HealthLawProf Blog

Editor: Katharine Van Tassel
Concordia University School of Law

Sunday, September 30, 2012

The Dangers of Uninformed Reporting: Clinical Trials in Russia

It’s way too easy to say “never believe what you read in the papers.”  But on the occasions when I read or hear something about which I know more than the reporter—a recent general example being whether the individual mandate had been upheld or not, it’s disconcerting to see how much they get wrong because they lack any context.  This is an especially serious issue when reporters without a background in science, medicine or law rely on too few sources.  Here’s the most recent example.  In an article in Friday’s New York Times entitled, “Russians Eagerly Participating in Medical Experiments Despite Risks.”  The reporter, Andrew E. Kramer, who has been reporting on Russia for the Times since 2005, has written what amounts to a press release touting the wonderful advantages of bringing drug development overseas.   The direct subjects of the article are Russian citizens delighted to have the opportunity to enroll in clinical trials to test drugs for which they would otherwise not have access.   The testing of pharmaceuticals intended for use in the United States using patients in countries with less developed laws regarding quality, monitoring and human safety is a topic of intense discussion and concern in the popular press, legal, industry, human rights and bioethical communities.  And by concern I mean in the sense of there being  “concern” in Israel about the Iranian nuclear program”  The article explains how the Russian government  is encouraging pharmaceutical companies into the country to conduct these trials by requiring that drugs sold in Russia be tested in Russia.  The reporter never considers how odd that is---we don’t have that requirement in the US nor does Japan, Switzerland, New Zealand, or the like.


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September 30, 2012 | Permalink | Comments (0) | TrackBack (0)

Friday, September 28, 2012

Worth Reading This Week

Thursday, September 27, 2012

Presidential Candidates in the NEJM

The Democratic and Republican presidential candidates' positions on healthcare and visions for the future of American Healthcare have just been printed in the New England Journal of Medicine.  The journal's editors invited President Obama and former Governor Romney to submit their essays, which were published late last night online.  The essays are addressed to NEJM's physician audience.  President Obama described and defended the Affordable Care Act and explained why it should make physicians' jobs easier by protecting their patients.  Focusing on policies particularly of interest to physicians, the President wrote:

If I am elected for a second term, I will follow through on all the work we have started together to implement the Affordable Care Act. I have also been clear that additional steps are needed. We need a permanent fix to Medicare's flawed payment formula that threatens physicians' reimbursement, rather than the temporary measures that Congress continues to send to my desk. I support medical malpractice reform to prevent needless lawsuits without placing arbitrary caps that do nothing to lower the cost of care. I also know we must continue to support life-sciences research and ensure that our regulatory system helps bring new treatments and tools to pharmacies, doctors' offices, and hospitals across the country. I will keep Medicare and Medicaid strong, working to make the programs more efficient without undermining the fundamental guarantees.

My opponent in this election, Mitt Romney, has a radically different vision for the future of our health care system — even if it means running from his past as the architect of health reform in Massachusetts.

This, of course, highlights the most mystifying aspect of Former Governor Romney's position in his campaign, because he denies the legacy he left in Massachusetts in order to attack what he calls ObamaCare.  Writing to the physician audience, Romney wrote:

A strengthened system must also be one where America continues to lead the world in innovation and where we continue to attract the best and the brightest, both from our own towns and from around the world, to the practice of medicine. Doctors should spend more time treating patients and less time practicing defensive medicine or processing paperwork. Innovators should increase their investments in new cures, and those cures should reach the market faster. Achieving these goals requires medical malpractice reform, a streamlined regulatory framework to support the interoperability of information technology, and strong Food and Drug Administration leadership committed to a practical and predictable approval process that appropriately evaluates risk.

Finally, for our health care system to work for all Americans, we must have government programs that effectively serve our senior citizens and people in need without breaking the bank. In other words, we need genuine entitlement reform.

The comments to these unsurprising essays range quite a bit, but a few ask the very question I had: why did NEJM bother to make the invitation?  Neither candidate offers insights, both supply now familiar soundbites.  Seems like a wasted opportunity.


September 27, 2012 | Permalink | Comments (0) | TrackBack (0)

Protecting Patient Privacy in the Age of Big Data

In a new essay, available here, that is part of a Symposium collection, here, recommending legislative/regulatory action to the incoming Administration ("The Next Four Years") I argue for some enhanced privacy protections in the face of emerging "big data" models.

