Medical Board Spends $35 Million Disciplining 314 Doctors

The Medical Board of California released its 2007-08 Annual Report today.

The report has some jaw-dropping numbers. Among other things, the Board spent over $35 million of its $53 million in revenues on “enforcement operations,” i.e.investigating complaints against doctors, and “legal and hearing services,” i.e. paying the Department of Justice to prosecute doctors and paying the Office of Administrative Hearings to hear those prosecutions. These totals are staggering in light of the product of all of that effort: 314 physicians were disciplined. Of those, 32 physicians had their licensed revoked, 70 surrendered their licenses, 91 were placed on probation, and 87 received a letter of reprimand, which is the most mild form of discipline imposed. Even if you count the lowest level forms of discipline, this works out to over $113,000 spent for every physician disciplined.

The story gets even more outrageous when you drill down into the kinds of cases that the Medical Board elects to pursue. Sensitive to complaints about its performance, the Board only gets to the numbers posted in its report by seeking discipline for non-serious conduct, such as poor recordkeeping and by insisting on discipline even when physicians can demonstrate that issues like recordkeeping were fixed well before the investigation event started.

The Annual Report offers excuses — most notably that “[r]etention [of investigators] remains a serious problem.” The Board correctly notes that any investigators who can get jobs in other parts of the government do so because of the poor pay.

It’s little wonder that Governor Schwarzenegger made a serious proposal for the outright abolition of the Board a few years ago. That $35 million could be better spent paying down the state budget deficit.

Does Media Coverage Contribute to Declining Healthcare Consumption?

Does media coverage impact healthcare consumption? Over the past two months, a steady stream of newspaper stories have reported on the negative effect of the sour economy on patient consumption of healthcare services. Last week, the New York Times reported that patients were skimping on their prescription drugs to save money. Today, the Times reports on a trend with a less serious public health implications, but very negative ramifications for the healthcare economy of Southern California: declining public interest in cosmetic procedures.

The story reports results of a survey about the first six months of 2008. As with many of the other articles, the statistics on which the story draws are from a small sample that calls into question their reliability.

It would be interesting to know how real the underlying trend is. Is it possible that such reports are having a significant negative impact on healthcare consumption? Anecdotally, many –but not all — providers of elective care have been reporting a softening demand for elective procedures in Southern California that predated the most immediate bad economic news. As for non-elective care, however, my sense is that the issue in Southern California is not one of demand, but rather the challenge of collecting from patients who are having somewhat more difficulty paying the portion of care for which they are responsible.

Will the Election Bring Federal Healthcare Reform?

With the election a week away, the issue of healthcare reform has been getting a relatively high degree of media coverage. It will be interesting to see whether the political will for reform will be present in 2009. If so, given the certainties of Democratic majorities in both the House and Senate, the outline of federal reform is likely to follow the proposals of Barack Obama:

• Universal health insurance by 2012. Via a new government insurance program, employers (except for the smallest companies) will be required either to provide private health insurance coverage or to pay a payroll tax toward a federal fund.
• Insurance companies will be more tightly regulated (prevented, among other things, from rejecting applicants based on their health conditions).
• New controls will be used to bring costs down.

Leaving aside the merits of these proposals, a few questions come to mind: (1) In light of the recent hemmorhaging of federal money in various bailouts, will there be political will for the astronomical costs of the envisioned system?

(2) Is there any reason to think the health plans will be any less effective in undermining the Obama proposals than they were at scuttling the Hillary Clinton reform of 1993?

(3) If there is no movement at the federal level, what are the prospects for Governor Schwarzenegger’s statewide healthcare reform plans?

Are Cardiologists Under the Influence of Stent Manufacturer Money?

Barry Meier reports in the New York Times on questions being put to cardiologists by Senators Grassley and Kohl regarding the propriety of financial ties between cardiologists and stent manufacturers. The article notes that the Cardiovascular Research Foundation (CRF) reported 2005 revenues of $47.2 million. Senators Grassley and Kohl are asking how much of those funds came from stent makers, including Abbott Laboratories, Medtronic, Boston Scientific, and Johnson & Johnson. In addition, the inquiry is focusing on 22 leading academic researchers.

Without taking anything away from the legitimate questions being raised about the need for transparency and disclosure in academic research, the questions skirt around a far more difficult issue: the relationship between physician compensation and physician decisionmaking.

