US Presidential Candidates' Financial Relationships with Health Care Organizations

As the leadership of the large field of Republican candidates for the US Presidency shifts, different candidates come in for increased media scrutiny.  Recently, reporting about former Pennsylvania Senator Rick Santorum focused on his financial relationships with a health care organization. Senator Santorum, however, is only the candidate with ties to health care organizations to come into the spotlight most recently.  We will review the report on Santorum, and then summarize the publicly known relationships of the other candidates.

Republican Former Pennsylvania Senator Rick Santorum and Universal Health Services

The relationship was first revealed by Bloomberg,

Santorum’s greatest financial gain came from $395,414 in director fees and stock options he listed in a recent financial disclosure.

The fees and options came from King of Prussia-based Universal Health Services Inc., a publicly traded health-care management company....

Senator Santorum started on his board service in 2006. He resigned in June, 2011, when he started his campaign for the presidency.

Note that while Santorum served on the board, the company was accused of ethical missteps:

The Justice Department accused the company in a 2010 lawsuit of submitting fraudulent reimbursement claims under the Medicaid health-care program for the poor. The government said the company falsely claimed to have provided inpatient psychiatric services to children at a detention facility in Marion, Virginia. Pantaleoni said the case has been settled.

The company has also risked losing certification to receive Medicare reimbursement for medical centers that it owns.

According to a release on the UHS website, the Rancho Springs Medical Center and Inland Valley Regional Medical Center in Riverside County regained their certification in November after the Centers for Medicare and Medicaid Services threatened to terminate their provider agreement in June 2010. The state of California had also threatened to revoke the group’s hospital license.

It wasn’t the first time UHS risked losing certification for one of its facilities. In late September 2008, CMS terminated participation in Medicare for the Two Rivers Psychiatric Hospital in Kansas City. It’s a decision that led to a court appeal and settlement requiring Two Rivers to retain an outside monitor for six months.

Thus, Senator Santorum was on the board of a for-profit hospital corporation until just before he became a presidential candidate. While he was on the board, the company allegedly committed unethical actions.

Republican Former Georgia Congressman Newton Leroy "Newt" Gingrich and the Center for Health Transformation and its Numerous Corporate Sponsors

A few weeks ago, we posted about Congressman Gingrich's operation of a health care consulting firm, the Center for Health Transformation. It had relationships with a long list of major health care organizations, including Allscripts, the American Hospital Association, AstraZeneca, Blue Cross Blue Shield, GE Healthcare, Gundersen Lutheran Health System, Johnson and Johnson, Pfizer, Pharmaceutical Research and Manufacturers' of America, Siemens, and WellPoint. At a minimum, the Center helped some of these organizations try to influence health care policy to favor their vested interests in the guise of promoting health policy solutions.

The juxtaposition of the stories about Senator Santorum's and Congressman Gingrich's financial ties to health care organizations suggested we review whether other current candidates also had such ties. Some quick searching revealed that some others did. We will review the other current major candidates below, starting with the other Republicans, in alphabetical order.

Republican Former Utah Governor Jonathan Huntsman Jr

I could not find any publicly reported relevant relationships.

Republican Texas Congressman Dr Ronald E Paul

Dr Paul is a physician, an obstetrics-gynecology specialist. According to Wikipedia, he apparently practiced until his current stint in the Congress began in 1996. I could not find any publicly reported relevant relationships.

Republican Texas Governor James Richard "Rick" Perry and Merck

In September, 2011, Governor Perry's prominence in the campaign caused a reconsideration of his relationship to Merck. As MSNBC reported,

On the campaign trail, Perry had recently apologized for the executive order-which would have made Texas the first state in the country to mandate that all teenage girls, starting with 12-year-old sixth graders, be vaccinated with Gardasil.

Gardisil is made by Merck. Then candidate Representative Michele Bachmann noted that Governor Perry had received campaign contributions from Merck. As the Los Angeles Times reported,

In fact, Merck PAC — the company’s Washington, D.C.-based political action committee — has given Perry $28,500 since 2001, according to Texas Ethics Commission filings.

The bulk of that money came before 2007, when the governor signed an executive order mandating all sixth-grade girls in the state to receive the Gardasil vaccine against HPV.

However, Governor Perry had another tie to Merck, as noted by MSNBC,

Perry's order came after the drug company that manufactured the vaccine hired Mike Toomey, his former chief of staff, as one of the firm's top lobbyists in Austin.

Toomey, who is now running the main 'super pac' backing Perry's candidacy, was retained by pharmaceutical giant Merck & Co., maker of the Gardasil vaccine, which is designed to prevent the human papillomavirus, or HPV, an infection linked to cervical cancer in women.

His hiring was part of an aggressive lobbying push in Texas by the drug company, which also donated $16,000 to Perry's gubernatorial campaigns in the two and a half years prior to the executive order. Merck paid Toomey between $260,000 and $535,000 in lobbying fees between 2005 and 2010, according to state lobbying records.

Although Perry's GOP foes never brought up the connection during the debate, Democratic political operatives and a public watchdog group said Thursday his association with Merck is likely to be emerge as a prime example of Perry's 'crony capitalism,' should he win the GOP nomination.

Although there were no reports that Governor Perry personally financially benefited from a relationship with Merck, the company paid substantial amounts to his campaign and to an organization he ran, and to his former chief of staff. There seems to be at least a reason to think that these relationships had something to do with a decision he made that lead to increased sales of a Merck product, and which he now regrets.

Republican Former Massachusetts Governor Willard Mitt Romney and Bain Capital and Numerous Health Care Corporations

Today's Wall Street Journal summarized the investments made by Bain Capital, a venture capital and private equity firm lead by Governor Romney,

The Wall Street Journal, aiming for a comprehensive assessment, examined 77 businesses Bain invested in while Mr. Romney led the firm from its 1984 start until early 1999, to see how they fared during Bain's involvement and shortly afterward.

Among the findings: 22% either filed for bankruptcy reorganization or closed their doors by the end of the eighth year after Bain first invested, sometimes with substantial job losses. An additional 8% ran into so much trouble that all of the money Bain invested was lost.

Of the 10 firms that produced the biggest returns for Bain, four were involved in health care, PhysioControl, Waters, Dade, and Wesley Jessen VisionCare. Dade, a medical diagnostics company, went bankrupt in 2002.

Furthermore, in 2007, the Boston Globe (via the Deseret News) reported on Governor Romney's private equity career, including his involvement with a company that had its ethical challenge,

Bain Capital's 1989 purchase of Damon Corp., a Needham medical testing firm that later pleaded guilty to defrauding the federal government of $25 million and paid a record $119 million fine.

Romney sat on Damon's board. During Romney's tenure, Damon executives submitted bills to the government for millions of unnecessary blood tests. Romney and other board members were never implicated.

More than a decade later, when Romney was in pursuit of the Massachusetts governorship, his Democratic opponent Shannon O'Brien accused him of lax oversight at Damon and failing to report the fraud.

Romney replied that he had helped uncover the illegal activity at Damon, asking the board's lawyers to investigate. As a result, he said, the board took 'corrective action' before selling the company in 1993 to Corning Inc.

But court records suggest that the Damon executives' scheme continued throughout Bain's ownership, and prosecutors credited Corning, not Romney, with cleaning up the situation. Bain, meanwhile, tripled its investment.

Romney personally reaped $473,000.

Thus, Governor Romney was on the board of a device company, albeit many years prior to when he became a presidential candidate. While he was on the board, the company allegedly committed unethical actions.

Democratic President Barack Obama, Michelle Obama, and the University of Chicago Medical Center

The issue of then Democratic Senator Barack Obama's wife's role at the Medical Center was first discussed in 2008, with some follow up in 2009. As the Washington Post reported in 2008,

Shortly after Barack Obama joined the U.S. Senate in 2005, the medical center promoted Michelle Obama to vice president of community and external relations, and more than doubled her salary. She is now on leave from the $317,000-a-year post, in which she sought to bridge the gap between the wealthy institution and its poorer neighbors. The hospital declined to discuss the budget for her program or her input into budgetary decisions.

She was particularly involved in one program that became controversial,

A few years ago, executives at the prestigious University of Chicago Medical Center were concerned that an increasing number of patients were arriving at their emergency room with what the executives considered to be non-urgent complaints. The visits were costly to the hospital, and many of the patients, coming from the surrounding South Side neighborhood, were poor and uninsured.

Michelle Obama, an executive at the medical center, launched an innovative program to steer the patients to existing neighborhood clinics to deal with their health needs.

That effort, in time, inspired a broader program the hospital now calls its Urban Health Initiative.

The Post noted,

The medical center markets its initiative as an effort to improve patient health for the poor and at the same time free its resources for emergencies and complicated procedures. The Urban Health Initiative also could save the hospital substantial amounts of money, by removing the nonpaying poor patients from its emergency room.