This essay discusses the threats to health privacy posed by “big data;” an ongoing revolution in data collection and processing. The essay takes the position that big data poses an exceptional group of problems for health care, its providers, researchers, and patients. Faced with increased privacy risks an exhaustive overhaul of HIPAA/HITECH is not proposed. Rather, this essay suggests an incremental approach, adopting aspects of the recent privacy proposals published by the White House and the Federal Trade Commission. The essay suggests that the battle to preserve health privacy needs to be fought on three fronts. First, while HIPAA/HITECH provides increasingly robust protections against unauthorized uses of health information by a relatively narrow set of traditional health care provider data stewards, it does almost nothing to regulate the collection of health data. It is time that the federal government put real limits on the collection and processing of personal information. Second, the U.S. has adopted a sector-based approach to data protection. HIPAA, as amended by HITECH, and the “privacy” and security regulations made thereunder apply only to a narrowly constructed version of the vertical health care market. Such sector-based approaches to regulation are frequently flawed because of poor calibration. Further, the very concept of health sector specific regulation is flawed because health related or medically inflected data frequently circulates outside of the traditionally recognized health care sector. Third, there is great value in patient information that could be extracted and used by responsible medical and public health researchers. Responsible public policy suggests that researchers should be able to request that information from patients. Many of the existing HIPAA and HITECH security and confidentiality protections apply here but are fundamentally flawed. Neither current policy nor regulations supply the key component: a coherent choice architecture for dealing with appropriate patient decision-making regarding research use of personal or familial health data.


September 27, 2012 | Permalink | Comments (0) | TrackBack (0)

Wednesday, September 26, 2012

Global Outlaws and Pharma Trade

I was recently listening to a podcast by Carolyn Nordstrom of her 2008 Franke Lecture in the Humanities, emergent(cies).  Nordstrom discusses the extraordinary power wielded by those in control of an underground economy of weapons, drugs, and human trafficking.  Paul Farmer attested to Nordstrom's extraordinary dedication to ferreting out the transactions that knit together so many imperiled and privileged lives.  I look forward to reading her book Global Outlaws

To write this book, she spent three years traveling to hot spots in Africa, Europe, Asia, and the United States investigating the dynamics of illegal trade around the world—from blood diamonds and arms to pharmaceuticals, exotica, and staples like food and oil. Global Outlaws peels away the layers of a vast economy that extends from a war orphan in Angola selling Marlboros on the street to powerful transnational networks reaching across continents and oceans.

Nordstrom's extraordinary fieldwork includes interviews with scores of informants, including the smugglers, victims, power elite, and profiteers who populate these economic war zones. Her compelling investigation, showing that the sum total of extra-legal activities represents a significant part of the world's economy, provides a new framework for understanding twenty-first-century economics and economic power. Global Outlaws powerfully reveals the illusions and realities of security in all areas of transport and trade and illuminates many of the difficult ethical problems these extra-legal activities pose.

The secrecy surrounding such trade (and even manufacture, in the case of cigarettes) has many causes. In a tour de force narrative in the lecture, Nordstrom describes how the fate of a child shot in Angola could be directly related to global market forces.  Pirate banking systems enable the flows of funds for "goods" ranging from arms to fake pharmaceuticals. Those struggling for transparency in these systems occasionally score some victories.  But without much more serious efforts to monitor the flow of money and goods, we should expect the "global outlaws" to exercise more influence in ever more rogue economies.


September 26, 2012 | Permalink | Comments (0) | TrackBack (0)

Reporting information about clinical trial data: passing the torch from HHS to the FDA

In 2007, motivated by concerns that pharmaceutical companies were not sharing negative data about what had been learned in clinical trials, Congress established enhanced reporting requirements,

A series of articles published in January 2012 in the British Medical Journal demonstrates that data reporting remains deeply problematic, especially for industry-sponsored trials. (The articles can be found at and are very much worth reading). 

A posting Sept. 26 in the Federal Register indicates that the Secretary of HHS has delegated authority to to oversee the reporting process to the FDA,  Whether this signals improved monitoring of clinical trial data submissions remains to be seen,  One can only hope.


