C R Bard Settles Allegations of Kickbacks to Promote Radiation Treatment for Prostate Cancer

Screening for and aggressive treatment of prostate cancer has become an enormously lucrative business, if not necessarily a life-saving medical strategy.  The minimal media coverage of a recent settlement suggests that at least to some degree, it has been fueled by some questionable practices.

The CR Bard Settlement

As reported by the Atlanta Journal Constitution,

A medical device company on Monday agreed to pay a $48.2 million settlement to resolve claims by a Georgia employee that it paid kickbacks to doctors and customers who bought radiation treatment for prostate cancer.

C.R. Bard Inc., which is headquartered in New Jersey and has offices in Covington, resolved a whistle-blower suit filed by the employee in 2006. The suit alleged that the company paid off doctors and hospitals to induce them to prescribe brachytherapy seeds, which are implanted in the prostate and deliver a dose of radiation to cancer cells.

Another brief report in the Macon (GA) Telegraph gave a tiny bit more detail about what was given to physicians to get them to use Bard's radiation therapy products,

 Customers could order the seeds, used in brachytherapy to deliver a prescribed dose of radiation directly to cancer cells, from multiple companies. But Bard allegedly offered doctors grant money, rebates, free medical equipment and advertising campaigns to entice them to buy their product at inflated prices, according to a news release issued by [whistle-blower Julie] Darity’s legal team....

The Usual Elements of Legal Settlements of Allegations of Health Care Corporate Bad Behavior

The story, briefly told as it was, included many of the usual elements of stories of legal settlements of wrong-doing by large health care corporations.

Slow Justice

The settlement, hence justice, as it were, took a long time, about 7 years since the most recent behavior, and 15 years since its start.  Per the AJC,

 Bard employed its kickback scheme from 1998 to 2006, federal prosecutors said.

 Penalties Not as Big as They Appeared

The penalties were not as big as they seemed.  There was the seemingly large fine, $48.2 million dollars.  However, that should be compared to the company's net sales of over $2.95 billion and net income of $530 million in 2012, according to the company's annual report.  It should also be compared to the total compensation of the company's chairman and CEO in 2012, over $8.7 million, and to that of its president and chief operating officer, over $6.0 million, according to the company's 2012 proxy statement.   Apparently, the fine came out of the company's treasury, so its impact was diffused among all shareholders, employees, customers, and patients, not directed to those who may have authorized, directed or implemented the kickbacks to physicians. 

No Penalties for Individuals, No Acknowledgement of Wrong-Doing

The settlement did not involve any sort of direct penalties to those who authorized, directed, or implemented the kickbacks.

The corporation did not even acknowledge any bad behavior.  As per the AJC,

Bard is pleased to settle the claims, Scott Lowry, a company spokesman, said in a statement.

'This resolution allows the company to put this matter behind it and continue to focus on delivering life-enhancing medical devices and technologies to patients around the world,' he said. 'We remain committed to continuously enhancing and improving our compliance programs in accordance with industry standards.'

Suppression of Whistle-Blowing

It may not be part of all such settlements, but note that in this case there seemed to be an attempt to shut up the whistle-blower.  So, there is reason to think that justice, such as it was, was delayed because the company seemingly tried to punish the whistle-blower, rather than listen to what she had to say.  Per the Macon Telegraph,

 Darity, 56, said she first reported what she suspected as questionable activities to her supervisors.

'I did exactly what was outlined in the company ethics policy,' she said. 'I wanted to think things were being corrected.'
In time, she realized nothing had changed. She filed an internal whistle-blower complaint.

Her job was eliminated in November 2005, soon after an investigation was launched into her whistle-blower complaint, she said.

Darity had worked for Bard, which has an office in Covington, for more than 18 years. When her job was eliminated, she was a manager in the Brachytherapy Contracts Administration division.

Out of a job, Darity filed the lawsuit in U.S. District Court for the Northern District of Georgia in January 2006.

Read more here: http://www.macon.com/2013/05/14/2478611/medical-company-agrees-to-pay.html#storylink=cpy

Nonetheless, the government seemingly trusted C R Bard to fix its own behavior going forward, per the Wall Street Journal,

 As part of a non-prosecution agreement, C.R. Bard agreed to pay an additional $2.2 million and take remedial steps to enhance compliance. The company had said in a regulatory filing last year that it expected the settlement to include a corporate integrity agreement, which typically require companies to obey restrictions on their sales and marketing practices, but no such agreement was announced Monday. 

Note that here we discussed a case in which an academic medical institution seemingly tried to punish faculty members who questioned that organization's overly enthusiastic approach to prostate cancer.

Summary - the Profitable but Unsubstantiated Aggressive Approach to Prostate Cancer

So its just another day at the office. This was a typical settlement of allegations of unethical behavior by a large health care organization.    A large health care company allegedly bribed doctors to use its products.  It seemingly tried to shut up a whistle-blower.  Seven years later, the company got a financial slap on the wrist, but no one directly involved in the alleged kickbacks, and no one whose compensation may have been enlarged due to such apparently unethical activity paid a price.  Never mind that the alleged kickbacks may have induced doctors to use treatments that provided no overall benefit, but could have harmed patients. 

