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The face of postmodern medicine: lying

The face of postmodern medicine, where what is moral is context-sensitive, and outright clinical fabrications about "illness" (a.k.a lies) are fair game. I don't remember anything like this in the Oath of Hippocrates: <blockquote><a href="http://en.wikipedia.org/wiki/Postmodernism">Postmodernism</a> is a movement away from the viewpoint of modernism. More specifically it is a tendency in contemporary culture characterized by the problem of objective truth and inherent suspicion towards global cultural narrative or meta-narrative. It involves the belief that many, if not all, apparent realities are only social constructs, as they are subject to change inherent to time and place.</blockquote> <div style="text-align: center;"><a href="http://www.youtube.com/watch?feature=player_embedded&v=ipqEzJpeqis"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5575608602360929682" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgtWvVMZEaxwAR2KTxSMo5Kicpa_imLxaNLSTDIF_2FwgESWDcBxps3Jw83eS-2VUet5MJlWDIoUoMFHJH_adK8x0R0Ef8OP4ImU_Cqg-4p4FHn-j4lHh0poFlOClU_ddCs2syHQ-cF0HF8/s320/dr_lie.jpg" style="display: block; margin: 0px auto 10px; text-align: center; cursor: pointer; width: 253px; height: 141px;" /></a>Lying with a smile. This alleged physician seems to have no qualms with lying, in writing medical "out sick notes" for political purposes. Click to play video. </div> If this person is truly a physician, I cannot condone such behavior, that is, lying about clinical matters to suit one's own agenda, whatever that agenda might be. I saw too much of that when I worked for the regional transit authority's medical department in a large city. Community physicians lied about injuries to support continued, fraudulent "therapy" (from which the physician - and the involved attorney - profited), and to support continued receipt of worker's compensation by the employees. Example: months of treatment for back "strain and sprain and myofasciitis" from a 30,000-lb bus (excluding passengers!) being rear ended by a 3,000 pound car at minor fender-bender speeds. This was not uncommon. Defying known laws of physics, the force from the impact somehow traveled the considerable length of the bus, took a 90 degree turn up into the driver's air spring-cushioned seat, and strained their back. Many of these folks failed the typical exams used to detect fakery. Example: elevating their legs to 90 degrees while sitting to remove their shoes, at which time they'd have no complaints, but then screaming loudly of back pain when in the same relative position, but supine. <div style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiL6fHFFB84B4EBl4pEsWiUQ2ngnHvsl3KQDEyU0WNlPvEWk7ptzm0BZo2YuRB_snj0jkVk6OAprBm9Eje9RBWS9-cMRT0RP_ZUyXcYKZIc4IJuaURtnGLeejXb_OVNHR6xP0EvD87qFJRg/s1600/backpain.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5575619449541333218" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiL6fHFFB84B4EBl4pEsWiUQ2ngnHvsl3KQDEyU0WNlPvEWk7ptzm0BZo2YuRB_snj0jkVk6OAprBm9Eje9RBWS9-cMRT0RP_ZUyXcYKZIc4IJuaURtnGLeejXb_OVNHR6xP0EvD87qFJRg/s320/backpain.jpg" style="display: block; margin: 0px auto 10px; text-align: center; cursor: pointer; width: 302px; height: 262px;" /></a>Click to enlarge. A maneuver to detect exaggerated response for back pain. Somehow, the dishonest "injury clinic" docs certifying these folks as "disabled" never seemed to perform this test. All in the patient's best interest, of course... </div> Often, passengers on the bus would go to the same type of doctors with the same claims of injury. Sometimes as well, <a href="http://books.google.com/books?id=NjjnfWxLE8sC&pg=PA29&lpg=PA29&dq=septa+injury+fraud&source=bl&ots=JEYkYJGk1T&sig=tUM4jQiZHLLC5athUBLN7STuqB4&hl=en&ei=opdgTY7xIYKclgfg0LCwDA&sa=X&oi=book_result&ct=result&resnum=3&ved=0CCQQ6AEwAjgK#v=onepage&q=septa%20injury%20fraud&f=false">there would be more people claiming injury than people on the vehicle </a>known as "ghostriders" (as opposed to ghostwriters, a frequent topic on this blog). The dishonest community physicians would certify them "injured" nonetheless. And you wonder why your bus fare is several dollars... Ultimately, physician dishonesty-on-an-agenda leads to a <a href="http://en.wikipedia.org/wiki/Tuskegee_syphilis_experiment">medical slippery slope</a> that, as history proves, is not a path the profession wants to emulate. One wonders what other lies physicians with attitudes like this proffer. <a href="http://hcrenewal.blogspot.com/2011/02/does-emr-facilitated-upcoding-formely_15.html">Lies in their billing</a>, perhaps, to "<a href="http://en.wikipedia.org/wiki/The_Man">stick it to the Man</a>?" -- SS Addendum Feb. 27, 2011: Along comes this story at AOL news: <a href="http://www.aolnews.com/2011/02/27/horrific-us-medical-experiments-come-to-light/">"Horrific US Medical Experiments Come to Light</a>." It seems the medical slippery slopes of the not-too-distant-past, as recent as the 1960's, were more slippery than most knew. -- SS

The face of postmodern medicine: lying

The face of postmodern medicine, where what is moral is context-sensitive, and outright clinical fabrications about "illness" (a.k...

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EHR as Molestation Candidate Selector: What was this Resident looking for in the EHR before "examining" female patients?