September 26, 2012 | Permalink | Comments (0) | TrackBack (0)

Filing a complaint with HHS about a HIPAA violation: a warning about "how (not) to"

I posted in June about the fact that my social security number (and possibly other personal information) had been downloaded to an unknown site in Eastern Europe as part of a large security breach from the Utah state health department,  In connection with that breach, I have filed a complaint with the Office for Civil Rights at HHS (OCR).

I thought readers might like to know, however, that the process of complaining about a HIPAA violation to OCR is cumbersome indeed.  There are forms available on line, here,  You can open them, and fill in information, but you can't save them.  If you close the form, you lose all the data. You also can't file them online--you have to print them out and fax them off.  (You are helpfully told, however, to "print out a copy for your records.")  I finally figured out that if you save the form to notepad before you fill it out, you can then email it to HHS--but this required a telephone call to the appropriate regional office of HHS.

When I pointed out to OCR that this process is not exactly user-friendly, they indicated that they are "working on it." Imagine someone without a home computer, or a home fax machine, or a home printer, using public library computers in the effort to reach OCR about what they regard as a significant problem with their health information. Surely in a world of blue buttons and digital Medicare strategies, see Responsive Design and the New,, the ability to file a complaint about possible violations of health information security or confidentality should be an easier online process. 


September 26, 2012 | Permalink | Comments (0) | TrackBack (0)

Monday, September 24, 2012

More Bad News on Electronic Health Records

During the debate over the Affordable Care Act, the Obama administration and other proponents of electronic health records (EHRs) cited a RAND study projecting cost-savings of $80 billion a year from EHRs. More recent data have cast doubt on those estimates. In March, for example, a study in Health Affairs found that physicians with access to electronic records were more likely to order MRI scans and other diagnostic tests. Last week, the New York Times reported that EHRs apparently lead hospitals and physicians to bill more aggressively for their services, using higher billing codes than justified by the services they provide. (For an earlier post on the disappointing impact of EHR, see here.)


September 24, 2012 | Permalink | Comments (0) | TrackBack (0)

Sunday, September 23, 2012

Will ACA Create a Doctor Shortage--And If So, What Should We Do About It?

Being in my native land of Connecticut reminds me that Mark Twain is famously, if inaccurately, quoted as saying that everyone talks about the weather but no one ever does anything about it.  Nowhere is this concept more true today than in the handwringing over the coming shortage of physicians following the passage of Affordable Care Act.  We hear dire predictions that the patients who now have access to health care will flood the system resulting in poor care not just for them, but for those among us who were lucky enough to already have health insurance.  The American Academy of Family Physicians has recently expressed its concern that the shortage will be made up by nurse practitioners rather than physicians. 

This is a situation where the shortage, if it exists, has nothing to do with fear of law suits.  Applications to U.S. medical schools have been steadily increasing.  Moreover, the shortage isn’t of doctors in general, it is of primary care physicians.  There are still a fair number of dermatologists and plastic surgeons, but not so many physicians who provide the kind of primary and preventive care that actually improve the public’s health.  

 Uwe Reinhardt, the Princeton health care economist, has been following this issue closely and in a series of posts for the New York Times’ Econmix Blog has been aggressively skeptical about the existence of the shortage as well as the actions taken so far by the Federal Government to address it.  He also questions the need both for the residency system as currently structured and for the benefit to the public of subsidizing it through Medicare given what a poor job it does in producing the primary care doctors the public really needs.  Last week, he undertook an extensive analysis of medical school debt which showed that by charging students intending to be high paid specialists the same as those who might go into primary care has created a loan burden that makes it difficult for any but the most dedicated to turn away from training for the most lucrative specialty for which they can qualify.

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September 23, 2012 | Permalink | Comments (0) | TrackBack (0)

Saturday, September 22, 2012

Pharma Credibility Crisis?

Ben Goldacre's book on big pharma is highly critical.  Here is a recent Guardian piece by Goldacre questioning the influence of sponsorship on trial results: 

In 2010, researchers from Harvard and Toronto found all the trials looking at five major classes of drug – antidepressants, ulcer drugs and so on – then measured two key features: were they positive, and were they funded by industry? They found more than 500 trials in total: 85% of the industry-funded studies were positive, but only 50% of the government-funded trials were. In 2007, researchers looked at every published trial that set out to explore the benefits of a statin. These cholesterol-lowering drugs reduce your risk of having a heart attack and are prescribed in very large quantities. This study found 192 trials in total, either comparing one statin against another, or comparing a statin against a different kind of treatment. They found that industry-funded trials were 20 times more likely to give results favouring the test drug. . . . 

