Idaho Insurer Moves Ahead With Health Plans That Flout Federal Rules

It's barely been two weeks since Idaho regulators said they would allow the sale of health insurance that doesn't meet all of the Affordable Care Act's requirements — a controversial step some experts said would likely draw legal scrutiny and, potentially, federal fines for any insurer that jumped in.
And on Wednesday, Blue Cross of Idaho unveiled a menu of new health plans that break with federal health law rules in several ways, including setting premiums based on applicants' health.

"We're trying to offer a choice that allows the middle class to get back into insurance coverage," said Dave Jeppesen, the insurer's executive vice president for consumer health care.

The insurer filed five plans to the state for approval and hopes to start selling them as soon as next month.

The Blue Cross decision ups the ante for Alex Azar, the Trump administration's new Health and Human Services secretary. Will he use his authority under federal law to compel Idaho to follow the ACA and reject the Blues plans? Or will he allow state regulators to move forward, perhaps prompting other states to take more sweeping actions?

At a congressional hearing Wednesday, even as Blue Cross rolled out its plans, Azar faced such questions. "There are rules," Azar said. "There is a rule of law that we need to enforce."

However, he didn't specifically indicate whether the federal government would step in.

Robert Laszewski, a consultant and former insurance industry executive, says it should. "If Idaho is able to do this, it will mean other ... states will do the same thing," he said. "If a state can ignore federal law on this, it can ignore federal law on everything."

Idaho's move stirs up more issues about the stability of individual insurance markets.

Policy analysts say that allowing lower-cost plans that don't meet the ACA's standards to become more widespread will pull younger and healthier people out of Obamacare, raising prices for those who remain. Supporters say that is already happening, so the lower-cost plans provide more choices for people who earn too much to qualify for subsidies to help them purchase ACA coverage.

Idaho's move to allow such plans, announced in January, drew harsh and swift criticism.

"Crazypants illegal," tweeted Nicholas Bagley, a law professor at the University of Michigan and former attorney with the civil division of the U.S. Department of Justice, who said that states can't pick and choose which parts of federal law to follow. Sabrina Corlette, a research professor at Georgetown University's Center on Health Insurance Reforms, pointed out that health insurers could be liable for sharp fines if they are found to be in violation of the ACA.

But both Idaho regulators and Blue Cross officials say they aren't worried.

Jeppesen said the ACA gives states regulatory authority "to make sure the market works and is stable," and the insurer is simply "following what the state has given us guidance" to do.

Other insurers in Idaho are taking a much more cautious approach, telling The Wall Street Journal they aren't stepping up immediately to offer their own plans.

Laszewski said they are likely waiting to see what legal challenges develop. "If I were running an insurance company, there's no way I would stick my neck out until the high court has ruled in favor of this — and they're not going to," he said.

Jeppesen said his company has consulted with legal experts and is moving ahead with confidence.

The aim is to bring people back into the market, particularly the young, the healthy and those who don't get a tax credit subsidy and can't afford an ACA plan.

For some people — especially younger or healthier applicants — the new plans, which the insurer has named Freedom Blue, cost less per month than policies that meet all ACA rules.

They accomplish that by limiting coverage. If they are allowed to be sold, consumers will need to weigh the lower premiums against some of the coverage restrictions and variable premiums and deductibles, policy experts say.

The plans, for example, will include a "waiting period" of up to 12 months for any pre-existing conditions if the applicant has been without coverage for more than 63 days, Jeppesen said.

Additionally, they cap total medical care coverage at $1 million annually. And premiums are based, in part, on a person's health: The healthiest consumers get rates 50 percent below standard levels, while those deemed unhealthy would be charged 50 percent more.

All those conditions violate ACA rules, which forbid insurers from rejecting coverage of preexisting conditions or setting dollar caps on benefits or higher premiums for people with health problems.

But the rates may prove attractive to some.

Premiums for a healthy 45-year-old, for example, could be as low as $195 a month, according to a comparison issued by the insurer, while a 45-year-old with health problems could be charged $526. In that case, the 45-year old would find a lower price tag — $343 a month — for an ACA-compliant bronze plan.

While Freedom Blues plans cover many of the "essential health benefits" required under the ACA, such as hospitalization, emergency care and mental health treatment, they do not include pediatric dental or vision coverage. One of the five plans doesn't include maternity coverage.

When compared with one of the Blues' ACA-compliant plans — called the Bronze 5500 — the new standard Freedom Blue plan's annual deductibles are a mixed bag.

That's because it has two separate deductibles — one for medical care and one for drugs. If a consumer took only generic drugs, the new plan would be less expensive, according to details provided by the plan. But with a $4,000 deductible for brand-name drugs, the Freedom Blue plan requires more upfront money before full coverage kicks in than the ACA-compliant plan it was compared with.

Jeppesen said the insurer hopes to attract many of the "110,000 uninsured state residents who cannot afford [ACA] coverage."

That's the total number of uninsured people who earn more than 100 percent of the federal poverty level in the state, he said.

Sarah Lueck, senior policy analyst for the Center on Budget and Policy Priorities, cautioned that some of those residents might actually be eligible for subsidies under the ACA, which are available to people earning up to four times as much.

"Many ... could be getting subsidies for more comprehensive coverage through the [ACA-compliant state exchange] and would be better off," Lueck said.

source

Unnecessary Medical Care: More Common Than You Might Imagine

Marshall Allen

From

It's one of the intractable financial boondoggles of the U.S. health care system: Lots and lots of patients get lots and lots of tests and procedures that they don't need.

Women still get annual cervical cancer testing even when it's recommended every three to five years for most women. Healthy patients are subjected to slates of unnecessary lab work before elective procedures. Doctors routinely order annual electrocardiograms and other heart tests for people who don't need them.

That all adds up to substantial expense that helps drive up the cost of care for all of us. Just how much, though, is seldom tallied. So, the Washington Health Alliance, a nonprofit dedicated to making care safer and more affordable, decided to find out.

The group scoured the insurance claims from 1.3 million patients in Washington state who received one of 47 tests or services that medical experts have flagged as overused or unnecessary.

What the group found should cause both doctors, and their patients, to rethink that next referral. In a single year:

• More than 600,000 patients underwent a treatment they didn't need, treatments that collectively cost an estimated $282 million.
• More than a third of the money spent on the 47 tests or services went to unnecessary care.
• 3 in 4 annual cervical cancer screenings were performed on women who had adequate prior screenings – at a cost of $19 million.
• About 85 percent of the lab tests to prep healthy patients for low-risk surgery were unnecessary – squandering about $86 million.
• Needless annual heart tests on low-risk patients consumed $40 million.

Susie Dade, deputy director of the alliance and primary author of the report released Thursday, said almost half the care examined was wasteful. Much of it comprised the sort of low-cost, ubiquitous tests and treatments that don't garner a second look. But "little things add up," she said. "It's easy for a single doctor and patient to say, 'Why not do this test? What difference does it make?' "

ProPublica has spent the past year examining how the American health care system squanders money—often in ways that are overlooked by providers and patients alike. The waste is widespread – estimated at $765 billion a year by the National Academy of Medicine, about a fourth of all the money spent each year on healthcare.