As I was the Director of Clinical Informatics/CMIO (Chief Medical Informatics Officer) at Christiana Care Health System in Delaware back in the mid to late 1990's, and was the physician-architect of their EHR systems then, I find this story particularly disturbing: <blockquote><a href="http://www.myfoxphilly.com/dpp/news/local_news/Christiana_Hospital_Sex_Assault_Charges_021811">First-Year Resident Accused Of Fondling 6 Patients</a> FoxPhilly.com, Feb. 18, 2011 Warrants Issued, Police Searching For Suspect NEWARK, Del. - Delaware State Police are trying to find a former first-year resident at Christiana Hospital who they have identified as a suspect in alleged sexual contact with six patients. According to state police, [the former Medical Resident] has been charged with six counts each of third-degree unlawful sexual contact and abuse, mistreatment or neglect of a patient or resident of a facility. ... The incidents were reported between Oct. 1 and Nov. 15 at the hospital in Newark. <div class="fontStyle4"><div class="story last"> The female patients were between the ages of 20 and 32, police said. Authorities interviewed victims and hospital staff, reviewed patient charts, and audited access to computer records, which led to the identification of [the Resident] as a suspect, according to state police. ... State police said investigators found [the Resident] accessed the computerized hospital records of the six victims prior to the incidents, performed "physical exams" on the victims and failed to provide clinical documentation of the examinations in the victims' hospital charts. Scheduling records also indicated that [the Resident] was working when the incidents occurred. ... In three of the incidents, it was determined that the victims were identified as "non- teaching" patients for whom [the Resident] had no direct patient care responsibilities and had no authority to conduct physical exams or access their hospital records. </div></div></blockquote><div class="fontStyle4"><div class="story last"> Also noted in another account of the story <a href="http://www.delawareonline.com/article/20110218/NEWS01/110218012/Former-resident-sought-in-Christiana-Hospital-assaults?odyssey=tab%7Cmostpopular%7Ctext%7CFRONTPAGE">in the Delaware News Journal</a> (a newspaper) is this:<blockquote>... State police initially released details about three of the assaults on Nov. 12 and said at the time that they were investigating why hospital officials did not report the incidents to police until after the third assault, some two weeks after the first victim reported the incident to hospital staff. During the subsequent police investigation, three additional women contacted state police to report similar incidents.</blockquote>One could ask, then, why the Medical Resident was able to access these medical records, and why the unauthorized accesses apparently took some time to discover by "investigators" (presumably law enforcement officers), only after complaints were made.It is also reasonable to assume this Resident did not abuse the first woman's records he found in a search. There was likely a larger series of unauthorized chart accesses as he searched the EMR system. In other words, I don't think he was peeking at an individual record, and then going in to a room to do his nasty work, one at a time. He was likely looking at a number of potential "candidates" before each incident; i.e., he was likely "trolling around" for potential victims. It would be interesting to see the electronic "footprint" he left. I had horrifying firsthand experience with abuse of electronic medical information in an earlier role in the public sector. Specifically, I had observed the events in John Doe vs. the Southeastern Pennsylvania Transportation Authority (<a style="font-weight: bold;" href="http://www.aegis.com/law/fedapp/3d/1995/1995c03329.html">link</a>). In this situation a gay co-worker, the SEPTA Employee Assistance Program liaison John Eakes (now deceased of AIDS) with whom I had worked extensively in the SEPTA Medical Department, was discriminated against by administration after peeks at his prescription records. His medications included those used in treating HIV-positive patients:<blockquote>...[After the disclosure to SEPTA Chief Administrative Officer (and Deputy General Manager - ed.) Judith Pierce, Doe - a.k.a. Eakes] testified that he felt as though he were being treated differently. A proposal he had made for an in-house employee assistance program met with scant interest; he felt that this was because of his HIV condition. In addition, an administrator who reported to Pierce did not call on Doe to assist in the same way that he had called on Doe earlier. Doe testified that he felt as though there was less social chitchat, co-workers ate less of the baked goods he brought to the office to share, and that his work space seemed more lonely than before. He also became fearful of Pierce, who never told Doe that she knew of his illness. Doe alleges that he became depressed and requested a prescription for Zoloft, an antidepressant, from his physician. Later, another antidepressant called Elavil was added to the medications Doe was taking. </blockquote>John Eakes was a good and conscientious employee and deserved none of this, in these relatively early years of HIV+ intolerance. Therefore, when I was CMIO at Christiana Care Health System just a few years later, and as Chair of the committee on compliance with the then-new Health Insurance Portability and Accountability Act of 1996 (HIPAA), I recommended strongly that chart audits for unauthorized access be performed on a regular basis by a dedicated person or team, and rapid action taken if it occurred. (Then again, <a href="http://www.ischool.drexel.edu/faculty/ssilverstein/cases/?loc=cases&sloc=Cardiology%20story">my counsel on healthcare IT</a> was <a href="http://www.ischool.drexel.edu/faculty/ssilverstein/cases/?loc=cases&sloc=clinical%20computing%20problems%20in%20ICU">not infrequently ignored</a>.)Multiple accesses by a resident (trainee) to EHR records of non-teaching (private) patients should have sent up a very large and immediate cybernetic red flag.<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi-Mgv1rMyxIAyhZglmpRG_QL8-Tf3KEGDzHCndqG4Yu0YGvvh2GNip5i6Ba1YhNXUnUOLuC9DVAntiYWfmmb-LRAwfI4EDGWc_WHqjroFXedkqYDQCpe7_lROX2fZjVmBQPPhXI6VxRKnI/s1600/Red_Flag_Logo_med.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5578083552944692690" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi-Mgv1rMyxIAyhZglmpRG_QL8-Tf3KEGDzHCndqG4Yu0YGvvh2GNip5i6Ba1YhNXUnUOLuC9DVAntiYWfmmb-LRAwfI4EDGWc_WHqjroFXedkqYDQCpe7_lROX2fZjVmBQPPhXI6VxRKnI/s320/Red_Flag_Logo_med.jpg" style="display: block; margin: 0px auto 10px; text-align: center; cursor: pointer; width: 134px; height: 136px;" /></a>Ding! Ding! Ding! Warning! Unauthorized accesses detected... I am also concerned about the characteristics this former trainee was seeking in reviewing the EHR. A history of gynecological or breast disease to serve as a ploy for performing an intrusive exam? Was he looking for a psychiatric history? A history of prior sexual abuse? While the EHR proved helpful in post hoc forensics, are we now seeing another potential abuse of EHR's for the identification of patients who may be preyed upon by the disturbed? It would be helpful to know if there was a common medical theme regarding the patients affected in this rather shocking affair. -- SS Feb. 19 Addendum: This affair reminds me of a saying that became news in the election of President Barack Obama: "The Chickens Have Come Home To Roost" - Rev. Jeremiah Wright Feb. 21 Addendum: It appears that the corporate PR folks are monitoring the airwaves in planning their responses to this scandal. From the blog viewing logs: <blockquote>IP Address 167.112.160.# (Christiana Care Health Services) ISP Christiana Care Health Services Time of Visit Feb 21 2011 9:36:32 am Last Page View Feb 21 2011 9:42:03 am Visit Length 5 minutes 31 seconds Page Views 5 Referring URL <a style="font-weight: bold;" href="http://us.cisionpoint.com/NewsItemDetail.aspx?id=1671771040">http://us.cisionpoint.com/NewsItemDetail.aspx?id=1671771040</a> Visit Entry Page <a href="http://hcrenewal.blogspot.com/2011/02/what-was-this-medical-resident-looking.html">http://hcrenewal.blogspot.com/2011/02/what-was-this-medical-resident-looking.html</a> Visit Exit Page <a href="http://hcrenewal.blogspot.com/2011/02/what-was-this-medical-resident-looking.html">http://hcrenewal.blogspot.com/2011/02/what-was-this-medical-resident-looking.html</a></blockquote> On the "Cisionpoint" company, <a href="http://us.cisionpoint.com/">us.cisionpoint.com</a>, the "referring" URL that led to this post: <blockquote style="margin-right: 0px;" dir="ltr"> CisionPoint brings together - in one integrated customized dashboard - the on-demand tools you need to create, execute and evaluate superior campaigns from start to finish.Log in to plan your campaign, connect with the media directly, monitor news coverage and analyze campaign results. </blockquote> It will be interesting to see how this horrifying episode is "managed" by the corporate spin doctors. -- SS Feb. 21 addendum #2: Here is a message posted by the organization: <blockquote>Message from the chief operating officer Posted today Christiana Care is steadfast in our commitment to the safety and well-being of our patients, employees and all visitors to our campuses. The Delaware State Police have issued a press release identifying a suspect in the case of inappropriate touching first reported late last year. The suspect is a former first year medical resident at Christiana Care. The prompt and thorough work of our Department of Public Safety when the allegations first surfaced, and information we shared with the State Police from our robust health information technology system, was instrumental to the process. We quickly identified the medical resident as a person of interest, and took swift action to prevent any further patient contact. As a result of our preliminary investigation, he was suspended and upon further investigation dismissed from employment. Our rapid response when the allegations were first reported revealed no systemic issues contributed to this incident. As an organization guided by learning, we are continuing a thorough review of best practices in hospital security to determine if there are any new security measures we should adopt. [Hopefully in the intervening years since I was CMIO, they've become even more of a learning organization compared to <a style="font-style: italic; font-weight: bold;" href="http://www.ischool.drexel.edu/faculty/ssilverstein/cases/?loc=cases&sloc=clinical%20computing%20problems%20in%20ICU">here</a>, <a href="http://www.ischool.drexel.edu/faculty/ssilverstein/cases/?loc=cases&sloc=Cultures%20of%20mismanagement%20toxic%20to%20healthcare%20quality">here</a> and <a style="font-style: italic; font-weight: bold;" href="http://www.ischool.drexel.edu/faculty/ssilverstein/cases/?loc=cases&sloc=Cardiology%20story">here</a>, where under the prior "C" level leadership they learned so much from me and made me feel so at home, I felt compelled to leave to maintain my sanity - ed.] We remind and encourage all patients and family to always ask health care providers to identify themselves, explain why they are there to see the patient, and explain the care provided to them. All Christiana Care employees are required to prominently display their identification badges. [One wonders if they now permit PhD holders to use that credential on the badge, not permitted when I was there - ed.] We deeply regret the alleged incidents and our concern for the affected patients is shared throughout our health system. Gary Ferguson Chief Operating Officer </blockquote> <div>As I knew Mr. Ferguson in a prior role, and as he is a good person, I with some regret point out that this appears to be corporate spin control. A truly "robust" HIT security system, in my opinion, would have flagged the perpetrator after the first victim. It might even have prevented the molestation if there was a time delay between when he, as a trainee, trolled for a victim by viewing the records of a private patient, and then saw the patient, without some medical emergency that could have justified the records breach. <blockquote>Merriam-Webster dictionary <a style="font-weight: bold;" href="http://www.merriam-webster.com/dictionary/robust">ro·bust</a> adj \rō-ˈbəst, ˈrō-(ˌ)bəst\ a : having or exhibiting strength or vigorous health b : having or showing vigor, strength, or firmness [a robust debate] [a robust faith] c : strongly formed or constructed : sturdy [a robust plastic] d : capable of performing without failure under a wide range of conditions [robust software]<robust> </robust></blockquote> This "robust" system, after all, is a system critical to human life and well-being, not an inventory system of medical data. Let an unauthorized person access, say, government intelligence files, and see how far that flies... (Notwithstanding the Wikileaks affair, where the <a href="http://en.wikipedia.org/wiki/Bradley_Manning">low-level person</a> who accessed the diplomatic files did have authorization to access the servers, through managerial complacency.) </div>-- SS Feb. 26 Addendum: This story was picked up by the Newark Post, the local newspaper in Newark, Delaware, where Christiana Hospital is located. <a style="font-weight: bold;" href="http://www.newarkpostonline.com/articles/2011/02/24/news/doc4d65787e4758e501313769.txt"></a><blockquote><a style="font-weight: bold;" href="http://www.newarkpostonline.com/articles/2011/02/24/news/doc4d65787e4758e501313769.txt">Questions raised about access to hospital medical records</a> By Doug Rainey, Newark Post Published: Thursday, February 24, 2011</blockquote> -- SS </div></div>

