying of peaceful …

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22 Nov 2011

The UC-Davis Pepper-Spray Case as Illustrative of Problems with the Leadership of Health Care

The aggressive actions by University of California-Davis police against unarmed, peaceful student protesters turn out to be the latest illustration of the problems with leadership and governance we discuss on <a href="http://hcrenewal.blogspot.com/">Health Care Renewal</a>.  The University of California - Davis Pepper Spray Incident To summarize the current episode, I start with quotes about its background <a href="http://www.reuters.com/article/2011/11/19/us-protests-davis-pepperspray-idUSTRE7AI0ZA20111119">from Reuters</a>, <blockquote>Student protesters at Davis had set up an encampment in the university's quad area earlier this month as part of the nationwide Occupy movement against economic inequality and excesses of the financial system. Their demonstrations, which had been endorsed by a faculty association, included protests against tuition increases and what they viewed as police brutality on University of California campuses in response to recent protests. The students had set up roughly 25 tents in a quad area, but they had been asked not to stay overnight and were told they would not be able to stay during the weekend, due to a lack of university resources, [university Chancellor Linda] Katehi said. Some protesters took their tents down voluntarily while others stayed.</blockquote> Then, <blockquote>The pepper spray incident appeared to take place on Friday afternoon, when campus police moved in to forcibly evict the protesters.</blockquote> Then, as <a href="http://www.independent.co.uk/news/world/americas/outcry-over-chilling-campus-pepper-spray-use-6265203.html">per the (London, UK) Independent</a>, <blockquote>A police officer saunters up to a group of young protestors who are sat in a line on the ground, with their arms linked. Then he removes a canister of pepper spray from his belt, with a flourish, before casually proceeding to unload its contents into their faces. The demonstrators remain silent and motionless, with their heads bowed. So the policeman carries on, methodically covering them, from point blank range. By the time he’s finished, their heads and faces are covered in a thick layer of the toxic red liquid.</blockquote> The actual video is below: <iframe allowfullscreen="" frameborder="0" height="315" src="http://www.youtube.com/embed/WmJmmnMkuEM" width="560"></iframe> The UC-Davis Chancellor's Defense of the Police Actions The Independent's coverage emphasized that initially the leadership of the campus police defended the use of pepper spray on apparently unarmed, peaceful students: <blockquote>Annette Spicuzza, the head of the UC Davis Campus Police, who were responsible for Friday’s incident .... told reporters that her officers had been 'forced' to use the pepper spray, after demonstrators surrounded them. Lt Pike gave his victims sufficient warning of the impending attack, she added, and emptied the canister with a sweeping motion, in keeping with official procedures. 'When you are encircled by 200 individuals, I don’t know if I want to say ‘afraid,’ but I think they were quite concerned about their safety,' she said, regarding the circumstances her officers faced. 'There was no way out of that circle... It's a very volatile situation.'</blockquote> That coverage also made clear that the directive to clear the demonstrators came from the top: <blockquote>Linda Katehi, the Chancellor of UC Davis ... had asked the police to clear demonstrators from her campus, a couple of hours north of San Francisco. In the aftermath of the incident, she had initially joined Spicuzza in defending the force's methods, saying that they had 'no option' but to adopt a hard line.</blockquote> Ms Katehi later backed off, but only after her first response <blockquote>sparked immediate outrage, and within hours, the university’s Faculty Association, representing Ms Katehi’s employees, issued a statement called for her resignation, saying that her authorisation of 'excessive' force had amounted to a 'gross failure of leadership.' Nathan Brown, an assistant English professor who witnessed the incident, wrote in an open letter: 'Several of these students were hospitalized. Others are seriously injured. One of them, forty-five minutes after being pepper-sprayed down his throat, was still coughing up blood... You are responsible.'</blockquote> Other comments likened the police actions to something "coming from some riot-control unit in China, or in Syria," [<a href="http://www.theatlantic.com/national/archive/2011/11/pepper-spray-brutality-at-uc-davis/248764/">James Fallows in the Atlantic</a>] called them indicative of "a police state in its pure form," [<a href="http://www.salon.com/2011/11/20/the_roots_of_the_uc_davis_pepper_spraying/">Glenn Greenwald in Salon</a>], or otherwise denounced them as "outrageous" or "awful." (Clark McPhail, professor emeritus of sociology at the University of Illinois, and Greg Lukianoff, President of the Foundation for Individual Rights in Education, respectively, <a href="http://www.insidehighered.com/news/2011/11/21/experts-and-activists-question-use-pepper-spray-davis">via Inside Higher Ed</a>.) This aggressive, violent response to peaceful protest seems to be the latest example of the arrogance of some current leaders of our important organizations. Our Previous Discussion of the Chancellor in Health Care Renewal This case appears directly related to the problems in leadership and governance we discuss on <a href="http://hcrenewal.blogspot.com/">Health Care Renewal </a>Ms Katehi has the distinction of having been already written up twice on Health Care Renewal for questions about her leadership. On her arrival at UC-Davis in 2009, she promised to "help UC Davis to become more aggressive in taking new biotechnology and agriculture products to market." This indicates at best ignorance of, at worst hostility to the fundamental university mission, which is hardly developing and particularly marketing products, but discovering and disseminating knowledge (see <a href="http://hcrenewal.blogspot.com/2009/08/university-leaders-goal-taking-new.html">this post</a>). At that time, I called this an example of "how the leaders of academic institutions seem to be forgetting or radically deconstructing their academic missions." In 2011, Ms Katehi defended the payment to the medical center CEO, whom she called a "great CEO,' of nearly a million dollars yearly in compensation. However, that CEO was part of a group of top university leaders demanding large increases in their pensions at a time when the university was under great financial distress. For that, some called them not great leaders, but greedy and "despicable." Thus, Ms Katehi seemed to stand up for top leaders' privilege and exceptionalism, including their entitlement to huge compensation whatever the circumstance, even in a time of financial travail (see <a href="http://hcrenewal.blogspot.com/2011/09/more-repeats-of-talking-points.html">this post</a>). I could not have predicted that Chancellor Katehi would preside over the pepper spraying unarmed students for peaceful, legitimate protest. However, it is not surprising that a leader who does not understand the fundamental academic mission and who supports executive privilege and exceptionalism would foster an authoritarian climate in which such an incident could happen. This example clearly illustrates the issues we have been discussing on Health Care Renewal for a long time. In particular, leaders who are more dedicated to their own and their fellow executives' privilege and exceptionalism than their organizations' missions are likely to end up promoting actions that threaten those  missions. The Moral of the Story Instead, as we have been preaching 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. You heard it here first on <a href="http://hcrenewal.blogspot.com/">Health Care Renewal </a>. Keep your eye on Health Care Renewal for continued discussion of parallels between problems in health care and in the larger political economy.