Before ending with our usual fulmination, I should note that this case appears to be one small piece in the puzzle of our national infatuation with an aggressive approach to prostate cancer, despite a lack of essentially any good evidence that this approach does any good.  Brachytherapy, the treatment pushed allegedly by kickbacks, is one kind of aggressive treatment for prostate cancer.  Yet there is no good evidence from randomized controlled trials that is prolongs life.  In fact, a recent (and the only major) randomized controlled trial of aggressive treatment of prostate cancer on initial diagnosis failed to show any overall survival benefit.(1)  There has been a huge push to screen all men of a certain age for prostate cancer.  Yet now two new trials also failed to show any overall survival benefit from screening.(2,3)   

But the prostate cancer business is very lucrative.  On the Reforming Health blog, a post summarized a lecture given by Dr Otis Brawley, chief medical officer of the American Cancer Society in which Dr Brawley described the financial scheme underlying the aggressive approach to prostate cancer,

Brawley recounts an experience he had on a site visit to a hospital in 1998 while an Assistant Director at the National Cancer Institute. During the visit a marketing executive explains to Brawley the publicity value and financial rewards of a free prostate screening program offered by the hospital at a local mall. The plan is to screen the first 1,000 men over 50 who come to the mall for testing. I’ve transcribed Brawley’s recollections from the video and they provide a great explanation for the profit-driven practices that continue to occur today, 14 years later:

'If they screen 1,000 men they’re going to have 145 abnormals. They’re going to charge about $3,000 to figure out what is abnormal about these abnormals, that’s how they pay for the free screening. About 10 of the 145 won’t come to this hospital so that’s business for their competitors, but they’ll get 135 times $3,500 on average. Of the 135, 45 are going to die of prostate cancer and the other percentage are going to get radical prostatectomy at about $30-40,000 a case; there’s a percentage that’s going to get seeds at about $30,000 a case; a percentage were going to get radiation therapy that (at the time) was about $60,000. Then [the marketing executive’s] business plan goes further, he knows how many guys are going to have so much incontinence that diapers aren’t going to do it so he had in his business plan how many artificial sphincters urologists were going to implant. And then he was a little apologetic because there was this new thing called Viagra that screwed up his estimates for how many penile implants he was going to sell because guys were upset about impotence related to prostate cancer treatment.'

Brawley says, 'this is 1998, I ask him, if you screen 1,000 people how many lives are you going to save? He took off his glasses and looked at me like I was some kind of fool and said, ‘Don’t you know, nobody’s ever shown that prostate cancer screening saves lives, I can’t give you an estimate on that.’'

Presumably because he was a marketing executive, the manager whom Brawley quoted did not have to feel doubt about all the men subjected to needless procedures, and who would be at risk of serious and unpleasant adverse effects of these procedures, all to make money but not to prolong their lives.  Of course, not only the hospitals make money, but also quite obviously the companies that sell them the drugs and devices needed for all this medical aggression make money, as do the doctors who go along with it all. 

Now we suspect that one small reason the doctors have gone along with it is that they may have gotten inducements from those companies.

Time to fulminate,...

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.

References

1.  Wilt TJ, Brewer MK, Jones KM et al.  Radical prostatectomy versus observation for localized prostate cancer.  N Engl J Med 2012; 367: 203-13.  [Link here]
2.  Andriole GL, Crawford ED, Grubb RL et al.  Mortality results from a randomized prostate-cancer screening trial.  N Engl J Med 2009; 360: 1310-9. [Link here]
3.  Schroder FH, Gugosson J, Roobl MJ et al.  Screening and prostate-cancer mortality in a randomized European study.  N Engl J Med 2009: 360: 1320-8.[Link here]

Read more here: http://www.macon.com/2013/05/14/2478611/medical-company-agrees-to-pay.html#storylink=cp

Six Years Later, Ranbaxy - Oops, Daiichi Sankyo - Pleads Guilty to Adulteration, Pays $500 Million

It only took until 2013, but the US Food and Drug Administration finally secured guilty pleas and fines.  The basics are in an Associated Press story (via the Washington Post):

 A subsidiary of India’s largest pharmaceutical company has agreed to pay a record $500 million in fines and penalties for selling adulterated drugs and lying to federal regulators in a case that is part of an ongoing crackdown on the quality of generic drugs flowing into the U.S.

Federal prosecutors say the guilty plea by Ranbaxy USA Inc. represents the largest financial penalty against a generic drug company for violations of the Federal Food, Drug and Cosmetic Act, which prohibits the sale of impure drugs.

Note that the company pleaded guilty to criminal charges.

 The subsidiary of Ranbaxy Laboratories Limited pleaded guilty to federal criminal charges and the company separately agreed to resolve civil claims with all 50 states and the District of Columbia. The company had earlier set aside $500 million to cover potential criminal and civil liability stemming from the Justice Department investigation.

It admitted as part of the deal that it sold adulterated batches of drugs — including an antibiotic and generic versions of medications used to treat severe acne, epilepsy and nerve pain — that were developed at two manufacturing sites in India. 

Ironies

Note that this resolution has certain ironies.

Lateness

There is a saying that justice delayed is justice denied.  Note that it took six years to obtain the guilty pleas.  As noted by the AP,

 The problems were largely revealed by a whistleblower in a federal lawsuit filed in Maryland in 2007. 

Ambiguities about Responsibility

First, note that while all the headlines are about Ranbaxy, Ranbaxy is not really an independent company.  As reported by Reuters (and only by Reuters so far as I can tell at this time),

Ranbaxy ... [is] majority-owned by Japan's Daiichi Sankyo.

Second, as per the AP, see the comment made by the Ranbaxy CEO,

'While we are disappointed by the conduct of the past that led to this investigation, we strongly believe that settling this matter now is in the best interest of all of Ranbaxy’s stakeholders; the conclusion of the DOJ investigation does not materially impact our current financial situation or performance,' Ranbaxy CEO and managing director Arun Sawhney said in a statement.

Maybe there was something lost in translation, but the CEO certainly spoke as if someone else was responsible for the "conduct of the past."  Incidentally, it does not appear that so far any journalist has even sought comment from the people really in charge, at Daiichi Sankyo.