However, after Senator Obama became President, his wife became the First Lady and quit her job at the medical center, the program became even more controversial. In March, 2009, the Chicago Weekly reported on the extensions of the Urban Health Initiative

or UHI, which has garnered a lot of criticism recently, such as accusations that it comes 'dangerously close' to the illegal practice of 'patient dumping.' Additionally, the emergency room structure that it will leave in its wake will likely result in a decline in the quality of care provided to Medicaid, Medicare, and uninsured patients.

Ultimately, the Wall Street Journal reported that:

More than 190 doctors at the University of Chicago Medical Center signed a letter to trustees protesting plans to reduce the number of beds available to emergency patients as 'unnecessarily risky' and a threat to patient safety.

At that time, this admission appeared,

Dr. Madara, the hospital's chief executive, said in an interview last week that the hospital is seeking to admit more patients to its 'programs of distinction' such as oncology and advanced surgery, and treat fewer in the ER, and that these moves will mean more privately insured patients at the hospital.

Note that "programs of distinction" may also mean programs that provide the most revenue. Ultimately, the Chicago Tribune reported that the plan was halted by the university president, and a few months later, Dr Madara, the CEO resigned (again per the Tribune).

Thus, while he was a Senator, current President Obama's wife earned a substantial salary from a non-profit academic medical center and hospital system. A program she ran was then and later alleged to have compromised patient safety and perhaps acted unethically.

Summary

We have frequently discussed how large health care organizations seek to influence discussions of health policy to further their vested interests. At times, they have organized stealth health policy advocacy initiatives to comprehensively push their aims. For example, we discussed how commercial health insurance companies have tried, often succesfully, to influence health policy as recounted by former CIGNA public relations leader Wendell Potter in his book Deadly Spin.

It appears that the more one looks, the more one finds evidence of the web of influence of large health care organizations. Pulling together a variety of journalistic efforts over more than three years, it now appears that the majority of the current credible contenders for the presidency of the US have or had financial relationships with health care organizations.

Often these relationships appear significant enough to be called conflicts of interest were the people who had them communicating about health policy in a venue that requires conflict of interest disclosure, like a major medical journal. One candidate until very recently was on the board of directors of a for-profit hospital corporation, and hence had a fiduciary duty to that company and its stock-holders. One candidate until very recently ran a health care consulting company whose clients included major drug, device, and insurance companies. One candidate previously was on the board of a medical device company. One candidate's spouse previously was a top executive of a academic medical center and hospital system.

While the current candidates may now now be writing articles for medical or health care policy journals, by virtue of their candidacies they now receive enormous attention. Anything they say about health care policy is likely to be influential. Yet there is reason to be concerned that many of their views on health policy were influenced by their financial relationships. In particular, would a candidate who at one time got a major part of his or his family's livelihood from a big health care organization be likely to strongly challenge the status quo that allowed that organization to prosper?

In my humble opinion, there needs to be complete reconsideration of how health care policy is made. In particular, we must define how much of the discussion is driven by vested economic interests, and make sure such interests and their relationship to those in the discussion becomes clear. It is just as important for health policy analysts, pundits, and decision-makers to disclose in detail their conflicts of interest as it is for clinical researchers and educators. Maybe the Institute of Medicine would be willing to take up this issue as they took up conflicts of interest affecting research and education.

Health Care Policy of the Insiders, by the Insiders, for the Insiders - the Newt Gingrich Case Files

Newt Gingrich's rise to the top of the pack of Republican contenders for the US presidency has earned him increased scrutiny.  The resulting investigative reporting has provided a revealing set of case studies showing how insiders have come to dominate US health care policy.

Below I have reorganized the information presented in a series of news articles from mid-November to mid-December, 2011.

Mr Gingrich's Consulting Empire

A general description of Mr Gingrich's health care "think tank" appeared in the Washington Post.(1)

A think tank founded by GOP presidential candidate Newt Gingrich collected at least $37 million over the past eight years from major health-care companies and industry groups, offering special access to the former House speaker and other perks, according to records and interviews.

The Center for Health Transformation, which opened in 2003, brought in dues of as much as $200,000 per year from insurers and other health-care firms, offering some of them 'access to Newt Gingrich' and 'direct Newt interaction,' according to promotional materials.

Despite its name, the CHT was for-profit. Much of its actual workings are confidential, per the Post,(1)

Susan Meyers, a center spokeswoman, declined to comment on the think tank’s income or staffing levels because it is a private-sector organization.

Despite its pretentious name, the CHT was apparently a vehicle for its wealthy corporate clients to influence health policy to favor their business interests.  A NY Times article(2) reported that:

His consultancy practice was centered around his ability to help big corporate interests speak the language of Republicans and navigate the corridors of Capitol Hill on issues vital to their businesses.

According to a Bloomberg article(3), the work was quite lucrative:

Two companies founded by Newt Gingrich announced yesterday that they had grossed $55 million between 2001 and 2010, part of an effort to quiet questions about how the former U.S. House speaker earned millions since he resigned from Congress in 1999.

That revenue supports the Center for Health Transformation and The Gingrich Group LLC, which have a staff of as many as 30 people, stage health-care policy events, and provide advice to clients, Nancy Desmond, the chairman and chief executive officer of the firms, said in a written statement.

The CHT was linked to a small corporate empire, as described by the Washington Post,(4)

Former House speaker Newt Gingrich transfigured himself from a political flameout into a thriving business conglomerate. The power of the Gingrich brand fueled a for-profit collection of enterprises that generated close to $100 million in revenue over the past decade, said his longtime attorney Randy Evans.

Among Gingrich’s moneymaking ventures: a health-care think tank financed by six-figure dues from corporations; a consulting business; a communications firm that handled his speeches of up to $60,000 a pop, media appearances and books; a historical documentary production company; a separate operation to administer the royalties for the historical fiction that Gingrich writes with two co-authors; even an in-house literary agency that has counted among its clients a presidential campaign rival, former senator Rick Santorum (R-Pa.).

Separate from all of that was his nonprofit political operation, American Solutions for Winning the Future.

Relationships with Big Health Care Corporations

The Center for Health Transformation was largely funded by big health care corporations. The Post first noted,(1)

The biggest funders, ... [included] firms such as AstraZeneca, Blue Cross Blue Shield and Novo Nordisk,...

Also,(1)

The center has listed scores of firms and industry groups as members over the years, amounting to a Who’s Who of the medical field, from GE Healthcare to the American Hospital Association to Wellpoint, the nation’s largest health insurer.

Other clients were listed in a Bloomberg article,(5)

Among the member companies were drugmaker Johnson & Johnson (JNJ) and health insurer Blue Cross and Blue Shield Association....

Also,(5)

Pfizer Inc. (PFE), the world’s largest drugmaker, had consulting contracts with Gingrich, according to two people familiar with the arrangements. Pfizer spokesman Ray Kerins didn’t respond to requests for comment.

The Pharmaceutical Research and Manufacturers of America, the industry’s trade group, was also a client. His firm 'was retained by the PhRMA general counsel’s office at one time to provide advice on a positioning project,' the group said.

In addition, as noted below, clients included important firms in the health care information technology (IT) sector, including GE, IBM, Microsoft, Allscripts, and Siemens.

Below, we present several cases in which Mr Gingrich apparently intervened on behalf of his clients to promote their business interests in the guise of promoting his views on health policy solutions.  In some cases, the views he promoted did not fit with what is generally regarded as his political philosophy, suggesting that the interests of his paying clients overrode his political views.

Case: End of Life Care

The New York Times reported,(2)

Writing on the Web site of the Washington Post, Mr Gingrich praised Gundersen Lutheran Health System of LaCrosse, Wis., for its successful efforts to persuade most patients to have 'advance directives,' saying if Medicare had followed Gundersen's lead on end-of-life care and other practices, it would 'save more than $33 billion a year.'

Note that

Gundersen was one of the paying clients of Mr. Gingrich's Center for Health Transformation....

However,

within weeks, Mr. Gingrich would find himself on the wrong end of what some Republicans labeled the 'death panel' issue.

At that point, Mr Gingrich abruptly changed his tune,

As it happens, shortly after Mr. Gingrich wrote his article praising Gundersen, he joined the conservative critics of the provision. 'You are asking us to trust turning power over to the government,' Mr Gingrich told George Stephanopoulos of ABC News that August 'when there are clearly people in America who believe in establishing euthanasia, including selective standards.'

This suggested that Mr Gingrich took up the cause of end-of-life decision making not be cause he deeply believed in it, but because it was expeditious given the wishes of his clients, despite the assertion made by his spokesperson,(2)

Mr. Hammond said that Mr. Gingrich did not take policy positions for pay; rather, he said, clients sought him out because of the views he already held and his expertise in communicating ideas.

