New poetry column.

Number 30.

Bush reportedly knew of higher Medicare costs

According to a syndicated article from the Washington Post, GW knew the true price-tag on Medicare reform months ago. So all the time I was writing in this blawg that we can't afford the prescription drug benefit (estimated at the time to cost $400 billion over ten years), the president was laughing up his sleeve because the true cost was estimated to be 33% higher than the White House was admitting? Interesting way to do policy.

Boston-area father wins case against fertility clinic.

As reported in the Boston Globe on Sunday: "In one of the first legal cases in Massachusetts involving the largely unregulated field of fertility treatment, a Middlesex County jury awarded more than $100,000 yesterday to a Dennis man who said that a Boston fertility clinic impregnated his estranged wife without his permission and should pay his share of child support for his now 7-year-old daughter."

Medicare prescription benefit to cost 1/3 more than originally estimated.

It seems like a pittance, really, just a little rivulet pouring into the ocean of red ink produced by this administration. For what it's worth, however, the White House finally came clean and admitted that the price tag on the prescription benefit for Medicare enrollees won't cost $400 billion over ten years, as originally claimed by the Congressional Budget Office, but $530-540 billion instead, which is what the President's proposed budget will reflect. (The New York Times article by Robert Pear is here.) This would be tolerable if the benefits flowed to seniors who need them, but for the most part they don't. Time to break open the bubbly, Big Pharm? This might have been a better deal for you than even your lobbiests were willing to claim, or admit publicly.

Report Assails Hospital Lapses

The L.A. Times today reported a chilling tale of a hospital run amok. According tothe story, "Nurses at Martin Luther King Jr./Drew Medical Center were ordered to lie about patients' conditions, failed to give crucial medications prescribed by doctors and left seriously ill patients unattended for hours — including three who died — according to a new report by federal health officials." The story continues: "[T]he report [is] by the U.S. Centers for Medicare and Medicaid Services, which oversees federal healthcare funding. The document has not yet been released publicly but was obtained by The Times." I will provide a link as soon as one becomes available.

Florida appeals court strikes down state antikickback statute.

This won't have much impact on Texas' AKB law, which slavishly adheres to federal standards, including federal safe harbors. But, for what it's worth, a Florida court has struck down that state's AKB law because it is inconsistent with the federal version. Here's today's Modern Healthcare story:

A Florida appeals court has overturned the state's Medicaid Provider Fraud Statute, calling its antikickback provision unconstitutional. In doing so, the 3rd District Florida Court of Appeal affirmed a judge's ruling in 2000 that the antikickback provision conflicted with the federal law. The Florida law has a different definition of illegal remuneration and does not include safe harbors, the court said. Thus, the state law "criminalizes certain activity that is protected under the federal antikickback statute and stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress," the court said. As awareness of healthcare fraud has grown and whistleblower lawsuits have proliferated, many states have passed their own versions of federal antifraud law. Edgar Bueno, a former attorney with HHS' inspector general's office and now in private practice in Fort Lauderdale, Fla., said there's no binding requirement on other states' courts to follow the Florida decision. "But it does set nonbinding legal precedent," Bueno said. "I suspect we'll hear of more state challenges."

The opinion, State v. Hardin (No. 03-0521, Jan. 28. 2004), is here.

F.D.A. Begins Push to End Drug Imports.

The N.Y. Times has a good piece on the FDA's renewed efforts to stop imports of lower-priced drugs from Canada. (The link is the the paper itself, which requires a free subscription, and which will die in a day or two; you might be able to update the link using Google News.)

UK has its own Peter Singer.

The Sunday papers are all carrying a story about the comments of a bioethicist, John Harris, who is a member of the British Medical Association, that he doesn't see a moral distinction between aborting a full-term fetus and infanticide. Pro-life groups are up in arms, though their reaction is somewhat curious. They don't see a moral distinction between aborting a 4-cell embryo and infanticide, so you'd think they would embrace Harris' comments. Fact is, Harris' point is that infanticide isn't that big a deal, once you embrace the morality of late-term abortions, so the pro-lifers can be excused their contradictory response.

Tort reform and malpractice premiums.

From Health Affairs, a very respected health policy journal:

Malpractice Insurance Premiums Lower In States With Caps
On Damage Awards, According To Health Affairs Analysis

But Sharp Increases In Premiums May Not Be Explained
By Lack Of Tort Reform In Many States, Article Contends


BETHESDA, MD — Medical malpractice insurance premiums are 17.1 percent lower in states that have capped court awards, although the lack of such tort reform measures in other states does not fully explain recent jumps in what physicians pay to cover the cost of malpractice suits, according to a new analysis published on the Health Affairs Web site, www.healthaffairs.org.