Third, just like many other cases we have reported before, no individual, especially anyone who authorized, directed, or implemented the bad behavior, was held legally responsible.  The cost of the fines will no doubt be spread among the corporate structures involved.  Since a company pleaded guilty, no individual pays a fine, much less goes to jail.

It does appear that when the settlement was first announced in 2011, a cut in compensation for top executives of Daiichi Sankyo was announced, but the cuts were temporary, and apparently in response to the immediate financial consequences of the settlement, not any larger implications.  See Bloomberg's report:

 Chief Executive Officer Joji Nakayama and board members will receive 5 percent to 30 percent less compensation for six months in response to the cut in the earnings forecast, Daiichi Sankyo said today. The company has lost about half its market value since agreeing to buy a majority stake in Ranbaxy, India's largest drugmaker, in June 2008. 

 The Contrast with the Case of the Adulterated Heparin

Note that in this case, there have been no allegations that patients were harmed by the admitted adulteration,  Per the AP:

 It’s not known whether the problems with the drugs led to any health issues.... The government’s allegations against the company make no claims that the drugs, whose strength, purity or quality differed from the specifications, harmed anyone.

In 2008, we began blogging about how  US patients started to get sick and die after being infused with heparin, the common anti-coagulant drug. As we have discussed repeatedly  (look here, and see the summary at the end of the post), Baxter International was selling contaminated heparin under its label which was made in unregulated workshops in China, and then transmitted through a complex chain of Chinese and US companies.

The AP article stated,

 The case comes as federal regulators and prosecutors focus attention on the quality of ingredients of generics and other drugs manufactured overseas, said Allan Coukell, an expert on drug safety at The Pew Charitable Trusts. He said the 2008 deaths linked to tainted batches of the blood-thinner heparin that were imported from China served as a 'wake up call' about just how much of the nation’s drug supply comes from overseas.

So perhaps this wake up call helped propel the current case against Ranbaxy, that is, Daiichi Sankyo.  However, since 2008, if there has been a criminal investigation of the tainted heparin, which appears to have been much more consequential, sometimes fatally so, to patients, the results have not been made public.  A cynic might note that the contaminated heparin was sold by a US based manufacturer of branded pharmaceuticals, not a foreign based manufacturer of generic drugs.

Summary

The most fundamental obligation of a drug company is to produce pure, unadulterated drugs.  The first attempts to regulate the drug industry in the US were meant to ensure that these companies fulfilled this obligation.  Yet now there is increasing evidence that the contemporary pharmaceutical industry has trouble with this most basic responsibility. 

As we discussed here, the managers of pharmaceutical companies have been swept up in a dominant business management fad, outsourcing, as a means to cut costs to the bone.  (It seems that most health care managers are also caught up in the larger rage for financialization, to emphasize short term revenue over all other concerns, including patients' and the public's health.)  As the New York Times reported  re the Ranbaxy case,

Others say the company’s problems highlight how little oversight federal drug safety officials have of overseas plants. Studies that have shown the F.D.A. inspects foreign generic manufacturing plants about once every seven to 13 years, compared with once every two years for domestic manufacturers. A law passed last year will eventually require the F.D.A. to apply the same standards when inspecting all manufacturing plants, regardless of location. But some worry that federal budget cuts are slowing the adoption of that law. 

'They just happened to stumble across the Ranbaxy problem at those two plants in India,' said Joe Graedon, a pharmacologist who runs a consumer Web site, the People’s Pharmacy, which has raised questions about the safety of generic drugs. 'Ranbaxy was the biggest and one of the best in India. What about all the smaller ones? What does that say about them?'

Again, all pharmaceutical companies, not just generic drug manufacturers, have seen fit to outsource much, if not most of their production.

In our rush to market fundamentalism, we seem to have deregulated, at least de facto, most aspects of health care.  We now cannot trust the drugs we take to have been made by the companies whose labels they bear, or to be pure.  We now cannot trust that regulators will find that out, or having found that out, will do anything about it in a timely manner. 

To repeatedly reiterate, as long as the leaders of health care organizations are not held accountable for the results of their decisions on health care quality, cost, and access (even in such extreme quality violations as those resulting in multiple patient deaths), we can expect continuing decisions that sacrifice quality, increase costs, and worsen access, but that are in the self-interest of the people making them.

To really reform health care, we must hold health care organizations and their leaders accountable (and not blame all the problems on doctors, other health care professionals, patients, and society at large).

- Roy M. Poses MD for Health Care Renewal 


Appendix - Heparin Case Summary

- We have posted several times, recently here about the tragic case of suddenly allergenic heparin. Although heparin, an intravenous biologic anti-coagulant, has been in use for over 70 years, serious allergic reactions to it had heretofore been rare. Starting late in 2007, hundreds of such reactions, and 21 deaths were reported in the US after intravenous heparin infusions.All the heparin related to these events in the US was made by Baxter International.

- We then learned that although the heparin carried the Baxter label, it was not really made by Baxter. The company had outsourced production of the active ingredient to a long, and ultimately mysterious supply chain. Baxter got the active ingredient from a US company, Scientific Protein Laboratories LLC, which in turn obtained it from a factory in China operated by Changzhou SPL, which in turn was owned by Scientific Protein Laboratories and by Changzhou Techpool Pharmaceutical Co. Changzhou SPL, in turn, got it from several consolidators or wholesalers, who in turn got it from numerous small, unidentified "workshops," which seemed to produce the product in often primitive and unsanitary conditions. None of the stops in the Chinese supply chain had apparently been inspected by the US Food and Drug Administration nor its Chinese counterpart. (See posts here and here.)