Case: Medicare Prescription Coverage Sans Negotiations about Drug Prices

As reported by Bloomberg,(5)

When U.S. House Republican leaders in 2003 were short of votes to pass a $395 billion Medicare prescription drug benefit, they recruited former House Speaker Newt Gingrich for help.

In a hushed room on Capitol Hill, Gingrich told his former Republican colleagues that if he could endorse the measure, they should be comfortable with it, too, said two former senior House aides who attended the closed-door session.

Two days later, after a vote was held open for three hours as leaders corralled the final ayes, the measure passed and was eventually signed into law by President George W. Bush.

What Gingrich didn’t mention during the Republican caucus meeting was that he was also building a for-profit, health-care research company and seeking financing from drugmakers, which were investing $128.6 million in lobbying for passage of the new benefit for seniors.

Note that the legislation that provided Medicare drug coverage forbade the government from negotiating prices with drugmakers.  This was unprecedented, because drug coverage from the US Veterans Administration and Medicaid did not come with the obligation to pay whatever the drug-makers charged.  The inability of Medicare to negotiate the prices it paid for drugs certainly helped the companies' revenues while driving up the costs of Medicare, the federal deficit and the costs of health care in general.

Case: Promoting Expensive Diabetes Care

The Washington Post reported,(4)

Novo Nordisk, a Denmark-based drug firm that specializes in diabetes treatments.... paid a total of $1.2 million to Gingrich’s foundation over six years as a 'founding charter member.'

'It was strictly a business, nonpolitical relationship,' Novo Nordisk spokesman Ken Inchausti said. 'We admired his leadership on issues related to health-care delivery systems. We thought the CHT brought something to the table to us in terms of finding ways to help people prevent diabetes.'

Gingrich loaned his celebrity to causes that, whatever their other merits, could also be good for Novo Nordisk’s bottom line. For instance, he was the keynote speaker at Novo Nordisk’s 'diabetes summit' in 2005 and joined the company in issuing a 'call to action' to fight diabetes in Texas and Georgia.

One wonders how many of the widely promoted "summits" and other star-studded conferences on health care featuring corporate  and political leaders as speakers are just stealth health policy advocacy or stealth marketing.

Case: Irrational Exuberance for Electronic Health Records

My fellow Health Care Renewal blogger has often discussed the "irrational exuberance" for electronic health records (EHRs) despite scant information about their benefits, and increasing data suggesting their harms.  It now appears that Mr Gingrich, sponsored by copious funds from the health care IT sector, has been a major source of such exuberance. 

Mr Gingrich had a complex relationship with the health care information technology (IT) industry. It began to come out first in a NY Times story,(6)

When the center [for Health Transformation] sponsored a 'health transformation summit' at the Florida State Capitol in March 2006, lawmakers who attended Mr. Gingrich's keynote speech inside the House chamber received a booklet promoting not just ideas but also the specific services of two dozen of his clients. Executives from some of those companies sat on panels for discussions that lawmakers were encouraged to attend after Mr. Gingrich's address.

Gerard White, president of Clearwave, which paid about $50,000 to become a center member, used the occasion to pitch his company's system for managing patient data.

This had all began earlier,

Two years before the Florida 'summit,' Mr. Gingrich made a presentation to Republican lawmakers in Georgia, promoting the work of his member companies by citing specific benefits if they were hired. For example, 'VitalSpring could save the State Employee Program over $20 million a year.'

Minutes of the members-only conference call from March 2004 said the center had 'arranged joint meetings' for members to present their work on electronic health records to top federal officials, noting that Mr. Gingrich 'reported very positive feedback overall from these meetings.'

He also pressed for passage of a federal bill to increase the use of electronic health records, collaborating with one of its co-sponsors, Representative Patrick J. Kennedy of Rhode Island, and Senator Hillary Rodham Clinton of New York, both Democrats.

Furthermore,

Many of the ideas he has pushed involve the increased use of information technology, and companies specializing in that are well represented in the center's roster. They also figured prominently in an early center initiative, teaming up in 2003 with the conservative Georgia Public Policy Foundation to promote changes in health care in Mr. Gingrich's home state.

At his discussion with Georgia House Republicans in 2004, Mr. Gingrich gave examples of companies whose services could 'both improve health and start saving money,' according to the center's summary of his presentation.

And there is more,

In Washington, Mr. Gingrich's push for electronic health records illustrated how his own policy advocacy and ties to former Congressional colleagues made him a sought-out consultant for companies like Astra Zeneca and Siemens. Mr. Gingrich hailed HealthTrio, one of the center's 'founding charter members,' during a hearing held in 2003 by Senator Larry Craig, Republican of Ohio. Telling the senator that HealthTrio's chief executive had helped design the electronic records program in the United Kingdon, Mr. Gingrich said the company 'estimates we could have an electronic health record for American for about 10 cents per month, per person.'

The center later arranged for HealthTrio and I.B.M to meet with senior federal health officials and congressional leaders 'to review the U.K. approach and how it might be applied in the U.S.,' according to center records.

Some of the ideas promoted by the center found their way into the electronic health records legislation proposed by Mr. Kennedy, which was prepared with input from Mr. Gingrich.

This is especially ironic, given that the UK NHS electronic health record initiative has become a crashing failure (for example, see this post).

Even more involvement with the push for electronic health records (EHRs) appeared in a Boston Globe article,(7)

Newt Gingrich seized the TV airwaves in 2009 to bash President Obama’s stimulus package, calling it 'entirely a pork-barrel bill' that would do little to solve the recession.

Later, in a separate web video, the former House speaker stepped back from his blanket criticism. He explained that he strongly supported spending $27 billion of stimulus funds to encourage doctors and hospitals to create electronic medical records for their patients. Left unsaid was that the Gingrich Group, his consulting business in Washington, received large payments from medical technology companies that stand to profit from the federal money.

In particular,

The stimulus infusion Gingrich supported is expected to benefit health care technology companies, including those who have been clients such as GE Healthcare and Allscripts.

GE Healthcare said it pays Gingrich’s center to act as a 'collaborator and facilitator' among a diverse group of health care interests.

'We work with the Center for Health Transformation in an effort to improve the effectiveness of the health system through the use of information technology,' said GE Healthcare spokesman Corey Miller.

Allscripts spokeswoman Ariana Nikitas said the company ended its relationship with Gingrich’s center two years ago but considered the venture 'a think-tank to advance health care efforts.'

It does not stop there. Per the NY Times,(8)

Mr. Gingrich was cheering a $19 billion part of the [Obama stimulus] package that promoted the use of electronic health records, something that benefited clients of his consulting business. 'I am delighted that President Obama has picked this as a key part of the stimulus package,' he told health care executives in a January 2009 conference call.

After the bill was passed a month later, Mr. Gingrich's consultancy, the Center for Health Transformation, joined two of his clients, Allscripts and Microsoft, in an 'Electronic Health Records Stimulus Tour' that traveled the country, encouraging doctors and hospitals to buy their products with billions in federal subsidies.

We, particularly InformaticsMD, have frequently commented on how health care information technology has been promoted not just by enthusiasts in the field, and by companies that manufacture such devices, but by the government.  The bandwagon has gone down the road despite little clinical evidence that such technology is beneficial, and increasing evidence of its harms.  Now it appears that an important reason for this ruch to promote expensive, but unproven devices comes from the sort of stealth health care policy advocacy on behalf of corporate vested interests described above.
Summary

So Newt Gingrich parlayed his political track record into a lucrative "consultancy" which enthusiastically promoted the health policy objectives of its clients, who included some of the biggest US health care corporations.  Some of the policy positions the consultancy promoted seemed to run counter to Mr Gingrich's political record.  Worse, some of the initiative he successfully promoted seem to have contributed to US health care dysfunction.

These stories, some of which are many years old, only came out after Mr Gingrich became the front runner for the Republican nomination for US President.  Had he not chosen to re-enter politics, it is not clear when reporters would have had time to due the required investigations.  One wonders how many similar stories have not been made public because they do not involve prominent presidential candidates.

The bottom line seems to be that there are myriad ways corporate and political insiders push health policy agendas because of self-interest, regardless of their effects on patients' and the public's health.  Health policy in the US has become an insiders' game.  Unless it is redirected to reflect patients' and the public's health, facilitated by the knowledge of unbiased clinical and policy experts rather than corporate public relations, expect our efforts at health care reform to just increase health care dysfunction. 

Physicians, public health advocates, whatever unbiased health policy experts remain must educate the public about how health policy has been turned into a corporate sandbox.  We must try to somehow activate the public to call for health care policy of the people, by the people, and for the people.