Does the FDA device approval process need an overhaul?

Reed Abelson questions the FDA medical device approval process in the New York Times. (“Quickly Vetted, Treatment Is Offered to Patients,” Oct. 26, 2008). In contrast to the extensive review process for medications are approved, the FDA has a streamlined process for approval of devices that limits review to whether the device does what its manufacturers claim:

Critics say the F.D.A.’s process for reviewing medical technology, under which medical devices have become a $75 billion-a-year industry in this country, is often too lax. More devices, they say, should get the same scrutiny applied to new drugs. While that process is not perfect, a new drug is typically studied in hundreds or even thousands of patients before the F.D.A. will approve it as safe and effective.

But under the fast-track review for most devices, a product’s effectiveness is never directly established. Regulators simply determine if the device does what its maker says it does — in MammoSite’s case, that it delivers radiation — and whether it poses any undue safety risks.

Once a device is approved by the FDA, physicians can use it freely and are not obligated to make any further disclosure regarding its proven efficacy or lack thereof. Critics have also suggested that Medicare actually rewards the use of new devices with higher compensation rates, despite their unproven status, thereby incentivizing physicians to adopt new devices.

Half of doctors give placebos?

Gardiner Harris writes in the New York Times that half of American doctors in a national survey claim to regularly prescribe placebos to patients. The study involved 679 internists and rheumatologists, rather than a cross-section of all specialties The most common placebos were headache pills and were headache pills and vitamins, but a “significant number” reported prescribing antibiotics and sedatives.

The problem, apparently, is patients who need psychic, not physical, help. Even if patients get the mental relief they need, the practice of treating patients in a deceptive manner is ethically fraught and, if discovered, legally, problematic. The American Medical Association (AMA) has discouraged placebos based on their violation of the trust that inheres in the patient-physician relationship. Providers would be well advised to avoid misrepresenting medications or misleading patients, even when they it’s intended for the patient’s own good.

Does Baseball Hold the Answer to Improving America’s Healthcare?

Today’s New York Times includes an op-ed from Oakland A’s general manager Billy Beane, Newt Gingrich, and John Kerry proposing that the key to improving American healthcare (first in cost, but supposedly worst than most of the industrialized world in “quality”) is to follow the example of baseball. Not free agency or skyrocketing compensation, but use of statistics:

In the past decade, baseball has experienced a data-driven information revolution. Numbers-crunchers now routinely use statistics to put better teams on the field for less money. Our overpriced, underperforming health care system needs a similar revolution.

Data-driven baseball has produced surprising results. Michael Lewis writes in “Moneyball” that the Oakland A’s have won games and division titles at one-sixth the cost of the most profligate teams. This season, the New York Yankees, Detroit Tigers and New York Mets — the three teams with the highest payrolls, a combined $486 million — are watching the playoffs on television, while the Tampa Bay Rays, a franchise that uses a data-driven approach and has the second-lowest payroll in baseball at $44 million, are in the World Series (a sad reality for one of us).

Remarkably, a doctor today can get more data on the starting third baseman on his fantasy baseball team than on the effectiveness of life-and-death medical procedures. Studies have shown that most health care is not based on clinical studies of what works best and what does not — be it a test, treatment, drug or technology. Instead, most care is based on informed opinion, personal observation or tradition.
. . .
America’s health care system behaves like a hidebound, tradition-based ball club that chases after aging sluggers and plays by the old rules: we pay too much and get too little in return.

One interesting the op-ed notes: “Starbucks pays more for health care than it does for coffee.”

No one disputes the value of increasing the systemic use of comparative evidence in healthcare. That seems to be happening already with increasing regularity, as reports of new clinical studies on the efficacy of this or that treatment (stent placement, arthroscopic surgery, etc.) are released. The question is how much to allow the process to happen naturally, and how much and how government should intervene. The authors’ proposal for a new public-private “institute for evidence-based medicine” sounds like an invitation for more bureaucracy to do work already being undertaken in academia and the private sector. On the other hand, their proposal to increase Medicare reimbursements and some liability protections for doctors who follow the recommended clinical best practices sounds like a winner.

Are Physicians Required to Hire Sign Language Interpreters for Deaf Patients?