- We found out that the Baxter International labelled heparin was contaminated with over-sulfated chondroitin sulfate, a substance not found in nature, but which mimics heparin according to the simple laboratory tests used in the Chinese facilities to check incoming heparin. (See post here.) Further testing revealed that the contamination seemed to have taken place in China prior to the provision of the heparin to Changzhou SPL. (See post here.) It is not clear whether Baxter International or Scientific Protein Laboratories had inspected most of the steps in the supply chain, or even knew what went on there.

- The Baxter and Scientific Protein Laboratories CEOs did not seem aware of where they got the heparin on which the Baxter International label was eventually affixed. But one report in the New York Times alleged that Scientific Protein Laboratories would not pay enough for heparin to satisfy any sources other than the small "workshops."

- Leaders of all organizations involved, Baxter International, Scientific Protein Laboratories, Changzhou SPL, the Chinese government, and the US Food and Drug Administration, and the US Congress assigned blame to each other, but none took individual or organizational responsibility. (See post here.)  Note that SPL was recently bought out and taken private, making its current leadership even less transparent (see post here).  A 2010 inspection of an SPL facility by the FDA revealed ongoing manufacturing problems (see post here).

- Researchers (who turned out to have financial ties to a company which is developing an anti-coagulant drug that could compete with the heparin made by Baxter International) investigated the biological mechanisms by which the contamination of the heparin lead to adverse effects, but no one investigated further how the contamination occurred, or who was responsible. (See post here.)

- Hundreds of lawsuits against Baxter have now been filed, so far without resolution. (See post here.)  Efforts to make documents to be used in these cases public so far have not succeeded (see post here).

- A government report which attracted little attention warned of the dangers of pharmaceutical ingredients made in China and subject to virtually no oversight. (See post here.)

-  Despite requests from the US, the Chinese government did not investigate the production of the heparin that lead to the deaths (see post here.)

-  In February, 2011, a congressional investigation of the case was announced, but results are so far unavailable (see post here.)

-  In June, 2011, a jury returned the first verdict in a civil case about the contaminated heparin, awarding money from Baxter International and Scientific Protein Laboratories to the estate of a man who apparently died due to tainted heparin (see post here).

-  If there was a criminal investigation of the case, its results have not yet appeared. 

Clouded "Visionary" Leadership - Wake Forest Baptist Medical Center's EPIC "Business Cycle Disruptions"

A typical excuse for the multi-million dollar compensation now enjoyed by many leaders of health care organizations is these leaders' supposed brilliance.

For example, in 2011 we noted  that the total compensation of Dr John McConnell, the CEO of Wake Forest Baptist Medical Center, a non-profit teaching hospital, rose from over $700,000 in 2008-2009 to over $1.6 million in 2009-2010.  Other top executives in the system made nearly one million a piece.  An official statement from the hospital system claimed that this level of compensation was needed to "retain skilled executives and visionary leaders for the medical center."  Furthermore, in 2012 we noted that in 2010-2011 Dr McConnell's compensation had grown to nearly $2.5 million, while other top executives received from over $900,000 to over $1.1 million. 

Recent events, however, suggest that the "visionaries" may need new glasses.

An EPIC Challenge

Last month, the Winston-Salem Journal reported that Wake Forest Baptist Medical Center is facing some unexpected fiscal challenges, especially from its new electronic health record (EHR):

Wake Forest Baptist Medical Center’s struggles to implement its Epic electronic records system contributed to additional costs and lost revenue during the first half of its fiscal year 2012-13.

The center provided the information in a second-quarter financial report submitted to bond agencies in which it also reported a $49.6 million operational loss and a gain of $7.4 million in overall excess revenue.

That is interesting.  There have been many criticisms of EHRs, particularly for how they may impede, rather than help health professionals, and more importantly for their risks of causing adverse effects affecting patients, in the absence of clear data from controlled clinical trials that they provide benefits that outweigh their potential harms to patients.  Some of these problems may stem from design and implementation that prioritizes benefits to managers and institutional finances over effects on patients and doctors.  As InformaticsMD noted, even the AMA now admits that

 As the healthcare industry moves to EHRs, the medical record has essentially been reduced to a tool for billing, compliance, and litigation that also has a sustained negative impact on doctors' productivity, according to Steven J. Stack, MD, chair of the American Medical Association’s board of trustees.

Yet in this case, a well known commercial EHR did not even help out the hospital system's finances.

Furthermore,

Wake Forest Baptist said it spent as of Dec. 31 about $13.3 million directly on the Epic electronic-record system, which went live in September.

And,

 The center also cited $8 million in 'other Epic-related implementation expense' that it listed among 'business-cycle disruptions (that) have had a greater-than-anticipated impact on volumes and productivity.' Also listed was $26.6 million in lost margin 'due to interim volume disruptions during initial go-live and post go-live optimization.'

Note that InformaticsMD frequently criticizes proponents of commercial health care information technology for glossing over potentially bad effects on patients and practice with management-speak (e.g., as "glitches," or "hiccups.").  Here is a great example of an attempt to gloss over bad effects on finance with management-speak.

Bond Downgrades and Furloughs, Wage Reductions, Hiring Freezes, Retirement Contribution Reductions, and Bonus Eliminations

As a consequence,

 On March 20, Moody’s Investors Service downgraded the center’s long-term debt rating below the lowest level of high-grade investment quality. The downgrade to A1 from Aa3 affects $597.2 million of rated debt outstanding.

The rationale was clear,

 Moody’s said the A1 rating 'reflects the unexpected decline in financial performance through the first half of fiscal 2013, largely due to the installation of a new information technology platform (Epic), encompassing 95 percent of all revenue components of the enterprise.'

You know when you see bond downgrade by rating agencies that  financial matters are really going badly.  

