Healthcare Reform

"Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled... the master or owner of every ship or vessel of the United States, shall... render to the collector a true account of the number of seamen, that shall have been employed on such vessel... and shall pay to said collector, at the rate of twenty cents per month for every seamen so employed; which sum he is hereby authorized to retain out of wages of such seamen.
... And it shall be further enacted, That it shall be the duty of the several collectors to make a quarterly return of the sums collected by them... to the Secretary of the Treasury; and the President of the United States is hereby authorized, out of the same, to provide for the temporary relief and maintenance of sick or disabled seamen, in the hospitals or other proper institutions now established..."
--Fifth Congress, Session II, Statute II
July 16, 1798

Moving Past the Affordable Care Act

The Affordable Care Act, aka Obamacare, really is a divisive issue. It brings out feelings of dislike, anger, and annoyance from members of both parties towards the other. That does absolutely nothing to help our nation come together at a time when partisan politics is at an all-time high and the sense of futility over Congress and the President is rising. I do not wish to discuss the Act in and of itself. Instead, we need to establish a base, some fundamental thoughts on just what healthcare in America should be about. Life is one of our unalienable Rights, something intrinsic to all humanity, which means that healthcare needs to be an important part of government and society. How that happens and why that happens is a matter of debate.

This is not a discussion full of talking points. I will not fill this page with pithy one-liners like "Obamacare is the best thing for healthcare" or "Obamacare is ruining our nation" or "Obamacare cures impotency" or "Obamacare totaled my new Mustang" or "Obamacare ruined my business." I'm also not going to tell you the only change necessary to fix healthcare is making people healthier, force them to exercise more, eat better, and halt alcohol consumption. We already know prohibition doesn't do anything except make people angry and ruin sex lives. Talking points like these are a BSer's way of feeding you easily digestible BS that you can then vomit up to your least favorite relative of an opposing political party during Thanksgiving.

What I want to do is have a real, honest, thoughtful discussion- a rarity in today's age of "now now now." And that requires transcending political party, because both parties are simultaneously right and simultaneously wrong. Both parties realize there is a problem with healthcare. Democrats have the Affordable Care Act as their solution. It has problems. Republicans know it has problems, but for years spent their time and energy trying to repeal it instead of coming up with alternatives. The talking point becomes one of political domination where people call the individual mandate unconstitutional, say the Supreme Court ruling shouldn't be followed because they got it wrong, and that Obama is a liar and a cheat. That was 2010-2014. In 2015, we start to see alternatives, thankfully. The GOP knows healthcare is an issue, but used talking points to get elected in the 2014 cycle.

As you can tell, I'm not a fan of the GOP's political tactics when it comes to healthcare. It worked, but only because we let it work.

What I would've rather had happen is the GOP say the Affordable Care Act is a piss poor bill and offered up another solution. I would've rather they said that the two main issues with healthcare in America are the conflicts of cost and desire. Medical expenses for visits, procedures, medicines, and insurance are on an ever-increasing trajectory up, which is a problem when people have the need or desire to get every single little cough, scratch, ache, pain, etc checked out. People want to be able to see a doctor whenever and not worry about cost, all while the money in medicine wants you to pay out the wazoo. This is what I would've rather the GOP said. They could have, too, since the healthcare lobby gives more to Democrats, or rather, it did when Democrats were in power working on getting the Affordable Care Act in place.1 Then the GOP could have pointed to the lack of competition as a source of problems. Monopolies and lack of transparency lead to increased costs, defying the invisible hand of free market capitalism which Republicans supposedly stand for. Their solution would cut down on healthcare costs, which in turn would lower Medicare costs, thus helping out budgets, deficits, debt, and everything else they dislike.

But, they didn't. And even with ideas being floated about- like the Burr, Hatch, and Upton Patient CARE plan that was being developed in committee- they aren't tackling the real problems.2 The real problems are the "whys" that I keep referring to. When it comes to healthcare, the "why" question is "why is healthcare so expensive?" That is the main problem everyone should be focusing on, but is not the only problem we have. Actual improvements to medicines and treatments are another problem. Remember, the ultimate end goal here, outside of a perfect utopia where everyone lives forever, free of disease and infection, is to provide the best healthcare possible for the lowest cost in order to maximize every American's ability to fully embrace their unalienable Rights of life, love, liberty, honor, humor, and the pursuit of happiness.