The UC-Davis Pepper-Spray Case as Illustrative of Problems with the Leadership of Health Care

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21 Nov 2011

If gov't officials can't deal with bendy bananas, curvy cucumbers and water for hydration, how can they possibly consider issues with computers?

I present this story with almost no commentary except this post's title, the simple observation that keeping government out of many aspects of out lives is not a bad idea, and a few minor points: <blockquote>The Telegraph <a style="font-weight: bold;" href="http://www.telegraph.co.uk/news/worldnews/europe/eu/8897662/EU-bans-claim-that-water-can-prevent-dehydration.html">EU bans claim that water can prevent dehydration </a> Brussels bureaucrats were ridiculed yesterday after banning drink manufacturers from claiming that water can prevent dehydration. By Victoria Ward and Nick Collins <div>6:20AM GMT 18 Nov 2011 </div> <div class="firstPar"> EU officials concluded that, following a three-year investigation, there was no evidence to prove the previously undisputed fact. </div><div class="secondPar"> Producers of bottled water are now forbidden by law from making the claim and will face a two-year jail sentence if they defy the edict, which comes into force in the UK next month. </div><div class="thirdPar"> Last night, critics claimed the EU was at odds with both science and common sense. Conservative MEP Roger Helmer said: “This is stupidity writ large. </div><div class="fourthPar"> “The euro is burning, the EU is falling apart and yet here they are: highly-paid, highly-pensioned officials worrying about the obvious qualities of water and trying to deny us the right to say what is patently true. </div><div class="fifthPar"> “If ever there were an episode which demonstrates the folly of the great European project then this is it.” <div class="body"> NHS health guidelines state clearly that drinking water helps avoid dehydration, and that Britons should drink at least 1.2 litres per day. The Department for Health disputed the wisdom of the new law. A spokesman said: “Of course water hydrates. While we support the EU in preventing false claims about products, we need to exercise common sense as far as possible." German professors Dr Andreas Hahn and Dr Moritz Hagenmeyer, who advise food manufacturers on how to advertise their products, asked the European Commission if the claim could be made on labels. They compiled what they assumed was an uncontroversial statement in order to test new laws which allow products to claim they can reduce the risk of disease, subject to EU approval. They applied for the right to state that “regular consumption of significant amounts of water can reduce the risk of development of dehydration” as well as preventing a decrease in performance. However, last February, the European Food Standards Authority (EFSA) refused to approve the statement. A meeting of 21 scientists in Parma, Italy, concluded that reduced water content in the body was a symptom of dehydration and not something that drinking water could subsequently control. Now the EFSA verdict has been turned into an EU directive which was issued on Wednesday. Ukip MEP Paul Nuttall said the ruling made the “bendy banana law” look “positively sane”. He said: “I had to read this four or five times before I believed it. It is a perfect example of what Brussels does best. Spend three years, with 20 separate pieces of correspondence before summoning 21 professors to Parma where they decide with great solemnity that drinking water cannot be sold as a way to combat dehydration. “Then they make this judgment law and make it clear that if anybody dares sell water claiming that it is effective against dehydration they could get into serious legal bother. EU regulations, which aim to uphold food standards across member states, are frequently criticised. Rules banning bent bananas and curved cucumbers [what?? - ed.] were scrapped in 2008 after causing international ridicule. Prof Hahn, from the Institute for Food Science and Human Nutrition at Hanover Leibniz University, said the European Commission had made another mistake with its latest ruling. “What is our reaction to the outcome? Let us put it this way: We are neither surprised nor delighted. “The European Commission is wrong; it should have authorised the claim. That should be more than clear to anyone who has consumed water in the past, and who has not? We fear there is something wrong in the state of Europe.” Prof Brian Ratcliffe, spokesman for the Nutrition Society, said dehydration was usually caused by a clinical condition [like hot weather and low fluid intake? - ed.] and that one could remain adequately hydrated without drinking water. [As the study was done in Italy, perhaps they had something else in mind? - ed.] <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjyLZUalU-u6gFdQV7_ahHIuCl5rKWj8ISlHwobBq2rxIG5xST8aJTc3QH-j4-PWZgv0nPRDYLKvmex6boEjJR1FvSSNCexoD0-1iH0Dp966zlA_c25nbKYEBo7svDnBcVjGANMzNZQ_I-1/s1600/wine-bottles.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5676861099366478818" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjyLZUalU-u6gFdQV7_ahHIuCl5rKWj8ISlHwobBq2rxIG5xST8aJTc3QH-j4-PWZgv0nPRDYLKvmex6boEjJR1FvSSNCexoD0-1iH0Dp966zlA_c25nbKYEBo7svDnBcVjGANMzNZQ_I-1/s320/wine-bottles.jpg" style="display: block; margin: 0px auto 10px; text-align: center; cursor: pointer; width: 189px; height: 189px;" /></a> Water? Where we're going, we don't need water. He said: “The EU is saying that this does not reduce the risk of dehydration and that is correct. “This claim is trying to imply that there is something special about bottled water which is not a reasonable claim.” </div></div><div class="storyHead"> </div> </blockquote>Hard as this is to believe, the ruling is no April Fool's joke. -- SS

If gov't officials can't deal with bendy bananas, curvy cucumbers and water for hydration, how can they possibly consider issues with computers?