By May, 2013, month, the problems were evidently still not solved, and the hospital was forced to take more drastic measures.  As again reported by Richard Carver writing for the Winston-Salem Journal,

The workforce at Wake Forest Baptist Medical Center is paying a paycheck price to make up for the financial shortcomings to date of its Epic electronic records system.

The center said in a statement Thursday it has begun another round of cost-cutting measures that will last through at least June 30, the end of its 2012-13 fiscal year.


The measures include attempts at volunteer employee furloughs and hour-and-wage reductions, a hiring freeze, a reduction in employer retirement contributions, and elimination of executive incentive bonuses for 2013.

Management made clear that the cuts were in response to the Epic debacle,

Even though management said Thursday the center is making progress with fixing the Epic revenue issues, it acknowledged it 'will not meet projected financial targets for the current fiscal year.'

'Wake Forest Baptist has identified immediate multimillion-dollar savings with a series of short-term measures that impact personnel,' according to the statement.

To give credit where it is due, at least the cuts will apparently not affect line clinical employees:

 Those primarily affected by the volunteer furloughs and hour-and-wage reduction requests are nonclinical full-time employees, including administrative staff. They can volunteer to work as few as 30 hours a week with no loss of health or dental benefits for May and June. In the memo, management said employees can volunteer to continue the reduced-hour work week into fiscal year 2013-14.

However, it seems likely that they will affect many employees, including some proportion who likely had not responsibility for the problems with Epic.

When in Doubt, Lobby the Government

What the hospital system did not seem to be cutting was lobbying and public relations.  Perhaps this was a response to its unexpected inability to manage its own commercial health care information technology?  What bad management can lose, maybe government can supplant.  Once again Richard Carver had the story for the Journal:

Stung by a series of unusual setbacks at the General Assembly, the North Carolina hospital industry is launching a public relations campaign aimed, in part, at protecting revenues and staving off competition from lower cost surgery centers.

In a social media initiative targeted at lawmakers and their constituents, the N.C. Hospital Association says hospitals are 'fighting for their economic survival.' [It was not said whether they were fighting in part because they had already managed to shoot themselves in their economic feet - Ed]


The association and some of the state’s bigger hospitals also are hiring more GOP lobbyists to make inroads with the Republicans who control the state House, Senate and governor’s mansion.

The hospital association recently began promoting a new website — www.healthyhospitalsnc.org — that describes an array of financial threats.

Wake Forest Baptist is a big part of this initiative:

When asked about its lobbying efforts, Wake Forest Baptist spokeswoman Paula Faria said last week that the center’s Office of Government Relations monitors proposed legislation and regulations at both the federal and state levels.

'It informs North Carolina’s congressional delegation, members of the General Assembly and their staff about how proposed language could impact the day-to-day operations of the medical center.'

Maybe they should be first worrying about the impact of badly chosen, designed, or implemented commercial health care information technology on "day-to-day operations of the medical center" first.

 Summary

So the top executives of Wake Forest Baptist Medical Center have seen compensation rising at a rate greater than inflation and than the general public's income over the last few years.  In particular, the CEO has seen his compensation go up three and one-half times in three years!  The hospital system administration has justified this extraordinary increase by referring to supposedly "visionary" leadership.  Yet over this time frame these "visionaries" decided to implement an EHR whose first effects were to lose the hospital system a lot of money.  Based on previous anecdotes about the Epic system, it is quite possible it had other adverse effects.  For example, InformaticsMD discussed a case in which an EPIC system apparently lead to a large disruption in patient workflow and hence large increases in waits for acute care, and lead to errors that could have adversely affected patients.  So this underscores some important lessons:

So beware that "visionary" behind the curtain. As we have noted repeatedly, top health care managers can now easily make themselves rich.  They, their boards of directors (who may be their cronies), and their public relations flacks often justify their exorbitant compensation by their supposed brilliance, if not visionary status.  Such claims are rarely further explained, and mostly seem be be humbug, for want of a better term.  It seems that most top leaders of health care organizations have participated in the managers' coup d'etat, and become at least manager nobility, if not manager-kings  At least, the public should know that their compensation is what they can grab, and its justification is often nonsense. 

Note that contrary to a red herring argument often made, outrageous compensation is important not so much because of how much money it drains out of health care, although that can be large in the aggregate.  It is important because it reflects a system that is no longer accountable, and leaders who follow perverse incentives.

Such management compensation is almost never revisited to determine whether it turned out to be justified.  Instead, the public, watchdog organizations, health care professionals, and even politicians ought to demand accountability of health care management, good  justification for their compensation, and rationality for the incentives they are provided.  True health care reform would encourage well-informed, competent, mission-focused, honest, responsible, accountable and transparent management, leading organizations of manageable size.  But as long as things stay the same, expect the craziness to continue.   

Guest Post: A Physician Rebels Against Micromanagement by "'Leadership-Trained' Management Extenders"

Health Care Renewal presents a guest post by Dr Howard Brody, John P McGovern Centennial Chair of Family Medicine, Director of the Institute for Medical Humanities at University of Texas - Medical Branch at Galveston, and blogger at Hooked: Ethics, Medicine and Pharma.

I recently heard from a physician whom I knew well in an earlier stage of her training—I’ll call her Pauline. She completed her training at one of the top children’s hospitals in the US, and served in several capacities in academic medical centers before her most recent job with a physician-owned for-profit practice. She called me to express her frustrations and to ask if the right course for her was to quit doing clinical medicine.

Pauline had become skilled in her earlier jobs in providing primary care for children with severe chronic conditions. Her reputation was such that when she was settled in her current post, pediatric subspecialists started to refer their difficult cases to her for follow-up. This patient mix did not suit her current employer for two reasons. First, these children were hard to take care of and even though they could have their visits “up-coded” to reflect their complexity, the practice much preferred to see healthy children with colds and earaches that could be moved through quickly and who did not demand much staff time and attention. Second, most of these children with special needs were on state insurance, which did not pay as well (even after up-coding) as the private insurance the practice coveted.