The waste contributes to health care costs that have outpaced inflation for decades, making patients and employers desperate for relief. This week Amazon, Berkshire Hathaway and JPMorgan rattled the industry by pledging to create their own venture to lower their health care costs.

Wasted spending isn't hard to find once researchers—and reporters— look for it. An analysis in Virginia identified $586 million in wasted spending in a single year. Minnesota looked at fewer treatments and found about $55 million in unnecessary spending.

Dr. H. Gilbert Welch, a professor at The Dartmouth Institute who writes books about overuse, said the findings come back to "Economics 101." The medical system is still dominated by a payment system that pays providers for doing tests and procedures. "Incentives matter," Welch said. "As long as people are paid more to do more they will tend to do too much."

Dade said the medical community's pledge to "do no harm" should also cover saddling patients with medical bills they can't pay. "Doing things that are unnecessary and then sending patients big bills is financial harm," she said.

Officials from Washington's hospital and medical associations didn't quibble with the alliance's findings, calling them an important step in reducing the money wasted by the medical system. But they said patients bear some responsibility for wasteful treatment. Patients often insist that a medical provider "do something," like write a prescription or perform a test. That mindset has contributed to problems like the overuse of antibiotics – one of the items examined in the study.

And, the report may help change assumptions made by providers and patients that lead to unnecessary care, said Jennifer Graves, vice president for patient safety at the Washington State Hospital Association. Often a prescription or technology isn't going to provide a simple cure, Graves said. "Watching and waiting" might be a better approach, she said.

To identify waste, the alliance study ran commercial insurance claims through a software tool called the Milliman MedInsight Health Waste Calculator. The services were provided during a one-year period starting in mid-2015. The claims were for tests and treatments identified as frequently overused by the U.S. Preventive Services Task Force and the American Board of Internal Medicine Foundation's Choosing Wisely campaign. The tool categorized the services one of three ways: necessary, likely wasteful or wasteful.

The report's "call to action" said overuse must become a focus of "honest discussions" about the value of health care. It also said the system needs to transition from paying for the volume of services to paying for the value of what's provided.

ProPublica is a nonprofit newsroom based in New York. You can follow Marshall Allen on Twitter:@marshall_allen. 

source

Letter: Take back health care from corporate interests

Kathy Waller, September 27, 2016

The health care system in the United States is rigged.  We are the richest country in the world — and the only industrialized nation that does not provide universal health care to all citizens. Our health care financing system puts corporate profits ahead of people, working for millionaires but not for us. While patients suffer and die, United’s CEO is paid $66 million a year. Aetna recently abandoned the ACA health insurance exchanges, claiming that they were unprofitable, while posting $7 billion in overall profits last year. One-third of every dollar that we pay for premiums is spent on administrative waste, including exorbitant CEO salaries, shareholder profits, political lobbyists, and marketing campaigns designed to spread fear and lies about health care reform.

Our health care system is in medical, economic and moral crisis. In Colorado, 535 people die each year from causes that would have been avoidable if they could have afforded medical care. We spend nearly twice as much per capita than any other wealthy country, with worse outcomes. Medical debt is the greatest contributor to bankruptcies. There is a perverse incentive for profit-driven insurance companies to deny as much care as they can get away with in order to maximize profits for their shareholders.

It’s time for a Health Care Revolution! Health care should be a right, not a privilege, and the people of Colorado have a chance to lead the nation in saying “no” to the obscene profit-driven motives of insurance companies by joining together as co-owners of a cooperative health care financing system, ColoradoCare, with the motive of providing actual health care to all. ColoradoCare will cover all Coloradans, save billions and provide high-quality care. No more deductibles or narrow networks. This is not government-run health care; there will be transparency and accountability to us as owners of the cooperative, a proven business model. The system will exemplify high-quality medical care, fiscal responsibility and social justice.

It’s time to take back our health care from corporate interests. Learn more at www.coloradocare.org. Stand against the status quo of the robber baron pharmaceutical and insurance industry profiteers. Vote yes for Amendment 69 — ColoradoCare. Join the Health Care Revolution and Feel the Care!

Kathy Waller, M.D., Fort Collins
source

The truth about why the U.S. can’t control healthcare costs

Editor’s Note: Welcome to Medical Economics' blog section which features contributions from members of the medical community. These blogs are an opportunity for bloggers to engage with readers about a topic that is top of mind, whether it is practice management, experiences with patients, the industry, medicine in general, or healthcare reform. The series continues with this blog by Ryan Gamlin, a former health care management consultant and current medical student at the University of Cincinnati. The views expressed in these blogs are those of their respective contributors and do not represent the views of Medical Economics or UBM Medica.

A graphic making the rounds on social media has people talking—plots health spending per capita against the average life expectancy for two dozen countries. The chart has renewed the important conversation around why the United States’ experience is such an outlier, spending more than any other country by a wide margin, effectively proving the adage that “more is not better.”

Blog: Doctors are being held back from intellectual creativity

 We spend more on healthcare only to generate outcomes far poorer than any comparable country.

The question of why the U.S. generates so little value for its healthcare dollar is a persistent source of study and debate. While dramatic changes are underway in how care is financed and delivered, two major structural impediments to moving the U.S. “closer to the curve” are rarely discussed.

The Inverted Pyramid

The U.S. spent less than $300 per person on public health in 2014 (the most recent year for which data is available) – this compared to $9,523 in per-capita total healthcare spending. While this figure is not comprehensive (it does not include things such as corporate wellness programs), the best estimate is that only 3% of all healthcare spending goes towards promoting health, response to health emergencies, and the prevention of illness and injury.

A rational system of health promotion would invest in wellness, rather than reveling in its ability to cure disease, yet under traditional fee-for-service compensation models, prevention has been a business model without profit, and the fractured and often fractious landscape of federal, state, and local public health spending has often left public health agencies without adequate resources and direction to achieve their mission.

Blog: Better quality will equal better pay for physicians

The bulk of public health expenditures have been shifted to the state level, creating an inefficient patchwork quilt of programs and initiatives. Funding for public health has been feast or famine, leaving delivering agencies and organizations unable to plan for or execute long-term projects. Much as the tragic I-35 bridge collapse in Minneapolis brought the issue of infrastructure under-investment to the public’s attention, Congressional inaction on salient threats to public well-being such as the Zika virus have left Americans in undue danger.

Dependency on the Healthcare Jobs Machine

Growth in the healthcare sector has been a bright spot in the preceding dismal economic decade. The sector has been a consistent source of jobs growth , but there is reason to believe that economic gains created by healthcare spending are not analogous to growth driven by other sectors of the economy.

When healthcare jobs do not increase productivity, the increased real price of healthcare is transmitted, via increased costs of production, to nearly all goods and services throughout the broader economy – a vast “ripple effect” not seen with inefficiency in other jobs sectors.

Unwinding this system quickly would be catastrophic. The U.S. has made a Faustian bargain: a healthcare system that generates fantastic profits for shareholders and delivers well-paying jobs, while straining governments at every level and households across the nation.

Blog: Top 3 warnings to medical providers from the fall of retail

While excessive profits are often cited as the cause of runaway spending, it is more important to examine the rampant excesses – the accumulated inefficiencies, myriad costs, large and small – of the system. Healthcare transactions in the U.S. are defined by a complex and unenviable process, during which information and money are transferred between a number of entities, accruing cost and complexity at each step. Each step is marked by administrative duplication.