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19 Nov 2011

Websites dedicated by patients to a physician in Illinois under fire essentially because he's "too slow" with an EMR

Stunning. Two websites dedicated by patients to a physician in Illinois under fire essentially because he's "too slow" with an EMR: <a href="http://kottemann.wordpress.com/" title="In Support of Dr. Steven Kottemann" rel="home"></a><blockquote>In Support of Dr. Steven Kottemann Testimonials submitted by the patients of Dr. Steven Kottemann, Lincoln, Illinois<hgroup></hgroup> <a href="http://kottemann.wordpress.com/">http://kottemann.wordpress.com/</a> </blockquote> And a corresponding Facebook page: <blockquote> Support Dr. Kottemann <a href="http://www.facebook.com/pages/Support-Dr-Kotteman/170060299745403">http://www.facebook.com/pages/Support-Dr-Kotteman/170060299745403</a></blockquote> The posts at these sites are well worth reading. For background, see "<a href="http://www.prairiestatereport.us/2011/10/26/beloved-springfield-doctor-benched-for-not-being-proficient-with-electronic-medical-records-system/">Beloved Springfield Doctor Benched For Not Being Proficient with Electronic Medical Records System</a>", The Prairie State Report, Oct. 26, 2011: <blockquote>... This situation brings into focus the problem of top-down medical solutions, calling into question the efficacy of healthcare by committee, not to mention Obmacare itself. Do we really want to sacrifice good doctors in favor of good followers of top-down rules? Do we want good users of computers or excellent doctors? The doctor, Steven Kottemann, 63, was placed on paid administrative leave in September because they felt he was not properly utilizing the new electronic medical records system that his employer, Family Medical Center, instituted.</blockquote> Which is more important, one needs to ask? A computer, or an excellent clinician? -- SS

Websites dedicated by patients to a physician in Illinois under fire essentially because he's "too slow" with an EMR

Stunning.Two websites dedicated by patients to a physician in Illinois under fire essentially because he's "too slow" with an EMR:In Support of Dr. Steven KottemannTestimonials submitted by the patie…

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19 Nov 2011

To Sir Andrew? With a Settlement - GlaxoSmithKline to Settle for $3 Billion, CEO Said to Pursue Knighthood