References


1.  Eggen D. Gingrich think tank collected millions from health-care industry.  Washington Post.  November 17, 2011.  Link here.
2. Rutenberg J. Gingrich faces more scrutiny over corporate clients. NY Times, November, 17, 2011. Link here.
3. Benson C, Lerer L. Gingrich health center and group paid $55M. Bloomberg, November 22, 2011. Link here.
4. Tumulty K, Eggen D. Newt Gingrich Inc.: how the GOP hopeful went from political flameout to fortune. Washington Post, November 26, 2011. Link here.
5. Davis JH, Jensen K. Gingrich campaigning as change agent profited as an insider. Bloomberg, November 18, 2011. Link here.
6. McIntire M, Rutenberg J. Gingrich gave push to clients, not just ideas. NY Times, November 29, 2011. Link here.
7. Rowland C. Newt Gingrich supported $27 billion of President Obama's stimulus for electronic medical records, helping his consulting clients. Boston Globe, December 16, 2011. Link here.
8. Rutenberg J, McIntire M. Gingrich push on health care appears at odds with G.O.P. NY Times, December 16, 2011. Link here.

Using Logical Fallacies to Scold "Pharmascolds"

I first became dimly aware of how dysfunctional health care had become in the US after seeing, up close and personal, a case of attempted suppression of medical research because its content offended vested interests.  (See "Academic Freedom and the Corporate University" by Jennifer Washburn here.)  We have since blogged frequently about suppression of research, other threats to free speech and academic freedom in health care, and the larger anechoic effect, which undermines discussion of many of the threats to core values in health care.

A Case Illustrating "How Academic Orthodoxy is Enforced?"

Thus, I am always on the lookout for new cases which illuminate these issues.  So a recent post on the well-known Forbes blog site by David Shaywitz, identified only as a "contributor," caught my attention:

an elite coterie of self-righteous academics seek not to level the playing field but to dominate it, imposing their particular world view on everyone else. Of course, conservatives, among others, have long alleged this is the true nature of American colleges– where tolerance and open-mindedness is said extend from the left all the way to … the far left. But we now have the opportunity to see this play out at the professional level as well.

This sounds somewhat familiar. The FIRE (Foundation for Individual Rights in Education) web-site boasts a huge case file of attacks on free speech in academia. Most of them did not involve professional schools, or academic medicine in particular. Note, however, that FIRE is avowedly non-partisan, and while many attacks they deplore seemed to be on the free speech of those on the right, quite a few were also on those on the left.

So what was the nature of this illuminating case?

Those who wonder how academic orthodoxy is enforced in practice need look no further than the response to a recent lecture given at Case Western University by Dr. Tom Stossel, the American Cancer Society Professor of Medicine at Harvard, and Director of the Translational Medicine Division of the Brigham and Women’s Hospital, where he is also an attending physician. (Disclosure: Stossel was an academic colleague of mine back when I was in Boston, and we have co-written a number of commentaries over the years; we also coined the term, Pharmascolds.)

Stossel’s lecture, from what I’ve heard, was well-attended — so good for him. But the real news was the three sentence email received by members of the Case Western faculty prior to Stossel’s lecture — a nastygram sent by a colleague at the neighboring Cleveland Clinic.

Subject line: 'Re: Medicine Grand Rounds — Tuesday September 13th' (i.e. Stossel’s talk).

Body of the email (in full): 'This guy is an embarrassment to the medical profession. Can’t believe you would have him provide Grand Rounds. Your trainees deserve better.'

Enforcement or Just Argument?
Unless there is more too it, however, this case would not seem to fit in the category of attempts at suppression of free speech or academic freedom. After all, the folks from FIRE often note that the best response to speech or writing with which one disagrees is more speech or writing. The case above seems to involve two people who disagree, Dr Stossel, and whoever wrote the email. Disagreement is what free speech is all about. Per the FIRE web-site section on free speech:

Freedom of speech is a fundamental American freedom, and nowhere should it be more valued and protected than at America's colleges and universities. The 'marketplace of ideas' upon which a university depends for its intellectual vitality cannot flourish when students or faculty members must fear punishment for expressing views that might be unpopular with the public at large or disfavored by university administrators.

For this case to be an example of someone trying to "enforce academic orthodoxy," there needs to be an action, or at least threat of an action to silence one of these two people, or to punish one of them for what he or she already said.

So I looked for the next part of this case. But there appears to be a problem. There is no more to the case than what appears above:

And there you have it — watch and learn kids! - here’s how A-list academics do it, in three steps and three sentences.

So Mr Shaywitz appeared to be arguing that somehow the email sent about Dr Stossel is a threat to free speech. However, unless the email came from some academic official who could punish Dr Stossel or his audience at Case Western University, the threat to free speech is not apparent.

So we need to find out who wrote the three-sentence email, and whether he or she had the power to enforce his or her opinions as orthodoxy.  Who wrote the email?

The author of this email? Dr. Steven Nissen, perhaps America’s most quoted Pharmascold.

Dr Nissen is Chief of Cardiovascular Medicine at the Cleveland Clinic. Although he appears to have an appointment at the Case Western Reserve Medical School, the chair of cardiovascular medicine there is Dr Dan Simon. Maybe Dr Nissen did not agree with Dr Stossel, but there is no obvious way he could "enforce" his dislike, or otherwise turn it into "orthodoxy."

Dr Stossel's speech may be obnoxious to Dr Nissen. And Dr Nissen's written email may be obnoxious to Dr Stossel, and to Mr Shaywitz. However, neither side has enforced its orthodoxy on, or suppressed the speech of the other.

Logical Fallacies

Relativist Fallacy
If Dr Nissen could enforce orthodoxy by merely writing an email, then Dr Stossel presumably could do so by giving his talk, and Mr Shaywitz could also do so by publishing his post. Implying that only Dr Nissen, with whom Mr Shaywitz disagreed, enforced orthodoxy appears to be an example of the relativist fallacy, the fallacy that a claim may be true for others, but not for the person making it.

Thus the central premise of the blog post appeared to be based on a logical fallacy.  This suggests one should be highly skeptical that the goal of the published work was really the defense of free speech. 

Straw Man Fallacy

It did begin with a paean to free speech that even FIRE staff might like, but then posed an interesting contrast:

When you think about the arguments raised by the Pharmascolds, critics who worry about university/industry interactions, constriction of academic freedom is typically cited as a key concern. To the Pharmascolds, industry represents an inherently corruptive influence on students and trainees, and threatens to impose a restrictive and biased world view upon them.

While this 'Pharmascolds as defenders of academic freedom' narrative has certainly enjoyed considerable traction (likely related to the enabling role of journalists in this dynamic), there’s another competing narrative to consider.

It appears that Mr Shaywitz really does not agree with the "Pharmascolds," a group in which he believes Dr Nissen fits.  Mr Shaywitz did not explain who the Pharmascolds other than Dr Nissen are. He did not provide evidence in support of his summary of their views.  So, at least in this blog post, the Pharmascolds appear to be straw men, and Mr Shaywitz thus appeared to be using the straw man fallacy to support his argument.

A Second Relativist Fallacy

Moreover, Mr Shaywitz did not try to challenge the truth of the "Pharmascolds'" supposed views. Rather, he offered a "competing narrative." That is a surprising form of argumentation for someone who seemed to be appealing to conservatives. The notion that there is no truth, only competing narratives, is straight out of post-modernism, a school of thought with which conservatives rarely identify. Mr Shaywitz's casting of his argument as a better, but still "competing narrative," thus appears to be another use of the relativist fallacy.

So this extraordinary blog post in Forbes appears to be less a reasoned defense of free speech and academic freedom and more an attempt to once again discredit the "Pharmascolds," and hence to discredit anyone who is skeptical of the influence of pharmaceutical companies and other commercial vested interests on academic medicine. But like the last attempt to mock the "Pharmascolds," this one was based on primarily on logical fallacies.

Summary

We have noted that logical fallacies are increasingly deployed to defend the status quo in health care, and particularly to defend the interests of those who are profiting the most from the current dysfunctional system.  We have noted that several defenses of the conflicts of interest generated by financial relationships between physicians and medical academics on one hand and commercial health care firms on the other, were based on logical fallacies.  (See examples here, here, and here.)  I have yet to see a coherent, logical, fact-based argument that the benefits for patients' and the public's health of physicians and medical academics working part-time as consultants, advisers, speakers, and directors of health care corporations outweigh the obvious risks of biasing medical decision making, education and research in favor of vested interests.
I have also yet to see an argument in favor of conflicts of interest made by anyone who does not have such conflicts.  While David Shaywtiz was identified only as a "contributor" on his Forbes post, and as an "adjunct scholar" on the version on the American Enterprise Institute site, his profile on the Forbes site notes that he really is Dr David Shaywitz, trained as a "physician-scientist," who now "works at a biopharmaceutical company in San Francisco." His own blog identifies him as "currently Director of Strategic and Commercial Planning at Theravance, a publicly-held drug development company in South San Francisco."  So perhaps Dr Shaywitz disagrees with the "Pharmascolds" because their skepticism may be perceived as threatening the vested interests of Dr Shaywitz's company? Perhaps the campaign against the "Pharmascolds" is yet another example of stealth health policy advocacy by those with vested interests that might be threatened by skepticism about ties among physicians, academic medicine, and industry?