Kenneth E. Thorpe, chairman of the health policy and management department at the Emory University Rollins School of Public Health, examines the effects of recent sharp increases in malpractice premiums in many states and states’ efforts to keep malpractice premiums down. Malpractice premiums increased by 23.2 percent in 2002, although the increases varied by state and specialty.

Awards caps exist in 24 states and are the only malpractice reform efforts that have affected physicians’ premiums, reducing them 17.1 percent. While Thorpe says that such measures extended to other states or nationally through a federal law “would ultimately result in lower premiums,” he questions whether taking that step would accomplish the goals of the liability system.

“At issue is whether we should adopt short-term, stopgap solutions to slow the growth in premiums, or use the recent experience to more fundamentally evaluate and perhaps reform the liability system,” Thorpe says. “The results suggest that capping awards may improve the profitability of malpractice carriers and reduce premiums. Whether this is socially desirable or improves the goals of deterrence and compensation remains an open question.”

Three factors have been the principal drivers of malpractice premiums: growing awards and settlements, increased frequency of lawsuits, and declines in investment income. By 2002 every premium dollar collected resulted in $1.29 in total expenses, awards, and settlements, up from 95 cents of total expenses in 1995, Thorpe writes.

Meanwhile, investment earnings have dropped steadily, from 49 percent of premium income 1995 to 18 percent in 2002. Combined, those trends yielded an industrywide net after-tax loss of 11 percent in 2002.

Also disrupting the market has been the bankruptcy of some malpractice insurance carriers and the decisions of others to stop writing policies in some states or withdraw from the business altogether. Thorpe identifies a correlation between the reduction of competition and higher premiums in some states.

Thorpe questions whether the recent increases in malpractice premiums constitute a crisis or simply standard fluctuations in the insurance markets.

“Rising claims costs may reflect a rise in underlying negligence,” Thorpe says. “If true, the system may be functioning as designed, and the spike in premiums may provide stronger incentives to improve the quality of care provided.

“On the other hand, we may be observing a permanent rise in claims payments and costs unrelated to trends in physician negligence,” he says. “At issue is the extent to which the underlying factors generating higher premiums are following a traditional cyclical insurance pattern, or whether a structural change has occurred in severity and frequency.”

To view the article, click here.

Health law and policy

Interesting book review in tomorrow's JAMA:
The Privatization of Health Care Reform: Legal and Regulatory Perspectives
edited by M. Gregg Bloche, 220 pp, $39.95, ISBN 0-19-510868-X, New York, NY, Oxford University Press, 2003.
JAMA. 2004;291:375.

The reviewer is Ronald Andersen, PhD, UCLA School of Public Health. Apparently no fan of the role of health law (or health lawyers?) on the health care system, Andersen concludes his review:

Bloche concludes, "Scholarship that concedes the health sphere's complexities and seeks remedies that fit this country's legal, political and cultural constraints can contribute to reasoned regulatory governance." Again, he may be right. Still, I am left with the troubling suspicion that by narrowly focusing on health law's role in reform of the medical marketplace the book may be seeking to make the proverbial "silk purse out of a sow's ear."

The book itself sounds like it might be a good read:

The failure of President Clinton's health reform plan in 1994 was followed by multiple efforts at market-driven reform in the US health services system. This book is about those efforts. . . .

The authors start from the premise that systematic, state-sponsored overhaul of the US system is unlikely in the foreseeable future. . . .

Much of the market-driven reform over the past 10 years has been the efforts of managed care plans to control costs through preauthorization review of proposed treatments, selective affiliation with frugal providers, bargaining for discounted payment rates, and financial incentives to physicians to limit spending. Challenges to these managed care cost control efforts by consumers and providers and the law's treatment of these challenges is the main focus of the book. The authors provide some in-depth understanding of some of the managed care revolution's failings and the law's relationship to these failings. Some of the authors consider law as a cause of market failure while others examine the law's potential and limitations to correct market failure.

The legal/regulatory areas that are the book's main focus include "the power of the state vs the federal government in making rules for the medical marketplace; conflicts between insurers and patients and providers regarding what constitutes medical need; how financial rewards to physicians for frugal practice influence their medical decisions; the role of antitrust law in the organization of health care provision and financing; privatization as a solution to bureaucratic and legal rigidities in public hospitals; and the case against tax and regulatory preferences for the nonprofit form over investor ownership in the hospital and health insurance sectors."