In the health insurance market, for example, a number of companies offer a similar set of services (charitably, these would include handling claims, answering customer inquiries, and negotiating discounts with facilities and health care providers), yet each organization generates a unique set of transactional and profit totaling in the tens of billions of dollars. With a simplified payment system, insurance – and insurers – would be less complex. Less complex organizations may be run more efficiently, and with a lower managerial burden.

Inefficiency also manifests itself on the provider side. From 1990 to 2012 healthcare jobs grew by 75% -- far faster than patient volumes. Worse, the growth of healthcare administrators far outpaces the rise of the healthcare labor force as a whole; more than 60% of all physician jobs are now purely administrative.

What Lies Ahead

Physicians, for their part, have begun to push back against administrative waste and excess, moving in large numbers to service delivery models like Direct Primary Care – saving themselves and patients the time, frustration, and costs associated with third party payment.

Blog: Physicians abused, ignored and silenced no more

New reimbursement structures, like shared savings and ACOs, will draw provider and payer incentives closer to one another – and it is within these highly aligned arrangements that the efforts of physician stewardship organizations, such as Costs of Care and Choosing Wisely. will likely be most effective.

But with 53% of physician reimbursement tied to fee-for-service, the majority of dollars saved through these efforts are still subject to recapture by insurers, administrators, or other entities, rather than making their way back to patients in the form of lower out-of-pocket costs.

As Holman W. Jenkins pointed out in a recent, devastating, satire of the Mylan Pharmaceuticals Epi-Pen scandal, many of the incentives in the current healthcare system are aligned only with growing the total scale of healthcare expenditures, not shrinking them.

Until we create a system that rewards investment in wellness and healthcare dollars not spent, there is reason to fear that the negative effects of healthcare excesses will continue to be borne by households, businesses, and governments.

source

Medicine’s Top Earners Are Not the M.D.s

THOUGH the recent release of Medicare’s physician payments cast a spotlight on the millions of dollars paid to some specialists, there is a startling secret behind America’s health care hierarchy: Physicians, the most highly trained members in the industry’s work force, are on average right in the middle of the compensation pack.

That is because the biggest bucks are currently earned not through the delivery of care, but from overseeing the business of medicine.

The base pay of insurance executives, hospital executives and even hospital administrators often far outstrips doctors’ salaries, according to an analysis performed for The New York Times by Compdata Surveys: $584,000 on average for an insurance chief executive officer, $386,000 for a hospital C.E.O. and $237,000 for a hospital administrator, compared with $306,000 for a surgeon and $185,000 for a general doctor.

And those numbers almost certainly understate the payment gap, since top executives frequently earn the bulk of their income in nonsalary compensation. In a deal that is not unusual in the industry, Mark T. Bertolini, the chief executive of Aetna, earned a salary of about $977,000 in 2012 but a total compensation package of over $36 million, the bulk of it from stocks vested and options he exercised that year. Likewise, Ronald J. Del Mauro, a former president of Barnabas Health, a midsize health system in New Jersey, earned a salary of just $28,000 in 2012, the year he retired, but total compensation of $21.7 million.

The proliferation of high earners in the medical business and administration ranks adds to the United States’ $2.7 trillion health care bill and stands in stark contrast with other developed countries, where top-ranked hospitals have only skeleton administrative staffs and where health care workers are generally paid less. And many experts say it’s bad value for health care dollars.

“At large hospitals there are senior V.P.s, V.P.s of this, that and the other,” said Cathy Schoen, senior vice president for policy, research and evaluation at the Commonwealth Fund, a New York-based foundation that focuses on health care. “Each one of them is paid more than before, and more than in any other country.”

She added, “The pay for the top five or 10 executives at insurers is pretty astounding — way more than a highly trained surgeon.”

 

She said that executive salaries in health care “increased hugely in the ‘90s” and that the trend has continued. For example, in addition to Mr. Del Mauro’s $21.7 million package, Barnabas Health listed more than 20 vice presidents who earned over $350,000 on its latest available tax return; the new chief executive earned about $3 million. Data released by Medicare show that Barnabas Health’s hospitals bill more than twice the national average for many procedures. (In 2006, the hospital paid one of the largest Medicare fines ever to settle fraud charges brought by federal prosecutors.)

Hospitals and insurers maintain that large pay packages are necessary to attract top executives who have the expertise needed to cope with the complex structure of American health care, where hospitals and insurers undertake hundreds of negotiations to set prices.

Ellen Greene, a spokeswoman for Barnabas Health, said Mr. Del Mauro’s retirement package was “a function of over four decades of service and reflects his exceptional legacy.” Nearly $14 million was a cumulative payout from a deferred retirement plan, she said, and the remainder included base compensation, a bonus and an incentive plan.

Ms. Greene also said Barnabas’s compensation program follows I.R.S. rules and is established by an executive compensation committee with “guidance from a nationally recognized compensation consultant.”

In many areas, the health care industry is home to the top earning executives in the nonprofit sector.

And studies suggest that administrative costs make up 20 to 30 percent of the United States health care bill, far higher than in any other country. American insurers, meanwhile, spent $606 per person on administrative costs, more than twice as much as in any other developed country and more than three times as much as many, according to a study by the Commonwealth Fund.

As a result of the system’s complexity, there are many jobs descriptions for positions that often don’t exist elsewhere: medical coders, claims adjusters, medical device brokers, drug purchasers — not to mention the “navigators” created by the Affordable Care Act.

Among doctors, there is growing frustration over the army of businesspeople around them and the impact of administrative costs, which are reflected in inflated charges for medical services.

“Most doctors want to do well by their patients,” said Dr. Abeel A. Mangi, a cardiothoracic surgeon at the Yale School of Medicine, who is teaming up with a group at the Yale School of Management to better evaluate cost and outcomes in his department. “Other constituents, such as device manufacturers, pharmaceutical companies and even hospital administrators, may not necessarily have that perspective.”

Doctors are beginning to push back: Last month, 75 doctors in northern Wisconsin took out an advertisement in The Wisconsin State Journal demanding widespread health reforms to lower prices, including penalizing hospitals for overbuilding and requiring that 95 percent of insurance premiums be used on medical care. The movement was ignited when a surgeon, Dr. Hans Rechsteiner, discovered that a brief outpatient appendectomy he had performed for a fee of $1,700 generated over $12,000 in hospital bills, including $6,500 for operating room and recovery room charges.

It’s worth noting that the health care industry is staffed by some of the lowest as well as highest paid professionals in any business. The average staff nurse is paid about $61,000 a year, and an emergency medical technician earns just about minimum wage, for a yearly income of $27,000, according to the Compdata analysis. Many medics work two or three jobs to make ends meet.

“It’s stressful, dirty, hard work, and the burnout rate is high,” said Tom McNulty, a 19-year-old college student who volunteers for an ambulance corps outside Rochester. Though he finds it fulfilling, he said he would not make it a career: “Financially, it’s not feasible.”

source

Health Care Reform: The Real Issue

Everywhere someone is talking about Health Care Reform…politicians, consumer groups, and the media.  Big insurance carriers have become a target and are disparaged repeatedly for continuing to raise premiums. 