Two weeks ago, reports of the largest legal settlement involving a pharmaceutical company to date in the US appeared.  The $3 Billion Settlement In summary, <a href="http://articles.philly.com/2011-11-04/business/30359814_1_glaxo-diabetes-drug-medicaid-pricing">per the Philadelphia Inquirer</a>, <blockquote>In perhaps the largest penalty ever paid by a pharmaceutical company, GlaxoSmithKline said Thursday it had reached a tentative deal with the U.S. Justice Department to pay $3 billion to settle criminal and civil allegations of illegal marketing practices and pricing under a Medicaid program.</blockquote> Why the deal was announced this month is not clear. Neither are all its provisions: <blockquote>Glaxo said the deal would be made final in 2012, but it was unclear why it was announced now. A spokeswoman declined to say whether Glaxo would have to live by a corporate integrity agreement, which the government sometimes requires in such cases.</blockquote> The Inquirer listed some possible reasons for the settlement, <blockquote>As for Glaxo's latest situation, one investigation, started by the U.S. Attorney's Office in Colorado and later run on a national level by the U.S. Attorney's Office in Boston, looked at Glaxo's marketing practices related to nine of its best-selling drugs, including Paxil, Wellbutrin, and later Advair. In a second investigation, the Justice Department looked at Glaxo's possibly inappropriate use of rules exceptions when reporting prices charged for drugs for different situations in the marketplace. Under part of the Medicaid Rebate Program, drugmakers are supposed to report the lowest price they charge most organizations, which is then used to calculate the price that Medicaid ultimately pays for its drugs. The third investigation, also by the Justice Department, was over how Glaxo promoted the diabetes drug Avandia, which was pulled from European markets and severely restricted last fall by the Food and Drug Administration after it was shown to cause heart attacks.</blockquote> As commonly occurs in such cases, GSK and its CEO averred that all the sorts of conduct that lead to this settlement are old news: <blockquote>The company said in a statement that since 2008 it had 'established a new framework for compliance in the U.S., based on the company's values, policies and established industry codes of practices. It is supported by a larger compliance staff and strengthened training programs that require certification by employees.' The changes included new incentive formulas for sales representatives, eliminating sales targets for bonuses. 'This is a significant step toward resolving difficult, long-standing matters which do not reflect the company that we are today,' Glaxo chief executive officer Andrew Witty said in the statement. 'In recent years, we have fundamentally changed our procedures for compliance, marketing and selling in the U.S. to ensure that we operate with high standards of integrity and that we conduct our business openly and transparently.'</blockquote> As is also usual, none of the reports included any acceptance of responsibility for the bad conduct by GSK or any of its leaders, and certainly they did not mention any negative consequences for any persons who might have authorized, directed, or implemented the misbehavior, even giving, as is apparently true in this case, that some of the behavior was at least alleged to be criminal. A Settlement for a Knight? It was not clear why this settlement was announced this early in such a preliminary, and vague manner. However, a <a href="http://www.pharmalot.com/2011/11/your-majesty-may-i-present-sir-andrew/">post</a> on the PharmaLot blog suggested one motivation: <blockquote>As the calendar year draws to a close, the UK government is busy readying the next list of individuals who are to be honored as members of the Order of the British Empire. These honors are bestowed on people from all walks of life who have somehow made a difference in their community. And there are various types of awards, including knighthood, that recognize a different type of contribution. The list, however, is a closely guarded secret. Presumably, even Rupert Murdoch employees would have a hard time hacking into the treasured line up of nominees. But one name that may be under consideration is Andrew Witty, the ceo at GlaxoSmithKline. Our sources say that Glaxo minions have been encouraged to find ways to hone his image in hopes that he becomes Sir Andrew.</blockquote> So one could speculate that being able to clear up these "difficult, long-standing matters," could be touted as a task that only could be accomplished by a knight. That might have been plausible if Mr Witty recently rode into town on a white horse, and then dispatched these old legal demons. Some More History In fact, that is not what happened. Per his <a href="http://www.gsk.com/about/bio-witty-cet.htm">official GSK biography</a>, <blockquote>Andrew Witty became Chief Executive Officer of GlaxoSmithKline plc on 21 May 2008. He is a member of the Board and Corporate Executive Team. Andrew joined Glaxo in 1985 and held a variety of Sales and Marketing roles in the UK business. He has worked in the Company’s International New Products groups, both in the Respiratory and HIV/Infectious disease fields and has been involved in multiple new product development programmes. He has also worked in South Africa, The USA and Singapore where he led the Group’s operations as Senior Vice President, Asia Pacific. While in Singapore Andrew was a Board Member of the Singapore Economic Development Board, the Singapore Land Authority and in 2003 he was awarded the Public Service Medal by the Government of Singapore. In 2003 Andrew was appointed President of GSK Europe, and joined GSK’s Corporate Executive Team. </blockquote> So he has been with GSK a long time. However, the misbehavior that the current settlement is apparently designed to resolve has been going on for a long time. As we previously <a href="http://hcrenewal.blogspot.com/2010/10/glaxosmithkline-subsidiary-pleads.html">posted</a>, Paxil (Seroxat in the UK, or paroxetine), was the anti-depressant whose marketing lead GlaxoSmithKline (GSK) to settle allegations of fraud brought by then New York Attorney General Elliott Spitzer in 2004. That case included allegations of suppression and manipulation of clinical research, and was discussed in great detail in the book <a href="http://www.alison-bass.com/books.html">Side Effects</a> by Alison Bass. We posted about various aspects of this case, e.g., more recently <a href="http://hcrenewal.blogspot.com/2007/01/not-something-we-want-to-publicise-spin.html">here</a>, <a href="http://hcrenewal.blogspot.com/2008/03/british-government-concludes-gsk.html">here</a>, and <a href="http://hcrenewal.blogspot.com/2008/09/brown-university-student-journalists.html">here</a>.  The case continues to echo to this day: see <a href="http://alison-bass.com/blog/2011/11/international-group-seeks-brown-universitys-help-in-getting-controversial-paxil-study-retracted">this post</a> by Alison Bass about attempts to have a questionable journal article that was used to market Paxil retracted.  Then there was Avandia (rosiglitazone), the anti-diabetic drug whose use was just restricted by the US Food and Drug Administration. This GlaxoSmithKline product inspired a <a href="http://hcrenewal.blogspot.com/2010/07/avandia-spin-cycle-continues-even-after.html">"spin cycle"</a> which provided us with endless grist for the Health Care Renewal mill. A good summary of the case appeared in September, 2010, in the British Medical Journal (Cohen D. Rosiglitazone: what went wrong: Brit Med J 2010; 341: 530-534. Link <a href="http://www.bmj.com/content/341/bmj.c4848.fu%20%20ll">here</a>) Once again, it appears that research was suppressed and manipulated (e.g., see <a href="http://hcrenewal.blogspot.com/2010/02/bring-back-dsi-avandia-case-as-spy.html">here</a>), Avandia critics were attacked by "experts" whose financial relationships with GSK were not always obvious (e.g., see <a href="http://hcrenewal.blogspot.com/2007/06/avandia-spin-cycle-continues.html">here</a>), and there were allegations that GSK executives tried to intimidate those who disagreed with them (e.g., see <a href="http://hcrenewal.blogspot.com/2010/02/bring-back-dsi-avandia-case-as-spy.html">here</a> and <a href="http://hcrenewal.blogspot.com/2007/11/more-about-who-called-dogs-out-on.html">here</a>).  All this about Avandia came out after Mr Witty became President of GSK Europe and joined the Corporate Executive Team.  While there is no reason to think he was directly responsible for any of it, as a member of this team, he ought to be accountable for the corporation's major actions, and misbehavior.  By the way, we <a href="http://hcrenewal.blogspot.com/2010/10/glaxosmithkline-subsidiary-pleads.html">posted</a> last year about another settlement by GSK, in which a GSK subsidiary pleaded guilty to criminal charges for selling adulterated drugs, including a version of Paxil. In the Washington Post <a href="http://www.washingtonpost.com/business/economy/3billion-settlement-expected-in-glaxosmithkline-drug-marketing-probe/2011/11/03/gIQAYf7sjM_story.html">report</a> of the $3 billion settlement, there is this quote from Dr Sidney Wolfe, <blockquote>'The size of the penalties, although large, are not as large as the money [the drug companies] make and so they keep doing it over again,' said Sidney M. Wolfe, director of Public Citizen’s health research group. 'The only way this is going to stop, or get reversed, is to greatly increase the size of the penalties or to start sending some of the executives to jail, if appropriate.'</blockquote>Summary I have no idea whether there is evidence supporting criminal charges for any executives in this case. However, GSK and its leadership have not covered themselves in glory recently as shown by now three major legal settlements. I am just an American and not very knowledgeable about how the UK decides to dub people knights. However, in my humble opinion, it would be grotesque to honor the current CEO of GlaxoSmithKline with a knighthood based how his company has been lead since he became a member of its Executive Team in 2003. I thus will end on my usual, repetitive note for such cases.... penalties that only appear to be (relatively small) costs of doing business are unlikely to deter future bad behavior. Until the people who actually authorized, directed and implemented the bad behavior have to suffer some negative consequences, expect the bad behavior to continue. When it comes to health care's leadership, society seems to have acceded to defining deviancy down. Until we start holding health care leaders to high standards, expect their organizations not to uphold high standards. Further, expect organizations that did not uphold high standards in one instance to fail to uphold them in other instances. ADDENDUM (18 November, 2011) -  See additional posts on attempts to have Study 329, a particularly questionable study of Paxil, withdrawn on <a href="http://loathingbioethics.blogspot.com/2011/11/fraud-what-fraud-brown-remains-silent.html">the Fear and Loathing in Bioethics blog</a>, <a href="http://brodyhooked.blogspot.com/2011/11/will-brown-university-investigate.html">the Hooked: Ethics, Medicine and Pharma blog</a>, and on <a href="http://www.margaretsoltan.com/?p=33573">the University Diaries blog</a>. ADDENDUM (21 November, 2011) - See also these posts on the call for the withdrawal of Study 329 on the <a href="http://alison-bass.com/blog/2011/11/international-group-seeks-brown-universitys-help-in-getting-controversial-paxil-study-retracted">Alison Bass blog</a>, and the <a href="http://1boringoldman.com/index.php/2011/11/20/a-walk-on-the-wrong-side-side-of-the-street">1BoringOldMan blog</a>.