How do industry-sponsored trials almost always manage to get a positive result? Sometimes trials are flawed by design. You can compare your new drug with something you know to be rubbish – an existing drug at an inadequate dose, perhaps, or a placebo sugar pill that does almost nothing. You can choose your patients very carefully, so they are more likely to get better on your treatment. You can peek at the results halfway through, and stop your trial early if they look good. But after all these methodological quirks comes one very simple insult to the integrity of the data. Sometimes, drug companies conduct lots of trials, and when they see that the results are unflattering, they simply fail to publish them.

These are deeply troubling practices. Though I would like to see more resources allocated to pharmaceutical research, it's only worthwhile if it is tested in a fair and reliable manner.



September 22, 2012 | Permalink | Comments (0) | TrackBack (0)

Thursday, September 20, 2012

ACA litigation - Oklahoma's "federalism unit" piles on

We Who Follow ACA Litigation will continue to be in business.  Yesterday, Oklahoma's Attorney General sought leave to amend the state's original complaint regarding the individual mandate.  Now the state claims that the tax subsidies offered to those qualifying for financial assistance to obtain insurance through the exchanges are impermissible.  This amended complaint builds on an existing thread of new challenges that was promoted before NFIB was decided.  (The amended complaint also asks the court to consider the state's nullification law, which should be struck down based on the Supremacy Clause.)  The ACA challengers that never advanced beyond district court have been seeking leave to amend their complaints with regularity.  Last week I posted about the Pacific Legal Foundation's new strategy, which is rooted in the Orgination Clause.  (The case was also noted over at Balkinization.)

Oklahoma's amended complaint is grounded in theories advanced by Jonathan Adler and the Cato Institute.  The argument is that tax credits to support the purchase of health insurance through qualified health plans in the exchanges are only available when the exchanges are created by the states, not the federal government.  They claim that section 1311 of the ACA only contemplated providing tax subsidies in state-run exchanges to incentivize states to create the exchanges and that the federally-established exchanges cannot offer the same tax benefit.  In testimony to Congress, they argued the problem is that the proposed IRS regulation implementing the subsidies for people from 100-400% of the FPL in the exchanges applies to both state and federally-run exchanges, not just state exchanges.  Thus, they claim that the IRS has exceeded its statutory authority.  As Tim Jost noted here, the ACA did intend to permit tax credits in federal exchanges.  I agree with Tim's analysis and would add that the Anti-Injunction Act probably would apply to this provision; unlike the "penalty" of the individual mandate, this is actually described as a "tax."  Also, the states are not the appropriate parties to raise this issue; individuals benefit from tax credits, individuals would need to pursue the alleged problem.  

Despite the jurisdictional hurdles, we should not write off this litigation.  After all, the states should not have had standing to challenge the minimum coverage provision either.  This is where the Oklahoma "Federalism Unit" comes back into focus.  The Oklahoma AG formed this new unit to protect the state from "systematic overreach" by the federal government.  If one of the purposes of Chief Justice Roberts' opinion was to explicate the Court's current federalism project, then this so-called Federalism Unit may have more power than anyone would have guessed before NFIB.  We have now seen the states successfully challenge the enactment of the 'individual mandate' under the commerce power, even though that provision only operated on individuals (yes, individuals were part of the litigation, but the states were the real victors).  And, the Roberts opinion echoed the federalism concepts extolled by Justice Kennedy in Bond v. U.S. and Comstock - namely, that federalism exists to protect both the states and individuals from federal overreach.  Suddenly, a "Federalism Unit" seems less like political posturing and more like a potentially successful litigation strategy. 

The ACA contains a number of tax-related provisions, so if any litigation regarding the tax credit sticks, it has the potential to open the courthouse doors to even more ACA litigation.  But, beyond the tax credit issue, the Court appears poised to actively enforce the federalism questions that come before it.  Each of these pile-on challenges raises this specter, which could be a threat to not only the ACA but also Medicaid and other conditional spending programs.