EHR as Molestation Candidate Selector: What was this Resident looking for in the EHR before "examining" female patients?

As I was the Director of Clinical Informatics/CMIO (Chief Medical Informatics Officer) at Christiana Care Health System in Delaware back in ...

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Pharmacia, or Maybe Pfizer Settles, Only Eight Years Later

Didn't somebody say "justice delayed is justice denied?"*  Here is a story for a Friday afternoon, via a press release from the New York state Attorney General's office, <a href="http://www.bloomberg.com/apps/news?pid=conewsstory&tkr=PFE:US&sid=atVb2W5YOIaE">per Bloomberg</a>: <blockquote>Attorney General Eric T. Schneiderman today announced a multimillion dollar settlement with a pharmaceutical company that inflated the cost of drugs sold to state health programs. The company, Pharmacia Corporation, has paid $2.5 million to the New York Medicaid program and to the Elderly Pharmaceutical Insurance Coverage Program (EPIC), and also to cover the costs of the investigation.</blockquote> Here is more information about the lawsuit: <blockquote>The lawsuit, filed in 2003, charged that Pharmacia failed to report real and accurate prices, and did not take into account discounts, rebates, chargebacks and other price concessions to their wholesalers. As a result, New York's Medicaid Program and the EPIC program paid more for certain drugs manufactured by Pharmacia than those state programs should have. </blockquote> This is an unusual entrant into our march of legal settlements. As noted above, this lawsuit took eight years to settle. The entity that made the settlement, Pharmacia, is actually long gone as an independent company. It merged into Pfizer in 2003 (see <a href="http://www.pfizer.com/about/history/pfizer_pharmacia.jsp">this</a>). Despite the eight years of waiting, the settlement is extremely paltry compared to the size of the company to which the settlement now applies. According to Google Finance, in 2010, Pfizer's annual revenues were more than $67 billion. This settlement adds in a small way to a series of settlements Pfizer has recently made.  Pfizer paid a $2.3 billion settlement in 2009 (see post <a href="http://hcrenewal.blogspot.com/2009/09/pfour-legal-settlements-for-pfizer-why.html">here</a>), and three other major settlements from then to early 2010 (see post <a href="http://hcrenewal.blogspot.com/2010/03/settlement-and-conviction-round-up.html">here</a>).  The company was listed as one of the pharmaceutical "big four" companies in terms of defrauding the government (see post <a href="http://hcrenewal.blogspot.com/2010/12/drug-companies-are-now-no-1-when-it.html">here</a>).  For other discussions of Pfizer on Health Care Renewal, look <a href="http://hcrenewal.blogspot.com/search/label/Pfizer">here</a>.  The New York Attorney General's press release claimed, "These are hard financial times for our state, and my office will do its part by uncovering every dishonestly claimed dollar, and holding those who take advantage of New York accountable."  Begging his pardon, but could he really have been serious that nicking Pfizer for $2.5 million eight years after the lawsuit was filed is really holding this giant company accountable?  Will this settlement make the company any more accountable than all those that came before, some almost one thousand times bigger?  Meanwhile, as is usually the case in these stories about the march of <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">legal settlements </a>in health care, no person who authorized, directed or implemented the questionable activity apparently paid any penalty or suffered any sort of negative consequences. This week, Matt Taibi asked "<a href="http://www.rollingstone.com/politics/news/why-isnt-wall-street-in-jail-20110216">why isn't Wall Street in jail?"</a> in the title of his most recent Rolling Stone article.  I should also ask, why aren't some leaders of pharmaceutical, device, biotechnology, and managed care corporations in jail?  Just as the leaders of big financial service firms seem to be completely unaccountable for the havoc they created in the global economy, and despite bluster by various government officials, the leaders of big health care corporations seem to be completely unaccountable for the unethical behavior of their companies that continue to inflate the health care bubble. So for the nth time I will repeat:  we will not deter unethical behavior by health care organizations until the people who authorize, direct or implement bad behavior fear some meaningfully negative consequences. Real health care reform needs to make health care leaders accountable, and especially accountable for the bad behavior that helped make them rich. Meanwhile, the continued unwillingness of government leaders to take on corporate leaders suggests how corporatist the US has become. Government for the corporations, by the corporations, and of the corporations, bodes no good for the people whose rights are increasingly being displaced. Mr Taibi encapsulated the problem in a more colorful way, and I will end with his version, somewhat edited for this family publication: <blockquote>Over drinks at a bar on a dreary, snowy night in Washington this past month, a former Senate investigator laughed as he polished off his beer. 'Everything's f***ed up, and nobody goes to jail,' he said. 'That's your whole story right there. Hell, you don't even have to write the rest of it. Just write that.'</blockquote> * - the quote has been attributed to William Gladstone in a 1868 speech. but may be older than that (link <a href="http://freakonomics.blogs.nytimes.com/2010/06/17/quotes-uncovered-justice-delayed/">here</a>)