To Sir Andrew? With a Settlement - GlaxoSmithKline to Settle for $3 Billion, CEO Said to Pursue Knighthood

Two weeks ago, reports of the largest legal settlement involving a pharmaceutical company to date in the US appeared. The $3 Billion SettlementIn summary, per the Philadelphia Inquirer,In perhaps the…

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18 Nov 2011

A New Low - A Hospital CEO Got a "Golden Parachute" for A Merger that Never Occurred

We recently <a href="http://hcrenewal.blogspot.com/2011/11/ceos-first-to-benefit-from-for-profit.html">posted</a> about how top hospital managers are often the first to benefit from mergers and acquisitions, which once again have become fashionable in management circles.  Now it appears that top executives can benefit even from failed mergers, as <a href="http://www.news-journalonline.com/news/local/east-volusia/2011/11/12/ideas-run-the-gamut-on-future-of-bert-fish-medical-center.html">reported</a> by the Daytona Beach (Florida) News-Journal, <blockquote>Five months after Bert Fish Medical Center's failed merger, one board member said he was surprised to learn payments are still being made toward the $1 million buyout of the former hospital CEO. Hospital board member Joe Benedict said he didn't know former hospital Chief Executive Officer Bob Williams, who steered the board into the illegal deal with Adventist Health System, is due to receive his $289,000-a-year salary until 2014 –– paid through the publicly owned hospital. At the time the merger was announced, a memorandum of understanding with Williams became public and showed the deal had triggered a three-year buyout clause in Williams' contract. Starting July 1, 2010, the Adventist agreement paid him his salary for three years, as his contract required, plus seven months and eight days –– a deal worth $1 million and benefits. 'That man has got away with a lot more than he should have,' said Benedict, a former County Council member, explaining that he considers Williams as responsible for the failed merger as Jim Heekin, the board's former attorney. </blockquote> These payments were made to the former CEO despite the cost of the failure of the merger: <blockquote>The hospital district incurred $3.4 million in administrative and legal fees as a result. </blockquote> Apparently, there are allegations that the merger failed because former CEO Williams agreed to keep the board meetings of this public hospital secret, which was illegal: <blockquote>The hospital board has voted to pursue a legal malpractice lawsuit against Heekin, of the Orlando firm Lowndes, Drosdick, Doster, Kantor & Reed, for his advice to keep the public out of talks about merging the New Smyrna Beach hospital with a partner. The 21 closed meetings that were held over 16 months were called 'so much darkness for so long' they couldn't be cured, according to a ruling earlier this year from Circuit Judge Richard Graham, who threw out the merger. </blockquote> Also, <blockquote>Williams is quoted in transcripts of the closed meetings telling board members not to tell anyone Adventist had been chosen as Bert Fish's partner</blockquote> Other contractual provisions for golden parachutes exist, but have yet to be activated: <blockquote>Benedict said he's still hopeful he can undo other buyout clauses in hospital contracts he believes obligate the hospital to pay more than is allowed, under state law, for the departure of Bert Fish Medical Center administrators. According to the current contracts, provided to the News-Journal, the hospital's current CEO, chief financial officer and chief of nursing must be paid 24 months' salary should they be dismissed from their positions through no fault of their own. Their departures could be a possibility if Bert Fish were to seek another merger partner who doesn't want to keep them on. The contracts were executed June 30. On July 1, a new state law went into effect that limits the buyout of public employees to 20 months. </blockquote> Summary So, a hospital CEO had a contract that made him eligible to begin receiving "golden parachute" payments just because a merger was in process, and these payments could not be stopped even though the merger was declared illegal, and hence never occurred. We noted recently that CEOs and other top officials of health care organizations are often the first to benefit financially from mergers and acquisitions, even when such transactions to not prove so beneficial to the affected institutions, much less patients' and the public's health in the long run. Here is a case in which a CEO could get extra money just because a merger was contemplated. This is some sort of new record for health care leaders personally profiting from their insider positions. There has been growing public outrage about how ordinary people who play by the rules are disadvantaged in today's economy, while insiders profit from their positions. There ought to be equal outrage in health care over its version of this pheonomenon. As long as health care leaders can continue to put their self-interest ahead of the health care mission in this way, is it any wonder that health care costs continue to rise while access and quality suffer? When will would be health care reformers realize that to truly reform health care, we will have to reform health care leadership? We need health care leaders who understand and uphold the mission, are accountable for how well they do so, and whose incentives depend on how they do so. We do not need leaders who put their self-interest first. Right now, however, that seeems to be the leadership we have.