Physicians and the public need to stay extremely skeptical about much of published health policy advocacy, particularly when the arguments appear illogical, or the interests of the advocates are not clear.

Smart ALEC's Strange Bedfellows

 A number of articles in the Nation, plus posts by some of our blogging colleagues discussed the American Legislative Exchange Council (ALEC) and its role in policy, including health policy advocacy.  The lead article, "ALEC Exposed," in the Nation, characterized ALEC as:

a critical arm of the right-wing network of policy shops that, with infusions of corporate cash, has evolved to shape American politics. Inspired by Milton Friedman’s call for conservatives to 'develop alternatives to existing policies [and] keep them alive and available,' ALEC’s model legislation reflects long-term goals: downsizing government, removing regulations on corporations and making it harder to hold the economically and politically powerful to account. Corporate donors retain veto power over the language, which is developed by the secretive task forces. The task forces cover issues from education to health policy.

ALEC and Health Care Reform
Wendell Potter contributed an article about ALEC's position on health care reform. First,

ALEC crafted the Freedom of Choice in Health Care Act, which, despite its Orwellian name, was written to deny the citizens of any state that passed it the freedom to set up such a system. By declaring that Congressional attempts to regulate health insurance at the federal level would be unconstitutional, it would effectively ban not only a federal single-payer proposal but also a federally created health insurance exchange and a federally operated public insurance option.

ALEC

adopted a strategy to shape rather than stop reform. Its top five goals became:

§ Keeping single-payer proposals off the table;

§ Ensuring that the final bill contain a clause requiring all Americans not eligible for an existing federal program to buy coverage from a private insurance company; [note that thus the "mandate" that pseudo-conservative groups like the Tea Party hate seems to have been pushed by big commercial insurance firms, and by some of the Tea Party's backers, not by the "big government" the Tea Party also loves to hate]

§ Preventing the new law from establishing a government-run plan (the 'public option') that would compete with private insurers;

§ Making sure that the reform law is implemented primarily at the state level, to keep the federal government from assuming any significant new oversight of private insurers’ business practices; and

§ Keeping any new regulations and consumer protections to a minimum.

Insurers achieved their first four goals, with ALEC playing a key role in a well-coordinated effort to keep the most progressive proposals from being enacted at the state or federal level.

Corporate Funders and Influencers
The articles in the Nation suggest that ALEC's health policy advocacy is shaped only by commercial health care insurance. However, it appears that ALEC is supported by a much broader spectrum of health care corporations and other corporations whose products affect health care. It's "Private Enterprise Board" includes Mrs Sandra Oliver, First Vice Chairman, Bayer Corp; Mr John Del Giorno, Second Vice Chairman, GlaxoSmithKline; Mr David Powers, Treasurer, Reynolds American; and Board Members Mr Don Bohn, Johnson and Johnson, Mr Jeffrey Bond, PhRMA, and Mr Michael Hubert, Pfizer.

A PRWatch special report on its funding noted:

98% of ALEC's funding comes from corporations like Exxon Mobil, corporate 'foundations' like the Charles G. Koch Charitable Foundation, or trade associations like the pharmaceutical industry's PhRMA and sources other than 'legislative dues.'

In more detail,

Other current ALEC corporate leaders have given an undisclosed sum to ALEC this year and before.

These companies include: CenterPoint 360 (a firm that helps companies 'manage legislation'), Altria (formerly Phillip Morris tobacco), the American Bail Coalition (the trade group for for-profit bail bonds), AT&T, Bayer (aspirin), Coca-Cola, Diageo (Crown Royal and other liquor), Energy Future Holdings (Texas electricity), ExxonMobil, GlaxoSmithKline (Tums and other brands), Intuit (Quickbooks), Johnson & Johnson (lotion), Koch Industries (Georgia Pacific paper products and other brands), Kraft Food (Macaroni and Cheese dinners), Peabody Energy (the largest private coal company in the world), Pfizer (Viagra), PhRMA (the pharmaceutical trade group), Reed Elsevier (Lexis/Nexis legal research), Reynolds American (tobacco), Salt River Project (energy), State Farm Insurance, United Parcel Service, and Wal-Mart (world's largest retailer).

So ALEC supporters include some very strange bed fellows.

Commercial Insurance in Bed with Pharma
ALEC has championed health care positions that seem designed to favor commercial health insurance.  However, it is supported by many corporations with which commercial health insurance ostensibly negotiates at arms length, and whose prices commercial health insurance ostensibly wants to lower.  These include pharmaceutical companies, Bayer, GlaxoSmithKline, and Pfizer, and pharmaceutical/ biotechnology/ device conglomerate Johnson and Johnson, all represented by PhRMA. 

It is very curious, to say the least, that such companies are helping to fund a set of policy objectives all designed to further the interests of commercial insurance companies as listed above.  Perhaps the leaders of drug companies think that commercial insurers are likely to be easier negotiators than would be some future hypothetical "public option," (government run insurance company).  Perhaps the leaders of commercial insurance companies realize that they can more plausibly raise their administrative costs, and the amounts they pay to top executives, when overall health care costs, fueled by pharmaceutical and device prices, are rising.

A UK Company in Bed with American State Legislators

ALEC is supposed to be directed at American state legislatures, and be a membership organization for American state legislators.  It literally includes a graphic of a waving American flag on its home page.  However, it is supported by at least one foreign (UK) pharmaceutical company, GlaxoSmithKline. 

It is very curious that a British company seems to be seeking to influence the US state legislative process. The appropriateness, and the legality of a British company seeking to influence American state legislatures I leave to be judged by others. 

Pharmaceutical Companies (Including Those that Make Smoking Cessation Products) in Bed with Tobacco Companies

ALEC is supported by pharmaceutical companies that all promise to improve health care.  These particularly include those that make or sell products that are designed to improve health by aiding smoking cessation, (GlaxoSmithKline, Johnson and Johnson, and Pfizer).  However,by their side stand two tobacco companies, Reynolds America and Altria, whose products the pharmaceutical companies' products are designed to counter. 

It is very, very curious that smoking cessation product manufacturers would team up with tobacco companies.  Perhaps cynics among the leadership of the drug companies realize that the market for smoking cessation products increases with tobacco sales.  Perhaps cynics among the leadership of tobacco companies think that the knowledge that there are treatments, albeit not very effective ones, to aid in smoking cessation may encourage people to start or continue smoking (an interesting but rarely discussed example of the "moral hazard" that free market economists love to otherwise discuss).  

Summary

So in my humble opinion, the strange bedfellows among health care related corporations funding ALEC suggest 1) how little the health care system functions like anything resembling an ideal free market; and 2) how top organizational leaders may have feel they have more in common with each other than they do with their more lowly employees, customers, clients, and the public at large.

True health care reform would require decreasing the size and power of large health care organizations, and ensuring that their leaders put their mission, and their patients' and the public's health ahead of their personal enrichment.

Hat tip to Naomi Freundlich's post on the Health Beat blog.

Say It Ain't So - Howard Dean Runs Through Revolving Door to Become Biotechnology Booster

The revolving door now accommodates the whole political spectrum.  A Salon article documented the transit of one Howard Dean, former darling of the left-wing of the Democratic party:

Howard Dean has long cultivated an image as the plainspoken doctor who speaks for the left wing of the Democratic Party, a role he still plays as a pugnacious pundit on TV. But since his term as chairman of the Democratic National Committee ended in January 2009, Dr. Dean has taken on a less-noticed role: paid advocate for interest groups that would find few fans among the progressive voters once energized by Dean's 2004 presidential bid.

Dean may not be the worst of the 'buckrakers,' those prototypical capital characters who exploit their name and connections without regard for principle. But his recent political forays seem to have diverged from his trailblazing left-liberal past.

As senior strategic advisor at McKenna Long & Aldridge, a heavyweight Washington lobbying firm, Dean played a prominent role representing the biotech industry during the healthcare bill debate, staking out a position on biopharmaceutical drugs that was decried by consumer groups.

'Gov. Dean was very helpful to us,' biotech CEO Jim Greenwood told a trade publication 'As a physician clearly focused on healthcare, a Democrat leader and clearly to left of center, his efforts were impactful.' Greenwood is the head of the Biotechnology Industry Organization (BIO), a trade group that lobbies for the industry in Washington.

In particular,

Dean arrived in the comfortable K Street offices of McKenna Long & Aldridge shortly after his term as DNC chair ended in January 2009. He had been passed over by President Obama for the secretary of health and human services Cabinet post, and he needed a paying job.

