Category Archives: Ethics

A review of Hospice spending shows an alarming change in mission goals from patient care and comfort to profits;

From 2005 through 2009, Medicare spending on hospice care rose 70% to $4.31 billion, according to Medicare records.

A recent report by the inspector general for Health and Human Services, which oversees Medicare, found for-profit hospices were paid 29% more per beneficiary than non-profit hospices. Medicare pays for 84% of all hospice patients.

The article highlighted the investigation of the two largest corporate hospice providers and their alleged fraudulent claims.

Medicynical Note: Trolling nursing homes for “hospice appropriate” patients apparently has become a way to increase revenue. It’s bizarre that Hospices thought it necessary to offer services to patients already in full-time nursing facilities. Two service providers, the nursing home and the hospice, being paid for providing what are, for the most part, the same nursing and support services is a irresistible recipe for waste and in this case fraud.

It should be evident that industry seeks to maximize profit. That’s what capitalism is about. In health care that means leveraging control over products and services by testing the limits of programs–in this case illegally increasing the patient base. It’s an irresistible urge that CEO’s simply can’t resist.

Patient care? Value? Cost Efficiency? Not their department.

Not surprisingly drug companies do everything they can to get doctors to prescribe their products. It matters not that their medications are no better than generics, that their medications cost more than the annual average income in the U.S., that there are other better drugs available. They pay for the ads and for the prominence of the drug recommendations. Take the “wonderful” free app Epocrates: Please.

But like so much else on the Web, “free” comes with a price: doctors must wade through marketing messages on Epocrates that try to sway their choices of which drugs to prescribe.

and:

However, the marketing through Epocrates is more insidious, according to Dr. Adriane Fugh-Berman, an associate professor of medicine at Georgetown University and founder of PharmedOut, a nonprofit group critical of drug companies’ marketing practices.

“With targeted ads in Google, you may buy something that’s an unwise purchase,” she said. “But when a physician is influenced in Epocrates, it’s the patient (Medicynical addendum: and insurer) who’s bearing the financial and health risk.”

Dr. Fugh-Berman and other critics of drug marketing say the apps promote more expensive and sometimes less effective drugs. The companies say they are helping doctors find the best medicines.

Medicynical Note: This type advertising costs us all money, whether we pay directly for the medication or our insurer covers the cost. Doctors have lived too long in the world where cost is not a consideration in their treatment options. We need to encourage value, as well as efficacy, in health care. The U.S. has the most expensive, most inefficient and perhaps only non system of health care operational in the industrialized world. We can do better……..maybe.

Nice article in the NY Times by Bruce Bartlett on the policy choices, taxation and health care, comparing the U.S. and other OECD countries. He notes:

1. The U.S. has very low taxes by international standards:

2. The difference in taxation is to a great degree the payment of health care costs in most industrialized countries by taxation and cash payments (family allowances) made to families in most Euopean countries.

He notes the impact of such payment on taxes:

The impact on the tax burden can be dramatic if one views family allowances as negative taxes. For example, in Luxembourg, an average married worker with two children pays a nominal income tax rate of 16.5 percent (including state and local income taxes), while an American in the same situation would pay 5.2 percent. But once family allowances are subtracted from the Luxembourg worker’s income-tax payment, the effective tax rate falls to just nine-tenths of 1 percent. (Medicynical note: lower than the U.S. )

3. Regarding health care in the U.S. national health insurance covers 72% of expenditures in other OECD countries and just 46.5 % in the U.S.

4. The U.S. pays more for health care than residents in any other major country. And the government share of current health spending that in the U.S. covers a just minority of citizens…

is about the same as total health care costs in many other countries, including (as a percentage of G.D.P.) Luxembourg (6.8 percent), Israel (7.8 percent), Japan (8.1 percent), Britain (8.4 percent) and Norway (8.5 percent).

That is, the proportion of GDP we spend now for just those on medicare, and medicaid in the U.S. non-system covers the total health costs in other countries. We are one of the least efficient, lowest value health care “systems” in the world. Exceptional!

Read the article, it’s short and clear.

Medicynical Note: The solution being offered by Ryan, provides less coverage for those in medicare and medicaid; does nothing about the 50 million uninsured. It will likely cut costs but also cut care provided and result in the deaths of our citizens. Amazingly modest proposal.

Two interesting events this week illuminate why health care costs are increasing (by double digit percentages) each year and why they are bankrupting individuals, insurance companies, Medicare, Medicaid, states and indeed the U.S. government.  And while this is happening congress is taking resolute steps to cut NPR’s funding, question individual’s rights to abortion (even in cases of rape, incest and mother’s life risk).  Their budget cuts amount to about 2% of the current budget deficit.  This budget balancing urgency comes after granting a 400 billion dollar a year tax cut.  Remarkable ineptitude.

