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Author Archive: Howard Brody

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01/19/2015

The Beginning of the End of Economism? One View

E.J. Dionne's latest column:http://www.chron.com/opinion/outlook/article/Dionne-What-change-sounds-like-6021317.php--takes aim at one of the central features of this blog. Dionne claims that we may be witnessing the beginning of the end of economism (w...

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09/30/2014

The Disappearance of Generic Drugs

(My source for this post is Elisabeth Rosenthal's article in the New York Times:http://www.nytimes.com/2013/10/13/us/the-soaring-cost-of-a-simple-breath.html?_r=0--which has actually published almost a year ago, but seems to have some important informa...

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09/30/2014

Sunshine Act Goes Live, Sort Of

According to ProPublica's Charles Ornstein--http://www.propublica.org/article/what-to-be-wary-of-in-the-govts-new-site-detailing-industry-money-to-docs --as the Sunshine Act (of the 2010 Affordable Care Act) finally goes live today, some 18 months afte...

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09/14/2014

Piketty, Capitalism, and Progressive Taxation


One of the most important graphs in The Golden Calf is taken from Wilkinson and Pickett (The Spirit Level, 2009) and shows the widening gap between the richest and poorest in America in income, between 1975 and 2004. It’s the second half of my life. The first part of my life, beginning in 1949, was the “good news” part, when the economy worked well, and a worker with one job could buy a home and raise a family and send kids to college. This was followed by the “bad news,” economism or neoliberalism, especially under Reagan starting in 1980, when income stagnated for the lower and middle classes and virtually all the new wealth was snapped up by the top few percent. By this picture, economism was a bizarre development, and one was hard pressed to explain why such a thing should have occurred.

Thomas Piketty, Professor at the Paris School of Economics, has now cast considerable new light on these developments (Capital in the Twenty-First Century, trans. Arthur Goldhammer, Cambridge: Belknap Press of Harvard University Press, 2014). As he points out, until modern computers, economics tended to be light on facts. It’s only within the past couple of decades that the available data have been recorded and investigated, to allow those familiar with them a reasonable peek at the actual history. And history, in fact, is what economics should be concerned about; Piketty takes a dim view of American neoclassical economics and favors a collaborative view of the economist as one of the social sciences.

Piketty offers data on capital and income between 1800 and the present for Britain and France, and going back to the late 1800s for the United States and other major countries. He focuses a good deal of the basic equation, r > g, meaning that the rate of return on capital virtually always exceeds the growth rate of the economy; the former tends to be 3-5 percent and the latter runs from less than 1 percent to 1.5 percent. Piketty notes that this is basic to the whole idea of civilization—it allows people to be engaged in something besides pure subsistence.

When Piketty graphs the history of the relationship between the after-tax rate of return to capital and the growth rate of world output, as best as is known from the year 0 to the present, capital return always exceeds the growth rate except at one point—the years 1913-2012. So the data that informed my standard way of thinking between 1949 and 1975-80 turns out to be wildly out of sync with the norm.

Piketty describes what he considers most important, capital/income ratio, roughly as follows. For Europe, inequality was very pronounced, until the shocks of the twentieth century, in the years 1914-1945. Then income inequality rose again. The major change was that before the twentieth century, there were a small number of rich people who had almost all the wealth, and the vast majority of laborers who had virtually none of it. Now there is a middle class which collectively holds a significant amount of wealth, one-quarter to one-third of the total; while the extreme upper class, especially the top 1 percent, now holds around 60 percent of the wealth.

The United States presents a different picture. The middle class was establishing itself all along. However, during the Gilded Age, income inequality rose in America as well. It then decreased during the world wars and depression, but America was spared the extreme trials of Europe. Since 1975, income inequality has risen even higher in the U.S. than in Europe.