September 20, 2012 | Permalink | Comments (0) | TrackBack (0)

Wednesday, September 19, 2012

More on Immigrants and the ACA

On September 5, I posted on immigrants and the Affordable Care Act, Undocumented immigrants are given no rights under the Act.  Yesterday's New York Times carried a story very relevant to this issue:  that the Obama Administration's suspension of deportation for undocumented children who have attended school in the US and met other requirements does not extend to any rights under ACA.  See Robert Pear, "Limits Placed on Immigrants in Health Care Law,"  So education is OK--but health not?  Or, as Pear hypothesizes, is the choice a political one of keeping ACA clear from any of the controversies over immigration?


September 19, 2012 | Permalink | Comments (0) | TrackBack (0)

ONC backs off rule-making for governance of health information exchange

Establishment of the infrastructure needed for the efficient, accurate, and secure exchange of health information is a crucial piece of improving care in the US.  Exchange fosters the ready availability of information, reducing redundancy and hopefully improving care quality.  To this end, proposals for a National Health Information Network were highly touted during the Bush Administration and continue to be supported by the Obama Administration, the Office of the National Coordinator for Health Information Technology (ONC) was established in 2004, and several federal advisory committees (the ONC Policy Committee and the ONC Standards Committee) were established by Congress in the HITECH Act in 2009.  Yet progress towards health information exchange remains halting at best--some hypothesize because of resistance within the private sector itself.  Recent developments at ONC are not encouraging.

For good reasons, among them security and privacy, the idea of a "nationwide health information exchange" has morphed to a "NwHIN"--a network of networks, rather than a single data repository--and the "Direct Project" for "simple, secure, scalable, standards-based way for participants to send authenticated, encrypted health information directly to known, trusted recipients over the Internet,"  When ONC moved to the NwHIN approach, it established a Governance Work Group under the aegis of the Health IT Policy Committee to prepare recommendations for NwHIN governance, including standards, policies, and procedures, Last spring, ONC requested information on important governance topics in preparation for rule-making. In the words of Steven Posnack, Director of the Federal Policy Division at ONC, "We need a common set of rules (expressing technical, privacy and security, and business practice requirements) to create a consistent trust baseline for stakeholders,"

On September 7, Farzad Mostashari, ONC head, announced the decision to back away from any rule-making at this time,  The primary stated reason for the decision is that exchange development is proceeding rapidly in new directions and regulatory intervention might impede process. ONC promised to continue to promote good practices for robust and secure exchange by "shin[ing] the light on good practices."  ONC will actively engage with entities developing governance structures and will continue to provide guidance and tools.  Reassuringly, ONC will continue to evaluate the consumer protections that now exist and work through federal partners to this end.  And ONC will "rigorously" monitor progress to assure that if there are market breakdowns or systemic problems, it will once again seek input from the public, from stakeholders, and from its own advisory committees.

Whether ONC is correct that regulation at this time might have threatened progress will remain an untested proposition.  What is clear is that multiple barriers to exchange remain--and that these barriers contribute to care inefficiencies and worse.  What is also clear is that security and privacy policies--for identity proofing and authentication, for example--are important to consumers and, in the language of ONC, to "trusted exchange."  In many cases, exchange partners now rely on separate data use agreements--contracts--to set their terms of exchange and to incorporate data protections that the partners believe are necessary. This mechanism is not only cumbersome particularly when multiple parties are involved in exchanges but also leaves data protection up to the vagaries of contract enforcement.  ONC's aim in the RFI was to establish some basic rules of the road; their hope at present is that without additional regulation traffic will flow freely and safely, without harm to passengers.  I am not sure that I am reassured.


September 19, 2012 | Permalink | Comments (0) | TrackBack (0)

Tuesday, September 18, 2012

The Central States Law Schools Association 2012 Scholarship Conference

The Central States Law Schools Association 2012 Scholarship Conference will be held October 19 and 20, 2012 at the Cleveland-Marshall College of Law, in Cleveland, Ohio.  We invite law faculty from across the country to submit proposals to present papers or works in progress.

The purpose of CSLSA is to foster scholarly exchanges among law faculty across legal disciplines.  The annual CSLSA conference is a forum for legal scholars, especially more junior scholars, to present working papers or finished articles on any law-related topic in a relaxed and supportive setting where junior and senior scholars from various disciplines are available to comment.  More mature scholars have an opportunity to test new ideas in a less formal setting than is generally available for their work. 