Andersen's main beef seems to be his disagreement over the book's focus on private market-driven reforms to the exclusion of top-down reforms: "Nonetheless, I believe that failure of the market-driven mechanisms to provide universal access to care, control costs, or 'empower the consumer' suggests that attention in the book to other approaches to system reform might still have been warranted." But that, as the saying goes, would have been a different book.

Congressional Budget Office doubts economic impact of tort reform on health costs.

As we've, ahem, been saying here all along, tort reform is not the way to get a handle on rising health care costs. Now the bipartisan Congressional Budget Office is saying it, in a report ("Limiting Tort Liability for Medical Malpractice," Jan. 8, 2004) that offers the following key observation:

Evidence from the states indicates that premiums for malpractice insurance are lower when tort liability is restricted than they would be otherwise. But even large savings in premiums can have only a small direct impact on health care spending—private or governmental—because malpractice costs account for less than 2 percent of that spending. Advocates or opponents cite other possible effects of limiting tort liability, such as reducing the extent
to which physicians practice “defensive medicine” by conducting excessive procedures; preventing widespread problems of access to health care; or conversely, increasing medical injuries. However, evidence for those other effects is weak or inconclusive.

The point about the lack of a correlation between tort reform and reduced pressure to practice defensive medicine deserves an additional comment, which appears later in the brief:

Proponents of limiting malpractice liability have argued that much greater savings in health care costs would be possible through reductions in the practice of defensive medicine. However, some so-called defensive medicine may be motivated less by liability concerns than by the income it generates for physicians or by the positive (albeit small) benefits to patients.

The report comes too late to save Texan from Proposition 12, which voters approved last fall, but at least we now have CBO support for the idea that the legislature sold them a pig in a poke.

Institute of Medicine report: US should aim for universal coverage by 2010.

The IOM has added its voice to the steadily rising chorus calling for aggressive steps to cover all Americans (including the 43 million currently uninsured) by 2010. Its report, "Insuring America's Health," can be found on-line, as can summaries of its major findings and statistics. Fact Sheet 4 is an eye-opener: Your chances of being uninsured are higher in Texas than in any other state in the Union (28.4%). As for the impact of this initiative on public budgets, universal coverage would probably save money in the long run. Besides, considering the impact on the health, the lives, and the future of children (who account for half the uninsured), it's the right thing to do!

Emily Dickinson.

Margo Jefferson has a nice end-piece in today's NY Times Book Review ("I Don't Know How She Does It") about Emily Dickinson and the various men who are mostly on display in a recent PBS documentary on the Belle of Amherst. She might as well have named the essay "I Don't Know Why Men Don't Get It." The director/writer Jim Wolpaw takes a couple of direct hits, and Billy Collins gets swiped, too, for his poem, "Taking Off Emily Dickinson's Clothes," which Ms. Jefferson describes as "smarmy." Maybe I like Billy Collins' stuff too much, or perhaps Margo Jefferson likes it too little, but I think his agenda is actually the same as hers: Get past the "blessed virgin" image of the Belle and try to understand that she was a flesh-and-blood creature who did not shrink from the world in all its power and fury and unknowable bleakness and stark beauty. Or something like that.

The Constitution and the war on terrorism (II).

The last time Tony Lewis wrote an op ed for his old employer, The New York Times, before today (see below) it appeared in the paper on February 24, 2003, the 200th anniversary of the Supreme Court's opinion in Marbury v. Madison (click here for full opinion). For purposes of my con law class, at least, it does a very nice job of tying together Marbury (which we will begin discussing on Jan. 21) and the Quirin and Johnson cases (yesterday's class). For a critical view of Lewis' op ed article by a former Supreme Court law clerk (who mysteriously remains nameless), click here (Howard Bashman's "How Appealing" blawg).

The Constitution and the war on terrorism (I).

Anthony Lewis's op ed in today's N.Y. Times is (i) a wonderful reminder of how valuable Lewis' voice has been (and occasionally continues to be) in the national debate over the role of the Constitution in our public and private lives and (ii) a very nice summary of the Supreme Court's terrorism cases. For my con law class, it should help put the Appendix C cases of Ex parte Quirin and Johnson v. Eisentrager in perspective. The University of Chicago Law School has put together a fine web page in connection with a January 17 (2002?) panel discussion there on military tribunals.

Unanimous Supreme Court victory for the children of Texas.