Pharmacia, or Maybe Pfizer Settles, Only Eight Years Later

Didn't somebody say "justice delayed is justice denied?"* Here is a story for a Friday afternoon, via a press release from th...

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After Manufacturing Problems, Genzyme CEO's Golden Parachute Means "Failure = Success"

In late 2009, I <a href="http://hcrenewal.blogspot.com/2009/11/genzymes-remarkable-businessstrategy.html">posted</a> about problems at a Genzyme plant that manufactured some fabulously expensive drugs, e.g. Cerezyme whose cost to patients approximated $160,000 a year. We thought then that for a drug costing that much, the company ought to have figured out a conservative process to provide pure and unadulterated product. In a later <a href="http://hcrenewal.blogspot.com/2009/11/was-is-worst-biotech-ceo-worth.html">post</a> I asked why a company that could afford to make its CEO very rich could not afford to adequately maintain its manufacturing facilities. In May, 2010, I <a href="http://hcrenewal.blogspot.com/2010/05/genzyme-settles.html">posted</a> about a legal settlement of charges related to its manufacturing problems requiring Genzyme to pay a $175 million fine and function under US government supervision.  And in August, 2010, I <a href="http://hcrenewal.blogspot.com/2010/08/golden-parachute-for-making.html">posted</a> about how this series of management missteps could lead to the company's CEO becoming even richer because they lead to a declining stock price, which increased the likely that the company would be bought out, which could trigger the CEO's golden parachute.  I suggested then that were this to happen, it would be a gross example of how massively perverse incentives stupendously reward the top brass of health care organizations for mediocre, or worse leadership and bad results for both patients/ clients/ customers and stock-holders alike. Now it  looks like this will happen.  Yesterday, the Boston Globe <a href="http://www.boston.com/business/healthcare/articles/2011/02/16/genzyme_agrees_to_201b_sale_to_drug_giant">reported</a>: <blockquote>Ggenzyme Corp., the largest biotechnology company in Massachusetts and one of the industry’s historic pioneers, has struck a definitive agreement to be bought by French pharmaceutical giant Sanofi-Aventis SA, in a deal valued at about $20.1 billion.</blockquote> As a result of this deal, <blockquote>Genzyme’s high-profile president and chief executive, Henri A. Termeer, who has run the company for 28 years, will resign following the close of the transaction. But he will advise Sanofi on integrating the two companies. Termeer built the company into a global operation with 10,000 employees worldwide and a business model that has been the envy of the biotechnology industry. He turns 65 on Feb. 28. Termeer, though fiercely proud of Genzyme’s independence, stands to make more than $23 million when the sale is completed, according to a 'change of control' clause in his employment contract. In addition, as a major Genzyme shareholder, he would be in a position to cash out shares that last year were worth more than $275 million.</blockquote> That and several other articles s noted that it was Genzyme's manufacturing problems that lead to the buy-out: <blockquote>the string of events that made Genzyme vulnerable to a takeover began in the summer of 2009 when workers discovered viral contamination at Genzyme’s Allston Landing plant overlooking the Charles River. Genzyme was forced to temporarily shut down and clean up the plant and ration shipments of its best-selling Cerezyme and Fabrazyme drugs, both of which treat enzyme deficiencies. The events created an opening for competitors such as Shire and Israel’s Protalix Biotherapeutics and sent Genzyme’s stock tumbling on the Nasdaq. The dip in Genzyme’s share price drew activist investors, including Carl C. Icahn of New York and Ralph Whitworth of San Diego, who accumulated shares they hoped to sell at a rich premium. They pressured management to take steps to boost shareholder value, including a stock buyout and the elimination of 1,000 jobs worldwide. Ultimately, the company gave Whitworth a seat on its board, and, after Icahn threatened to unseat Genzyme directors in a proxy battle, it granted two seats to his associates. In many ways, industry watchers said, an acquisition became inevitable once Genzyme stumbled at its Allston plant.</blockquote> A Bloomberg <a href="http://www.bloomberg.com/news/2011-02-16/genzyme-s-termeer-may-follow-health-care-ceo-path-to-private-equity-firms.html">article</a> noted that this sequence of events would lead to <blockquote>The departure package [which] makes him 'one of the biggest all- time winners in biotech,' said [University of Michigan business professor Erik] Gordon, who has studied the pharmaceutical industry for three decades. </blockquote> Our criticism of the Genzyme CEO's potential for reaping hugely perverse incentives was paralleled by Jim Edwards' <a href="http://www.bnet.com/blog/drug-business/genzyme-ceo-earns-300m-for-running-company-into-the-ground/7447">critique</a> of what actually happened: <blockquote>Here’s how crazy CEO incentive compensation is: Genzyme (GENZ) CEO Henri Termeer walked away from his company with a payout that may be worth $300 million yesterday when Sanofi-Aventis (SNY) acquired his company. But the only reason Genzyme was acquired — triggering Termeer’s gargantuan change-of-control package — is because Termeer nearly ran his company into the ground, making his stock cheap enough for Sanofi to buy. In other words, failure = success when it comes to change-of-control packages for CEOs.</blockquote> So let me just repeat my conclusion from last August: As long as being a health care CEO is effectively a license to loot the company, is it any wonder that health care organizations continue to be badly lead, and health care costs soar while quality and access suffer? Once more with feeling: real health care reform would require us to make health care executives truly accountable for their actions, and penalize them for those that are ill-informed, contemptuous of health care values, self-interested, or corrupt.

After Manufacturing Problems, Genzyme CEO's Golden Parachute Means "Failure = Success"

In late 2009, I posted about problems at a Genzyme plant that manufactured some fabulously expensive drugs, e.g. Cerezyme whose cost to pat...

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The University of Minnesota, Where Nothing Can Go Wrong, Go Wrong, Go Wrong...