A New Low - A Hospital CEO Got a "Golden Parachute" for A Merger that Never Occurred

We recently posted about how top hospital managers are often the first to benefit from mergers and acquisitions, which once again have become fashionable in management circles. Now it appears that to…

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16 Nov 2011

George Lundberg, MD: The Promise of Health IT, and a Caveat

I was cited yesterday in a <a href="http://www.medpagetoday.com/" style="font-weight: bold;">Medpage TODAY</a> video by medical internet pioneer <a href="http://www.medscape.com/public/bios/bio-georgelundberg" style="font-family: arial;">George Lundberg, MD</a>, also former editor of the Journal of the American Medical Association (<a href="http://jama.ama-assn.org/">JAMA</a>). A link was made to Healthcare Renewal as well.   <div style="font-family: arial;"><div style="color: black; direction: ltr; font-family: Arial; font-size: 13px;"> <h1 dir="ltr" style="color: #003399; font-size: 18px; margin-top: 0px;"> </h1><blockquote>Health IT: Garbage In, Garbage Out By George Lundberg, MD, Editor-at-Large, MedPage Today November 15, 2011 <a href="http://www.medpagetoday.com/Columns/29688">http://www.medpagetoday.com/Columns/29688</a> (video and transcript) <div style="text-align: center;"><a href="http://www.medpagetoday.com/Columns/29688"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5675586219048368530" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhDX_mb_kfYLRA-Yy8d1h1ZIIgjwrZWTev8fCqjRHe0PzceTlZ1rWc0O6m_8LN71p0jSu586pkchWFeq-Ue5hnbguBdwJfghUvZlA9UxQxpaH7g10m-Z06-uEhLLyQzLafRx_o26YRhwrMZ/s320/lundberg.jpg" style="cursor: pointer; display: block; height: 181px; margin: 0px auto 10px; text-align: center; width: 222px;" /></a>Click on picture to link to article/video</div> Transcript: Hello and Welcome. I'm Dr. George Lundberg and this is At Large at MedPage Today. I started working with computers in medicine in 1963. I was a Captain in the United States Army Medical Corps in San Francisco when a Lieutenant Colonel told me to "automate the California Tumor Tissue Registry." I said, "Yes, Sir. How would I do that?" He told me to walk across the Presidio parking lot and go into a building that had a big machine in it that is called a computer. I did that, and for the next three months, I took the information that was on a bunch of 3 by 5 cards and converted that data into punch cards, which were then fed into the computer and out came an automated California Tumor Tissue Registry. I was hooked and, although never a "techie," I never stopped finding ways to use computers in medicine. The goal was always better, faster, cheaper. I remain a strong advocate, and have worked in a string of jobs that strived for that goal. One of the truths I learned early on was "G I G O" -- Garbage In; Garbage Out. That has not changed. There are indeed a huge number of medical tasks that computers can do very well if properly programmed, managed, and utilized. The eminent UCSF academic clinician Dr. Bob Wachter was early in recognizing that there were also significant <a href="http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1785161/">downsides in applying computers in practice</a>. Physicians are very smart. They will quickly adopt new technology that helps them get their job done if it does not waste their time. Most American physicians have dragged their feet on implementing computers into their practices, and with good reasons. But now they should get on with it. I write this column as it has been announced that 100,000 U.S. physicians and hospitals have signed up for the <a href="http://www.ihealthbeat.org/articles/2011/10/6/more-than-100000-health-providers-sign-up-for-meaningful-use.aspx">"meaningful use" incentive program</a> and thus been able to take the government's money to help automate their organizations. I think this is good and I praise Dr. David Blumenthal for his major efforts to make this happen. However, there is another harsh critic worth listening to. His name is Dr. Scot Silverstein, and he seems to have made it his life's work to call attention to really <a href="http://hcrenewal.blogspot.com/2011/09/sweet-death-that-wasnt-very-sweet-how_24.html" style="font-weight: bold;">bad problems</a> that he discovers in this mass move to automation. Heed his cautions. They are real. But also recognize that where there is progress, there is trouble; but it can be worth the price. That's my opinion. I'm Dr. George Lundberg, At Large for MedPage Today. </blockquote><div dir="ltr"> </div></div></div> I thank Dr. Lundberg for his caveat, citing me, and agree with his position. My father died in 2000 due to complications of failure to diagnose bilateral renal adenocarcinomas (malignant tumors of both kidneys) for about two years despite numerous warning signs. This occurred in a hospital without electronic medical records and was in part due to impaired clinician communications. His life could have been longer, and with far less suffering, had there been a safe and effective EHR.   Once discovered -- only due to my insistence on a renal arteriogram -- the doctors told my father he could not be treated and to "get his affairs in order." (They lost the later malpractice case that ensued.) I was able to prolong my father's life for a few years by removing him from that hospital, "hospital A" and taking him to another hospital where he underwent bilateral heminephrectomies and other treatment. Let's call the other hospital "hospital B." On the other hand...a caveat of my own: Ironically and tragically, my mother died in June 2011 from complications of a medical error at "hospital B" that was due to impaired clinician communications -- caused by an EHR that to my observation was itself unsafe and ineffective. Therefore, my caveat is that we must be very mindful of the adage "where there is progress, there is trouble; but it can be worth the price." The price must respect medical ethics. It must not involve using patients, especially patients who have not been given informed consent and opt-out choices, as test subjects for software debugging. As I wrote back to Dr. Lundberg: <blockquote> Many thanks George. I agree with your assessments [on EHRs]. Now we have to work to ensure the pitfalls are habitually avoided. Regards, Scot Silverstein</blockquote> Here is a memorial bench I had erected to my parents at their grave last month, near where they ran a small community pharmacy for almost four decades. My father, a pharmacist, was a go-to source for health information in the <a href="http://articles.philly.com/1986-03-25/business/26081235_1_kelsey-hayes-city-material-manufacturer/2">once-bucolic</a> community of Somerton, in far Northeast Philadelphia, long before chain drugstores appeared in the region. The inscription atop the bench reads "Owners of Lumar Pharmacy. Served This Community 1954 -1991." They, like I, also toiled to safeguard and improve the health of the public. May they rest in peace: <div style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEic0QrFaMJTrHh8lqnr-yXq49hhStOs_KyhL3qpreHoOXjf7sNOjmARDOdsoyHVNb9u5WwTmlVSn_gSp6V4l1950vlGPSOxAkpETxlBgat2RTg1c6Bd3lYYBqi3a6tEBVeFQ7bLvAOvnn24/s1600/Bench.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5675584399345929698" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEic0QrFaMJTrHh8lqnr-yXq49hhStOs_KyhL3qpreHoOXjf7sNOjmARDOdsoyHVNb9u5WwTmlVSn_gSp6V4l1950vlGPSOxAkpETxlBgat2RTg1c6Bd3lYYBqi3a6tEBVeFQ7bLvAOvnn24/s320/Bench.jpg" style="cursor: pointer; display: block; height: 241px; margin: 0px auto 10px; text-align: center; width: 320px;" /></a>Click to enlarge.</div> -- SS

