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In This Issue:

1.) Medical Privacy and Information Technology Should Go Hand in Hand
2.) President Bush Proposes Billions in Health Care Spending, but Fails to Cover More Americans
3.) Science Needed for Better Ethics in Medicine
4.) Podcast on the Story of Innovation behind the Puget Sound Health Alliance

1.) Medical Privacy and Information Technology Should Go Hand in Hand

Last Thursday, in lieu of publishing the Health Wire, PPI held a forum, "Digitizing Medical Records: What Are The Choke Points?" The forum featured a diverse group of speakers including Sen. Tom Carper (D-Del.) who announced an important new initiative to encourage the use of personal health records (PHRs) in the Federal Employees Health Benefits program. PHRs contain the key health and health care information about a person and enable people to control who has access to this medical information.

PHRs are predicated on two ideas that emerged quite clearly at the PPI forum: stranded data and patient privacy. Stranded data are bits of information about patients that have already been logged into a computer system for a one-time use. For example, clinical laboratories use computer records to send doctors the results of a patient's lab tests. But that information is not available to doctors in an emergency room where a patient may have to be admitted just to repeat a test. In fact, that kind of waste happens every day in health care to the tune of $34 billion dollars each year according to the Patient Safety Institute. A personal health record would give patients and their doctors real-time access to critical medical information that is already standardized and digitized.

Protecting privacy is critical to winning patients' confidence that their medical records won't end up in the wrong hands. Patients should be able to control who sees their records and see a log about everyone who does. They may also wish to flag their most sensitive information for disclosure only when talking directly with a doctor. A personal health record would enable patients to exert such control.

Some argue that protecting medical privacy is too costly given the need to treat diseases like diabetes that consumes one of every seven health care dollars. Writing in The Washington Post, New American Foundation senior fellow Phillip Longman praises a New York City diabetes program that identifies city residents who have diabetes from the records of blood sugar tests performed by clinical labs. It is undoubtedly abhorrent to many that the government has such power, and it's equally important to consider the corrosive effect on patient's trust when you don't ask permission before sharing their medical records.

A recent survey published in Health Industry Insights shows one-third of consumers with health insurance are reluctant to share information with their primary care physician out of fear that the information could become widely accessible through the Internet.

If it's done right, information technology can give patients more control and protection than they have even under current federal privacy laws. But that's a big "if." Initiatives like Sen. Carper's personal health records for federal workers are critical to giving patients a good experience with health information technology, and for avoiding a false public policy choice between protecting privacy and improving health care.

For more information:

PPI Forum: Digitizing Medical Records: What Are The Choke Points?
February 1, 2006:
http://www.ppionline.org/ppi_ci.cfm?knlgAreaID=126
&subsecID=900096&contentID=253704

"Economic Value of a Community Clinical Information Sharing Network,"
Patient Safety Institute, March 2004:
http://www.ptsafety.org/resources/

"From Typhoid Mary To Diabetic Debbie,"
By Phillip Longman, The Washington Post, February 15, 2006:
http://www.washingtonpost.com/wp-dyn/content/
article/2006/02/14/AR2006021401772.html

"Health Industry Insights Survey Finds Consumers Don't Want Medical Information on Internet,"
Health Industry Insights, January 17, 2006:
http://www.healthindustry-insights.com/HII/
pdf/HII_consumersurv011706.pdf

2.) President Bush Proposes Billions in Health Care Spending, but Fails to Cover More Americans

The president's budget proposal for health care includes $60 billion over five years for tax credits and deductions for health savings accounts and high deductible insurance policies. You might think that some of this money would reduce the number of Americans without health insurance. Think again.

According to an analysis by MIT professor Jonathan Gruber released by the Center on Budget and Policy Priorities, the president's proposal would actually increase the number of Americans who are uninsured by more than 500,000. Here's how: For healthy Americans, the tax breaks the president proposes would make it much less expensive to purchase individual coverage than job-based coverage. Healthier employees would therefore have every reason to leave their job-based coverage, leaving sicker employees behind in a smaller and more expensive insurance pool. Over time, many employers would drop health benefits because it would be too financially burdensome to cover only the sicker employees. Many of these employees would then be without coverage altogether because individual health insurance is basically unaffordable for people with pre-existing health conditions. Many healthy employees, too, would put off getting the individual coverage (despite the tax breaks) because they would feel they might not need it.

Although the president could have devised a way to protect sicker workers, he has not proposed a national policy to do so. Instead, his proposals would undermine the efforts of large employers such as those in the Seattle area who are joining forces to lower health care costs by improving quality.

To be sure, analyses like Gruber's are simply sophisticated guesses about what might happen. But Gruber's analysis is based on plausible assumptions that should stimulate debate. And even if he's wrong about the president's proposal actually increasing the number of uninsured, the expenditure of $60 billion without decreasing the number of uninsured would still be a huge waste.

Of course, $60 billion to promote health savings accounts and high-deductible insurance policies might be worthwhile if they were an effective strategy to restrain costs. But consider this calculation: HSAs are supposed to save money by making patients pay for their own health care instead of relying on their insurance company. But about 80 percent of health care costs go for patients who are very sick and have costs above the standard HSA insurance deductible. The administration projects that about 8 percent of Americans will use HSAs by 2011. In all, HSAs will be involved in less than 2 percent of the nation' health care spending. That's simply not a big enough base from which to restrain the runaway medical inflation that has risen five times faster than general inflation during the Bush presidency.