As <a href="http://ptable.blogspot.com/2011/02/university-of-minnesota-regents-refuse.html">noted</a> on the Periodic Table blog, the administration of the University of Minnesota continues to believe all is well with its clinical research activities.  A recent internal review said there was nothing more to investigate about the unfortunate death of a psychiatric patient years before. So should we all be relieved? It will take an extensive review of the case to ultimately suggest we should not at all be relieved.  The case raised important concerns about the validity of clinical research, and whether it violates the trust of its patient-subjects.  These concerns had not been addressed before the university's most recent review, and thus seem even more pointed after its recent non-investigation. Background: the Untimely Death of Dan Markingson In May, 2008, the (Minnesota) Pioneer Press ran a series of articles about the untimely death of Dan Markingson which occurred while he was enrolled in a randomized trial sponsored by AstraZeneca (the CAFE study) at a site at the University of Minnesota.  The<a href="http://www.twincities.com/ci_9292549"> first article</a> in the series made the following major points: Mr Markingson had given his consent to be enrolled despite evidence that he was actively psychotic <blockquote>He started having visions of killing his mother in the storm. Markingson was taken Nov. 12, 2003, to Regions Hospital in St. Paul, but it had no open psychiatric beds. He was then transferred to the University of Minnesota Medical Center, Fairview. Weiss said discussions about research started right away at the hospital. Markingson was placed in Fairview's Station 12, a new unit at the time created to treat psychotic patients and screen them for research. Olson and Dr. Charles Schulz, head of the U's psychiatry department, helped launch the unit in part to enhance the hospital's startup schizophrenia program and meet the U's mandate to bring in more research dollars. Olson first recommended on Nov. 14 that a Dakota County District Court commit Markingson to the state treatment center in Anoka because he was not fit to make decisions about his care. He wrote to the court that Markingson was convinced his delusions were real and that he wasn't mentally ill. The doctor changed his opinion about the commitment in less than a week, telling the court Markingson had started to acknowledge the need for help. Reversals by patients are common, Olson explained in an interview with the Pioneer Press last month. Schizophrenics often arrive for treatment with delusions and denial but change their outlook while hospitalized. A judge agreed Nov. 20 with Olson's new recommendation, requiring Markingson to follow the doctor's treatment plan. The next day, Markingson signed a consent form to be part of a national anti-psychotic drug study, Comparison of Atypicals for First Episode, or CAFE. </blockquote> His mother's multiple complaints that while in the study, Markingson was not getting better and not getting proper treatment were ignored <blockquote>Weiss' letters to Olson and Schulz, who was a co-investigator in the study, urged them to consider different treatment options for her son, which would have disqualified him from the study. But the doctors were unconvinced by her pleas. </blockquote> In particular, she wrote with strange prescience, <blockquote>'Do we have to wait until he kills himself or someone else,' she asked three weeks before his suicide, 'before anyone does anything.'</blockquote>There was evidence that Markingson was not getting optimal treatment In retrospect, it was not even clear that Markingson was taking his study medications prior to his suicide: <blockquote>An autopsy showed no medication in Markingson's bloodstream, and a coroner's photo showed a sealed bottle of his medication. Had he been taking his drugs? Study officials could have been fooled. They only counted drugs left in pill bottles instead of testing blood levels in patients. </blockquote>Suggestions that financial conflicts of interest influenced trial investigators' actions The initial news article raised questions whether the study investigator had been unduly influenced to keep Markingson in the study by financial concerns: <blockquote>CAFE was an early opportunity at the U for Olson to add research experience to his academic credentials. The U had recruited him in 2001 for his expertise in schizophrenia. It was a slow start. Olson recruited one patient in 2002, and CAFE study leaders considered dropping him altogether, according to monthly recruiting summaries. Olson and the university had been dropped from a previous study because of low recruiting numbers, the doctor later said in his court deposition. Exchanges between local and national study officials made it clear that there was pressure for results and a 'risk' that the study would be shut down if it didn't recruit enough patients. </blockquote> Note that: <blockquote>As Subject 13, Markingson was worth $15,000 to the U, with some of that going to Olson's salary and the psychiatry department. Switching or adding medications could have disqualified Markingson and halted payments to Olson and the department from AstraZeneca. Overall, the study offered $327,000 to the U and an opportunity to raise the profile of its schizophrenia program. </blockquote> An accompanying Pioneer Press <a href="http://www.twincities.com/ci_9316658">article</a> indicated that both Dr Olson, and the Chair of Psychiatry, Dr S Charles Schulz, were receiving considerable financial support from AstraZeneca and other pharmaceutical companies at the time of the study. <blockquote>Olson received $220,000 from six companies since 2002, including $149,000 from AstraZeneca, according to the state records. Schulz received $562,000, including $112,000 as a researcher and consultant to AstraZeneca. Olson said his AstraZeneca money went straight to the U but did support his salary. Markingson's full participation in the yearlong study meant up to $15,000 for the university. </blockquote>Did the lawsuit's results indicate nothing was wrong? Mr Markingson's mother sued the University of Minnesota and AstraZeneca, but (per the first Pioneer Press article), <blockquote>The lawsuit ended this year after a judge ruled that the university had statutory immunity from such lawsuits and that AstraZeneca shouldn't stand trial because there was no convincing proof that its drug caused Markingson's death. Weiss settled with Olson, the only defendant left. She said she was granted $75,000, which went entirely toward legal bills. </blockquote>Note that the results did not address the university's or its administration's role. Dr Carl Elliott Takes Another Look Thus the case appeared to end, with no real reconsideration of how medical schools' dependence on commercial funding of clinical studies, and how individual faculty members' financial relationships with drug, device, and biotechnology firms may affect research done on human beings. However, in September, 2010, Mother Jones published <a href="http://motherjones.com/environment/2010/09/dan-markingson-drug-trial-astrazeneca">an article </a>by Dr Carl Elliott, a University of Minnesota bioethicist, which raised further questions about the case. <blockquote>I talked to several university colleagues and administrators, trying to learn what had happened. Many of them dismissed the story as slanted and incomplete. Yet the more I examined the medical and court records, the more I became convinced that the problem was worse than the Pioneer Press had reported. The danger lies not just in the particular circumstances that led to Dan's death, but in a system of clinical research that has been thoroughly co-opted by market forces, so that many studies have become little more than covert instruments for promoting drugs</blockquote> Major design defects of the CAFE study: <blockquote>It barred subjects from being taken off their assigned drug; it didn't allow them to be switched to another drug if their assigned drug was not working; and it restricted the number of additional drugs subjects could be given to manage side effects and symptoms such as depression, anxiety, or agitation. Like many clinical trials, the study was also randomized and double-blinded: Subjects were assigned a drug randomly by a computer, and neither the subjects nor the researchers knew which drug it was. These restrictions meant that subjects in the CAFE study had fewer therapeutic options than they would have had outside the study. In fact, the CAFE study also contained a serious oversight that, if corrected, would have prevented patients like Dan from being enrolled. Like other patients with schizophrenia, patients experiencing their first psychotic episode are at higher risk of killing themselves or other people. For this reason, most studies of antipsychotic drugs specifically bar researchers from recruiting patients at risk of violence or suicide, for fear that they might kill themselves or someone else during the study. Conveniently, however, the CAFE study only prohibited patients at risk of suicide, not homicide. This meant that Dan—who had threatened to slit his mother's throat, but had not threatened to harm himself—was a legitimate target for recruitment.</blockquote> As Dr Elliott noted, this appeared to be yet another example of <a href="http://hcrenewal.blogspot.com/search/label/manipulating%20clinical%20research">manipulation of clinical research</a> designed to make the sponsors' products look better, a topic we have frequently discussed on Health Care Renewal: <blockquote>A 2006 study in The American Journal of Psychiatry, which looked at 32 head-to-head trials of atypicals, found that 90 percent of them came out positively for whichever company had designed and financed the trial. This startling result was not a matter of selective publication. The companies had simply designed the studies in a way that virtually ensured their own drugs would come out ahead—for instance, by dosing the competing drugs too low to be effective, or so high that they would produce damaging side effects. Much of this manipulation came from biased statistical analyses and rigged trial designs of such complexity that outside reviewers were unable to spot them. As Dr. Richard Smith, the former editor of the British Medical Journal, has pointed out, 'The companies seem to get the results they want not by fiddling the results, which would be far too crude and possibly detectable by peer review, but rather by asking the 'right' questions.'