While everyone focuses on health insurance reform, no one looks at what causes these sky high increases:  the rising cost of health care.  According to the Centers for Medicare and Medicaid Services, by 2019 health care spending will near $4.4 trillion.  The California Health Care Foundation reported that health care spending is rising three times faster than inflation.  Additionally, Medicare spending is rising 10% annually while enrollment is only increasing by 2.5%.  In 2009, the most recent data, Medicaid spending increased almost 7% while enrollment only increased 2.3%.

As a result, hospitals, outpatient surgery centers, imaging centers, labs, medical groups and pharmaceutical companies seek higher payments from health insurance carriers when negotiating contracts.  Recently, some negotiations have reached impasses that only penalized patients who found themselves unable to visit their doctor or hospital due to a disruption in insurance.  Carriers are caught between politicians who scorn premium increases and providers who ask for higher reimbursements.

There are many culprits driving this high and rising cost of health care.

First is cost shifting.  As Medicaid and Medicare reimbursements decreased by 20% to 30%, hospitals and providers are attempting to shift lost revenue to insurance carriers.  To do so, they have been seeking 25% to 45% increases in coverage.  Yet with the clamor about high insurance costs, there is no way carriers can raise rates to offset these increases should they accept them, nor can they afford to absorb them.  This illustrates a major predicament facing health insurance carriers– lower health care spending and increase premiums, or lower premiums and increase the health care cost burden.

Second is lifestyle choices that result in a higher use of health care services.  It is widely known that 75% of health care costs are associated with lifestyle issues such as obesity, tobacco, and sedentary lifestyles.  These choices lead to chronic issues such as diabetes, high cholesterol, high blood pressure and heart disease that could have been prevented purely by embracing healthier lifestyles.

A third cause is medical technology.

Expensive technology accounts for about one half to two-thirds of spending growth.  Technology is now essentially mandated for compliance to HIPPA laws and is used increasingly by doctors seeking to protect themselves against medical malpractice lawsuits.  Not all this technology contributes to better care.  Technology expenses will only become worse as new tests and more costly equipment emerge.

The fourth cause comes from inefficiencies that result in the unnecessary repetition of services by multiple doctors.  An anesthesia medical group in Los Angeles told me that about 50% of the time they are forced to re-order test results on a rush basis prior to surgery because critical reports have been omitted from the charts.  In another example, I spoke with one individual who sees both his primary care doctor and his oncologist four times a year.  Both doctors draw blood and send it for lab tests.  Recently, he learned that the doctors were running the same tests.  This duplication of draws and tests also doubled costs and insurance claims.  Ultimately, carriers ended up paying double for the same services.

The fifth factor in rising costs is drug company advertising.

Doctors are prescribing more – and patients are taking more – drugs for conditions that didn’t exist a short time ago, conditions like restless leg syndrome.  The Kaiser Family Foundation reports that nearly two-thirds of Americans fill at least one prescription and the average American fills 12 prescriptions annually.  Half of all patients leave a doctor’s office with a prescription.  Yet, these same people ask more questions when buying a car than when they get a prescription for a new drug.  Additionally, patients with multiple doctors often receive a variety of prescriptions for different purposes.  Unfortunately, patients don’t always show their drug lists to each of their doctors.  This often results in new maladies from complications cause by mixing drugs, again, increasing medical care costs.

The last factor is health care fraud.  According to the National Health Care Anti-Fraud Association, it is estimated that fraud adds up to 3% of all annual health care spending, that’s $68 billion a year, or more than $180 million daily.  Better fraud prevention can only lower health care spending.

Even with health insurance reform, rising premium costs will prevail until the focus is placed on healthcare reform and these issues are addressed.  Every participant in health care – from patients to doctors to carriers and politicians – must be part of the solution in order to bend the cost curve downward.

source

U.S. recovers $4.2 bln from healthcare fraud probes in 2012

The Obama administration said on Monday that its efforts to combat fraud in the Medicare and Medicaid healthcare programs were paying off as the government recovered a record $4.2 billion in fiscal 2012 from individuals and companies trying to cheat the system.

For every dollar spent investigating healthcare fraud over the past three years, the government recovered $7.90, according to a report released on Monday by U.S. Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius.

This was the highest three-year average return on investment in the 16-year history of the federal Health Care Fraud and Abuse Program, the report said.

Healthcare lawyers representing both providers and whistle-blowers said the announcements echoed patterns they have observed in their practices and that the trend toward more rigorous enforcement has boosted business.

"We're doing more and more fraud and abuse work, and we also work with providers like hospitals and doctors' offices who are more concerned about compliance issues," said Robert Brennan, a former prosecutor who now represents healthcare companies as a partner in Parker Hudson Rainer and Dobbs in Atlanta. "(Companies are) scared because if the government comes knocking, it can mean big trouble for their business."

Lesley Ann Skillen, a partner in the New York firm Getnick and Getnick, who has represented whistle-blowers in fraud cases since the 1990s, said that the Justice Department has been increasingly eager to work with firms such as hers.

"We bring them good cases, and success breeds more success," she said.

The Obama administration has stepped up investigations under the program, making the prevention of fraud and waste in healthcare a top priority. The Patient Protection and Affordable Care Act authorized additional tools to fight fraud, including tougher eligibility screening for Medicare providers, increased data sharing among government agencies and greater oversight of private insurance abuses.

Efforts to curb waste, fraud and abuse are also seen by administration officials as a means to control healthcare spending, as the White House and Congress prepare for the next round of deficit reduction talks.
HCA Holdings Inc, the largest for-profit hospital operator in the United States, said in August that federal authorities were investigating whether heart procedures performed at some of its facilities were medically necessary.

Federal spending for Medicare, Medicaid and other healthcare programs is expected to hit $885 billion this year, according to the nonpartisan Congressional Budget Office.

The $4.2 billion recouped in fiscal 2012 from those attempting to defraud federal healthcare programs, including Medicare for the elderly and Medicaid for the poor, was up from nearly $4.1 billion the year before.

Over the past four years, the administration's enforcement efforts have recovered $14.9 billion, more than double the $6.7 billion recouped over the previous four-year period.

source

Healthcare Utilization Democrat vs Republican States

What Does the Dartmouth Atlas Have to Say About the Politics of the ACA?

Healthcare reform was a frontline topic during the recent presidential elections. The political warfare and misleading information around the Patient Protection and Affordable Care Act (PPACA), also known as Obamacare, has prevented the public from understanding its intended purpose, and has left many skeptical about its benefits. It is safe to say the general public has little to no idea about the quality of healthcare delivery in their respective regions.

In fact, it is not a far cry to claim that even healthcare professionals might not truly understand the issues facing American healthcare. Thus, most of the public is generally uninformed or misinformed about the population level problems facing the healthcare system. Therefore, it is quite simple for political parties to misguide the public and capitalize on their uninformed perceptions. If the public knew more about the flaws present in the healthcare system, perhaps they would better realize the PPACA is a reasonable start at addressing the failings of our system.

The Dartmouth Atlas Project is an online database which collects Medicare spending and utilization data from around the country. Information gathered from the database has shown immense variation in the way medical resources are utilized by even similar regions, communities, and health care organization. Evidence has repeatedly shown that, from a population perspective, areas that spend more on medical care do not consistently benefit from increased quality of care or patient wellbeing. Variation in the type of care delivered can be attributed to diverse incidence and prevalence of disease severity or the type of care a well- informed patient chooses. Variation in health care delivery is thus omnipresent and expected, because every patient is unique and medical innovation presents a growing number of care options to choose from.