Pauline found herself constantly struggling with her co-workers and superiors in order to deliver all of her patients—not just the special-needs kids—the quality of care she had been trained to demand. As far as the practice was concerned, it was Pauline, and the medically complex kids she was attracting into the practice, who were the problem.

One recent incident had especially concerned Pauline. She had set up a visit to see a new medically complex patient and had blocked off 40 minutes, the amount of time she felt she needed to do a good job. The child had a complex genetic disorder, cerebral palsy, and heart, lung, and kidney problems.  Both the cardiologist and the nephrologist had called asking her to take this patient.  She agreed.  After she had scheduled the visit, a manager called her and told her that she was being allowed only 15 minutes to see that patient. After some fruitless discussion with him, Pauline finally said, “Okay, I guess that means that you’ll be seeing the patient instead of me, right?” The shocked voice at the other end of the phone line replied, “What do you mean? I don’t know how to take care of patients.” “That’s exactly my point,” Pauline put in.

Pauline explained that this manager assigned to her office is not even a college graduate. Physicians cannot access the schedule electronically and have no control over scheduling. These functions are controlled by the office manager and (amazingly) by some of the medical assistants who have received some “leadership” training. These medical assistants are even allowed to evaluate the clinical competency and skills of the physicians.

Now, at this stage, I can imagine a response from a management-trained person. Pauline is obviously one of those starry-eyed idealist physicians who believe that money grows on trees and that costs should never be a factor in caring for patients. Somebody who actually knows what it means to make a payroll and keep the lights on has to step in and rein in these physicians. There has to be somebody in the system someplace with a head for business, who can recognize the stark realities of what today’s practice demands from all parties. Physicians should get off their high horses and stop imagining that they can give orders to everyone else.

So let me add a further nugget about Pauline’s background. In one of her previous jobs, she was made the manager of a pediatric outpatient center within a county hospital caring for a largely indigent population. This center had been running in the red for a good while. Pauline took over and within 28 months she’d streamlined the place and had them running well in the black, while still administering a quality of care that Pauline and her colleagues could be proud of. In short, Pauline could probably tell the managers of her current practice a thing or two about how to optimize patient scheduling without compromising care or cost —if they’d listen.

Pauline probably has a nearly-unique skill set in her community and has put in a lot of years of training and experience to get there. Due to the present state of American medicine, and those who want to run it as if it were an industrial operation to make a profit, Pauline is thinking about leaving clinical practice altogether despite her relatively young age – and she has several colleagues, who trained in the same way that she did, who are considering this option.

Fortunately, Pauline has at least for now postponed any final decision about leaving clinical medicine entirely. Here’s what she last told me:

I am leaving the organization - I cannot remain in an organization where profit comes ahead of quality - and as a former medical director who had financial accountability/responsibilities, I know it does not HAVE to be a choice.  I do not know what my next steps will be from here.  For me, working with integrity, compassion and a desire for excellence is not negotiable.

Physicians MUST become better advocates for our profession.  For too long, we have been asleep at the wheel while insurance companies and corporations shaped the environment in which we practice.  We cannot allow this to continue.  We are professionals, not vocationally educated medical automatons  who need every moment of work day micromanaged by 'leadership-trained' management extenders who have no idea what it means to take responsibility for patients.  

Dr Howard Brody

Tales of the Wayfaring Generic Manager - from Ritz Carlton Hotels to Henry Ford West Bloomfield Hospital to Cancer Treatment Centers of America

In 2006, we wondered what a former hotel manager, Mr Gerard van Grinsven, admittedly known for putting the "wow" back in the Detroit Ritz-Carlton, would be doing as a hospital CEO.  This seemed at the time like a real "wow" example of how generic managers were taking over health care.  Mr Grinsven had extensive experience in the hospitality field, but no known background in health care. 

Organic Local Produce, "Wellbeing Centers," Gourmet Dining, Wedding Receptions, and Corporate Functions

Over the next few years, Mr van Grinsven's Henry Ford West Bloomfield hospital did make a name for itself.  In 2009, Becker's Hospital Review reported on some of Mr Van Grinsven's innovations. 

First, he lead an apparent change in the hospital's mission from acute care to recreating:

the hospital experience into one focused on promoting wellbeing and healthy living. The hospital has already begun to realize its mission statement, which reads 'to take health and healing beyond the boundaries of imagination.'

The new hospital apparently was designed to look like a luxury hotel:

The hospital is located on 160 acres of woodlands and is designed to resemble a Northern Michigan lodge. The facility also features a retail 'main street' which looks like an actual main street in a Northern Michigan town and includes stores focused on sleep, pregnancy, organic food and healthy cooking as well as a pharmacy.

Apparently it is now a favored site for weddings:

The hospital also holds free concerts for the community and has already received nine wedding inquiries. 

It had a "wellness center"

Henry Ford West Bloomfield also features a unique, integrated wellness center called Vita. Vita offers acupuncture, therapeutic message, yoga and relaxation classes, an aqua therapy suite, a spa and health coaches who provide lifestyle and exercise consultations. In addition to offering one-time services, the hospital offers memberships to community members to encourage frequent use of the center.

What really stood out was its food service:

Henry Ford brought in top Michigan chef Matt Prentice to transform traditional hospital food service. The hospital features 24-hour room service for patients, all of which is served by the hospital's on-site gourmet, organic restaurant, Henry's. All food served in the hospital is organic, promotes sustainable agriculture and, in many cases, is procured from local farmers.