To allow scheduling of the conference, please send an abstract of no more than 500 words to Secretary Missy Lonegrass at by September 22, 2012.  Any late submissions will be considered on a space available basis only.

For those who are interested, the CSLSA mentorship program pairs interested junior scholars with more senior mentors in their fields of expertise to provide feedback on their presentations or papers.  To  participate in the mentorship program as either a mentor or mentee, please contact Vice-President Elizabeth Young at

In keeping with tradition, CSLSA is able to pay for one night’s lodging for presenters from member schools.  If a school is interested in joining CSLSA and has not received an invoice, please contact Treasurer Carolyn Dessin at For more information about CSLSA, visit our website at


Cross-Posted to Bill of Health


September 18, 2012 | Permalink | Comments (0) | TrackBack (0)

Announcement - Nova Law Review Openings

The Nova Law Review has openings in two upcoming issues and invites submissions of essays or articles. The first book with openings is the general book of the Law Review, for which the Law Review is seeking articles on any topic to fill a few holes.

The second book is a symposium issue for which the Law Review is seeking additional articles illustrating the intersection between the law and issues impacting veterans.  The Shepard Broad Law Center at Nova Southeastern University is hosting a symposium titled Wounds of War:  Meeting the Needs of Active Duty Military Personnel and Veterans with Post-Traumatic Stress Disorder on February 1, 2013.  The book is intended to be a special interdisciplinary issue providing a forum for discourse between scholars and practitioners to discuss emerging issues in the field of veterans’ affairs.  Potential topics may include, but are not limited to, the following:  veterans experiencing post traumatic stress disorder, veterans’ courts as therapeutic jurisprudence, any disability treatment post-active duty, any mental therapy treatment pre- and post-duty, the psychological effects of disabilities within the military and a military member’s family, philosophical ideas on how to improve the medical and psychological treatment of active duty military or veterans, etc.

Authors are invited to submit manuscripts of no more than 50 pages including footnotes for either book.  Shorter pieces are welcome. Email submissions are preferred; the subject line should include the words “General Book” for submissions for that book and the words “VA Symposium” for submissions for that book.  Each submission should include a cover letter and a C.V. Please submit all materials by November 1, 2012 to Raul Valero, Editor-in-Chief, at or Rachel Bausch, Lead Articles Editor, at


[cross-posted Bill of Health]

September 18, 2012 | Permalink | Comments (0) | TrackBack (0)

Now What? A Look at the Development of Health Exchanges

One of the most common questions I get asked when I talk about health care reform is some version of “how is it actually going to work?” Good question.  So much of the Bill was TBA while its Constitutionality was being tested that only now does it seem as if the both the insurance industry and the government are realizing that it is up to them to make this work.

For example, what, exactly is an Exchange?  There’s surprisingly little information—and all of in the future tense.  For example, the Kaiser Family Foundation website gives this definition: “Exchanges are new organizations that will be set up to create a more organized and competitive market for buying health insurance. “  This is how the Government is explaining it.

But there are still a lot of missing pieces.  Who decides the criteria for participation? How will “affordable” be defined? Because the issue isn’t just price—it’s what’s included in that price.   We know that “Exchange” is essentially a web shopping site where people can go to study and compare different health insurance packages.   The difference is that at least some of these packages will be “affordable” and there will always be some kind of “affordable” option for everyone regardless of their current health status.  Beyond that, there are a lot of questions.  Some states are working hard to set up exchanges, others have refused to participate and still others are still in some kind of “planning” or “study” phase.  This map from the Kaiser Foundation gives a 50 state overview.  As the idea of exchanges and the actual implementation of the mandate which will be the mechanism that requires consumers to use these exchanges, there is a growing awareness on the part of the government agencies responsible for running this that it will be a lot of work. For example, this article from Business Week reports concerns expressed by the Commissioner of IRS about how they are actually going to enforce the penalties. There’s already a considerable amount of hiring going in. 

I did some looking around the web and her are some examples of the kinds of things which may be on an Exchange.  Here’s a fun, interactive infographic from Cigna that purports to provide customized information for consumers about how ACA will affect them.  It doesn’t have much information at the moment, but it’s an example of what consumers might find when they go on exchanges.  Here’s a more substantive piece by Aetna reviewing what it thinks are going to be important features of successful exchanges.