Mary Pat Gallagher reports in the New Jersey Law Journal that a jury awarded $400,000 to a deaf patient who sued under the Americans with Disabilities Act (ADA) claiming that she was deprived of the opportunity to participate in her own healthcare decisionmaking by her doctor’s refusal to engage a sign language (ASL) interpreter.  To add insult to injury, the physician’s professional liability insurer is not expected to cover the liability, half of which was punitive damages.

The verdict raises the question of what obligations  physician owes to deaf patients.  The patient alleged that her repeated requests to her rheumatologist (treating lupus) were rebuffed because of the cost  ($150-$200/visit in his estimation).  Instead, he communicated over 20 vists and 20 months via her partner (in writing) and using the patient’s 9-year-old to translate.  As a result of poor communication, the patient claimed she did not understand her medical condition or treatment, including risks and alternatives.

Are California physicians similarly at risk?  Anyone treating a Medicare or Medi-Cal beneficiary (and thereby receiving federal funds) is subject to a similar potential ADA claims.  As a result of their relatively high incomes, physicians are generally at risk of similarly unsympathetic juries unswayed by arguments about relative cost. This case is hardly the first example of a case imposing an obligation to supply an interpreter on a physician (or hospital).

So what should California physicians do? Even when patients don’t make a specific request for a sign language interepreter (or a foreign language translator), physicians need to be concerned about ensuring that all patients — no matter what translation or interpretation is necessary — understand their contractual obligations, the notice of privacy practices, and, above all, the informed consent. For purposes of obtaining informed consent, a live translator or interpreter, as opposed to a prepared document, is advisable. Every situation is fact specific, but it would be safer to decline to treat a patient with whom a physician cannot communicate adequately. In cases where physicians elect to treat patients despite communication challenges, cost-effective options should be sought out, from ensuring that a staffer is able to communicate well or having access to an interpreter or interpretation service.

Microsoft HealthVault Partners with Aetna

Microsoft’s HealthVault or Google’s Google Health are the best known competitors is the emerging market for electronic health records (EHR) or personal health records (PHR). (The two terms are often used interchangeably, although EHR is meant to refer to the provider-controlled record (with myriad legal issues attendant to its content) and PHR to the patient-controlled record, so that, technically, both are PHR.) The Wall Street Journal reports that Microsoft has partnered with Aetna to transfer enrollee medical records to HealthVault. Patients enrolled in Aetna health plans will have the option of placing their Aetna PHR (e.g. claims, diagnoses, test results and prescriptions in HealthVault. The partnership with Aetna follows a June 2008 announcement of a HealthVault trial partnership with Kaiser. None of the major health plans (in California, Anthem Blue Cross, Blue Shield, United, Cigna, or Health Net) have yet partnered with Google Health.

Medicare’s Muddled Policy on Infusion Therapy

Laura Landro reports in the Wall Street Journal on the shortsighted policy of the Medicare Program with respect to home- and office-based infusion services. (“As Home IVs Grow, Medicare Patients Miss Out,” October 15, 2008.) Many infusion therapies, ranging from antibiotics (vancomycin) to cancer drugs to treatments for neuropathy, can be administered at home or in physician offices with the assistance of a nurse to insert the intravenous line. Private health insurers readily pay the full cost of home or office infusion therapy because of the savings in avoiding the expense of hospitalization and the risk of hospital-based bacterial infection. For patients, the big benefit is convenience.

Unfortunately, however, Medicare takes a dim view of infusion therapy, possibly as a result of suspected fraud and abuse in the area. Medicare Part B (physician services) and Part D (drug coverage) often cover the cost of the drug itself, but not the services, supplies, and equipment needed to administer the drug, which can amount to half of the actual cost. To get full coverage, Medicare beneficiaries need to seek hospital or nursing facility admission, where they can qualify Medicare Part A provides full coverage. (The article reports that some hospitals are actually making up the shortfall to free up beds for sicker patients.)

In recent years, a number of our clients have made the logical decision to discontinue the provision of infusion services and refer Medicare patients needing infusion therapy to hospitals as a result of this nonsensical policy. When the anticipated cost of full coverage for home-based infusion therapy ($1.5 billion over ten years) is balanced against the savings from shifting infusion patients out of hospitals (est. $7.4 billions), Medicare seems to be pushing expenses up by favoring hospitals (Part A) over physicians (Part B). Federal legislation introduced last month would finally allow physicians to be paid for the costs associated with infusion therapy. For physicians and Medicare beneficiaries alike, relief on this issue is long overdue.