I can't remember the last time the Supreme Court justices all agreed in an Eleventh Amendment case, but it happened yesterday in Frew v. Hawkins (U.S., No. 02-628, Jan. 14, 2004). Bottom line: Texas officials must abide by a consent decree to which they consented in 1996 to increase spending on the Medicaid program's Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) program. Legally, the case involves an interesting question whether federal courts can compel a state to adhere to the terms of such a consent decree consistent with the Eleventh Amendment, which in a number of analgous situations has been held to shield states from federal court actions for money damages. I say it's "interesting" because -- despite the Court's unanimous opinion -- it's an arguable point. In this case, the trial judge rejected Texas' Eleventh Amendment argument. On appeal, however, the conservative Fifth Circuit Court of Appeals bought the state's argument. But politically and morally, it's hard to see how Texas' position was anything but crass, cold-hearted, underhanded, and punitive. Here's the syllabus of the Court's opinion:

As a participant in the Medicaid program, Texas must meet certain federal requirements, including that it have an Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) program for children. The petitioners, mothers of children eligible for EPSDT services in Texas, sought injunctive relief against state agencies and various state officials, claiming that the Texas program did not meet federal requirements. The claims against the state agencies were dismissed on Eleventh Amendment grounds, but the state officials remained in the suit and entered into a consent decree approved by the Federal District Court. In contrast with the federal statute’s brief and general mandate, the decree required state officials to implement many specific proposals. Two years later, when the petitioners filed an enforcement action, the District Court rejected the state officials’ argument that the Eleventh Amendment rendered the decree unenforce-able, found violations of the decree, and directed the parties to submit proposals outlining possible remedies. On interlocutory appeal, the Fifth Circuit reversed, holding that the Eleventh Amend-ment prevented enforcement of the decree because the violations of the decree did not also constitute violations of the Medicaid Act. Held: Enforcement of the consent decree does not violate the Eleventh Amendment.

(a) This case involves the intersection of two areas of federal law: the Eleventh Amendment and the rules governing consent de-crees. The state officials argue that a federal court should not enforce a consent decree arising under Ex parte Young, 209 U. S. 123, unless it first identifies, at the enforcement stage, a violation of federal law such as the EPSDT statute itself. This Court disagrees. The decree here is a federal court order that springs from a federal dispute and furthers the objectives of federal law. Firefighters v. Cleveland, 478 U. S. 501, 525. The petitioners’ enforcement motion sought a remedy consistent with Ex parte Young and Firefighters and accepted by the state officials when they asked the court to approve the consent decree. Pennhurst State School and Hospital v. Halderman, 465 U. S. 89, in which this Court found Ex parte Young’s rationale inapplicable to suits brought against state officials alleging state-law violations, is distinguishable from this case, which involves a federal decree entered to implement a federal statute. Enforcing the decree vindicates an agreement that the state of-ficials reached to comply with federal law. Federal courts are not reduced to approving consent decrees and hoping for compliance. Once entered, that decree may be enforced. See Hutto v. Finney, 437 U. S. 678.

(b) The state officials and amici state attorneys general express le-gitimate concerns that enforcement of consent decrees can undermine sovereign interests and accountability of state governments. How-ever, when a consent decree is entered under Ex parte Young, the response to their concerns has its source not in the Eleventh Amend-ment but in the court’s equitable powers and in the direction given by Federal Rule of Civil Procedure 60(b)(5), which encompasses an equity court’s traditional power to modify its decree in light of changed circumstances. See, e.g., Rufo v. Inmates of Suffolk County Jail, 502 U. S. 367. If a detailed order is required to ensure compliance with a decree for prospective relief that in effect mandates the State to ad-minister a significant federal program, federalism principles require that state officials with front-line responsibility for the program be given latitude and substantial discretion. The federal court must en-sure that when the decree’s objects have been attained, responsibility for discharging the State’s obligations is returned promptly to the State and its officials. The basic obligations of federal law may re-main the same, but the precise manner of their discharge may not. If the State establishes reason to modify the decree, the court should make the necessary changes; otherwise, the decree should be en-forced according to its terms. 300 F. 3d 530, reversed.

This litigation started in 1993, based upon the plaintiffs' claim that Texas has dealt children in desperately poor families a really lousy hand, in violation of their federal-law obligations. If the plaintiffs were right (and I suppose we won't know, technically, since there was no trial and therefore no findings of fact on the underlying claims), it's been over a decade now that these kids have been denied services required by federal law. Perhaps this disgraceful record on children's health is about to come to an end.

Ambiguous Gifts: When Patients Give and Doctors Take

Good article by Denise Grady on VIP patients, gifts from patients, George Harrison's signed guitar, and the morally ambiguous topic of physicians and hospitals who profit from their association with the rich and famous.