However, much of the variation in healthcare practice is “unwarranted” because it cannot be explained by the degree of illness or patient preference. In fact, the two main drivers of unwarranted variation are the capacity of the local health care system to provide growing number of expensive services that must be utilized, and the physician’s practice habits that may not be evidenced based or patient preferred. The current healthcare reimbursement model propagates variation in care delivery due to the financial incentive of providing more service even when little benefit exists for the patient.

Analyzing Medicare data in a political context, the table below displays spending and service utilization data for the top ten Republican and Democratic states, based on the elections polls that tracked the popularity of each presidential candidate during the race (election polls).

These data tells a clear and simple story. The top ten Republican states have higher Medicare spending than the top ten Democratic states. The rate of hospitalization and surgical procedures are also higher for Republican states. If we investigate a procedure like percutaneous coronary interventions (PCI), the Republican states are performing more PCI procedures with equal mortality benefit compared to Democratic states. The evidence of variation in cost and utilization is a strong indication of inconsistency and inefficiency in the care delivery process. Are the Republican states providing better care by providing more care? We cannot find evidence of for such an assertion. Nor do we find evidence of harm occurring from a lack of utilization to individuals residing in democratic states.

Six of the ten Republican states sued the federal government over the individual mandate and Medicaid expansion earlier this year (Utah, Alabama, Louisiana, Texas, Georgia, and Nebraska), compared to only one democratic majority state (Maine). Yet the Republican states have a higher average of uninsured people, thus inhibiting a greater percentage of their citizens from accessing preventive healthcare. It is possible to draw many conclusions from these data, however it is intriguing that the states that have higher spending and resource utilization supported a Republican candidate who was not a supporter of the PPACA. The intrinsic values of the reform act are to cut down on waste, ensure access to preventive care, pay providers for quality rather than quantity, and reduce unwarranted practice variation and disparities by promoting accountable models of care delivery. Regardless of political stance, minimizing unwarranted variation is an ethical priority and a solution to decelerating the growing of healthcare spending in the United States.

Hopefully, the continuing implementation of Obamacare over the next four years will prove to be beneficial.

Dr. Anubhav Kaul is a recent medical graduate from Ross University School of Medicine, and he is pursuing a Masters in Public Health at The Dartmouth Institute of Health Policy and Clinical Practice. Thom earned his PhD from The Dartmouth Institute for Health Policy and Clinical Practice where his dissertation focused on understanding variation in the costs and utilization of care within and between hospitals.

source

Walmart Looking to Shift Costs of Employee Healthcare to Taxpayers?

Walmart, the nation’s largest private employer and the world’s biggest retailer plans to begin denying health insurance to newly hired employees who work fewer than 30 hours a week, according to a copy of the company’s policy obtained by The Huffington Post.

The online news outlet reports that under the policy, set to take effect in January, Walmart also reserves the right to eliminate health care coverage for certain workers if their average workweek dips below 30 hours, something the report says happens with regularity and at the direction of company managers.

Walmart did not disclose how many of its roughly 1.4 million U.S. workers are vulnerable to losing medical insurance under its new policy and in an emailed statement a company spokesman said Walmart had “made a business decision” not to respond to questions from The Huffington Post, accusing the publication of unfair coverage.

The paper reported that labor and health care experts portrayed Walmart’s decision to exclude workers from its medical plans “as an attempt to limit costs while taking advantage of the national health care reform known as Obamacare. Among the key features of Obamacare is an expansion of Medicaid, the taxpayer-financed health insurance program for poor people. Many of the Walmart workers who might be dropped from the company’s health care plans earn so little that they would qualify for the expanded Medicaid program, these experts said.”

Ken Jacobs, chairman of the Labor Research Center at the University of California, Berkeley told the newspaper that, “Walmart is effectively shifting the costs of paying for its employees onto the federal government with this new plan, which is one of the problems with the way the law is structured.”

The report noted that because of Walmart’s huge size and its massive number of employees, the company’s policies tend to influence American working conditions more broadly and that other companies are now crafting similar policies that will exclude some part-time workers from medical coverage. 

source

Hospital Chain Inquiry Cited Unnecessary Cardiac Work

In the summer of 2010, a troubling letter reached the chief ethics officer of the hospital giant HCA, written by a former nurse at one of the company’s hospitals in Florida.

In a follow-up interview, the nurse said a doctor at the Lawnwood Regional Medical Center, in the small coastal city of Fort Pierce, had been performing heart procedures on patients who did not need them, putting their lives at risk.

 

“It bothered me,” the nurse, C. T. Tomlinson, said in a telephone interview. “I’m a registered nurse. I care about my patients.” 

In less than two months, an internal investigation by HCA concluded the nurse was right. 

“The allegations related to unnecessary procedures being performed in the cath lab are substantiated,” according to a confidential memo written by a company ethics officer, Stephen Johnson, and reviewed by The New York Times. 

Mr. Tomlinson’s contract was not renewed, a move that Mr. Johnson said in the memo was in retaliation for his complaints. 

But the nurse’s complaint was far from the only evidence that unnecessary — even dangerous — procedures were taking place at some HCA hospitals, driving up costs and increasing profits. 

HCA, the largest for-profit hospital chain in the United States with 163 facilities, had uncovered evidence as far back as 2002 and as recently as late 2010 showing that some cardiologists at several of its hospitals in Florida were unable to justify many of the procedures they were performing. Those hospitals included the Cedars Medical Center in Miami, which the company no longer owns, and the Regional Medical Center Bayonet Point. In some cases, the doctors made misleading statements in medical records that made it appear the procedures were necessary, according to internal reports. 

Questions about the necessity of medical procedures — especially in the realm of cardiology — are not uncommon. None of the internal documents reviewed calculate just how many such procedures there were or how many patients might have died or been injured as a result. But the documents suggest that the problems at HCA went beyond a rogue doctor or two. 

At Lawnwood, where an invasive diagnostic test known as a cardiac catheterization is performed, about half the procedures, or 1,200, were determined to have been done on patients without significant heart disease, according to a confidential 2010 review. HCA countered recently with a different analysis, saying the percentage of patients without disease was much lower and in keeping with national averages. 

At Bayonet Point, a 44-year-old man who arrived at the emergency room complaining of chest pain suffered a punctured blood vessel and a near-fatal irregular heartbeat after a doctor performed a procedure that an outside expert later suggested might have been unnecessary, documents show. The man had to be revived. “They shocked him twice and got him back,” according to the testimony of Dr. Aaron Kugelmass in a medical hearing on the case. 

In another incident, an outside expert described how a woman with no significant heart disease went into cardiac arrest after a vessel was cut when a Bayonet Point cardiologist inserted a stent, a meshlike device that opens coronary arteries. She remained hospitalized for several days, according to a person who has reviewed internal reports. 