</blockquote> This was likely what was going on with the CAFE study: <blockquote>Although the documents unsealed in the Seroquel litigation do not specifically mention the CAFE study in which Dan was enrolled, they do suggest that AstraZeneca planned to establish Seroquel as the "atypical of choice in first-episode schizophrenia,' according to a 2000 'Seroquel Strate'y Summary.' A later document titled 'Seroquel PR Plan 2001' discusses the agenda for an advisory panel meeting in Hawaii. Among the potential topics were the marketing of Seroquel to first-episode patients, adolescents, and the elderly. The document refers to these populations as "vulnerable patient groups." Even more alarming are internal documents suggesting that AstraZeneca was designing clinical trials as a covert method of marketing Seroquel. In 1997, when Dr. Andrew Goudie, a psychopharmacologist at the University of Liverpool, asked AstraZeneca to fund a research study he was planning, a company official replied that 'R&D is no longer responsible for Seroquel research—it is now the responsibility of Sales and Marketing.' The official also noted that funding decisions would depend on whether the study was likely to show a 'competitive advantage for Seroquel.'</blockquote>Were study subjects protected? So, as Dr Elliott wrote, <blockquote>Many clinical studies place human subjects at risk—at a minimum, the risk of mild discomfort, and at worst, the risk of serious pain and death. Bioethicists and regulators spend a lot of time and energy debating the degree of risk that ought to be permitted in a study, how those risks should be presented to subjects, and the way those risks should be balanced against the potential benefits a subject might receive. What is simply assumed, without much consideration at all, is that the research is being conducted to produce scientific knowledge. This assumption is codified in a number of foundational ethics documents, such as the Nuremberg Code, which was instituted following Nazi experiments on concentration camp victims. The Nuremberg Code stipulates that an 'experiment should be such as to yield fruitful results for the good of society,' and 'the degree of risk to be taken should never exceed that determined by the humanitarian importance of the problem to be solved by the experiment.' But what if a research study is not really aimed at producing genuine scientific knowledge at all? The documents emerging in litigation suggest that pharmaceutical companies are designing, analyzing, and publishing trials primarily as a way of positioning their drugs in the marketplace. This raises a question unconsidered in any current code of research ethics. How much risk to human subjects is justified in a study whose principal aim is to 'generate commercially attractive messages'?</blockquote> Conflicts of interest Of course, university faculty pushed to bring in more external funds to support their careers (see <a href="http://hcrenewal.blogspot.com/2010/12/american-medical-schools-are-only-in-it.html">this post</a>) by university leaders with their eyes on the bottom line may not be too critical of the intricate designs of the studies they need to do to continue their academic careers, and whether such studies are really meant to promote science and improve patient care, or position products in the marketplace, especially when the same companies are paying them as consultants, speakers, etc. In fact, Dr Elliott found reasons to make such concerns specific to the case of Mr Markingson's untimely death: <blockquote>Olson had another financial reason to maintain good relations with AstraZeneca. According to a disclosure statement for a 2006 conference, he was a member of the AstraZeneca 'speaker's bureau,' giving paid talks for the company. He had similar arrangements with Eli Lilly and Janssen, the makers of the other atypicals being tested in the CAFE study, as well as Bristol-Myers Squibb and Pfizer. In addition, Olson was working as a paid consultant for Lilly, Janssen, Bristol-Myers Squibb, and Pfizer. </blockquote> Bioethicists Demand an Investigation So eight University of Minnesota bioethicists, including Dr Elliott, wrote a letter to the University administration demanding an investigation, as <a href="http://www.startribune.com/lifestyle/health/111419724.html">reported</a> in December, 2010, by the Minneapolis- St Paul Star-Tribune, <blockquote>In a letter to the board Monday, the professors questioned whether U psychiatrists lacked ethical judgment in enrolling the victim, Dan Markingson, a schizophrenic who may have lacked the wherewithal to consent to research. They also questioned whether financial incentives from AstraZeneca, the drugmaker funding the study, presented conflicts for the researchers, Dr. Stephen Olson and Dr. S. Charles Schulz.</blockquote> At the time, the administration promised a serious response: <blockquote>U leaders will take the letter seriously and take the protection of human research subjects seriously, said the U's general counsel, Mark Rotenberg. </blockquote> But then almost immediately indicated its bias: <blockquote>'The fact that this is tragic doesn't mean the treating physicians did anything wrong,' he said.</blockquote> What, Us Worry? It did not take long for Mark Rotenberg to decide that there was nothing more to worry about. As <a href="http://www.twincities.com/localnews/ci_17323154">reported</a> in February, 2011, by the Pioneer Press: <blockquote>in a Monday letter to Elliott and colleagues, the chairman of the U's board of regents wrote 'we do not believe further university resources should be expended re-reviewing a matter such as this, which has already received such exhaustive analysis by independent authoritative bodies.' 'Our general counsel has provided us with the extensive reviews of this case that were performed over the years by a number of independent experts and governmental units,' chairman Clyde Allen Jr. said in the letter. 'Each and every one of these reviews resulted in the same conclusion: there was no improper or inappropriate care provided to Mr. Markingson, nor is there evidence of misconduct or violation of applicable laws or regulations.' </blockquote> Of course, since Mr Rotenberg is responsible for, among other things, reducing the university's legal liability, one could see how he might not want to delve further into this case.  As we noted earlier, it is not clear that previous "exhaustive" investigations asked the questions that needed to be asked, or had access to all the relevant data.  The issues are not whether their was criminal conduct, or even civil liability, but whether the university is presiding over good science and protection of research subjects? So we should be worried, of course, that commercial firms sponsor research on human beings mainly to serve marketing objectives, and that university faculty and administrators go along, allowing their formerly prestigious universities' names to be added to the research in exchange for the money they so much want to keep themselves living in the style to which they are accustomed. We ought to be particularly worried when these universities seem to forget about their mission to find and disseminate new knowledge in favor of defending the work that continues to bring in the money. Thus, physicians, researchers, patients, and the public ought to be very skeptical about clinical research sponsored by commercial firms with vested interests in the research turning out a particular way, and even about research not sponsored by such firms, but done by researchers who have personal financial ties to such firms. Worse, patients ought to be extremely skeptical about the motives of researchers who want to enroll them in trials when the researchers have financial ties to commercial firms whose products could be promoted through such trials, and especially when such firms are sponsoring the trials. As a long-time advocate for evidence-based medicine, whose advancement depends on the continuing creation of valid research evidence from clinical research, it is heart-breaking to have to make these recommendations, but they will be necessary until there is better assurance that clinical research is being done to advance science and patient care, not the commercial interests of the sponsors and the researchers. Until academic medicine becomes more open about how and why it is doing clinical research, such skepticism is warranted. However, I will end with a ray of hope. If the administrators and faculty do not get it, the student journalists do. Read these words in an <a href="http://www.mndaily.com/2011/02/10/regents-play-innocent">editorial</a> in the Minnesota Daily: <blockquote>Of course, the University has maintained neither it nor anyone involved in the case did anything wrong, an odd claim to make after the Minnesota Legislature unanimously passed a law that prohibits exactly what happened and named the law after Markingson. The University seems to think that because it was not held liable in court for Markingson’s death, it did nothing wrong. This is false; it is a cynical excuse to keep corporate drug money flowing into the University. The regents’ decision fundamentally undermines our mission: Supposedly, the University is 'dedicated to … the search for truth.' But the letter makes it clear that corporate research cash is more important to the University than patient safety and transparency. Refusing to set up an independent investigation is a willfully ignorant attempt to sweep the Markingson case under the rug and damages the integrity of the entire University.</blockquote> Perhaps it is time for the state legislature to take another look at this issue. True health care reform would separate clinical research, that is, research done on human beings, from the commercial interests of health care corporations and the people who work for them. ADDENDUM (18 March, 2011) - See <a href="http://www.healthbeatblog.com/2011/03/the-dark-side-of-industry-funded-drug-trials.html#more">this post</a> by Naomi Freundlich on the Health Beat blog.

