Conflict of Interest at the FDA?

At The California Medicine Man – which, BTW, is a terrific new blog, written by a physician, but in no way overly technical or condescending – there’s a disturbing bit of information:

“(F)or an FDA advisory committee member evaluating the COX-2 inhibitors, affiliation with Pfizer or Merck appears to constitute a clear conflict of interest. Consider these numbers I extracted from the vote breakdown in one report. If you were one of 10 committee members taking money from Pfizer or Merck,

You had a 100% probability of supporting Bextra compared with a 35% if you had no such tie.

You had a 90% probability of supporting Vioxx compared to 36% if you had no such tie.

If these 10 committee members had abstained from the vote, neither drug would have been approved for marketing.

To suggest that this breakdown occurred by mere chance and had nothing to do with drug company affiliation strains credulity to say the least!"

If verifiable, this represents an incredibly egregious abuse of regulatory discretion. As I’ve noted in previous posts, rx coverage accounts for a disproportionate share of medical coverage costs, and this just adds fuel to that fire.

Anthem and Premier Have a Food Fight…

Okay, not really, but I couldn’t resist the headline. What did happen, tho, is that the much-ballyhooed arbitration has come to an abrupt – and fruitless – halt. Apparently, after they had met for a grueling day and a half (not counting coffee- or potty-breaks), the two sides “broke off their mediated negotiations without a contract.”

Where does this leave those Anthem insureds whose providers are in the Premier system? Think creek, missing paddle. For most, non-emergency access to Premier services will come with a much higher price tag. For some, there may be no non-emergency coverage at all (this depends on which plan design a given insured has chosen).

As always, there are (at least) two sides to this story. Anthem maintains, and Premier has so far not disputed, that Premier’s costs are significantly higher than other, comparable area provider networks. In essence, Anthem insureds who choose non-Premier providers are subsidizing those who do utilize Premier. OTOH, physicians and hospitals do have costs, and Premier, in the form of Miami Valley hospital, runs the region’s CareFlight service. That can’t come cheap.

So, at least for now, this will continue to be a juggling act between offering affordable health insurance (often, Anthem’s rates are below-market) versus access to a LOT of providers.

There don’t seem to be any winners here.

I’m in perfect health, so why was I declined?

Recently, I had occasion to speak with a client who was unhappy with his coverage [ed: nooo! really?!]. This gentleman owns his own business, and has had a policy with Company F for a number of years. The plan has a high deductible, and no frills. It covers this gentleman and his family for a little over $900 per quarter.

He called me a few months ago to see if there was anything we could do to lower his premium without lowering his benefits. I looked around, and found nothing that would do accomplish his stated goal. He was not happy with this report, but there was nothing I could do about that. The quotes are the quotes.

Last week, he called me back to complain that he had been declined for health insurance. Excuse me? It seems that he had contacted (or been contacted by) another agent, not affiliated with our agency, but who also represented Company F. This agent told the client that Company F offered a plan with benefits he did not currently have, at a lower premium. The client applied for this new plan, and was declined by Company F due to his elevated blood pressure [ed: on its face, this seems an unlikely reason for declination, but inasmuch as I had nothing to do with this application, I’ll never know the true reason].

The client was outraged, so naturally he called me. Or rather, he had his wife call me. I spoke with her, and then did a little more poking around (I realized at the time that this would most likely be a waste of my time, but one does try to accommodate one’s clients). Again, I found nothing that would maintain or improve his coverage without an increase in premium,. In fact, I ran the numbers with Company F (his current carrier) -- the plan which the other agent had touted as a significant increase in benefits and decrease in premiums – and it actually cost over $2,500 per quarter, and that assumed a preferred rate classification.

As you may imagine, this did not go over well with the client. According to his doctor, his blood pressure was fine, and he was in exceedingly good health.

Now, it may be that the doctor was lying.

It may also be that the insurance company was mistaken.

But what is more likely is that they were both right: The physician sees a patient, about whom he cares, and whose health he is reasonably certain can be managed with (presumably) a minimum of hassle. He sees no major or imminent problems, and because he knows the patient on a personal level, is confident that things will “be fine.”

The insurers, OTOH, sees a potential claim. The company doesn’t know this client on a personal level – whether or not he is a current insured notwithstanding – and assesses the risks of insuring him based on the experience of insuring thousands of others like him.

It’s nothing personal.

Watch your meds…

Got an interesting flyer from Humana today. Effective May 1, they’re changing how they cover certain medications. Based on previous experience, I expect other carriers to follow suit shortly.

The letter starts out auspiciously enough:

“Humana is launching a new program designed to help employees who take certain high-cost drugs save money each month on their prescriptions. And when employees choose less expensive drugs, overall pharmacy costs should decrease.”

The program targets specific medications that have “lower-cost alternatives,” presumably generic equivalents. For now, Humana is focusing on meds for heartburn, pain, allergy and high cholesterol. Left unsaid, but certainly easily inferred, look for blood pressure and anti-depressant meds to follow.