In announcing his appointment, the firm said Dean would 'provide guidance to clients, particularly in the areas of healthcare and alternative energy resources.'

Dean has been careful not to register as a lobbyist, a designation that would prompt legal disclosure requirements. Both McKenna and the governor's spokeswoman declined to reveal which clients he has worked for.

Dean took on a very public role during the 2009 healthcare reform battle, specifically going to bat for the biotech industry -- whose trade association is a client of McKenna.

At stake was how the government would regulate a growing class of drugs called biologics or biopharmaceuticals and their generic competitors. The industry argued for a longer period -- at least 12 years -- in which expensive brand-name biologics would face no competition from less costly generics. Consumer groups argued that, to keep costs down, the period of exclusivity should be just five years.

Dean jumped into the fight on the side of the industry, writing an Op-Ed in the Hill in 2009 arguing that a 'commonsense and fair approach' would be to bar generics for 'at least 12 years.'

'If we discourage investment, we jeopardize the development of the next generation of breakthrough medicines and cures,' he wrote, echoing a key industry talking point.

Dr Dean also apparently did some paid health policy advocacy on behalf of other clients:

In January, he waded into another high-stakes healthcare fight, this one being waged in New York state between foreign medical schools and their American competitors. The issue was whether foreign-trained doctors would have access to hospitals in New York for their residencies. Dean wrote an Op-Ed in the Albany Times-Union, 'N.Y. needs its foreign-trained doctors,' that repeated talking points of foreign medical schools, which, Dean's bio blurb noted, are clients of McKenna Long & Aldridge.

While the firm won't say whom Dean has worked for, his bio page on McKenna's website offers some clues.

Dean also took on a few other jobs for corporate health care. For example,

He currently serves on the board of advisors at Vatera Health Partners, a New York-based venture capital fund whose mission is 'to support and grow emerging biopharmaceutical companies.'

It's not clear from the public record how long he has served in the position. But his presence on the Vatera board indicates that he has a personal financial stake in the biopharmaceutical industry.

Also, he is now

serving on the board of Extendicare, a Canadian long-term care company.

Dr Dean's new job did not sit well with a former colleagues on the left side of the US political spectrum who had a distinctly different position on the issue of biologic exclusivity:

'It was devastating to have him involved because of his reputation,' says James Love, director of Knowledge Ecology International, a public interest group that fought for a shorter period of exclusivity. 'He's considered to be independent of industry and on the left, so it was really shocking to us when we first saw this. But there it was.'

The Salon article ended on this disillusioned note:

Dean is indeed uniquely positioned: Between his former followers and his current clients, between his idealist liberal past and the cynical culture of K Street, between independence and cooptation.

We have discussed how other government officials and political leaders transited the revolving door to work for corporate health care (e.g., starting here, and more lately here). However, this most recent case seems to present the most vivid contrast between previous reputation and later employment.  Actually, while Dr Dean was clearly an advocate for changing health care, he was not a supporter of some ideas usually labeled left-wing," such as a single payer system (see here).  However, the Washington Times reported that when he was running for President in 2004, the Club for Growth Political Action committee ran an television advertisement calling him the proprietor of a:

tax-hiking, government-expanding, latte-drinking, sushi-eating, Volvo-driving, New York Times-reading … Hollywood-loving, left-wing freak show

The transformation of Dr Howard Dean from a target of the Club for Growth to a paid helper and talking points echoer of the Biotechnology Industry Organization illustrates that nowadays the revolving door accommodates all kinds of politicians. The door remains legal, but its continuing rapid spin raises more and more concern that even the ostensibly most left-wing politicians may act to avoid offending any future lucrative corporate employer. So the coziness between government and the medical-industrial complex is increasingly revealed, and the ability of current government officials and politicians to represent the people rather than corporate CEOs is increasingly in doubt.

True health care reform would have to somehow reduce the resultant corporatism.

Medical Societies Paid To Do Corporate Public Relations

Background

Last year we posted about how two medical societies which received funding from a drug manufacturer tried to persuade the US Food and Drug Administration (FDA) to deny approval of a generic competitor to one of that company's products.  The medical societies were the Society of Hospital Medicine (SHM) and the North American Thrombosis Forum (NATF).  The company was Sanofi-Aventis and the product involved was its anti-coagulant derivative of heparin, Lovenox. 

At the time, we noted that the SHM CEO denied the need to specifically disclose funding from Sanofi-Aventis in the letter to the FDA, since he asserted the letter was about "providing the best, most effective care to the hospitalized patient." If so, I wondered why the SHM had not raised concerns about the case of the deadly contaminated heparin which was sold by another company from which it received support.  I noted that as long as medical societies accepted money from companies that made drugs or devices their members might prescribe or use, there would be "suspicion that such societies may use their considerable influence to serve the corporations', not patients' interests, and so undermine the professional values of the societies' members."

The Senate Report

Now the US Senate Finance Committee has reported on their investigation of this incident, and the concerns it raises go beyond just suspicions.  As reported by Alicia Mundy in the Wall Street Journal,

The Senate report, 'Sanofi's Strategic Use of Third Parties to Influence the FDA,' said the company enlisted medical experts to conduct 'independent interaction' with the FDA to hold on to Lovenox's market.

Between 2007 and 2010, the company contributed more than $2.6 million to the Society of Hospital Medicine; more than $2.3 million to the North American Thrombosis Foundation, which studies blood clots; and more than $260,000 to Dr. Tapson, the report said.

Sen. Max Baucus (D., Mont.), chairman of the Finance Committee, said: 'Pharmaceutical companies simply cannot be allowed to spend millions of dollars to buy medical opinions that claim objectivity but instead favor their products.'

The Society of Hospital Medicine was initially reluctant to write the letter, according to emails released by the committee. The society's director told Sanofi in a June 2008 email that his group 'has no history of making similar comments to the FDA' and might not have 'the expertise or knowledge to say much about' the issue.

However, the email added, 'we want to give any issue that is important to our partner careful consideration.'

Two months later, the society sent its letter to the FDA. A Sanofi public-relations representative later cited the letter in an internal email as a 'key accomplishment.'

The report itself made clear why Sanofi wanted the FDA to delay or deny approval of the generic version of Lovenox:

According to a 2009 Sanofi slide presentation on its 'Lovenox Patient Safety Strategy,' a core issue faced by Sanofi was the 'imminent threat to [Sanofi’s] Lovenox franchise' posed by 'generic alternatives.'

It also made clear how much financial impact Sanofi had on the SHM:

SHM received $2,675,850 from Sanofi from January 2007 through August 11, 2010 for conference exhibits, sponsorship, and grants. Sanofi’s payments to SHM totaled $1,132,500 between July 1, 2007 and June 30, 2009, accounting for 8 percent of SHM’s total revenue during those 2 years.

It made clear that the letter the SHM wrote to the FDA resulted from its interactions with Sanofi:

Internal Sanofi communications indicate that SHM consulted with the American College of Chest Physicians and Dr. Tapson about sending a letter to the FDA after 'a very positive meeting' with Sanofi officials.

Summary

So let us just walk through this again. Sanofi wanted to keep generic Lovenox off the market. Sanofi pushed two medical societies to which it provided considerable funding to try to persuade the FDA not to approve generic Lovenox, without revealing their financial ties to Sanofi or that Sanofi had instigated their protests. At the time, at least one of the societies' leaders denied that its attempt to persuade the FDA had anything to do with its relationship to Sanofi.

Note that Sanofi's use of two medical societies and a "key opinion leader" to try to influence public policy without disclosing the company's causal role was an example of what Wendell Potter called a "third-party" tactic (see this post).  While Mr Potter outlined a series of tactics used by public relations department of health insurance corporations to further their policy objectives, often in such deceptive and systematic ways as to constitute disinformation campaigns, there has not been such a broad description of these these tactics used by other kinds of health care organizations.  Now it looks like drug companies' PR departments are also users of these techniques.  Most likely they have been deployed throughout the health care sphere to promote policies that benefit particular companies, often at the expense of health care professionals, patients, or the public at large.

On a personal note, I am a general internist who spent some time as an academic hospitalist.  The SHM is the main society for hospitalists, and is allied with the Society for General Internal Medicine (e.g., see here), to which I belong, and which I have served in a variety of capacities.  Thus I am very sad about the hole into which the SHM leadership has apparently fallen. 

The SHM and NATF leadership have apparently become stealth health policy advocates, and actively tried to change government policy on behalf of a corporation that had funded them.  Thus, these medical societies acted more like public relations or lobbying firms.  In doing so, they appeared to subverted their own missions, and their members' values.

A short time ago, we noted the cases of two medical societies that got substantial funding from drug and device companies, and thus seemed to function more like marketing firms that professional associations.  Now we have two cases of medical societies that seemed to function more like public relations and lobbying firms than professional associations.