How health care is  bankrupting us:

1.  Consider the recent rebranding of a long time generic drug hydroxyprogesterone caproate into  Makena.  Without getting into the question of efficacy, consider that hydroxyprogesterone caproate was available for many years at $10-15/ dose from compounding pharmacies.  The branded version of this same exact drug will sell, according to it’s manufacturer, for $1500/dose and the manufacturer expects individuals and insurers to pay.

Now a national pharmaceutical company has gotten FDA approval to make hydroxyprogesterone caproate and will be charging about $1,500 per shot.
KV Pharmaceutical, headquartered in Bridgeton, Mo., received approval Feb. 4 to make and market the drug for the prevention of pre-term labor that for years had been mixed by compounding pharmacies. (at $15, Medicynical clarification)

Medicynical Note:  It’s better than alchemy to be able to make a $15 drug into a $1500 one.  But that’s American ingenuity and creativeness.

2.  Selling a marginally effective drug (Provenge) for $93,000/course of treatment:

Medicare officials said Wednesday that the program will pay the $93,000 cost of prostate cancer drug Provenge, an innovative therapy that typically gives men suffering from an incurable stage of the disease an extra four months to live.

The Centers for Medicare and Medicaid said the biotech drug made by Dendreon Corp. is a “reasonable and necessary” medicine. The decision ensures that millions of men would be able to afford the drug through the government-backed health care coverage. With government reimbursement, analysts estimate Provenge could rack up $1 billion in sales next year. The decision, which will be finalized by June 30, is important for Dendreon because most prostate cancer patients are 65 or older.

Also:

“It’s impossible to put a dollar figure on a human life, especially when you’re talking about a drug that has such mild side effects,” said Jim Kiefert, a prostate cancer patient and advocate who was part of the Provenge study. “Of all the treatments I’ve had — with surgery, radiation and hormone treatment — Provenge had fewer side effects than any of them.”

But bioethicists who study health care decisions say Medicare’s ruling on Provenge mirrors the bias of the overall U.S. health system, which emphasizes expensive treatments over basic medical care. Health care costs account for nearly one fifth of the U.S. economy, more than any other country.

Medicynical Note:  It’s obvious to any thoughtful person that unless the cost of care comes down, we can’t afford our non-system.  We pay twice as much as other similar countries and still have 50 million and climbing uninsured.

Resolving the conundrum of health care costs is a major question that instantly strikes our politicians deaf, dumb and blind.  Even the most innocuous suggestion, for example, comparing the efficacy of new drugs against older less expensive ones, in studies not sponsored by drug companies, is considered controversial.

I’m sad for my grandchildren.

Addendum:  4/1/2011 Drug company slashes price of drug from $1500 to $690. A bargain?  Still only 50 times the price of the generic.  Amazing!

The price of an expensive (? Medicynical question mark) drug to prevent premature births has been cut by more than half, following bitter controversy over its high cost.KV Pharmaceutical Co. said Friday that it is dropping the price from $1,500 per dose to $690.

The company got government approval in February to exclusively make the drug named Makena (mah-KEE’-nah), and it hit the market last month. For years, specialty pharmacies had been making a version of the weekly injection for $10 to $20 a dose, so the price of Makena was a shock to doctors who prescribe the drug and private and public insurance programs that pay for it.

It’s hard to tell what’s real on April fools day.

Be careful what you wish for.  This cuts both ways.

The incidental economist notes: (Austin Frakt)

If one wants to address the problems in health insurance markets and/or to get providers to accept payment reforms, the mandate–or something like it–is the political price. Yes, it’s about money. What else?

Put it this way, if one wants to retain a private market-based health insurance system (which ours largely is), it takes a mandate. Reject the mandate without replacement with a similar mechanism and the whole thing unravels, not just as a matter of health economics (adverse selection) but as a matter of politics.

Medicynical Note:  We’ve created the most dysfuntional, expensive healthcare non-system in the world.  Yes we’re number one.

Employer sponsored health care is a mess.  Employers don’t have to provide their employees health care–in many instances they can’t afford to provide it; “contractors” are not employees and don’t qualify for employer provided benefits;  if you get sick and can’t work, you lose your insurance.  Remarkable.

Our health care costs are twice that of many other industrialized countries and thousands more per capita/year.  We have 50 million uninsured and have a “system” that encourages “free” use of the most inefficient, most expensive health care provider in the country–emergency rooms.

We all pay.