Thus our social issue of healthcare becomes an economic issue of cost, and the economic issue of cost becomes burdened by the political capital it bequeaths unto those who'd use it for their own ends. The lobby problem coupled with lack of transparency in Congress, the White House, and across the federal government, allows for economic influence to creep in.

Intellectual Property, Drug Costs, and ROI

Senator Harry Reid, a Democrat, acted as a lobbyist pawn for Big Pharma and others when he killed any hope of a patent reform bill last May.3 A bill with bipartisan support that would have benefited the American people got shelved, with Senator Leahy being told Senator Reid wouldn't even have allowed it to the floor.

The problem is Senator Reid's lack of foresight could cost him and other lobbyist pawns a lot more. See, if the American people saw a little give on an issue, it would have given them hope. I would've sat in my chair and thought "it's a start." Instead, the adamancy in refusal has just brought out more ire towards him and those like him. So it's with a very happy heart that I tell you the first part of my plan to help reduce healthcare costs is IP reform.

In the discussion on IP reform, I covered pieces of many industries suffering from IP restrictions, including healthcare. Patents give drug companies monopolies on products which are used in turn to extract incredible profits. Recall what I said about hepatitis C medication where treatments are going for over $1,000 a pill and over $80,000 for a full treatment. The cost of Sovaldi, alone, could see premiums in Medicare Part D rise 8% and the costs on state economies will be astronomical.4 Recall also drug makers who receive patents and then raise the price of their product already in the marketplace over 1000%.5 For Democrats, such high cost healthcare reducing individuals' ability to consume and be healthy should be shameful; for Republicans, such a high cost to the government should be shameful as high costs means larger budget for Medicare which means more difficulty in lowering outlays. Neither party is moving to counter this.

On top of that we have "evergreening," which is when drug manufacturers take an existing drug and change it slightly in order to get a new patent, continued exclusivity, or both. The basic function of the medicine in question usually doesn't change, just a small feature. For example, it might be able to be absorbed by the blood a little easier than before. Sometimes the health industry calls these "me-too" drugs. The reason this is a problem is because of the return on investment. Pharmaceutical firms receive the same benefits from government whether they focus on major therapeutic advances requiring a lot of time and money or focus on low-risk research with potentially high profit margins combined with the ability to bring products to market fast.6 From the firms' perspective, why spend all that money and fail when they can spend a lot less and still bring in money hand over fist?

The strategy seems to work. The worldwide pharmaceutical market brought in nearly $1 trillion in revenue in 2013.7 This is at a time when the FDA Center for Drug Evaluation and Research found only 22 percent of new drugs offered significant improvement over currently marketed products and around 14 percent were new molecular entities.8 So less than 25 percent of new drugs approved by the FDA are significant, yet the industry still pulls in nearly $1 trillion. Not only that, but research has also shown that these "me-too" drugs hinder the market for generics while also raising insurance premiums by billions of dollars and adding to government overhead by requiring the FDA to focus on these patent protected but slightly different "me-too" medicines.9

Something is wrong here. Part of the problem is that the FDA grants higher priority to reviewing drugs that offer incremental improvements, thanks to the Hatch-Waxman Act of 1986.10 That same Act also grants market exclusivity against generic drugs, giving pharmaceutical firms additional incentive to make incremental improvements.11 But all those incentives do is make the ROI greater for drugs that are not new molecular entities, drugs that don't offer much improvement, and drugs that focus on non-critical areas of medicine. I mean, think about it from a business perspective. You can spend nearly $1 billion trying to develop a brand new cure for cancer and fail, or you can tweak your existing billion dollar drug, get expedited approval and a measure of market exclusivity- you know, a monopoly that lives outside of real free market capitalism. Which would you rather do?

From the perspective of maximizing shareholder value, it's a no-brainer. You go the incremental route. You've already spent money on research of the base drug, incremental cost won't be as much, and the time to market is much shorter. You can see the problem, right? Healthcare in a capitalist society needs to be about fulfilling the market desire with proper supply. Cures for cancer, AIDS, ebola, diabetes, etc are in demand, but research and investment in such cures come up short due, in part, to lack of profitability.

