Wednesday, October 8, 2014

Payments to Doctors: The Bottom Line


There's a scene in Ghostbusters in which the characters are discussing gun safety.    
"Don't cross the streams."
"Why?"
"It would be bad."
"I'm fuzzy on the whole good/bad thing. What do you mean, 'bad'?" 
"Try to imagine all life as you know it stopping instantaneously and every molecule in your body exploding at the speed of light. Total protonic reversal."
"Right. That's bad. Okay. All right. Important safety tip. Thanks, Egon."

When it comes to the Sunshine Act and the massive database of payments just released, it's fair to say that we're all a little fuzzy on the "good/bad thing." 
 
Part of the problem is that there's too much data and too many categories, all wrapped up in a website that is tough to navigate. It's easy to lose the forest for the trees, but if we climb above the canopy we can begin to some patterns in Open Payments.  

First, let's do an overview of the large categories. CMS recently released this fact sheet explaining what has and has not been published in this first version of the website. (By the way, my sources for most of the figures in this article are ProPublica and the Open Payments website.)
  • The total amount of money that companies paid out to doctors and teaching hospitals from August-December 2013: $4.6 billion.
  • The amount of money that was actually published on the website: $3.5 billion
  • The unpublished money: $1.1 billion. This includes both disputed payments and payments that companies are allowed by law to delay disclosing (mostly payments related to products not yet approved by the FDA). This unpublished money is a lot, but it represents a relatively small number of payments--only 199,000, as opposed to the 4.4 million payments that have been published.
Now let's play a game that I call "good payments/bad payments".
 
A "good" payment is money invested in medical innovation.  
 
A "bad" payment is money paid to doctors to join the marketing team. To be clear, there's nothing wrong with marketing per se, nor is there anything wrong with a company hiring doctors as employees to market products. Once a doctor becomes a company employee, he or she is transparently part of the company's team, and once you're a member of the team, everybody knows you can no longer be objective when you talk about your company's products.

By "bad" payments, I'm talking about money (and meals, gifts etc....) going to doctors who are apparently independent but actually are not. Their day jobs are to treat patients, but they freelance as speakers, consultants, and consumers of catered lunches. They portray themselves as objective arbiters of information, but in fact they are being paid in such a way that they are de facto members of a ghost marketing team. This is why they are such effective marketers. Ads that don't look like ads are the most persuasive ads.
 
If you're willing to accept this moral yardstick, let's start judging payments.  

Mostly good payments: $3 billion
  • Research ($1.5 billion reported in Open Payments). Good because this is what gets us new medicines and devices. Sure, there are bogus studies meant to carve out market share for lousy drugs, but for the most part research is a good thing.
  • Physician ownership ($1 billion). Good because this is money that doctors are getting in return for investing in companies, providing capital that encourages research and development. The $1 billion is a return on an investment in innovation. Do these docs have conflicts of interest? Sure. But they are not being used by companies as ghost-marketers.
  • Royalties and licenses ($302 million). Good because these are rewards for doctors who have invented new medical devices or other products. Yes, companies have at times abused these payments, using them to curry favor with doctors. But on the whole these payments encourage medical innovation.  
  • Consulting fees ($79 million, half of the $158 million reported). Consulting is a tough one to judge. Sometimes consultants help companies decide on what research to pursue (good); other times they are paid to look at ads and help companies market nonsense me-too products that cost the health care system money (bad). So for accounting purposes, I'm assuming a 50/50 split on the good/bad scale, and assigning half to the good bucket and half to the bad.

 
Mostly bad payments: $500 million
  • Promotional speaking ($203 million). Bad because this turns doctors into drug reps. So bad, in fact, that GlaxoSmithKline decided it would end its promotional speakers' bureau program. The practice is now banned by half of all medical schools.
  • Food ($93 million). The fastest way to a doc's prescription pad is through his or her stomach.
  • Travel and lodging ($74 million). Join the marketers, see the world.
  • Education ($27 million). Companies buying textbooks for doctors. Nuff said.
  • Gifts ($19 million). Really??
  • Non-accredited CME ($15 million). Companies teaching doctors=recipe for disinformation, with some exceptions, such as bona fide training on medical devices.
  • Accredited CME ($4.2 million) Companies paying other companies to teach doctors. See above.
  • Consulting fees ($79 million). See my comments under good payments. 