On Monday morning, in a conference call with investors, company executives disclosed that in July the civil division of the United States attorney’s office in Miami requested information on reviews assessing the medical necessity of interventional cardiology services provided at 10 of its hospitals, located largely in Florida, but also two or three hospitals in other states. In the conference call and in a statement on its Web site, the company also referred to inquiries by The Times. HCA’s stock ended nearly 4 percent lower Monday, at $25.55. 

In a recent statement, HCA declined to provide evidence that it had alerted Medicare, state Medicaid or private insurers of its findings, or reimbursed them for any of the procedures that the company later deemed unnecessary, as required by law. 

“When the company becomes aware of a situation in which we might have a reimbursement obligation, we assess, with outside resources, what our reimbursement obligations might be,” the statement said. 

HCA also declined to show that it had ever notified patients, who might have been entitled to compensation from the hospital for any harm. 

Some doctors accused in the reviews of performing unnecessary procedures are still practicing at HCA hospitals. 

The cardiologists say the reviews of their work did not accurately reflect the care they provided, and HCA says the reviews “are not, by any means, definitive,” according to an e-mailed response by the company. HCA says it took whatever steps were necessary to improve patient care. It also said “significant actions were taken to investigate areas of concern, to bring in independent reviewers, and to take action where necessary.” 

Details about the procedures and the company’s knowledge of them are contained in thousands of pages of confidential memos, e-mail correspondence among executives, transcripts from hearings and reports from outside consultants examined by The Times, as well as interviews with doctors and others. A review of those communications reveals that rather than asking whether patients had been harmed or whether regulators needed to be contacted, hospital officials asked for information on how the physicians’ activities affected the hospitals’ bottom line. 

HCA denies its decisions at these hospitals were motivated by financial considerations, but rather “demonstrate the strong focus we have on quality patient care.” The company also says that more than 80 percent of its hospitals are in the top 10 percent of government rankings for quality. 

Although HCA has hospitals in about 20 states from California to Virginia and Alaska to Texas, Florida, with its large older population, is a critical and growing market for hospital chains and especially for HCA. HCA’s Florida hospitals provide about 20 percent of the company’s revenue. 

The need to root out Medicare fraud — billing for unnecessary procedures, for example — is high for all hospitals. In 2003, Tenet Healthcare agreed to pay $54 million to settle allegations that unnecessary cardiac procedures were being performed over six years and billed to Medicare and Medicaid at one of its hospitals in California, Redding Medical Center. 

But the pressure is even greater for HCA. In 2000, the company reached one of a series of settlements involving a huge Medicare fraud case with the Justice Department that would eventually come to $1.7 billion in fines and repayments. The accusations, which primarily involved overbilling, occurred when Rick Scott, now the governor of Florida, was the company’s chief executive. He was removed from the post by the board but was never personally accused of wrongdoing. 

As part of the settlement with the federal regulators, HCA signed a 97-page Corporate Integrity Agreement that extended through late 2008. It detailed what had to be reported to authorities and provided for stiffer penalties if HCA failed to do so. 

If there were intentional violations of such an agreement, it would mean “that a defendant, already caught once defrauding the government, has apparently not changed its corporate culture,” said Michael Hirst, a former assistant United States attorney in California who oversaw the case against Tenet. Mr. Hirst now represents whistle-blowers. 

In its statement, HCA said it fulfilled any obligation it had under the agreement to report “substantial overpayment.” The revelations in the documents come at a significant time in the evolution of medical treatment in the United States — from independently owned hospitals to large, corporate chains. 

HCA exemplifies the trend. In 2006, HCA was taken private by a group of private equity firms, including Bain Capital, the firm co-founded by Mitt Romney, the presumptive Republican presidential nominee. (By that time, Mr. Romney was no longer a partner in Bain.) By mid-2010, the private equity owners were eager to start cashing out of their investment. While HCA prepared for an initial public offering of its stock that took place in 2011, it borrowed to pay the private equity firms $4.3 billion in dividends. 

The ability to take these financial steps hinged on HCA showing continued robust profit growth at its hospitals. 

And for that the company turned, in part, to cardiac care. 

An Early Sign of Trouble

 

Two years after the 2000 fraud settlement, company executives uncovered problems in the cardiac catheterization lab at Cedars Medical Center, according to accounts that became public.

An outside consulting group hired by HCA provided a report that raised “questions regarding the medical necessity of some of the procedures,” the company said in a news release in early 2003. HCA said it was suspending eight physicians from doing certain cardiac procedures, was providing the report to a United States attorney and would refund any inappropriately submitted hospital claims.

“This issue at Cedars and the steps taken to investigate and resolve it should be seen and understood in the larger context of HCA’s commitment to quality care and patient safety,” Jack O. Bovender Jr., who was then the company’s chief executive, told investors in a conference call that February.

HCA will not say whether it had ever refunded payments for the unnecessary procedures. Medicare officials said they could not determine whether the agency had received payments, and the United States attorney’s office in Miami declined to comment. The hospital allowed four of the physicians to return under monitoring, according to HCA, and two did so. “We believe the hospital acted appropriately,” the company said in its recent statement. Still, the negative publicity swirling around Cedars worried HCA executives, according to internal e-mails. They wanted to avoid a replay when similar problems were discovered at another HCA hospital — Bayonet Point. 

An Outbreak of Stents

 

Nestled along the west coast of Florida, about 45 miles northwest of Tampa, the town of Hudson, with its winding canals, is largely a quiet fishing community. 

Soon after the Cedars episode, HCA executives noticed that the hospital in Hudson, the 290-bed Regional Medical Center Bayonet Point, was implanting an unusually high number of cardiac stents, given the size of the population. 

Late in 2003, executives from HCA’s headquarters in Nashville dispatched a group that oversees its hospitals’ cardiac care to investigate. In a confidential memo, the team cited incidents at Bayonet Point where patients were treated for multiple lesions, or blockages, even when “the second lesion (or third) did not appear to have significant disease.” The team went on to note “several cases” in which patients were treated even though their arteries did not have significant blockages.

In a transcript of confidential hearings held later, the lawyers for HCA were blunt. In looking at one physician, Dr. Sudhir Agarwal, Dr. Martin I. Kalish, a physician who served as an outside lawyer for HCA, said the “style of clinical practice leads to unnecessary procedures and unnecessary complications.” 

On the team’s recommendation, HCA brought in an external company, CardioQual Associates of Franklin, Mich., in 2004 to examine medical records from Bayonet Point. 

In a confidential memo prepared in December 2004 and reviewed by The Times, CardioQual concluded that as many as 43 percent of 355 angioplasty cases, where doctors performed invasive procedures to open up a patient’s arteries, were outside reasonable and expected medical practice.

Worse, the investigation revealed that some physicians had indicated in medical records that the patients had blockages of 80 to 90 percent when a later, more scientific analysis of a sampling of cases revealed the blockages had ranged from 33 to 53 percent. 

Cardiologists generally do not operate on any blockage less than 70 percent, said Dr. Rita Redberg, a prominent cardiologist at the University of California, San Francisco. The significant disparities between the magnitude of blockage being cited by the doctors at Bayonet Point and the CardioQual review “raises real concerns that this wasn’t just error, but it was intent” by the doctors, she said. 