How do we fix this? Here the issue is two-fold: IP reform is needed to fix this evergreening problem and the patenting of incremental drug improvements while the FDA needs to alter its priorities in determine what receives special treatment. The IP protection is a two-way street with healthcare. The monopoly status is, effectively, a license to print money by drug companies, but at the same time society expects affordable innovation. Budgets around the world cannot afford many $100,000 drugs, and that's the direction industry execs are going.12 Reducing or eliminating terms of patent protection for non-new molecular entities is a must, which includes the "me-too" drugs that cost taxpayers billions.

Some might say that lack of IP protection eliminates any desire to create in the first place. For some companies, this is true. But there are plenty of scientists out there who would love to work on cures for such diseases if they were given the opportunity. Our National Institute of Health already gives out taxpayer money in the form of grants to drug companies for research and development of products that are brought to market at ridiculous consumer prices, a double whammy in my opinion. If you asked a taxpayer to help fund a medicine that would then cost them an arm and a leg to buy, they'd probably tell you to get bent, yet some of the billions we give out in NIH grants do just that.

There have been hundreds of billions of dollars in grants that NIH has outlayed over decades. I cannot state the importance of this enough. Less than 20 percent of the most influential drugs created since 1965 were entirely funded by the private sector, meaning government funding- our tax dollars- went towards research and development of those drugs.13 And those costs come back to bite us in the ass. All research and development done with government dollars outside of national security interests should return to the public eye. Openness with such information would allow others around the country to further development, possibly trying new techniques or altering a medicine slightly for smoother consumption by our bodies. Some might say that all private research needs to remain proprietary in order to ensure trade secrets don't leak, but the CBO also shows that public financing augmenting private R&D spending yields positive results.14 Companies may claim that such transparency and lack of IP protection would ruin them, even if logic states that to not be the case.

Surely a balance can be found here. I know the drug companies won't just pack up and stop making drugs with these changes because there are billions still to be made all over the world. The beauty of globalization is that partners across the globe can provide assistance and research. If the drug companies did decide to take their ball and go home, I'd call them unpatriotic greedsticks, but then, as President, I'd start working on new trade agreements- worthwhile trade agreements- and funding with other companies to work on new medical advances. Not only that, but the freedoms that come from IP reform would allow new pharmaceutical startups, universities, and other organizations to expand on existing medicines or even create new advancements of their own. That is what our grants to healthcare should do. It will help bring down drug costs which will help local, state, and federal budgets, and also make treatments more accessible.15

Alternatively, we could import some of these expensive drugs from overseas. I heard that countries like Egypt, India, and a plethora of sub-Saharan African nations negotiated a deal for Sovaldi for just $300 for a 28-day treatment, compared to the approximately $28,000 said bottle would cost here in America.16 Someone could fly first class, get some medicine, experience the wonderful cultures in other nations, and then fly first class back for much less than $28,000, again thanks to globalization. But part of me suspects we have trade agreements in place to prevent these specific circumstances from happening. Consider how strange this entire cost circumstance currently is.

Alter How Clinical Testing Is Done

Drug costs are not the only factor weighing on healthcare. There are other aspects of the industry that need reform as well, many of which revolve around the implicit trust the FDA places in pharmaceutical firms. Such trust leads to potential corruption, shortcuts, and lack of transparency.

First, the issue of the drug companies being responsible for the clinical testing of their own drugs to determine safety and effectiveness needs to finally be addressed.17 Tons of studies have shown that when drug companies are responsible for forging the clinical tests, they tend to make the tests as favorable as possible, even when they outsource trials to a contract research organization.18 If a chosen CRO doesn't produce favorable results, the drug firm takes their business to a CRO that does, making it financially viable to find in favor of a firm at the expense of public health. Here again we see the problem with maximizing shareholder value, but let us remain focused on the problem of bias.