George Lundberg, MD: The Promise of Health IT, and a Caveat

I was cited yesterday in a Medpage TODAY video by medical internet pioneer George Lundberg, MD, also former editor of the Journal of the American Medical Association (JAMA). A link was made to Healt…

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16 Nov 2011

Novel Idea on Healthcare IT: Worth a Billion Dollars!

From an <a href="http://www.amia.org/">AMIA</a> announcement: <blockquote>CMS Innovation Center Announces $1 Billion Funding Opportunity: CMS announced a new initiative, the Health Care Innovation Challenge, which will provide grants for new ideas to improve care and lower costs for those in Medicare, Medicaid and CHIP. CMS will award up to $1 billion in grants for a 3 year period and is encouraging providers, payers, local government, public-private partnerships and multi-payer collaboratives to develop new and innovative ways to improve care. To learn more about the grants and application process, check out the CMS Innovation Center website and be sure to register for the CMS webinar on Thursday.</blockquote> CMS, I have an idea! It's a really, really novel idea! "Let's regulate HIT to improve its safety, usability, usefulness, fitness for purpose, effectiveness, etc." ™ That will lower healthcare costs! Save lives, too! ---------------------------------- Can I have my Billion Dollars now? <div style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhhinLWA0LEqtIx0hVUJ7BPLp62RwF2t6YjMjk5lObwSrXxX4ixGktTylUJpX3p3Fs1ty_pliiW-F7mrn6m4CFH1GqwZ4cfVYxz-97Vv0EJUIKBKGhfWEZr2hwI8k42p1RGUSDY2Q-L4TEW/s1600/Billion_Front.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5675578351849844338" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhhinLWA0LEqtIx0hVUJ7BPLp62RwF2t6YjMjk5lObwSrXxX4ixGktTylUJpX3p3Fs1ty_pliiW-F7mrn6m4CFH1GqwZ4cfVYxz-97Vv0EJUIKBKGhfWEZr2hwI8k42p1RGUSDY2Q-L4TEW/s320/Billion_Front.jpg" style="display: block; margin: 0px auto 10px; text-align: center; cursor: pointer; width: 310px; height: 134px;" /></a>You can do a lot in health IT with a billion dollars - if you're not the HIT industry, that is, that has squandered a large wad of these over the past several decades. </div> -- SS

Novel Idea on Healthcare IT: Worth a Billion Dollars!

From an AMIA announcement:CMS Innovation Center Announces $1 Billion Funding Opportunity:CMS announced a new initiative, the Health Care Innovation Challenge, which will provide grants for new ideas t…

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16 Nov 2011

Abbott Laboratories to Settle for $1.3 Billion Allegations Including Giving Doctors Kick-Backs and Training Them to Make False Diagnoses