The University of Minnesota, Where Nothing Can Go Wrong, Go Wrong, Go Wrong...

As noted on the Periodic Table blog, the administration of the University of Minnesota continues to believe all is well with its clinical r...

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"You Can't Say That" - Non-Disparagement Clauses and the Anechoic Effect

Here is another example of why health care organizations' leaders are different from you and me, and why that may not be a good thing for health care.  A few days ago, the San Jose (California) Mercury News <a href="http://www.mercurynews.com/peninsula/ci_17356043">reported</a> on the upcoming departure of a local hospital CEO: <blockquote>El Camino Hospital's handsomely-paid president and CEO Kenneth Graham is out of a job, the hospital announced Thursday afternoon. Graham's contract will end June 30 'without cause, at the request of the hospital's Board of Directors,' according to a statement released to the media. Until then, Graham will continue to fulfill his duties as the hospital's top administrator, according to the statement. Graham has been president and CEO of the hospital for 4½ years. The brief statement did not explain why Graham has been ousted, focusing instead on his accomplishments. Graham earns an annual base salary of $632,640.</blockquote> Not only was the CEO "handsomely paid," he will be handsomely paid to depart, as <a href="http://www.mercurynews.com/peninsula/ci_17367849">reported</a> two days later by the same newspaper: <blockquote>Former El Camino Hospital president and CEO Ken Graham may be out of a job, but he won't be hurting for a paycheck anytime soon. Fired 'without cause' by the hospital's board of directors on Wednesday, Graham is now entitled to nearly $1 million in severance pay, according to his contract, which the hospital provided to The Daily News on Friday. Specifically, the hospital will pay Graham a lump sum of 18 months' salary when he officially steps down June 30. Based on his annual salary of $632,640, he would receive $948,960.</blockquote> The reporter could not get any clearer fix on the reason for his departure: <blockquote>Hospital officials Friday were tight-lipped about their decision to drop Graham. Reached by phone, board Chairman Wesley Alles would only say it was 'without cause.' 'I guess as a generic (explanation) the only thing I can say is it's without cause, that (the board wants to take) some different directions, perhaps, as a generic (explanation),' Alles said. El Camino Hospital spokeswoman Chris Ernst said she couldn't say more than what was written in a statement released to the media Thursday, which simply stated Graham's contract was ended 'without cause, at the request of the hospital's Board of Directors.' 'I know everyone wants to know if there's something really there, but it was clearly without cause,' Ernst said. 'It's not like you can point to one particular thing and say this is why this action was taken.'</blockquote> Now wasn't that informative? It appears the CEO was let go "without cause." But reporter Diana Samuels did uncover why nobody was saying anything meaningful about this lucrative departure: <blockquote>The contract also includes a 'non-disparagement' clause, which says the hospital and Graham cannot make any statements about each other that could cause 'any embarrassment or humiliation or otherwise reflect negatively on the other party(ies).'</blockquote> I discussed the subject of executive contracts with one of our Health Care Renewal scouts who knows about such things. For high level executives in business, seemingly tidy severance packages are the rule.  We have discussed the problem with excess executive compensation in health care <a href="http://hcrenewal.blogspot.com/search/label/executive%20compensation">here</a>. Furthermore, various <a href="http://hcrenewal.blogspot.com/search/label/confidentiality%20clause">confidentiality</a>, non-compete, and non-disparagement clauses are often common. However, whether or not these are common practices in the larger business world, these contract provisions, especially non-disparagement clauses, pose problems in health care.  As we have discussed, there are lots of good reasons that the governance and leadership of health care ought to be maximally <a href="http://hcrenewal.blogspot.com/search/label/transparency">transparent</a>. Just to provide one example, consider the problem of medical errors, a subject which has received unending discussion since the report by Institute of Medicine entitled "<a href="http://www.iom.edu/~/media/Files/Report%20Files/1999/To-Err-is-Human/To%20Err%20is%20Human%201999%20%20report%20brief.pdf">To Err is Human</a>."  One widely espoused doctrine about medical error prevention is that such errors ought to be disclosed and discussed openly so that their root causes can be found, and methods to prevent them developed.  Now suppose, for example, that the CEO of a hospital had discovered some medical errors, but made himself unpopular by pursuing them.  Were he to have a bilateral non-disparagement clause in his contract, and were this unpopularity to cause him to lose his job, he could say nothing about these errors, possibly allowing them to recur, but more seriously.  Of course, the example could be turned on its head.  Suppose the CEO had introduced a new process that was thought to be the cause of such errors.  Were he to lose his job because of this, hospital officials could say nothing about the problem, etc, etc.  Similarly, other problems at the hospital either discovered by the CEO or possibly caused by the CEO could remain anechoic due to non-disparagement clauses in hospital executives' contracts. Of course, in the current case, the CEO might have left due to simple personality differences, and his departure might have nothing to do with medical errors, etc, etc. However, this case suggests that the sort of non-disparagement clauses that may appear in contracts for executives in various type of businesses have metastasized to contracts for hospital executives.  These clauses, and their cousins, confidentiality clauses and non-compete clauses, may be major reasons for the <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic effect</a>, and the general lack of transparency of hospital leadership and governance.  However, up to now, such clauses seem to be, you guessed it, <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic</a> in discussions of health care policy and health care reform.  Thus, one step to true health care reform would be for there to be some open discussion of the reasons we cannot openly discuss many important issues in health care, particularly the likely increasing use of contractual clauses such as non-disparagement clauses.  Likely an even more important step would be discrediting such contractual provisions that reduce <a href="http://hcrenewal.blogspot.com/search/label/transparency">transparency</a>.