The solution here is for Congress to require real independent testing in order to eliminate the problem of drug companies heavily guiding the market down a path of approval for their drug based on financial incentive over quality healthcare incentives. I realize this means more government, which I'm not a fan of, but we could probably limit that. If the FDA had a list of authorized institutions for drug testing and then kept those institutions in check, that would go a long way in weaning us off drug companies getting market safety approval through biased tests and financial motivation of the trial groups.

Improve Post-Market Monitoring and Data Disclosure

Along the lines of independent clinical testing, we come to the second issue in need of change: better post-market monitoring of medicines for adverse reactions. Pre-market trials are limited in what they can diagnose as problems; long term effects, effects on individuals of all age-ranges and nationalities, etc. This means post-market data is necessary for us to accurately understand the safety of drugs on the market. But much like the pre-market trials, post-market reporting is also entirely dependent upon the drug firms. Pharmaceutical companies are legally required to report even suspected adverse reactions to the FDA, but the FDA has no means of ensuring compliance. Relying on drug companies to do due diligence and report something negative on their product, a report that could lead to loss of revenue, is a conflict of interest in my mind.

In fairness, the FDA Amendments Act of 2007 required all pharmaceutical companies to report on adverse effects, but not immediately, which when coupled with a patent incentive, makes it more profitable to delay reporting post-market adverse affects for, say, six months if that means an additional $500 million in revenue on a $1 billion per year drug. Pre-market effects are easier to tackle because the Food and Drug Administration Amendments Act (FDAAA) setup the clinicaltrials.gov website as NIH's public database for all phase II and higher drug trials in the U.S. or when the trial is part of an investigational new drug application. But even then, firms can delay reporting for up to a year after collecting data or a month after the FDA approves a drug… though fewer than one in eight trial results are reported on time.19 More important, from what I understand, current law only requires the submission of partial data, data that may be insufficient to interpret the study in question or, worse, mislead those trying to understand.20

The solution to this disclosure problem is simply to require more complete disclosure. Congress should require that complete results of all studies conducted by drug firms be submitted in a timely fashion. What that time is, I'm unsure, but a year is definitely too long to wait. Along with study results, all clinical trial data should be disclosed as well. The general public may not be able to understand it, but one of the benefits of crowdsourcing is that there are those with knowledge and good intentions that will be able to make sense of the data and aid the FDA in bringing to light potential problems.

Continuing down this path, the data disclosure solution will also help fix the third area of healthcare in need of reform: off-label uses. When the FDA approves a drug, they approve it for a specific set of circumstances. But pharmaceutical companies conduct post-marketing studies of their own, not for receiving marketing approval by the FDA, but rather for publication in medical journals which encourages doctors to prescribe drugs for uses the FDA has not approved. There is a big gap between what the FDA approves of and what doctors can prescribe, namely that doctors can and do prescribe medicine for therapeutic uses outside of FDA scope after learning about potential benefits from medical journals.21

I would recommend data disclosure rules to tackle this problem as well. In addition to requiring trial data from off-label studies to also be published in full on clinicaltrials.gov, Congress should setup a separate drug database that references all the FDA approved drugs and their uses. The FDA would keep this updated regularly, at least once per month. When a new use is published in a medical journal, the new use could be submitted on this site for FDA approval. All approved uses would be cataloged here. This sounds like a lot of work, but considering we're only talking a few thousand drugs and a couple hours of work from the drug firm or journal publisher to get new data entered, it's a small price to pay for complete and accurate health data, especially considering that current law allows for off-label study data to be submitted up to three years after the fact.22 Three years is far too long.

What does all this have to do with lowering healthcare costs, which I said was the main issue with healthcare? The theory is that healthier people spend less money on healthcare, so anything we can do to keep people healthy is a good start, especially when it comes to possible beneficiary or malignancy in the medication given to us. What better way to start keeping people healthy than to ensure medicines are properly used and documented for safety in the first place? Who knows, maybe this will force pharmaceutical companies to step up their game in ensuring products are safer from the get go.