The program is set up so that, at the next refill (or, for first-time use, the initial scrip), insured’s will need to talk with their doc about their new options:

- Switch to lower-cost alternative (i.e. generic),

- Stay on current med, but absorb a greater share of the cost, or

- Obtain authorization to continue with their current prescription

This is really not all that new, and I’m not convinced that it’s necessarily a bad idea. In recent years, a disproportionate percentage of health costs – and renewal increases --has been attributable to meds. And many carriers have implemented a “formulary-based” protocol; that is, if you’re med isn’t on their “preferred” list, you pay more (sometimes a LOT more) for it.

This move is also consistent with Humana’s increasing push for Consumer Driven Health Care. The idea is that patients should be taking a more pro-active role in their own care. We see this in the widespread publicity (if not actual purchase) of High Deductible Health Plans and HSA’s, and the disappearance of the lower end of the deductible scale (when was the last time you saw a $250 deductible?).

I actually applaud this move, because it encourages us to take a more active role in our care, and in how we access and use the healthcare system. The funny thing is, I don’t currently have any groups with Humana (that’s another post), but I think that this move is a positive step in the evolution of how we pay for healthcare.

And Speaking of Dead Folks…

This article caught my eye. I’m a fan of Jeff Foxworthy, and I immediately thought of his humor when I read:

No federal charges in theft of boyfriend's remains, and beer

SHEBOYGAN, Wis. - A woman accused of digging up and taking her boyfriend's cremated remains more than a decade ago - and drinking the beer that had been buried with them - won't face federal charges, a prosecutor says.

Sheboygan County District Attorney Joe De Cecco said Karen Stolzmann, 44, faces only a misdemeanor charge of possession of stolen property, punishable by up to nine months in jail and a $10,000 fine.

Stolzmann has been accused of digging up the remains of Michael Hendrickson from the Cambria Cemetery in Columbia County and drinking the beer that also had been buried, possibly out of spite for his family…

An exhumation discovered that Hendrickson's cremated remains were missing from the cemetery. Beer and cigarettes that were buried with him were also missing.

One wonders if the late Mr Hendrickson (and/or his brews and smokes) would have made it onto the database in yesterdays post.

The Dead Pool…

Recently, my friend Bob (be sure to check out his blog, Health Insurance 411) sent me an article about a new product: The Social Security Death Index Database. Briefly, the company makes available “a database of all reported deaths of reported Social Security number holders.” That is, if you’re in the Social Security system (and who isn’t?), and you die, you “make the list.”

So Bob and I had a brief email conversation about WHY someone (or some company) might need this information, and under what circumstances that need would be so great as to justify paying over $600 a year for this information.

We speculated that perhaps funeral directors would find it helpful, or even insurance agents (“Pardon me, Mrs Thompson, but I see that your husband has passed away. Did he have enough life insurance? Do you?”). But neither of us could figure out exactly who would pay for this kind of information, or to what purpose(s) it would/could be put.

So I moseyed on over to the site (which is easily navigable, and informative as well). I was surprised at the number of applications for such information:

- Bill collectors (kinda adds new meaning to “deadbeat”)
- Anyone who must be HIPAA compliant (medical providers, insurers)
- Mass marketers (who would presumably prefer that their lists remain current)

I’m still not sure how I feel about this. I guess it’s (technically) public knowledge, and I suppose that it could be a useful tool in certain businesses. But I’m also a little “creeped out” at the thought that news of my demise would be disseminated in that fashion.

Maybe I’m overreacting [ed: nooo!], but I just find this to be an unsettling development.

This is definitely a post for which I’d welcome feedback.

Brooklyn Bridge For Sale…

According to the Dayton Business Journal, “Anthem expects to save $40 million to $50 million this year as a result of dropping Premier from its network,” and “plans to funnel some of that savings back to businesses through quarterly premium credits.”

Leaving aside the plausibility of ANY insurer promising to “reduce rates,” nowhere in the article does the company representative [ed: Chris is an okay guy. This isn’t a slam on him, per se] explicate exactly how Anthem determined that it would save this amount of money by deleting Premier from its network.

But it gets better: these “premium credits” would only be available to groups of greater than 50 employees. The major problem here is that most employers fall into that “small group” (under 50 lives) category, and so will never see a penny in “savings.”

Notice the other “gotcha,” as well: those employers which ARE eligible will see that any savings will be offset (reduced) “based on how often their employees had used Premier services in the past.”

So why am I pooh-poohing such a generous offer from a carrier? Exactly what motivates me to “look a gift horse in the mouth?” Because I don’t think that this is coming from the gift horse’s mouth at all…rather, I think it’s coming from the other end.

What motive could a carrier have to publicly announce presumably proprietary figures (i.e. information regarding the amount of claims projected to be paid to a specific provider, or set of providers)? Politics, plain and simple.

As noted in the article (and by this blog a while back), Anthem and Premier have hired Lisa Kloppenberg, dean of the University of Dayton Law School, to mediate their discussions. And by announcing these alleged rate reductions in advance, it certainly helps Anthem in the court of public opinion.

I’ll be advising my clients not to spend those savings, just yet.