So all the organizations which ought to have upheld health care professionals' values against the onslaught of laissez faire commercialized medicine, now medical societies as well as academic medical centers, medical schools and their parent universities, and medical and health care foundations, seem to have been systematically sold out to big health care corporations' marketers and public relations flacks. 

What Is To Be Done?

If we health care professionals really want to improve patient care and the public health, we could start by exercising extreme skepticism about the funding and leadership intentions of our own professional associations.  If these societies appear as dependent on industry for money as they are dependent on their own members, and/or if they appear to be acting more like marketing, public relations or lobbying firms, why do we continue to enable such behavior?  Why should we pay dues to marketing, public relations or lobbying firms?  We need to have our medical societies uphold their own missions, or we need to get new medical societies. 

Hat tip to the Project on Government Oversight (POGO) blog.

Millions to Health Insurance CEOs, But Blame Everyone Else for Rising Health Care Costs

The revelations about the huge golden parachute given the outgoing CEO of ostensibly non-profit Massachusetts Blue Cross Blue Shield induced some public discussion about the disconnect between executive compensation and the mission of health care organization (see most recent post here).  Several other recent stories should generate more discussion on these issues. 

First, new proxy statements revealed the compensation of executives of two large for-profit health care insurers/ managed care companies.  In alphabetical order,

Cigna

As reported by the AP, via ABC news, the CEO got a big raise:

Cigna Corp. CEO David M. Cordani's total compensation more than doubled in 2010, his first year as leader of the nation's fourth-largest health insurer, and a period in which the company's earnings, revenue and enrollment all climb.

Cordani, 45, received compensation valued at $15.1 million last year from the Philadelphia managed-care company, according to an Associated Press analysis of a regulatory filing Friday.

That included a $1 million salary, a performance-related bonus totaling more than $7.3 million and stock and option awards adding up to $6.7 million.

In 2009, Cordani's compensation was $6.5 million, but he did not serve for the entire year. Note that according to the 2009 proxy, the previous CEO, H Edward Hanway, received $12,236,740 in total compensation in 2008, his last year as CEO.

What was the rationale for the huge rise in Cordani's compensation from 2009 to 2010? (And implicitly, the fairly large increase compared to Hanway's compensation in his last year?)

The company said in its proxy statement filed with the Securities and Exchange Commission that Cigna 'effectively executed on its growth strategy under Cordani's leadership last year.

'Revenue rose significantly in 2010, reflecting strong premium growth in (Cigna's) ongoing business segments,' the proxy said.

Cigna earned about $1.35 billion, or $4.89 per share, on $21.25 billion in revenue in 2010. That was up from $1.3 billion, or $4.73 per share, on $18.41 billion in revenue in 2009. The insurer's medical membership climbed 4 percent to 11.4 million people compared to the final quarter of 2009, when it fell more than 5 percent. That helped raise premiums and fees in health care, the insurer's largest segment.

Also,

Cigna shares climbed 4 percent to close 2010 at $36.66, while the Standard & Poor's 500 index rose 12.8 percent.

So to recap, Cigna's current CEO's total compensation doubled in a year while earnings and the stock price rose about 4%.

WellPoint

Also reported by AP, via the Washington Post, the CEO got a small raise (but ended up with compensation similar to Mr Cordani's above):

The president and CEO of health insurer WellPoint Inc. received a 3 percent boost in total compensation in 2010 even as the company’s profit and enrollment numbers slipped during a transitional year for U.S. health care companies.

The Indianapolis-based insurer awarded Angela Braly a total pay package worth $13.4 million up from $13.1 million in 2009. Wellpoint disclosed the compensation — which includes salary, bonus and other awards — in a filing with federal financial regulators late Friday.

On the other hand, the company did not do so well financially:

The insurer’s profit fell sharply last year compared with 2009, when the sale of its NextRx subsidiary contributed $2.2 billion in after-tax income. Medical enrollment also slid 1 percent last year to 33.3 million members.

So what was the rationale for even a small raise (over an already huge compensation package)?

In the company’s filing, Wellpoint’s board of directors highlighted accomplishments by management, including reducing general expenses by 3 percent.

Also,

A Wellpoint spokeswoman stressed Friday that the company’s pay formula rewards executives for improving enrollee health, boosting share prices and meeting other pre-set goals.

'For the CEO, almost 90 percent of total target compensation is based on company performance and is tied to meeting established goals,' Kristin Binns said in a statement.

So while Cigna did slightly better financially than last year, its CEO's total compensation doubled to well over $10 million, and while WellPoint did slightly worse financially than last year, its CEO's total compensation increased, again remaining well over $10 million.  It seems that the leaders of top health care organizations will continue to get richer, no matter how well their organizations performed financially, let alone what effect they had on patients' and the public's health.
So What Drives Up Health Care Costs?

Just to distract from CEOs getting increases in their already huge compensation that seem disproportionate to any reasonable measure of their companies' financial performance, health care insurers continued to deny any responsibility for the rise in health care costs.

For example, the San Francisco Chronicle published a story entitled, "Insurer Wants Focus on What Drives Up Health Costs," which had a familiar ring:

When health insurers notify members that rates are going up - often in the punishing double-digits - they typically blame rising medical costs.

They say the problem really isn't theirs; it's all the other pieces of the health-care puzzle that drive up costs that must be passed on to customers.

Don't blame you, don't blame me, blame that fella behind the tree.
It went on to name all the usual suspects (color-coded for comparison below):

Insurers say their costs grow in part because of new medical technologies and the rising price of pharmaceutical products and medical equipment.

The consolidation of hospitals and doctors into large networks also makes it hard to keep prices low, as do waste, fraud and malpractice, they say. The system also lacks incentives for hospitals and doctors to curb costs. For example, they can charge twice by repeating tests and procedures, and by readmitting patients.

Insurers also say they lose money with policies people buy on their own, as opposed to group coverage from employers. Because the individual policies are more expensive, healthier people tend to avoid them, leaving insurers with a sicker pool.

Poor reimbursement from government programs such as Medi-Cal also forces insurers to raise private insurance prices to make up the slack, they say.

Finally, as people get older and fatter, they gobble up more health care resources.

'When you're looking at growth in premiums, the largest engine of that growth are those medical costs,' said Charles Bacchi, executive vice president of the California Association of Health Plans, which represents health insurers. He said critics who claim that insurers raise prices to increase profits and pad executive salaries are wrong, and that insurers' average profit margin has remained at 3 to 5 percent for years.

First, note that the executive compensation, the administrative costs, the marketing, public relations and lobbying costs all come off the top of revenues before any profits are generated, and before any possible dividends get paid to stock-holders.   I suspect that the insurance industry spokespeople immediately switch the topic to profits and investors' results to distract from those who really make money from health insurance companies, the top executives, and all those managers, bureaucrats, marketers, public relations people, and lobbyists who never touch patients and never deliver any care.  As Wendell Potter has written, many people like to blame government bureaucrats for health care's problems. They may deserve some blame, but not any more, and perhaps less than corporate bureaucrats and executives.

Recall further what Wendell Potter described in Deadly Spin. All those health insurance corporate public relations people were earning good salaries in part based on their ability to distract the public and policy-makers from the insurance companies' roles in health care dysfunction. Potter wrote (p. 110):

Rather than admit responsibility for the failures, insurance executives pointed the finger of blame at their customers, the 'consumers' of health care, and, of course, the providers of care. In introducing the concept of their new silver bullet - consumer driven health care - insurance executives claimed that the 'real drivers of health care costs' (one of my CEO's favorite expressions) were the people who sought care when they really didn't need it and the doctors and hospitals who were all too willing to provide this unnecessary care. Sure, the aging population and expensive new technology were also factors, but the main culprits were people who just didn't realize how expensive health care had become.

Note the similarities among the "real drivers of health care costs" promulgated by the corporate PR people and the defense of the health insurers' role mounted above (some of the more obvious color-coded). Note that the defenses never explain why the insurance companies seem unable to negotiate prices down, and why they all use the physician payment schedule derived from the recommendations of the secretive RUC.

For some final irony, the Chronicle found an academic who was not too hard on the health insurance companies:

Glenn Melnick, a health economist at the University of Southern California, sympathizes with many of the insurers' arguments.

He blamed rising costs mainly on higher prices charged by hospitals and doctors, which account for the largest portion of health care spending.

The reporter did not note Prof Melnick's full title, Professor and Blue Cross of California Chair in Health Care Finance. Oops.

So in summary, health care costs continue rising, access keeps declining, and there is no evidence of improvements in quality. Large health care organizations blame each other for the problems, but nearly all of them continue to make their top executives extremely rich. Although the amounts diverted to these executives cannot solely account for the rise in health care costs, the perverse incentives given those who lead health care are likely a major cause of the problems. A health care system run by leaders who are comfortable becoming extremely rich while the health care crisis worsens is a likely recipe for dysfunction.