Cross-Posted on Bill of Health

September 18, 2012 | Permalink | Comments (0) | TrackBack (0)

A Slap-Down to Liberterian Thinking in Health Care

On Sept. 14, the United States District Court for the Eastern District of Virginia delivered a slap-down to a case challenging Virginia's Certificate of Public Need (COPN) law, dismissing the case on all four of the constitutional theories raised in the case.

In Colon Health Centers of America v. Hazel (Subscription required), two health care providers who wanted to offer imaging services in Virginia challenged Virginia's COPN law, claiming it violates the Privileges or Immunities, Due Process, and Equal Protection Clauses of the Fourteenth Amendment, as well as the Dormant Commerce Clause.  The plaintiffs apparently sought to turn back the clock on judicial interpretations of these provisions at least 75 years, to the time when substantive due process reigned and the market was the unfettered king of commerce (think Lochner v. New York), and courts second-guessed legislatures on economic and social policy, The plaintiffs even acknowledged in their briefing on the motion to dismiss that their challenge under the Privileges or Immunities Clause was not in accordance with settled law, which has held since 1873 (in The Slaughter-House Cases)  that the right to earn a living unburdened by state police power legislation is not one of the privileges or immunities guaranteed by the Fourteenth Amendment.   They simply wanted to preserve the issue for appeal.

The court, predictably and in accordance with well-settled precedent, dismissed all of these claims.  But one of the interesting things that appears in the decision is the reiteration of the standard justification for Certificate of Need (CON) programs, which currently exist in 36 states.  The court states that CON programs "correct the market" for expensive health-care services.  We generally acknowledge that there is a need to "correct the market" in health-care through the retention of CON laws in most states by the legislatures. Yet the majority of the United States Supreme Court looked upon this idea with great suspicion in the Affordable Care Act case; failing to buy the argument that the health-care and health-insurance markets were tied together (or were a single market) and that there were major distortions in the national market that could be corrected via economic legislation under the Commerce Clause.  Why the difference?  Are we heading for another era where the courts impose a particular economic view of the world on elected representatives?

I'm sure that the plaintiffs in Colon, and their well-heeled supporters, with an eye to the ACA decision, will work their way up the court system not only for their Privileges or Immunities argument, but for all of their libertarian economic arguments, in the hope of getting a sympathetic hearing at the United States Supreme Court.   Either the market is distorted, and needs correction, or it is not.  It will be interesting to see how these theories play out as they work their way up the judicial food chain.  Everything old is new again, indeed!


Cross-Posted on Healthy Interests and Bill of Health

September 18, 2012 | Permalink | Comments (0) | TrackBack (0)

Sunday, September 16, 2012

Sunder on Patents and Access to Drugs

Last week, the blog Concurring Opinions featured a symposium on Madhavi Sunder’s new book, From Goods to a Good Life: Intellectual Property and Global Justice. A chapter relevant to health law scholars is available online, here.  The chapter focuses on access to drugs in less developed countries (LDCs), and makes the following case:

Not too long ago, an HIV-positive diagnosis was tantamount to a death sentence — for people in the East and the West, in the South and the North. The drug companies that perfected the antiretroviral therapies invested princely sums to find these miracle cures. To justify their investment, they rely on the promise of a patent . . . . Thus patents have saved countless lives. But this structure has its limits. Indeed, the evidence is mounting that in crucial ways patents fail to promote the health of people in the developing world, and in some cases in the developed world as well.

The chapter begins by telling the moving story of Thembisa Mkhosana, one of thousands of South Africans who cannot afford the third-line antiretroviral treatments needed to survive AIDS.   “My blood test results have worsened dramatically,” Mkhosana told a reporter, “And now I suddenly have fever and am in pain. I’m really worried.”  ”I know that I’m going to die,” she said, but “who is going to look after my children?”  Her story appears in this video.

Mkhosana’s plight raises difficult interpretive issues.  Is she “collateral damage” from a patent system that depends on the strict rules that deny her access to the medicine she needs? Or is this an entirely avoidable tragedy, a consequence of misapplied and misinterpreted laws?  Sunder makes the case for the latter view very convincingly, while providing a compact and accessible account of the development of international patent policy over the past 20 years.