"You Can't Say That" - Non-Disparagement Clauses and the Anechoic Effect

Here is another example of why health care organizations' leaders are different from you and me, and why that may not be a good thing fo...

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Why Weren't Existing Laws About Hospital CEO Compensation Enforced in Washington State?

Public radio station KUOW <a href="http://kuow.org/program.php?id=22556">reported</a> on the generous compensation given hospital CEOs in Washington: <blockquote>KUOW has learned that 15 hospital executives in Washington made $1 million or more in 2009. That elite group includes 14 nonprofit executives and one head of a government hospital. CEOs at Multicare, Providence, Virginia Mason and Valley Medical each made more than $2 million. Those numbers can be found in the hospitals' latest tax filings and other public records. The pattern was more lopsided in the two prior years. Nobody working at a public hospital cracked the top 10 list of the state's highest hospital paychecks in 2007 or 2008.</blockquote> But then the story takes an interesting twist: <blockquote>Most of Washington's largest hospitals are nonprofit organizations. The state gives the nonprofits a break on their business taxes to help reduce the cost of health care. The hospitals have to jump through some hoops to qualify for the reduced taxes. For one thing, state law limits how much the hospitals can pay their executives. Their pay has to be comparable to what public servants in Washington make in similar jobs — or else no break on their B&O taxes.</blockquote> Somehow everyone seems to have forgotten about this part of the law: <blockquote>The limit on executive pay has been on the law books for 30 years. Gowrylow: 'Frankly, I don't think it's something that's been on our radar since the mid–80s.' Mike Gowrylow is a spokesman for the Washington Department of Revenue. He says the recent million–dollar incomes were news to the department. Gowrylow: 'But it's certainly something that I think we need to take a look at again and examine whether these nonprofits are paying their executives excessively or not.' Gowrylow says the agency only audits 2 or 3 percent of tax returns. It mostly relies on businesses to comply voluntarily with the state's tax laws. Gowrylow: 'We can't be everywhere. If we become aware of a nonprofit or any other business that's underreporting their taxes, we investigate those complaints, and if tax is due, we will assess it.' He says the agency can recover back taxes for the past four years, along with penalties and interest.</blockquote>Although the article cited an unsuccessful legal action to enforce the law in a particular case in 1986, why the state government seemed to forget about it after that is unclear, and maybe deserving of further investigation. Right  now, hospital management seems to be trying to avoid the issue, or is arguing about the meaning of "comparable," <blockquote>Several present day hospital officials declined to be interviewed on tape. They told KUOW they believe they are in compliance with the state law. But they generally provided little detail to back up that claim. Providence and Group Health representatives both said their organizations are so large and complex that there may not be any comparable public service jobs in Washington. Swedish spokeswoman Melissa Tizon told me that CEO Rodney Hochman's pay was generally comparable to what the highest paid public hospital executives made, at Valley and Evergreen hospitals.</blockquote> On the other hand, <blockquote>Harborview is the state's largest hospital. Eileen Whalen is its head and an employee of the University of Washington. She makes about $470,000. [State Senator Karen] Keiser: 'That's really not comparable to the million dollar and more salaries of other hospital directors in our state. We are paying attention here in Olympia to that.' Other executives at UW Medicine did make more than Whalen. Still, none of them, not even the president of UW, made as much as any of the 15 highest paid executives at nonprofit hospitals in 2009. I searched high and low to find any public officials making as much as the top nonprofit CEOs. The only one I found who consistently did so was the UW football coach. But it might be hard to argue that Steve Sarkisian's job is comparable to running a hospital system.</blockquote> We have discussed numerous cases of executives of not-for-profit hospitals and hospital systems receiving <a href="http://hcrenewal.blogspot.com/search/label/executive%20compensation">lavish compensation</a> and <a href="http://hcrenewal.blogspot.com/search/label/executive%20life%20style">benefits</a> that seem out of proportion to any reasonable measure of their performance or of their positions' difficulties.  (Remember that advocates of corpulent executive compensation love to cite the size of the company and the number of employees, but the CEO really has only to manage the next tier of executives, rarely numbering more than a dozen.) As we have <a href="http://hcrenewal.blogspot.com/search/label/executive%20compensation">said before</a>, far too often the leaders of not-for-profit health care institutions seem more interested in padding their own bottom lines than upholding the institutions' missions. They often seem entirely unaware of their duty to put those missions ahead of their own self-interest. Like the financial services sector in the era of "greed is good," health care too often seems run by <a href="http://hcrenewal.blogspot.com/2009/12/compensation-madness-insiders-hijacking.html">"insiders hijacking established institutions for their personal benefit."</a> True health care reform would encourage leadership of health care who understand health care and care about its mission, rather than those who see a quick way to make a small fortune. However, the twist in this story is that it appears the lavish compensation of hospital executives in this particular state may have violated state law, or at least the tax breaks these hospitals got may have violated the law, given their leaders excessive compensation, and that the law in question is over 30 years old.  However, the law seems to have been forgotten or ignored for nearly all that time, for reasons that are unclear.  This seems reminiscent of how the Responsible Corporate Officers' Doctrine seems to have been forgotten and ignored.  <a href="http://hcrenewal.blogspot.com/2010/06/attempt-to-hold-health-care-leaders.html">this post</a> from June, 2010).  However, in the last 30+ years, this notion has been ignored and abandoned by US government regulators at least in so far as it applies to health care organizations, particularly drug, biotechnology and device companies. The big question is why have such laws and legal practices, which have not been repealed or refuted, instead been ignored and forgotten?  Surely this cries out for investigation. Of course, It seems that somehow in the brave new world of laissez faire, anything goes capitalism foisted on health care over the last 30 plus years, old practices and customs that limited the power and enrichment of top leaders may have seemed increasingly prudish, and those advocating them may have seemed to be old fuddy duddies to those bent on personal gain.  But unhipness and scorn of prudishness are not reasons to ignore an existing law.  So it is not that there are no legal tools to prevent abuses by leaders of health care organizations.  Instead, there has been increasing forgetfulness of the existence of such tools, and perhaps a growing effeteness of enforcement that has lead to a reluctance to even try to use them.  So we can start truly reforming health care by simply enforcing the laws that are already there.

Why Weren't Existing Laws About Hospital CEO Compensation Enforced in Washington State?

Public radio station KUOW reported on the generous compensation given hospital CEOs in Washington: KUOW has learned that 15 hospital execu...

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