We now know commercial health insurers deploy well paid public relations departments to use stealthy if not downright deceptive means to distract those who want to address what really causes health care dysfunction (see this post.) It is likely that all large health care organizations use similar stealth advocacy strategies. These strategies have successfully distracted the conversation away from problems with health care leadership and governance, at least until now.

As we have said before, far too often the leaders of not-for-profit health care institutions seem more interested in padding their own bottom lines than upholding the institutions' missions. They often seem entirely unaware of their duty to put those missions ahead of their own self-interest. Like the financial services sector in the era of "greed is good," health care too often seems run by "insiders hijacking established institutions for their personal benefit." True health care reform would encourage leadership of health care who understand health care and care about its mission, rather than those who see a quick way to make a small fortune.

Furthermore, we need an open discussion of the real issues related to health care dysfunction, not one stifled by the anechoic effect, spun by corporate PR, and dominated by "third parties" whose conflicts of interest are hidden. 

Once More with Feeling: Another Defense of Conflicts of Interest Based on Logical Fallacies

Despite increasing recognition of the adverse effects of health care professionals' and health care institutions' conflicts of interest on health care, such financial relationships continue to have their prominent defenders.  The latest example was an article in Medscape General Surgery by Frank J Veith MD, entitled "Physicians and Industry: Fix the Relationships, but Keep Them Going."  Dr Veith is a prominent vascular surgeon who "received numerous awards and honors as a leader, outstanding teacher, and innovator in vascular surgery," according to New York University

We have noted before how defenders of conflicted professionals and professional societies often employ logical fallacies to support their arguments.  Some recent examples were discussed here, by a prominent ostensibly libertarian attorney and law professor; here, published in a well-known medical journal by the former director of "medical communications" for a large pharmaceutical firm; and here, by the president of a large medical society, published again in a well-known medical journal.

Dr Veith seems to be continuing that tradition. His approach emphasized frequent repetition of the same fallacious argument.

Straw Man: "Totally Interrupt All Doctor-Industry Relationships"

Dr Veith's main argument seemed to be with attempts to prevent physicians from having any relationships with industry, presumably including not just financial relationships, but professional collaborations or even personal friendships.  For example, he wrote about

a recent initiative to completely sever the relationship between industry and doctors has gained traction. This initiative has been supported by several states, including Massachusetts and Vermont, and universities, such as Harvard, Stanford, the University of Massachusetts, and the University of Michigan, which have enacted draconian laws or policies designed to separate doctors and industry and to interrupt any relationship between them.

Furthermore,

Even many individual physicians have sanctimoniously jumped on the bandwagon and written articles or opinion pieces attacking the evils of any relationship between industry and doctors, suggesting the severance of any such relationships.

Then later, Dr Veith wrote,

We should establish rules to prevent or minimize the abuses, but we should not totally interrupt all doctor-industry relationships. To do so is wrong-headed and would eliminate the many beneficial effects that accrue to medical care and society from these relationships. It would be throwing the baby out with the bathwater.

Finally, he concluded thus,

These will be far better solutions than completely eliminating all industry-doctor relationships.... Such safeguards will be better than the present trend for institutions and governments to enact strict measures to separate physicians from industry.

Despite making this argument at least four times, the problem is that Dr Veith provided no citations, much less evidence that such "draconian" policies have been enacted or even advocated.

There have been new policies on conflicts of interest suggested or adopted by some organizations. None, to my knowledge have been exactly "draconian."

For example, Harvard University does have a new policy on conflicts of interest. Maybe Dr Veith was referring to it above when he mentioned Harvard. However, in an interview about the new policy involving university leaders published in the Harvard Gazette, the Vice Provost of the University said,

The University is not designed to be an ivory tower isolated from the world. So the trick is to be able to have a robust system for affording faculty opportunities to engage with the commercial world and at the same time not threaten in any way their own fundamental integrity or that of Harvard.

That hardly sounds like a policy that completely severs all relationships between faculty and industry.
So Dr Veith's main premise seems to be based on a multiply repeated straw-man argument. He argued again and again against a policy that no one seems to be advocating. (And even I, as a hard-liner about conflicts of interest, have never advocated a complete interruption of all relationships of any kind between all physicians and all of industry.)

Appeal to Fear: You Will be "Blighted"

Perhaps just to spice things up, Dr Veith warned of the dire consequences of the "draconian" policies that no one was advocating:

Those institutions that choose such inquisitional approaches will be blighted and suffer competitive disadvantages.

Dr Veith had asserted multiple benefits of continuing relationships among physicians, health care institutions, and commercial firm. He presented no evidence to support his assertions, most of which can be questioned (see below). His warning that institutions will be "blighted" was based on his assertion that the stringent policy no one advocated would eliminate these unproven benefits, hence his warning of  something so severe as "blight" seemed to be an appeal to fear.

Ad Hominem: "Sanctimonious" Physicians Leading a "Witch Hunt"

As noted above, Dr Veith referred to anonymous physicians who "sanctimoniously jumped on the bandwagon," thus leading to

The initiative to separate industry from physicians and surgeons [which] has taken on the trappings of a witch hunt.

And again,

Their leaders should recognize this and resist the temptation to join the separation witch hunt....

My interpretation is that this was an implied set of ad hominems. Those who supposedly advocated the "draconian" policy were made out to be "sanctimonious" witch hunters. After just having seen "The Crucible," I could also argue that the use of the term "witch hunt," with its current extreme emotional references (apparently to a case in which presumably innocent people were hanged), amounted to an appeal to emotion and an appeal to fear.

Summary

I must admit Dr Veith's entire set of arguments was not completely based on logical fallacies.  However, the rest of his arguments hardly appeared even-handed.  He presented a series of assertions about the benefits of such relationships, including that they "foster innovation and development," that "industry-sponsored medical education helps to keep physicians informed about new developments," that industry sponsored education about devices prevents "difficult and dangerous" practices, and helps physicians use devices "better and more safely."  He provided no evidence in favor of these claims, and seemed to ignore arguments about the hazards of payments to physicians biasing their clinical practice, teaching and research.

I should also note that these arguments were made by a physician who appears to have his own personal financial relationships with industry.  In the Medscape article, Dr Veith "disclosed no relevant financial relationships."   However, as a member of the editorial board of Medscape General Surgery, Dr Veith "disclosed the following relevant financial relationships: Owns stock, stock options, or bonds from: Vascular Innovations, Inc."  Furthermore, the disclosure summary for the iCON2011 conference includes the following for Dr Veith, "Honorarium/Expenses: Cook Medical, Cordis, WL Gore, Medtronic." Finally, Dr Veith apparently runs the Veith Symposium, which in 2010 acknowledged the following commercial sponsors: Aastrom, Abbott Vascular, Aptus Endosystems Inc, Atrium, Bard Peripheral Vascular, Boston Scientific, Cook Medical, Cordis Cardiac and Vascular Institute, Delcath Systems Inc, Gore, Hansen Medical, Lombard Medical Technologies, Maquet, Medtronic, Organogenesis Inc, Sanofi-Aventis, St. Jude Medical, Tenaxis Medical, Triavascular, Vascutek Terumo.

So Dr Veith's article continues the tradition of defenses of physicians' and health care institutions' conflicts of interest based on logical fallacies and unbalanced and unsupported assertions.  Also, note that all the examples of such defenses we have discussed were made by people with their own financial relationships with drug, device, and/or biotechnology companies, although some of them disclosed these relationships.  I have yet to see a defense of such conflicts based on logic and evidence, or a defense of such conflicts made by someone who has absolutely no conflicts of his or her own. 

The currently prevalent relationships with health care corporations among academic physicians, researchers, and other decision makers and influencers in health care have been lucrative for them.  I have yet to see a coherent, logical argument that these relationships are good for patients, medical education, biomedical or clinical science, or public health made by anyone, much less someone who does not have such relationships.

I will note that the defenses of conflicts of interest begin to seem drearily similar.  Not only do they often use the same logical fallacies, but they repeat the same stale and unsupported arguments about the benefits of financial relationships with industry: that they foster "innovation," and that they provide better educational opportunities than unconflicted programs and educators.  We now know that the managed care industry has engineered stealth health policy advocacy campaigns that furnish talking points to "third parties" which may get caught up in the larger policy discourse (see posts here and here).  I wonder whether some such stealth health policy advocacy campaign by pharmaceutical, device and/or biotechnology companies seeded the discourse about conflicts of interest with some of the logical fallacies and unproven assertions that have become so familiar. 

We need to elevate our discourse about health care policy.  People involved in health policy discussions should at least disclose their conflicts of interest when making their points.  We should be very skeptical of  arguments and look carefully for the evidence and logic that supports them.  When we find that evidence and logic is lacking, be even more skeptical about who benefits from them.