It looks like the march of billion dollar <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">legal settlements</a> by health care organizations is on its way again.  The Proposed Abbott Laboratories Settlement Last month Bloomberg <a href="http://www.bloomberg.com/news/2011-10-21/abbott-said-to-agree-to-pay-1-3-billion-to-end-depakote-suits.html">reported</a>: <blockquote>Abbott Laboratories (ABT) agreed to pay at least $1.3 billion to settle claims by the U.S. government and 24 states alleging the company illegally marketed its Depakote epilepsy drug, people familiar with the accords said. Abbott executives, federal prosecutors and state officials reached a tentative agreement calling for the drugmaker to pay about $800 million to resolve civil claims over Depakote and about $500 million in criminal penalties for marketing the epilepsy medicine for unapproved uses, said three people familiar with the settlement who declined to be identified because the agreement hasn’t been made public. Abbott said earlier this week it was reserving $1.5 billion to cover costs of the potential settlement. </blockquote> A billion here, and billion there, it begins to add up: <blockquote>The settlement would be the third-largest illegal pharmaceutical marketing accord in U.S. history, behind the $2.3 billion Pfizer paid in 2009 over the marketing of its Bextra painkiller and other drugs and the $1.4 billion Eli Lilly & Co. paid the same year over sales of its Zyprexa anti-psychotic medicine. </blockquote> Encouraging Dishonesty, Giving Kick-Backs The Bloomberg report only briefly discussed the behavior by Abbott that lead to the settlement: <blockquote>In February, the government joined cases brought by former Abbott employees alleging the company engaged in so-called off-label marketing starting in the late 1990s. The suits contend the illegal sales practices resulted in false claims being submitted to government health programs. The whistle-blowers claim the drugmaker marketed Depakote for unapproved uses including agitation and aggression in patients with dementia, autism, sexual compulsion and other disorders. </blockquote> However, an <a href="http://articles.chicagotribune.com/2011-11-13/business/ct-biz-1113-abbott-20111113_1_whistle-blower-epilepsy-drug-illegal-marketing">article</a> published last week in the Chicago Tribune further described the allegations made by the whistle-blowers. In summary, <blockquote>The lawsuits against Abbott allege that the company encouraged and trained sales reps to market Depakote off-label to nursing home directors, geriatric doctors and other long-term care facilities. The company also gave doctors illegal kickbacks to talk about off-label uses of the drug in an effort to boost sales, according to the lawsuits, which were filed in federal courts in Virginia, Illinois and the District of Columbia. The FDA approved Depakote in 1983 to treat certain seizures in adults and children over 10. Since then, the drug has received approval for the treatment of other types of seizures, manic episodes of bipolar disorder and the prevention of migraine headaches. However, Depakote was never approved to treat Alzheimer's disease or other types of dementia or for general treatment of bipolar disorder. According to the whistle-blower lawsuits, though, Abbott sales reps specifically marketed Depakote to treat agitation and aggression associated with dementia.</blockquote> One whistle-blower alleged that Abbott encouraged doctors to make false diagnoses that would enable the government to pay for the use of Depakote: <blockquote>During a nationwide conference call in 2007, an Abbott trainer allegedly coached sales reps on how to explain to doctors that they could miscode a patient's illness in order to bypass federal regulations. For example, a physician could code a patient as having 'late onset of bipolar' or 'underlying seizure disorder' instead of 'agitation associated with dementia,' according to her complaint. Abbott held training sessions focused on off-label promotion but brought in outside consultants and held the training away from its North Chicago headquarters. At one training event, McCoyd and another sales representative allegedly were asked to share their techniques for off-label marketing but were forbidden from preparing or distributing any written materials about the topic. Upper-level management who attended the sales training purposely left the room when the off-label training sessions began, according to the complaint.</blockquote> The whistle-blowers also alleged that Abbott gave kick-backs (presumably the same idea as bribes) to doctors for prescribing Depakote: <blockquote>The complaints also allege that doctors were given kickbacks to talk about off-label uses of Depakote. According to McCoyd's filing, Abbott salespeople were given about $20,000 to $30,000 each year to 'educate' physicians and other heath care providers about off-label use of Depakote. Abbott paid doctors who promoted the drug between $500 and $2000 per speech, the complaint states. The money allegedly was funneled through intermediaries and associations, including the Alzheimer's Association, although the association told the Tribune it has 'no knowledge' of such activities. Using the organizations to pay doctors was done to 'disguise the direct payments to doctors and Abbott's substantial and direct involvement' in the events, the complaint alleges.</blockquote> Summary So it appears that Abbott is about to settle a case involving some very serious allegations, including training physicians to make false diagnoses, and giving physicians kick-backs. These sort of actions seriously subvert physicians' core values (and any physicians who made such false diagnoses or accepted such kick-backs would have seriously violated core ethical principles.) These actions also may have directly harmed patients. There appears to be no good evidence that Depakote has benefits that exceed its harms for patients with dementia, autism, etc. So encouraging doctors to prescribe the medicine for these patients was likely to have subjected some patients to side-effects without providing them any benefit. That would contradict the physicians' obligations to put the interests of individual patients first, and to avoid harming them. As the Tribune article noted, <blockquote>[Dr Adriane} Fugh-Berman, with PharmedOut, said companies put patients at risk when they promote drugs that haven't gone through the FDA's regulatory process. 'These drugs are being promoted for conditions they have not been shown to be effective, and they might be dangerous,' she said.</blockquote> So a $1.3 billion penalty would actually be a cheap price to pay for such ethical offenses. Note that the Bloomberg report did mention "criminal penalties," so this may be one of the infrequent cases in which a big health care organization actually would plead guilty to some crime. Note however that neither article mentioned anything about any individual who authorized, directed, or implemented the conduct in question suffering any negative consequence or paying any penalty. These reports are preliminary, so it may be that such penalties are part of the final settlement. But it is also possible that this settlement becomes another, and particularly flagrant example of health care corporate executive impunity. If no one turns out to have to pay a penalty for training physicians to lie to the government, and giving them kick-backs to prescribe a possibly useless and likely harmful medicine, what will deter other executives from authorizing and directing such actions again to make more money? Note in the Bloomberg article: <blockquote>Sales of Depakote 'rocketed to over $1.4 billion per year' as a result of improper marketing, according to a complaint filed in February by ex-Abbott sales representative Meredith McCoyd. 'Compensation for senior executives soared as well.' </blockquote> Furthermore, if no one turns out to have to pay a penalty for these actions, this case will just contribute to the ongoing demoralization of health care professionals. It will be another example of how insiders take advantage of the system for their personal gain, to the disadvantage of patients, and at further cost to an already overly expensive health care system that fails to provide adequate access and quality care. So I repeat, repeat, repeat... to really deter bad behavior, those who authorized, directed or implemented bad behavior must be held accountable. As long as they are not, expect the bad behavior to continue. Real health care reform needs to make health care leaders accountable, and especially accountable for the bad behavior that helped make them rich.

Abbott Laboratories to Settle for $1.3 Billion Allegations Including Giving Doctors Kick-Backs and Training Them to Make False Diagnoses

It looks like the march of billion dollar legal settlements by health care organizations is on its way again. The Proposed Abbott Laboratories SettlementLast month Bloomberg reported:Abbott Laborator…

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15 Nov 2011

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