Seniority: Two Holes in the Medicare Drug Law/

Finally, somebody is asking the questions that need to be asked about the Medicare reform law signed by
Dubyah last month. In an article in today's NY Times, Fred Brock asks:

What impact will it have on pharmaceutical companies' programs that offer free drugs to low-income people, including those on Medicare? Why does the law prohibit beneficiaries from buying private insurance to cover the considerable gaps in coverage?

As for the first question:

The drug companies themselves are struggling with the first question, as is their trade group in Washington, the Pharmaceutical Research and Manufacturers of America. But one thing is clear: if the companies do not change their requirements by 2006, thousands of older low-income Americans will lose access to free or nearly free drugs. That's because participants in the programs generally must not have any drug coverage or access to it. Of course, they will have access to drug coverage in 2006 - although with coverage gaps that could cost thousands of dollars a year.

The free-drug programs are crucial for many recipients. The income limits are not that strict: in some cases, people earning up to $50,000 a year can qualify. The drugs are commonly dispensed through doctors or via discount cards; patients usually have to requalify regularly and apply separately to each company that makes the drugs they need.

I am particularly interested in that second question:

The prohibition against buying private insurance, meanwhile, will hit middle-income people the hardest. "Many people will be forced to put out their own money, even if they want to buy insurance," Mr. Hayes [president of the nonprofit Medicare Rights Group] said.

A report accompanying the final Medicare bill when it was passed last year said the insurance prohibition was to keep beneficiaries from becoming "insensitive to costs." Well, if your mother needs a prescription, her "sensitivity" is not going to lessen her need, but the cost may lessen her ability to buy it. And why shouldn't she be allowed to buy private insurance to help if she wants to? By that logic, should we prohibit auto insurance to make people sensitive to high repair costs?

Some administration and Congressional officials argue that older Americans would consume less health care if they had to pay more for it, so the government would save money. Maybe, but what are the health consequences?

Deane Beebe, a spokeswoman for the Medicare Rights Center, said: "The whole concept is based on the idea that people will use too much medication if they have coverage. We're really troubled by that."

Mr. Hayes added, "There is something very unrealistic about politicians who think that people will rush off to take prescription medication they don't need."

Hayes believes that the prohibition might be eliminated before 2006, partly because of pressure from insurance companies that want to sell the coverage. "A lot of people who voted for this bill," he said, "had no clue about this provision."

Dallas Morning News: public health comes first.

Thank God the Dallas Morning News has weighed in on the public-health issues facing Dallas County with an editorial that urges the County Commissioners to split the health department from the county's Department of Health and Human Services. The mid-90's merger of public health and welfare functions, says the editorial, was "to cut overhead costs. The budget concerns back then may have been justified. But they have been overtaken by today's more pressing challenges. For one, the county has had to step up its bioterrorism preparedness in this post-9-11 world. And that duty is certain to grow." More importantly:

many physicians have become concerned about the combined department's apparently poor record of controlling diseases. The Dallas County Medical Society cites the county's alarming rates of sexually transmitted diseases, its high incidence of tuberculosis and its low rate of childhood immunizations. A re-energized Health Department would be better able to identify public health problems early on and map out strategies for solving them.

The medical society -- under the leadership (on this issue, as on so many more) of past president Robert Haley -- also deserves our thanks for jaw-boning the county (and the editorial board of the Dallas Morning News, apparently) for adequate public health resources and controls.

2002 shows higher rate of health-care inflation than 2001.

Is anyone in the health care industry really surprised to learn that, "[f]ueled by rising hospital costs and health insurance premiums, U.S. employers, consumers and the government spent 9.3% more on health care in 2002 than they did in 2001"? (USA Today) Not surprised, perhaps, but that doesn't mean everyone took the news in stride. Forbes, for one, opined that "Health Care Costs Rise Beyond Belief":

U.S. health care costs are rising so fast that not only do they outstrip the prior year, they even exceed forecasters' ability to project them.

In mid-2002, the U.S. Department of Health and Human Services projected that national health expenditures would reach $2.8 trillion in 2011--an estimate based on a mean annual growth rate of 7.3%. Since then, the growth rate has increased significantly to 9.3%--to the point where health spending is already at nearly 15% of GDP, according to Centers for Medicare & Medicaid Services (CMS), a unit of HHS.

This increase--and future projections--don't take into account the potential effects of the prescription drug entitlement in the Medicaid bill passed by Congress last year.

The full report from CMS is available in Health Affairs (for a hefty fee; unhelpful article abstract is here); some of the details are on the CMS website here.