Granted, I've created a pretty simplistic moral universe here. Some of what I called "good" payments are probably sleazy, and some of the "bad" payments are probably legit. But, as a rough approximation:

--86% of companies' spending was mainly good for the public health
--14% was potentially bad for the public health, because it engendered inappropriate conflicts of interest in physicians.  

The question for companies is whether they can all get together and agree to stop throwing bad money after bad.
 

Wednesday, October 1, 2014

I'm Back! Now Let's Talk Sunshine.

Hi readers. Yesterday was my last day at The Pew Charitable Trusts--timed to coincide with the launch of the Open Payments website.

Before commenting on the website, here are some quick impressions about my last 2 1/2 years in Washington: fascinating, sometimes frustrating, often exhilerating, and overall just a great introduction to the arena of politics. Pew is amazing--work there if you can.

But now, let's talk Sunshine.

When I said my goodbyes to you in March of 2012, the Open Payments website was already delayed, and much of my work at Pew was aimed toward preventing that delay from stretching to infinity and beyond.  The site was finally launched yesterday, one year behind schedule--not too bad.

The website is not what most people were originally anticipating. Most of us were expecting a big search box where you could type in your doctor's name. Instead, what we have are downloadable spreadsheets of varying complexity. CMS--the agency in charge of the site--plans to make it more user-friendly within a month or so.

At this point, the best way to begin to peer through that complexity is by going to Propublica's website, where you can benefit from the wisdon of the undisputed guru of physician payment data-mining, Charles Ornstein.

The main headline is that companies have spent $3.5 billion on various "transfers of value" to physicians and teaching hospitals during the last five months of 2013. That sounds like a lot of money. It is. For fun, I did a back-of-the-envelope calculation and determined that companies spent $23 million/day, or roughly $1 million/hour over that period.

But let's not go overboard. Of that $3.5 billion, about $1.45 billion was for research, and roughly $1 billion was equity that physician-investors have in drug or device companies. That leaves about $1 billion in other payments to doctors and teaching hospitals. These are the potentially dubious payments.

So what do we make of these amounts? How do we judge them? Because ultimately, the reason the Sunshine Act was passed in 2010 was that not all drug company payments are morally equivalent. We must look at the data and judge which payments appropriate and which are not. 

Next post, we'll go through each category of business activity listed in the website and start to assign some moral valence to the payments.  

Preview: The Open Payments website makes companies look better than I would have thought. Stay tuned.

Monday, March 19, 2012

Dr. Carlat Goes to Washington To Head Pew Prescription Project

This will be my last Carlat Psychiatry Blog post for a while, as I have recently accepted a new job as the director of the Pew Prescription Project in Washington DC. My main job there will be to pull together a group of experts to review conflict of interest recommendations, and to work with various partner organizations (AMSA, Community Catalyst, and the National Physician's Alliance) to disseminate these recommendations to medical schools and teaching hospitals throughout the U.S.

Because my current job as owner of Carlat Publishing creates its own potential conflict of interest, I am in the process of relinquishing involvement in the company--hiring a new CEO, and placing any profits into an account which I can access only if and when I return to the company. Although I will continue to own Carlat Publishing, I will draw no salary from it, nor will I have any contact with the business in any way. I want to prevent any appearance that I'm joining Pew in order to increase my company's profits from non-industry-sponsored CME activities.

The Carlat Psychiatry Blog lives on in the form of Thought Broadcast, a blog written by psychiatrist Steve Balt, who is the new editor-in-chief of The Carlat Psychiatry Report.

I thank all my devoted blog readers over the years, and I intend to continue writing and blogging about medical conflicts of interest issues and psychiatry--though not in the context of the Carlat "brand."