For more information:

"The Cost And Coverage Impact Of The President's Health Insurance Budget Proposals,"
by Jonathan Gruber, Center on Budget and Policy Priorities, February 15, 2006:
http://www.cbpp.org/2-15-06health.htm

"In Ohio, Bush Touts Health Savings Plan,"
By Jim VandeHei, The Washington Post, February 16, 2006:
http://www.washingtonpost.com/wp-dyn/content/
article/2006/02/15/AR2006021502296.html

3.) Science Needed for Better Ethics in Medicine

In the past few weeks, a number of reports have surfaced about unscrupulous relationships between pharmaceutical companies and medical providers, mirroring the lobbying controversy in Congress. The ubiquitous practice of drug makers taking doctors out to meals, giving "no strings attached" gifts, and sponsoring "educational" vacations to exotic destinations is well known, but the degree of the industry's influence is more significant than many consumers had thought.

A few examples: Drug makers have been found to pay physician assistants and pharmacists to "inform" patients about the benefit of their drugs, paying them for every patient they win over; regional pharmaceutical representatives, who are supposed to show doctors the medical benefits of their products, persistently pressure doctors by reminding them of all the "no strings attached" gifts and favors they do for them; a surgeon in Wisconsin was recently caught being paid $400,000 as a "consultant" by a manufacturer of surgery equipment, receiving payment in exchange for using and promoting the company's products in his hospital and medical school; and patient health advocacy groups, like the American Diabetes Association and the National Osteoporosis Foundation, have been criticized for not informing their members of the potentially severe negative side-effects associated with drugs produced by pharmaceutical companies that are also big donors to the organizations.

Some doctors have argued that for all the gifts in the world, they base their medical decisions on scientific evidence alone and are not influenced by gimmicks. But recent studies of doctors' prescribing behaviors have concluded that doctors are indeed influenced by these gifts, even the smaller ones.

That's why a group of physician researchers from leading academic medical centers have written in The Journal of the American Medical Association that doctors should be altogether prohibited from receiving gifts, meals, or payments for attending meetings organized by pharmaceutical companies (and other corporations, like those that manufacture medical equipment). California-based Kaiser Permanente already imposes such regulations upon its doctors, and Kaiser's doctors' prescribing habits are noticeably more in line with good medical decision making than many in their peer group.

But there is still more that can and should be done. Doctors need greater access to research about new drugs from unbiased sources, including updated prescribing information and warnings from the FDA as well as independent researchers. Part of the problem is that good information simply does not exist to the extent that it should, but a lot of the information that does exist, such as much of the data pharmaceutical companies produce themselves, is not readily available to doctors or to the public. Without accessible research guiding doctors and patients, doctors are left to be wooed by gifts and patients by direct media advertisements.

Yes, it's time for health care professionals to upgrade their ethical standards to ensure that their allegiances are to patients rather than corporate sponsors. But it's also time for health plans to reinforce doctor's responsiveness to patients by paying them according to the quality of their services and the outcomes they produce. That way, they would be more inclined to prescribe the most effective medications rather than the most advertised ones. Finally, Congress and the administration should aggressively fund research that compares the efficacy and efficiency of medical interventions and promote the development of decision-support tools for doctors and patients that can quickly put research results into practice.

For more information:

"Health Industry Practices That Create Conflicts of Interest: A Policy Proposal for Academic Medical Centers,"
by Troyen Brennan et al., Journal of the American Medical Association, January 25, 2006:
http://jama.ama-assn.org/cgi/content/abstract/295/4/429

"In Article Doctors Back Ban on Drug Companies' Gifts,"
By Gardiner Harris, The New York Times, January 25, 2006:
http://select.nytimes.com/gst/abstract.html?
res=F60F1EFF3B5B0C768EDDA80894DE404482

"Drug Maker's Efforts to Compete in Lucrative Insulin Market are Under Scrutiny,"
By Gardiner Harris and Robert Pear, The New York Times, January 28, 2006:
http://www.nytimes.com/2006/01/28/national/28insulin.html?
ex=1296104400&en=b8092220272001a5&ei=5088

"Divided Loyalties?"
By Tinker Ready, The Washington Post, February 7, 2006:
http://www.washingtonpost.com/wp-dyn/content/
article/2006/02/06/AR2006020601180.html

4.) Podcast on the Story of Innovation behind the Puget Sound Health Alliance

Ron Sims, Executive of King County, Washington, was featured in a PPI forum on January 26 about the Puget Sound Health Alliance, which he helped form. While visiting PPI, Sims also participated in a recorded interview that is now available as part of the Democratic Leadership Council's Podcast series. Sims' interview can be accessed at the DLC website and at iTunes.

Sims recounts his path toward active involvement in health care policy, his decision to set into motion an employer-led health alliance that aims to reduce costs and raise the standard of care in the Seattle area, and the accomplishments and goals of the still nascent Puget Sound Health Alliance. Sims offers words of wisdom to other local officials and health policy advocates who are looking to address rising health costs in their own regions of the country. To listen to Sims interview, please visit:
http://www.dlcpodcasts.org/Volume1/sims.mp3

For more information:

"The Puget Sound Health Alliance,"
By Eitan Hersh and David B. Kendall, PPI, January 26, 2006:
http://www.ppionline.org/ppi_ci.cfm?knlgAreaID=111
&subsecid=298&contentid=253694

"Disciplining Health Care Costs by Demanding Better Value,"
Kaiser HealthCast:
http://www.kaisernetwork.org/health_cast/
hcast_index.cfm?display=detail&hc=1633

DLC Podcasts,
Democratic Leadership Council:
http://www.dlc.org/ndol_ci.cfm?kaid=450013
&subid=900116&contentid=253563

Newsletter compiled and written by David B. Kendall, PPI's senior fellow for health policy and Eitan Hersh, Dutko fellow.