Healthcare IT, the DoD, and the VA

Next we need to cover healthcare IT, or HIT, because my proposed solutions thus far outside of IP reform revolve around data. Data means technology and technology has faced hurdles in the realm of medicine. But if America is supposed to have the best healthcare in the world, we absolutely must wean our medical staff off Windows XP. HIPAA requires software to be patched and up-to-date for security purposes, yet with Windows XP well past end of life, some medical organizations continue using it.23

When it comes to HIT, the saying "if it ain't broke, don't fix it" comes to mind. Medical personnel have grown accustomed to certain ways of doing things, making change to more efficient and future-proof data more of a burden than anything. They're coming around as electronic health records are being used more and more with each passing year, but it's still a struggle. Technology is going to continue to push forward, providing valuable assistance to our medical community. We must embrace the change with open arms and open wallets. The longer hospitals and medical practices wait to make the tech leap, the more expensive it will become.

This problem with medical tech goes beyond the traditional medical institutions. Let's consider for a moment the Department of Defense. According to former Secretary of Defense Robert Gates, healthcare costs are eating the DoD alive.24 Between 2000 and 2012, funding for military healthcare increased by 130 percent and now accounts for nearly 10 percent of the DoD's overall budget.25 One of the reasons for this increased cost is failure at the electronic health record level. A number of systems and attempted upgrades have cost the DoD billions in the last decade, resulting in applications that have been deemed inefficient and poorly designed by the group's own medical staff. Their current system cannot even easily integrate with other EHR systems, like that used by the VA.26 President Obama instructed the DoD and VA to develop a joint record that would replace their current systems, but billions of taxpayer dollars later, no integrated solution has come to pass.27

And it won't come to pass anytime soon. Earlier this year, the DoD made a choice in regards to a new EHR system- actually, 3 choices: Cerner, Leidos, and Accenture- to the tune of $9 billion with $4.3 billion renewable towards Leidos indefinitely.28 With these choices, the DoD has gone down the path of propriety in regards to their EHR's while the VA continues with its VistA EHR system. The NDAA of 2014 mandated the DoD and VA get their act together by the end of 2014, both departments said they would by 2015, and now there is no chance of that happening before 2018 at the earliest.29

Surely you can understand how problematic this might be, having such a large overlap in coverage yet not being able to communicate with each other directly. Not only that, but the lack of interoperability hinders the DoD and VA from providing the care our military and veterans deserve. The ongoing lack of electronic health record interoperability limits VA clinicians' ability to readily access information from DOD records, potentially impeding their ability to make the most informed decisions on treatment options.30 Lack of complete medical data can lead to improper treatment and delay in treatment. The Government Accountability Office (GAO) has gone so far as to label the interoperability problem "high risk" and I'm inclined to agree with them.31 On top of this, efforts in solving this problem have resulted in huge wastes of taxpayer money, over $500 million between 2011 and 2013 alone before both departments decided to pursue their own separate paths, seemingly without care for the interoperability problem.32

Were I Commander in Chief, with the computer knowledge that I have, I would clearly have chosen a system that was open source, one that allows for maximum flexibility and would not lock the federal government into wasteful contracts for products and services that turn out to be crap. This is what happened in the last decade as the federal government rushed to get EHR solutions pushed out to the masses. Incentives, subsidies and the like, were offered up to those who upgraded to the tune of billions in taxpayer dollars. The result is that about 80 percent of U.S. hospitals now have a basic EHR system33, but less than 50 percent meet the criteria for "meaningful use;" that is to say, actually using the system in ways that improve quality, safety, efficiency, and privacy while resulting in better clinical care, overall improvements in population health, increased transparency and empowering of patients.34 You know, things that make technology like EHR's worthwhile.

That's how these incentives work: you offer a lot of money with little time and you get poor results. Hospitals and medical offices had to move quickly to qualify for the so-called HITECH payouts with the quickest way of doing so being to adopt existing systems, not better ones.35 The HITECH Act required new systems being implemented to be able to share data with other providers through interconnectivity, but at the same time had the definition of "interconnectivity" watered down by the Department of Health and Human Services to the point where satisfying this qualification meant performing at least one test of electronically exchanging data via the EHR.36 Just one test, a test that did not require any authentication checks, consent checks, authorization checks, or the myriad of other conditions for secure electronic data exchange.37 Furthermore, the test didn't need to be done with real data of any sort. That's like saying you can pass your math test if you can show that at least one mathematical operation occurs. HHS thus allowed numerous healthcare providers to spend billions in taxpayer money to purchase EHR's that failed to meet the interconnectivity requirements HITECH supposedly brought to the table.