So it's goodbye for now.

In gratitude,

Daniel Carlat, M.D.

Friday, January 6, 2012

BMJ's Ten Commandments for the Ideal Physician

The British Medical Journal's great blogger Richard Lehman has published the following Ten Commandments for excellent clinical practice. These are great rules of thumb for any savvy health care practitioner--but they do require that wee bit of extra work to truly understand the statistics behind the medical literature. 
(Hat tip to Steve Balt, MD, for sending me the link). 

The New Therapeutics: Ten Commandments
  • Thou shalt treat according to level of risk rather than level of risk factor.
  • Thou shalt exercise caution when adding drugs to existing polypharmacy.
  • Thou shalt consider benefits of drugs as proven only by hard endpoint studies.
  • Thou shalt not bow down to surrogate endpoints, for these are but graven images.
  • Thou shalt not worship Treatment Targets, for these are but the creations of Committees.
  • Thou shalt apply a pinch of salt to Relative Risk Reductions, regardless of P values, for the population of their provenance may bear little relationship to thy daily clientele.
  • Thou shalt honour the Numbers Needed to Treat, for therein rest the clues to patient-relevant information and to treatment costs.
  • Thou shalt not see detailmen, nor covet an Educational Symposium in a luxury setting.
  • Thou shalt share decisions on treatment options with the patient in the light of estimates of the individual’s likely risks and benefits.
  • Honour the elderly patient, for although this is where the greatest levels of risk reside, so do the greatest hazards of many treatments.

Thursday, January 5, 2012

On Stephen Colbert, Super PACs, and Industry-Supported CME


The current New York Times Magazine carries a fascinating and quite hilarious profile of Stephen Colbert, of the Colbert Report. Colbert is well known for his parody of a know-nothing rabidly conservative Republican commentator—but according to the article he has taken his comedy into the real world, involving himself directly in those shady instruments of electioneering known as “super PACs.”

For those who haven’t followed super PACs, they are the political equivalent of the CME industry’s Medical Education Communication Companies (MECCs). Super PACs can take unlimited amounts of money from corporations, then turn around and use the money to promote candidates of their choosing—with the stipulation that they are not directly “coordinating” with their favorite candidates, whatever that means.  Analogously, MECCs can take unlimited amounts of money from drug companies, then turn around and use the money to pay doctors to promote the company’s products—with the stipulation that they cannot coordinate their CME courses directly with drug companies, again, whatever that means.

In both examples, a third party is being used by corporations to circumvent an inconvenient regulation. In the case of super PACs, companies can circumvent Federal  Election Commission (FEC) rules that limit campaign contributions to a maximum of $2500 per individual (super PACs can accept millions from individuals). In the case of MECCs, drug companies circumvent ACCME Standards for Commercial Support forbidding direct payments to doctors for CME, by laundering the money in the form of  educational grants to third party CME companies.

Colbert, in an effort to expose how corrupt super PACs are, has actually started his own super PAC, entitled "Americans for a Better Tomorrow, Tomorrow."  As quoted in the Times article, Colbert facetiously defends his and other super PACs by pointing out that they are “100 percent legal and at least 10 percent ethical.”

I’ve never heard a better characterization of industry-supported CME.  Let’s hope that Colbert continues his unorthodox lessons in the ways of money, corporations, and corruption.  For his next project, I suggest he start his own MECC, named, perhaps, “The Institute for Healthcare Education and Prescription Promotion.” 

Wednesday, January 4, 2012

APA Threatens to Sue "dsm5watch" Website

I just read Bernard Carroll's interesting post on the Health Care Renewal Blog about the latest DSM-5 brouhaha. It appears that the American Psychiatric Association has sent a "cease and desist" letter to a website critical of the DSM-5. The site was called "dsm5watch," but the APA argues that using DSM-5 in the blog title is an infringement of their trademark. The owner of the blog, Suzy Chapman, having no funds to tussle with APA lawyers, simply changed the name of her site to dxrevisionwatch, which, she says, has resulted in much less traffic.