Sunder acknowledges the importance of patent law to incentivizing the development of new drugs. However, as she wisely notes, one can’t squeeze blood from a stone, however important the “skin in the game” ideology has become to advocates of “free-market” healthcare.  According to Sunder, “creation of generic drug markets for the poor ought not significantly impact the bottom line of Big Pharma, which derives only 5 to 7 percent of its profits from this part of the world.”  It may well be possible to make up for some of that figure by cutting back on promotional budgets in the developed world. It’s also a rather trivial figure compared to tax avoided or evaded on the tens of trillions now hidden away in tax havens.

On the other hand, Big Pharma has a number of justifications and excuses for aggressive assertion of their patents. Spokesmen aver that they are only concerned about what would happen to their profit margins if drugs circulated in an uncontrolled manner. They claim that, if poor countries are permitted to manufacture vast quantities of their drugs, those countries may sell them on the black or grey markets. That, in turn, would reduce the return on such drugs in the developed world, leaving less money for research in the future.Sunder responds that, “The grey-markets concern is a valid one—but . . .the World Trade Organization has begun to craft creative solutions to this problem (requiring generic drugs made for developing world markets to be distinctively labeled, for example).”  As surveillance of both people and goods is better perfected by state security apparatuses and RFID technology, the grey market concern should also become more technologically manageable, enabling finer-grained and more effective price discrimination.

Access to drugs is a key area where ordinary markets simply can’t be expected to achieve humane and rational results.  In 2008, the purchasing power of the average American dog was higher than that of forty percent of the world’s population. Given the extensive extant involvement of the U.S. government both in the domestic pharmaceutical industry and in the international negotiations determining its powers and duties abroad, there is a special moral obligation for U.S. citizens and politicians to assure the widespread and equitable distribution of lifesaving drugs. As Sunder states:

Economists call the millions of people who need a drug but cannot afford it “dead weight loss.” But the millions who die needlessly because of the patent system—a number that some scholars calculate as nine million in the developing world annually—are more than an inefficiency in the system. . . . We must both adopt alternative mechanisms for developing and distributing medicines to the poor (including prizes), and fully support the use of compulsory licenses by developing countries to treat their sick poor. Patent law cannot draw the line at rectifying market failure. Our law must contend with moral failure as well.

Sunder’s eloquent case for access to drugs commends respect and admiration for the Health Impact Fund, Knowledge Ecology International, Medecins sans Frontieres, and other groups for trying to close this gap.


X-Posted at Bill of Health.

September 16, 2012 | Permalink | Comments (0) | TrackBack (0)

Friday, September 14, 2012

Worth Reading This Week

Thursday, September 13, 2012

Uninsured drop, but the challenges continue

The Pacific Legal Foundation seems unable to face its defeat before the Court in June.  The PLF has filed a motion seeking leave to amend a complaint on behalf of a small business owner who would have the ACA declared unconstitutional based on the theory that the law was introduced in the Senate, not the House.  Article I section 7 of the Constitution commands that "All bills for raising revenue shall originate in the House...."  This plaintiff, Matt Sissel, originally filed a complaint challenging the constitutionality of the ACA as exceeding Congress's commerce power; but, because the Court decided that the ACA is constitutional as an exercise of tax authority in part because it raises revenue, the plaintiff seeks to amend his complaint rather than allow it to be dismissed based on the decision in NFIB v. Sebelius.

It seems ironic that this novel filing made news the same day that the Census Bureau reported that the number and the percentage of uninsured Americans dropped for the first time since 2007.  The drop is largely attributed to young adults being permitted to stay on their parents' insurance policies under new ACA requirements.  While the drop is movement in the right direction, it is hardly a victory given that nearly one in six Americans still lack health insurance coverage and the percentage of Americans on Medicaid has increased due to the ongoing effects of the Great Recession.  Nevertheless, it is a small taste of the positive outcomes that the ACA may produce if the federal government could stop defending the law and instead focus on implementing it. 

Though it seems unlikely that lower federal courts will be interested in the obscure constitutional provision PLF relies on, as I have said before, the administration needs to learn from the nonchalance with which it initally treated challenges to the ACA.  The novelty or obscurity of the challenger's theory does not correllate to failure with the Roberts Court, which has proven itself willing to accept new legal theories and willing to ignore or modify precedent.


Cross-Posted to Bill of Health

September 13, 2012 | Permalink | Comments (0) | TrackBack (0)