While the topic of procurement in the federal government is another topic altogether, the billions of taxpayer dollars at stake here with the DoD's EHR system choice and interoperability across all agencies is critical, especially after billions already wasted thanks to poor management and oversight by the federal government during implementation. This brings us to the concept of closed systems versus open systems, or closed source versus open source as the IT world calls it. Closed system with proprietary data formats and standards are great for the private sector looking to cash in on our federal government needs for advancing medical technology, but absolute crap for healthcare. Millions in taxpayer money can be saved through an open source EHR solution as problems can be understood and fixed by any competent developer at market rates instead of by the monopoly holder of a closed source contract. And if you think a federal government contractor with a billion dollar contract won't try to squeeze millions more out of the deal... well, you're far more trusting than I am.

The DoD's $9 billion choice faced ridiculous lobbying pressure by groups and providers to choose certain systems, systems which (after everything is said and done) still will not integrate with the VA and which may still fail the interoperability tests mandated by Congress. Remember what I said about transparency; it's designed to make you, the people, aware of what special interests may do. Their actions are being driven by our capitalism problem of maximizing shareholder value. Imagine if the federal government signed an $9 billion, multi-year contract for the hottest texting and emailing phone on the market in 2006, the year before the iPhone came out. How irritated would you be at the lack of foresight and future thinking?

Foresight and future thinking is the antithesis of maximizing shareholder value. The maximum value is desired now, not 10, 20, or 30 years from now. Yes, growth over 30 years is great, but there's a difference between company growth and maximizing stock price. They are mutually exclusive; if no one thinks a share of your company is worth the price being asked, you lose value, regardless of whether you generate 10% more profit this quarter or not. EHR adoption and other HIT needs face the same uphill battle all industries faced during the IT boom of the 90's and early 2000's. People were used to certain ways of doing things, change was difficult, productivity actually dropped. Remember when email was for nerds? I got laughed at in college for using both email and instant messaging. Now people can't live without it.

ROI will be negatively impacted the first few years of any new healthcare system implementation. There is no way around it other than to not participate. But the long term outcomes, from better patient tracking to legible prescriptions to fewer lawsuits due to information confusion to ease of referrals and more makes up for the initial cost burden. Hospitals and medical offices will become more efficient and design better workflows or they will fade away. Change is a must for our healthcare system if we're to both improve quality of care and reduce costs for individuals and the federal government.

Conclusion

Remember what this is all about. Our healthcare system is there to support our unalienable Rights, to give us life which allows us to respect each other, love each other, laugh with and at each other, and be happy together with the freedoms granted us by this great nation. What I've covered today represents a small part of what we can do to make healthcare better while also bringing costs down for individuals and our federal government. A plethora of other possibilities exist, some more politically poisonous than others. These options I've laid out strike at the heart of the matter, aimed at saving everyone billions while also encouraging pharmaceuticals to step up with new molecular entities the world desperately needs. The only people who should find fault with these suggestions are the drug companies that don't want to lose easy money, Congress members who are strongly tied to the healthcare lobby, the DoD members with a personal stake in the EHR choice, and anyone who feels all these databases and government monitoring through the FDA is Big Brother encroaching on their personal liberty. So watch, America. Watch and listen to what those individuals have to say. Will they give you talking points? Will they give you rhetoric? Will they blow off the question? Or will they sit down and have an honest discussion with you over why my ideas won't work?

 

(1) See Health: Money to Congress. See the 2008 and 2010 cycles when Democrats were in power pushing the Affordable Care Act.

(2) See Not Ready for Prime Time: The Burr, Hatch, and Upton Obamacare Proposal. Of course, at the time of writing, the plan was not available for public consumption on websites like govtrack.us, making it difficult to verify the claims by Brookings. I trust their impartiality in the absence of transparency by the Congress on the matter (ie, not having the draft bill available).

(3) See How the patent trolls won in Congress. Pharmaceuticals and trial lawyers are the groups blamed for Reid's insistence that the legislation- bipartisan legislation not even make it to the floor.

(4) See The Cost Of A Cure: Medicare's Role In Treating Hepatitis C.