After receiving the CardioQual report, Bayonet Point suspended the privileges of nine physicians in late 2004. But unlike the Cedars episode, when HCA turned over its findings to regulators and authorities, HCA took steps to withhold details of its conclusions to the media and others, according to internal communications. In January 2005, David Williams, who was then the chief executive of Bayonet Point, wrote in an e-mail: “Clearly, we have protected ourselves under the peer review umbrella and have released very little information.” The recipients of his message included Dan Miller, who then oversaw HCA’s hospitals in western Florida, and Charles R. Evans, a Nashville executive who was president of all of HCA’s hospitals on the eastern side of the country.

In his response, Mr. Evans thanked Mr. Williams for the update and asked for a “summary as to the business impact.” 

In a later internal communication, a representative for HCA said the company had successfully used confidentiality rules to withhold the damaging CardioQual report from the Florida attorney general, whose Medicaid Fraud Control Unit had started an investigation of the physicians. In response to questions from The Times, however, HCA said it had provided “substantially all of the information in the report” to state regulators. The attorney general’s office did not return calls seeking comment. 

One of the subjects of that investigation was Dr. Agarwal. The CardioQual review of 20 of his cases concluded that fewer than half were within reasonable and expected practice. Dr. Agarwal did not return a call to his office. 

Anthony Leon, a lawyer for Dr. Agarwal and the other eight Bayonet Point physicians, said in a statement: “There is absolutely no merit to any allegation that any of these doctors were performing unnecessary procedures or performing procedures that led to unnecessary complications as a style or pattern of practice.” The suspensions of Dr. Agarwal and another physician were found to have been done in error by an outside panel in hearings in 2005 and 2006, Mr. Leon added. A doctor on the panel said Dr. Agarwal’s procedures were found to be within established medical practice, and his full privileges were reinstated in early 2006. 

Dr. Agarwal and the other eight physicians have filed defamation lawsuits in county court, claiming the actions and statements of the hospital and HCA ruined their practices. HCA has denied the claims. 

HCA would soon discover its problems didn’t end at Bayonet Point. 

A Nurse Speaks Out

 

C. T. Tomlinson said he could not believe his eyes as Dr. Abdul Shadani prepared to insert a stent in a heart patient in the cardiac catheterization lab of HCA’s Lawnwood hospital in the late spring of 2008. 

Mr. Tomlinson, a traveling nurse who had worked at more than a dozen cath labs before arriving at Lawnwood, said in a telephone interview that he saw no blockages in the images of the patient’s artery. 

“Sir, what are we going to fix?” Mr. Tomlinson recalled asking Dr. Shadani. The doctor responded by asking the nurse if he did not see the 90 percent blockage in the artery. Mr. Tomlinson did not, and looked at the others in the room. They all shrugged, he said, and Dr. Shadani inserted the stent. 

Mr. Tomlinson reported his concerns to hospital officials. Shortly after, he was told his contract would not be renewed. An internal memo, however, concluded that Mr. Tomlinson had been retaliated against. Even so, that summer the hospital opened an investigation. Internal communications show that HCA officials in charge of quality were involved in the decision to review a sample of cases from some cardiologists at the hospital. 

The reviewer, an outside heart specialist, concluded there were problems with 13 of the 17 cases performed by Dr. Shadani, including unwarranted cardiac catheterizations and patients who were needlessly subjected to multiple procedures. 

While it is not clear whether HCA accepted the reviewer’s findings, Dr. Shadani continues to practice at Lawnwood, according to the Web site. Dr. Shadani did not return several telephone calls seeking comment. 

The outside reviewer found similar problems with several other cardiologists at Lawnwood. The company declined to say whether it alerted regulators or patients of its findings but it said it established stricter rules governing how cardiologists should document their cases. 

A Moneymaking Practice

 

Cardiology is a lucrative business for HCA, and the profits from testing and performing heart surgeries played a critical role in the company’s bottom line in recent years. 

Some of HCA’s busiest Florida hospitals perform thousands of stent procedures each year. Medicare reimburses hospitals about $10,000 for a cardiac stent and about $3,000 for a diagnostic catheterization. 

But in recent years, doctors across the country have been less quick to implant stents, instead relying on drugs to treat blockages. Medicare has also questioned the need for patients who receive cardiac stents to stay overnight at the hospital, cutting into the profitability of the procedures at many hospitals. 

HCA has more than 100 catheterization labs across the country and the one at Lawnwood was a financial juggernaut. It accounted for 35 percent of the hospital’s net profits, according to financial documents. 

In fact, one of the physicians from Lawnwood’s cardiac cath lab, Dr. Prasad Chalasani, was highlighted by the hospital in a 2009 business plan as being the most profitable doctor at the facility. “Our leading EBDITA MD,” the plan described him. (Ebitda, or earnings before interest, taxes, depreciation and amortization, is a measure of corporate earnings.) Just a few months earlier, hospital executives had received an outside review that characterized Dr. Chalasani as too quick to perform catheterizations, often without first doing the stress tests necessary to determine whether a patient needed the invasive and costly test. 

When reached by telephone, Dr. Chalasani defended his work, saying the 2008 findings were the result of poor documentation about what had occurred before the patients received the catheterizations. “The tests were done,” he said. 

Dr. Chalasani emphasized that he was not paid by the hospital, and had privileges at other hospitals. Since 2008, he said, doctors have improved their documentation. Among the changes, he said, is the use of forms requiring the doctors to indicate that they are following established guidelines.

“To my knowledge, we have made tremendous progress,” he said. 

The questions raised by the 2008 incident might have ended there if not for Mr. Tomlinson’s 2010 letter to Alan R. Yuspeh, the head of HCA’s ethics and compliance. HCA undertook another review of Lawnwood and some of its other hospitals in Florida, including Kendall Regional Medical Center, in Miami, and Palms West Hospital, near West Palm Beach. The results showed that some patients without heart disease were receiving questionable treatment, and HCA has responded by conducting still more reviews. 

source

Mass psychosis in the US How Big Pharma got Americans hooked on anti-psychotic drugs.

Has America become a nation of psychotics? You would certainly think so, based on the explosion in the use of antipsychotic medications. In 2008, with over $14 billion in sales, antipsychotics became the single top-selling therapeutic class of prescription drugs in the United States, surpassing drugs used to treat high cholesterol and acid reflux.

Once upon a time, antipsychotics were reserved for a relatively small number of patients with hard-core psychiatric diagnoses - primarily schizophrenia and bipolar disorder - to treat such symptoms as delusions, hallucinations, or formal thought disorder. Today, it seems, everyone is taking antipsychotics. Parents are told that their unruly kids are in fact bipolar, and in need of anti-psychotics, while old people with dementia are dosed, in large numbers, with drugs once reserved largely for schizophrenics. Americans with symptoms ranging from chronic depression to anxiety to insomnia are now being prescribed anti-psychotics at rates that seem to indicate a national mass psychosis.

It is anything but a coincidence that the explosion in antipsychotic use coincides with the pharmaceutical industry's development of a new class of medications known as "atypical antipsychotics." Beginning with Zyprexa, Risperdal, and Seroquel in the 1990s, followed by Abilify in the early 2000s, these drugs were touted as being more effective than older antipsychotics like Haldol and Thorazine. More importantly, they lacked the most noxious side effects of the older drugs - in particular, the tremors and other motor control problems.