Is the APA simply protecting its ownership of a lucrative franchise, or is it engaging in something more insidious, what Dr. Carroll calls the "SLAPP maneuver," an acronym for "strategic lawsuit against public participation"? I'm guessing that APA would have had little problem with the site if it were cheerleading the DSM-5 process. It all seems rather heavy-handed to me. After all, the New York Times appears to have no problem with the anti-Times site called TimesWatch. In a democratic society, healthy dissent and debate is part of the package. It may be annoying, but that doesn't excuse the bullying tactics that the APA has chosen.

Thursday, December 22, 2011

The Gig is Up: The Sunshine Act Will Include CME Payments to Doctors

Those of us who have followed the progress of the implementation of the Physician Payment Sunshine Act have been acutely aware of one potential loophole: drug companies might try to hide payments to doctors for industry-supported CME activities. That’s because these payments are not "direct" payments to doctors, but rather indirect payments.

In a 2007 op/ed piece for the New York Times, I referred to this arrangement as a money laundering scheme: “Essentially, this is a new twist on that well-known instrument of corruption, money laundering. Drug companies don’t directly pay doctors to teach courses. Instead, they pay someone else to cut the checks. Similarly, the drug companies don’t explicitly tell doctors to say good things about their products. Instead, they hire a company to write good things about their products and to pay doctors to deliver the messages.” 

Nothing substantial has changed about this cloak and dagger payment process since 2007—other than the fact that the total amount of commercial support for CME has dropped substantially, from a high water mark of $1.2 billion in 2007 to $830 million in 2010—a decrease of  37%. But $830 million is still a chunk of change, and some unknown portion of that sum is paid directly to physicians by the CME provider.

Therefore, those of us in favor of transparency were able to breathe a sigh of relief when CMS recently unveiled its proposed regulations. Drug companies will, in fact, be required to report payments that flow through third party entities and end up in doctors’ pockets, as long as the company is aware of the identity of the doctor. And how could they not be aware? ACCME requires all CME programs to publically disclose the identities of both the industry supporter and the faculty—meaning that companies will eventually always know which doctors end up partaking of their “educational grants.”

In closing this loophole, CMS officials were hardly acting on their own—they were simply implementing the Sunshine Act as it was approved by Congress. In fact, if you look at the text of the Act, it is hard to imagine any reasonable interpretation other than CMS's. Here’s the crucial opening paragraph of the law, which sets the context for the entire Act:

“On March 31, 2013, and on the 90th day of each calendar year beginning thereafter, any applicable manufacturer that provides a payment or other transfer of value to a covered recipient (or to an entity or individual at the request of or designated on behalf of a covered recipient), shall submit to the Secretary, in such electronic form as the Secretary shall require, the following information with respect to the preceding calendar year….” (my italics).

The language is technical, so let's unpack it a bit. “Applicable manufacturer” means a drug or device company. “Transfer of value” means giving a doctor anything of value, including cash, meals, and gifts.  “Covered recipient” means a physician, dentist, podiatrist, optometrist, or chiropractor—all of which are professionals covered by the law. So far, the law is saying, in common parlance, “Any drug company that gives money or something else of value to a doctor…will have to report this to the government.”

But the framers of the Act went out of their way to acknowledge that sometimes these payments are indirect, and that such indirect payments should be reported as well. How else could you interpret all the language in parentheses: “ …Or to an entity or individual at the request of or designated on behalf of a covered recipient.”  To translate again: the Act is saying here that drug companies must report payments to any “entity” (eg., a MECC, a medical society, a non-profit organization) that takes payments from drug companies when those payments are actually “designated” for a “covered recipient”, ie., a doctor.

It seems quite clear, but of course both drug companies and those MECCs dependent on drug company grants are viewing this issue differently--see, for example, Tom Sullivan's take in this article on his blog Policy and Medicine. So stay tuned. Hopefully CMS will stick to its guns and issue final regulations that will not allow drug companies to cast a shadow on a major source of physician payments. Let the sun shine in!