(5) See 17P & Makena: Exploiting Premature Birth For Billions In Profit.

(6) See Conflicts of Interest, Institutional Corruption, and Pharma: An Agenda for Reform.

(7) See Revenue of the worldwide pharmaceutical market from 2001 to 2013.

(8) See Conflicts of Interest, Institutional Corruption, and Pharma: An Agenda for Reform. The 22% offering significant improvement over existing drugs and the approximately 14% that were new molecular entities is based off the 1,284 new drugs approved between 1990 and 2004.

(9) See Pharmaceutical Followers from Duke University and the National Bureau of Economic Research. Note their summary in that generic drugs reduced insurance premiums by $1 billion while "me-too" drugs raised them by $7 billion. Now consider the effect on Medicare costs.

(10) See Research and Development in the Pharmaceutical Industry. The CBO calls out the 505(b)(2) path that such incrementally modified drugs use to get expedited regulatory approval.

(11) Ibid.

(12) See We The People vs. The Pharmaceutical Industry. See also Express Scripts adds fuel to the fire in fight over Gilead Sciences' Sovaldi.

(13) See Research and Development in the Pharmaceutical Industry. The CBO cites a study by Iain Cockburn and Rebecca Henderson titled "Publically Funded Science and the Productivity of the Pharmaceutical Industry" when making this claim. The CBO also points out how muddy the distinction between basic research and applied research is.

(14) Ibid.

(15) See Express Scripts adds fuel to the fire in fight over Gilead Sciences' Sovaldi. Based on the $84,000 cost for a treatment and the millions of people in the U.S. suffering from hepatitis C, the article quotes Express Scripts CMO Steven Miller telling Bloomberg that costs could be upwards of $300 billion, more than America currently pays for all medication.

(16) Ibid.

(17) See Conflicts of Interest, Institutional Corruption, and Pharma: An Agenda for Reform. According to Rodwin, by 2000, drug firms funded 70 percent of clinical drug testing trials, trials that they hoped would favor their products. This gave them great influence on questions, research design, methodologies and more. You wouldn't want a tobacco company conducting a study on harmful effects of smoking, would you?

(18) Ibid. See also Chan, A.W. et al, Empirical Evidence for Selective Reporting of Outcomes in Randomized Trials for more on how drug firms manipulate tests to favor their desired outcomes in the Journal of the American Medical Association, 291, no. 20 (2004).

(19) Ibid. See also Despite Law, Fewer Than One In Eight Completed Studies Of Drugs And Biologics Are Reported On Time On ClinicalTrials.gov.

(20) Ibid.

(21) Ibid.

(22) Considering there are only 20-30 real new drugs approved each year these days, the task of updating their uses would be even less of a hassle. The "few thousand" referenced is to all drugs currently on the market.

(23) See Firewall & Windows XP HIPAA Penalties.

(24) See Reforming the Military Health System. The quote by Robert Gates is cited from a DoD speech given at the Eisenhower Library in Abilene, Kansas on May 8, 2010.

(25) See Approaches to Reducing Federal Spending on Military Health Care from the CBO.

(26) See Reforming the Military Health System.

(27) Ibid. That Secretary of Defense Chuck Hagel instructed the DoD to procure its own EHR system without VA involvement shows the complete disconnect between the DoD, President, and healthcare initiatives.

(28) See Cerner, Leidos, Accenture Awarded $9B DoD EHR Contract

(29) See DoD and VA: When will your EHRs really interoperate? and Outcome-Oriented Metrics and Goals Needed to Gauge DOD's and VA's Progress in Achieving Interoperability from the GAO.

(30) See High-Risk Series - An Update from the GAO.

(31) Ibid.

(32) See Outcome-Oriented Metrics and Goals Needed to Gauge DOD's and VA's Progress in Achieving Interoperability from the GAO.

(33) See 80% of hospitals embrace electronic records

(34) See Adoption Of Electronic Health Records Grows Rapidly, But Fewer Than Half Of US Hospitals Had At Least A Basic System In 2012.

(35) See Redirecting Innovation in U.S. Health Care: Options to Decrease Spending and Increase Value.

(36) Ibid.

(37) Ibid.

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