The atypical anti-psychotics were the bright new stars in the pharmaceutical industry's roster of psychotropic drugs - costly, patented medications that made people feel and behave better without any shaking or drooling. Sales grew steadily, until by 2009 Seroquel and Abilify numbered fifth and sixth in annual drug sales, and prescriptions written for the top three atypical antipsychotics totaled more than 20 million. Suddenly, antipsychotics weren't just for psychotics any more.

Not just for psychotics anymore

By now, just about everyone knows how the drug industry works to influence the minds of American doctors, plying them with gifts, junkets, ego-tripping awards, and research funding in exchange for endorsing or prescribing the latest and most lucrative drugs. "Psychiatrists are particularly targeted by Big Pharma because psychiatric diagnoses are very subjective," says Dr. Adriane Fugh-Berman, whose PharmedOut project tracks the industry's influence on American medicine, and who last month hosted a conference on the subject at Georgetown. A shrink can't give you a blood test or an MRI to figure out precisely what's wrong with you. So it's often a case of diagnosis by prescription. (If you feel better after you take an anti-depressant, it's assumed that you were depressed.) As the researchers in one study of the drug industry's influence put it, "the lack of biological tests for mental disorders renders psychiatry especially vulnerable to industry influence." For this reason, they argue, it's particularly important that the guidelines for diagnosing and treating mental illness be compiled "on the basis of an objective review of the scientific evidence" - and not on whether the doctors writing them got a big grant from Merck or own stock in AstraZeneca.

Marcia Angell, former editor of the New England Journal of Medicine and a leading critic of the Big Pharma, puts it more bluntly: "Psychiatrists are in the pocket of industry." Angell has pointed out that most of the Diagnostic and Statistical Manual of Mental Disorders (DSM), the bible of mental health clinicians, have ties to the drug industry. Likewise, a 2009 study showed that 18 out of 20 of the shrinks who wrote the American Psychiatric Association's most recent clinical guidelines for treating depression, bipolar disorders, and schizophrenia had financial ties to drug companies.

In a recent article in The New York Review of Books, Angell deconstructs what she calls an apparent "raging epidemic of mental illness" among Americans. The use of psychoactive drugs—including both antidepressants and antipsychotics—has exploded, and if the new drugs are so effective, Angell points out, we should "expect the prevalence of mental illness to be declining, not rising." Instead, "the tally of those who are so disabled by mental disorders that they qualify for Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI) increased nearly two and a half times between 1987 and 2007 - from one in 184 Americans to one in seventy-six. For children, the rise is even more startling - a thirty-five-fold increase in the same two decades. Mental illness is now the leading cause of disability in children." Under the tutelage of Big Pharma, we are "simply expanding the criteria for mental illness so that nearly everyone has one." Fugh-Berman agrees: In the age of aggressive drug marketing, she says, "Psychiatric diagnoses have expanded to include many perfectly normal people."

Cost benefit analysis

What's especially troubling about the over-prescription of the new antipsychotics is its prevalence among the very young and the very old - vulnerable groups who often do not make their own choices when it comes to what medications they take. Investigations into antipsychotic use suggests that their purpose, in these cases, may be to subdue and tranquilize rather than to treat any genuine psychosis.

Carl Elliott reports in Mother Jones magazine: "Once bipolar disorder could be treated with atypicals, rates of diagnoses rose dramatically, especially in children. According to a recent Columbia University study, the number of children and adolescents treated for bipolar disorder rose 40-fold between 1994 and 2003." And according to another study, "one in five children who visited a psychiatrist came away with a prescription for an antipsychotic drug."

A remarkable series published in the Palm Beach Post in May true revealed that the state of Florida's juvenile justice department has literally been pouring these drugs into juvenile facilities, "routinely" doling them out "for reasons that never were approved by federal regulators." The numbers are staggering: "In 2007, for example, the Department of Juvenile Justice bought more than twice as much Seroquel as ibuprofen. Overall, in 24 months, the department bought 326,081 tablets of Seroquel, Abilify, Risperdal and other antipsychotic drugs for use in state-operated jails and homes for children…That's enough to hand out 446 pills a day, seven days a week, for two years in a row, to kids in jails and programs that can hold no more than 2,300 boys and girls on a given day." Further, the paper discovered that "One in three of the psychiatrists who have contracted with the state Department of Juvenile Justice in the past five years has taken speaker fees or gifts from companies that make antipsychotic medications."

In addition to expanding the diagnoses of serious mental illness, drug companies have encouraged doctors to prescribe atypical anti-psychotics for a host of off-label uses. In one particularly notorious episode, the drugmaker Eli Lilly pushed Zyprexa on the caregivers of old people with Alzheimer's and other forms of dementia, as well as agitation, anxiety, and insomnia. In selling to nursing home doctors, sales reps reportedly used the slogan "five at five"—meaning that five milligrams of Zyprexa at 5 pm would sedate their more difficult charges. The practice persisted even after FDA had warned Lilly that the drug was not approved for such uses, and that it could lead to obesity and even diabetes in elderly patients.

In a video interview conducted in 2006, Sharham Ahari, who sold Zyprexa for two years at the beginning of the decade, described to me how the sales people would wangle the doctors into prescribing it. At the time, he recalled, his doctor clients were giving him a lot of grief over patients who were "flipping out" over the weight gain associated with the drug, along with the diabetes. "We were instructed to downplay side effects and focus on the efficacy of drug…to recommend the patient drink a glass a water before taking a pill before the meal and then after the meal in hopes the stomach would expand" and provide an easy way out of this obstacle to increased sales. When docs complained, he recalled, "I told them, ‘Our drug is state of the art. What's more important? You want them to get better or do you want them to stay the same--a thin psychotic patient or a fat stable patient.'"

For the drug companies, Shahrman says, the decision to continue pushing the drug despite side effects is matter of cost benefit analysis: Whether you will make more money by continuing to market the drug for off-label use, and perhaps defending against lawsuits, than you would otherwise. In the case of Zyprexa, in January 2009, Lilly settled a lawsuit brought by with the US Justice Department, agreeing to pay $1.4 billion, including "a criminal fine of $515 million, the largest ever in a health care case, and the largest criminal fine for an individual corporation ever imposed in a United States criminal prosecution of any kind,''the Department of Justice said in announcing the settlement." But Lilly's sale of Zyprexa in that year alone were over $1.8 billion.

Turning people into zombies

As it turns out, the atypical antipsychotics may not even be the best choice for people with genuine, undisputed psychosis.

A growing number of health professionals have come to think these drugs are not really as effective as older less expensive medicines which they have replaced, that they themselves produce side effects that cause other sorts of diseases such as diabetes and plunge the patient deeper into the gloomy world of serious mental disorder. Along with stories of success comes reports of people turned into virtual zombies.

Elliott reports in Mother Jones: "After another large analysis in The Lancet found that most atypicals actually performed worse than older drugs, two senior British psychiatrists penned a damning editorial that ran in the same issue. Dr. Peter Tyrer, the editor of the British Journal of Psychiatry, and Dr. Tim Kendall of the Royal College of Psychiatrists wrote: "The spurious invention of the atypicals can now be regarded as invention only, cleverly manipulated by the drug industry for marketing purposes and only now being exposed."

Bottom line:Stop Big Pharma and the parasitic shrink community from wantonly pushing these pills across the population.

source