A 2011 article in Fortune noted that

the hospital is on track to generate millions of dollars a year hosting and catering functions for companies and community groups.

It all sounds great, if it were describing a luxury hotel.

The Fortune article ended with the gushing summation:

While it will be years before anyone can say whether this model works, there's no question that it captures a spirit of innovation that just might be a cure for what ails so many organizations. We are living today through the age of disruption. You can't do big things if you're content with just doing things a little better than everyone else or a little differently from how you've done them in the past. In an era of intense competition and non-stop reinvention, the only way to stand out from the crowd is to stand for something special. Originality has become the acid test of strategy.

Neither it nor the Becker's rather uncritical discussions dealt with what any of this had to do with the fundamental mission of a hospital, to care for the sick, what it has to particularly do with quality of care, especially care of severely acutely or chronically ill patients, traditionally those whom hospitals were meant to serve.  Would a patient desperately sick from a myocardial infarction (heart attack), stroke, sepsis (bacterial blood stream infection) or the other major ills that bring people to hospitals really care that if he or she were to survive without major sequelae, organic, locally grown food would be served in the hospital's fancy restaurant?  Is there any evidence that provision of any of these fancy hotel amenities would affect important clinical outcomes for such patients?  Could the funds needed for all these fancy hotel services be better spent to improve patients' the the population's health?

On to a More Ethically Challenged Environment

We may never know.  But what we do know is that Mr van Grinsven, having brought "wellness" centers and organic, locally grown, gourmet food to an acute care hospital, is now moving on.

Crain's Detroit Business just reported:

Henry Ford West Bloomfield Hospital President and CEO Gerard van Grinsven has resigned from the position effective June 1, according to an internal email sent Friday to employees from Henry Ford Health System President and COO Bob Riney.

Van Grinsven is leaving the hospital to become the president and CEO of Chicago-based Cancer Treatment Centers of America, Riney said in the email. He will oversee the CTCA's five hospitals and medical centers in Illinois, Pennsylvania, Oklahoma, Arizona and Georgia. The CTCA is expected to announce van Grinsven's new position later today.

Henry Ford Health System CEO Bob Riney saluted van Grinsven thus,

'Gerard's leadership talents and his tremendous global experience made the transformation of this innovation and distinctive vision a reality,' Riney told employees in the email.

He did not apparently mention anything about the quality of care for acutely and chronically ill patients.  The press release from CTCA proclaimed

'Gerard's arrival is an exciting and dramatic step in the evolution of our leadership that will herald new opportunities for all of our talented Stakeholders and the thousands of patients we serve,' said [executive chairman and former CEO Stephen B] Bonner. 'Our expertise in Patient Empowerment Medicine® and track record implementing change is unparalleled. Nothing we do today is the same as we did two years ago. Gerard is uniquely qualified to provide the leadership required to advance our commitment to patient-centered care in all we do,' concluded Bonner.

Of course, there was nothing about how van Grinsven's expertise in wellness centers and organic produce would be useful to an organization supposedly devoted to cancer patients, whose care may involve risky treatment choices and who may become desperately ill.

There was also nothing about how van Grinsven's background would help CTCA to avoid new ethical misadventures.  Earlier this year, we posted about issues involving CTCA making unsubstantiated survival claims; promoting "integrative" treatments that are unsupported by evidence; and manipulating survival statistics, in part by turning away patients with poor prognoses.  Of course, it is not clear that given van Grinsven's background he would even understand why such behavior is unethical. 

Summary

As a physician, it is hard not to laugh at all this, at least to keep from crying.  As we have noted frequently, health care has been taken over by generic hired managers.  At best, while well meaning, many of them seem clueless about the nature and context of health care, and health care professionals' values.  At worst, the manager's coup d'etat has turned managers into manager-kings, queens and nobles, while driving up health care costs, and sacrificing the health of patients and the public.  The depth of this phenomenon is demonstrated by the absolute lack of skepticism about the worthiness of a former Ritz-Carlton executive to run either a community hospital or a system of cancer treatment centers.

I say once again that true health care reform would put in place leadership that understands the health care context, upholds health care professionals' values, and puts patients' and the public's health ahead of extraneous, particularly short-term financial concerns. We need health care governance that holds health care leaders accountable, and ensures their transparency, integrity and honesty.

BLOGSCAN - An Ex-Pharmaceutical Company CEO to Run the American College of Cardiology?

Marilyn Mann's blog discussed the appointment of a former pharmaceutical company executive, most recently at Actelion, and previously at Hoffman La Roche, Abbott Canada, Nordic Labs and Marion Merrill Dow (now known as Aventis), as president of the American College of Cardiology.  Although Mr Jacobovitz, who boasts a bachelor's degree in biology but no obvious experience in direct health care or biomedical science, was touted by the ACC as having "developed a strong patient- and customer-centered corporate strategy," Ms Mann provided documentation that his trajectory at Actelion seemed more money- than patient-centered.  

During his watch, Actelion was cited for not reporting 3500 deaths of patients taking two of its drugs to the US Food an Drug Administration (FDA).  Actelion blocked availability of samples of one of its drugs to generic drug companies, an action that the US Federal Trade Commission (FTC) alleged violated anti-trust laws.  Actelion purchased a company that was working on a drug that could have become a competitor to Actelion's most remunerative product, and then shut down development, possibly preventing a drug that might help patients from reaching them.  Finally, Acetelion's marketing practices seem to be currently under investigation by a US Attorney.   

One wonders why cardiologists would want such an individual representing them as leader of their premier organization? 

(Dr Wes wondered as well.)

AMA says EHRs create 'appalling Catch-22' for docs - And just how many experts does it take to screw in a light bulb, anyway?

(NOTE:  this post, being about minor matters like death and financial mayhem, is particularly and unusually [even for me] biting and lacking in euphemisms and political correctness.  If you are easily offended and want the latter, and/or believe we all need to be 'nice' about banal issues like patient injury and death, fraud, and other minor matters, click here:  http://www.disney.com and skip the post below.)

You were warned.

---------------------------------------

At some point, so-called EHR "experts" and pundits need to stop being accommodated for their having ignored years of warnings, complaints, "anecdotes" -a particularly egregious term that comes from those who don't understand risk management, especially academics of the echo chamber-egghead subspecies (link) - and other signs that health IT is not a beneficent, omniscient gift from the Lords of Kobol. (The latter is a pun on the business-IT programming language Cobol, of course.)

Instead, they simply need to be ridiculed for being stupid.

I will do so:  folks, you have been, and remain, stupid:

The Bovine Stare of Incomprehension (click to enlarge)

The Bovine Stare of Incomprehension describes the reactions I've gotten over the years to many warnings about health IT.  It was like talking to a cow.

So now there's this:

AMA says EHRs create 'appalling Catch-22' for docs
May 03, 2013 | Tom Sullivan, Editor

As the healthcare industry moves to EHRs, the medical record has essentially been reduced to a tool for billing, compliance, and litigation that also has a sustained negative impact on doctors' productivity, according to Steven J. Stack, MD, chair of the American Medical Association’s board of trustees.

Gee, they're only realizing and complaining about that - now?  In 2013?

“Documenting a full clinical encounter in an EHR is pure torment,” Stack said during the CMS Listening Session: Billing and Coding with Electronic Health Records on Friday.

(What, the "pure torment" in such a mission-critical function only started with the most recent patches installed last month on the nation's EHRs?  EHRs were just dandy until then?)

It's nice to know in May 2013 that “documenting a full clinical encounter [essential to avoid injurious and even lethal mistakes, I anecdotally note - ed.] in an EHR is "pure torment”, several years into an accelerated "National Program for HIT in the HHS" costing hundreds of billions of dollars.

I guess sites like this blog, this site extant since 1998, and other materials written over the years by backwards stubborn health IT iconoclast fear-mongering Luddites were beyond the comprehension level of - those now proffering the exact same pronouncements.

EHRs are also driving the industry toward charts that look remarkably similar because they’re based on templates created by the technology vendors — that includes often using the same words. And that threatens to make doctors appear to be committing fraud by the practice of record cloning, or cutting and pasting from one record to another, when they are not, in fact, acting fraudulently. 

I guess putting patients in mortal danger from note cloning (and to those too stupid to understand why that is, get off your rear end and look it up, I'm not going to spoon-feed you) is a step better than acting fraudulently...

Alongside the federal mandate to implement an EHR under threat of a monetary fine, that creates what Stack called “an appalling Catch-22 for physicians.”

Put another way: The government mandates that doctors use an EHR, the EHR vendors’ templates can sometimes create an appearance of fraud and that, in turn, opens the door for payers to decline reimbursement or, even worse, the government to prosecute doctors for the crime.

I guess actual fraud is just anecdotal.

As dire as that sounds, it's an exception that belies the unproven perception that EHRs perpetuate fraud. “Upcoding does not necessarily equate to fraud and abuse,” said Sue Bowman, AHIMA’s senior director of coding and compliance at the same event. “This is an area where more study is needed. We really need to know the causes. Further research is needed on the fraud risk of using EHRs.”

Sure, let's study while rolling this stuff out as frantically as we can.  We'll fix it later -- and Jesus, I guess, will heal and reanimate any patients actually harmed by the technology (link to ECRI Institute Deep Dive Study: 36 hospitals!  Nine weeks!  171 health information technology-related problems voluntarily reported!  Eight injuries!  Three possible deaths!  All mere "anecdotes", of course).

Indeed, Jacob Reider, MD, CMO of ONC, explained that the government and industry do not have good data right now proving whether or not EHRs trigger fraud and abuse.

Per the IOM, the same industry does not have good data on harms levels.  (The previous link to a recent small ECRI "Deep Dive" study's probably the most robust we've got on that score, and the figures are not encouraging).

So - let's review -

• poor data on harms, 
• poor data on benefits, 
• poor data on fraud and abuse.

 The logical, ethical course of action thus is:

D'OH!  LET'S ROLL THE TECHNOLOGY OUT AS FAST AS WE CAN, AND PENALIZE NON-ADOPTERS BESIDES!

See how simple logic, ethics and clear thinking can be?

“There is concern that some doctors are using the EHR to obtain payments to which they are not entitled,” said Mickey McGlynn of Siemens Medical Solutions and HIMSS EHR Association. “Any fraud is an important issue and we, as the vendor community, take that very seriously.”

Only after independent whistleblower investigations by Fred Schulte of the Center for Public Integrity ("Cracking the Codes"), and by New York Times reporters Reed Abelson and Julie Creswell, that is...

AMA’s Stack offered a triptych of suggestions to CMS and ONC: address EHR usability concerns, provide guidance on EHR use for coding and billing, and make meaningful use stage 2 more flexible for providers.

“My purpose is not to denigrate EHRs,” Stack said, explaining that he believes CMS and ONC are genuinely trying to better the current situation.

Nice to have Caspar Milquetoast  on the side of EHR criticism.

Knock knock, anyone home, McFly?

Knock knock, anyone home, McFly?

Today's EHR systems, for the aforementioned reasons above and more, deserve denigration for patients' sake.

There are efforts underway, within the government and industry, to more comprehensively understand the unintended consequences of EHR implementation.

But let's keep rollin' em out, anyway.  Wheeee!  What fun!

Class action attorneys, are you listening?

-- SS