Piketty talks then of the future of the remainder of the twenty-first century, and finds increasing income inequality to be an unstable factor, so he is hopeful that something can be done about it. His favorite is a progressive tax on capital. He favors a modest plan that would produce maybe 2 percent of GDP, but argues that the capital tax is more important than the amount raised, since it carries an important message. In particular, for it to work at all, it would require that data be gathered in a way that it is not currently, and particularly that international tax havens be opened to scrutiny. On Piketty’s plan, everyone would know everyone else’s wealth, throughout the world. He admits that this is a nearly-utopian goal and will require many stages of development.

Piketty speaks of the future as if everything will be smooth and there will be no more “shocks” equivalent to the World Wars. He admits that he cannot predict what would happen if shocks supervene.
Returning to my own views, it’s discouraging to find that the time that one had thought of as the halcyon days when everything was most fair and reasonable (the era 1945-1980 roughly) was a brief, highly atypical time period. It is, by contrast, encouraging to find that progressive taxation can so effectively reverse the worst of the trends. The only problem will be gaining the political will to succeed in such a mission in the US. Piketty’s own guess is, “Without a radical shock, it seems fairly likely that the current [state of affairs in the US] will persist for quite some time. The egalitarian pioneer ideal has faded into oblivion, and the New World may be on the verge of becoming the Old Europe of the twenty-first century’s globalized economy. [514]”

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08/26/2014

The Anechoic RUC: Some Small Efforts at Reform

I have previously written about the Resource-Based Relative Value Scale Update Committee, or RUC:http://brodyhooked.blogspot.com/2011/05/more-conflicts-of-interest-at-high.htmlhttp://brodyhooked.blogspot.com/2013/07/piling-up-on-ruc-about-time.htmlhttp...

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08/23/2014

Not-So-Personalized Medicine

Jack E. James, who appears to hail from either Reykjavik University in Iceland or the National University of Ireland in Galway, or both, kindly sent me a copy of a paper published in June in the European Journal of Epidemiology:http://link.springer.com...

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08/18/2014

Research on Pharmaceuticals: From Confidence to Commercialism

The main thrust of this commentary comes from Dr. Roy Poses and:
http://hcrenewal.blogspot.com/2014/08/desperate-vulnerable-research-subjects.html
--which in turn draws on two prior posts:
https://medium.com/matter/did-big-pharma-test-your-meds-on-homeless-people-a6d8d3fc7dfe

https://medium.com/matter/why-are-dope-addicted-disgraced-doctors-running-our-drug-trials-aff6d20843bf

A little background: HOOKED described a major shift in pharmaceutical research. Initially, the vast majority of drug trials were conducted by universities. Over the past 30 years, companies found that universities were too slow in doing this research for maximum financial gains, and so gradually, contract research organizations replaced universities as the major players. Dr. Carl Elliott (first of two prior posts) has been one of the major writers about the fallout from these policies.

Dr. Elliott describes in some detail a group of subjects who can be found in typical contract research organizations, who talk openly about their ways of qualifying for research trials, and also of dodging the painful and burdensome procedures that typically form a part of some trials. It seems quite clear that the money, and not any goal of contributing to science, is the main and indeed the sole motivator. Dr. Elliott had previously described this "guinea pigging" in earlier published work.

The second prior post, by Peter Aldhous, describes some of the physicians who run the contract studies, and focuses on those who have been censured and who have various licensure problems. Aldhous admits that these misfits count as a minority of all the doctors running the contract research organizations, but adds, "My trawl netted dozens of doctors selected to work on clinical trials over the past five years who had previously been censured by state medical boards. Thousands of doctors are hired each year to test experimental drugs, making this a small minority. But most doctors have clean records, so companies should have few problems finding recruits without red flags against their name."

Aldhous concludes, "Some experts argue that the FDA’s entire rulebook for clinical trials, with its talk of things like 'institutional' review boards, reflects the academic past of clinical research—not today’s industrial juggernaut of for-profit clinical trials firms and for-hire review boards, which oversee a workforce of doctors drawn from regular medical practice. 'They are regulations for a world that doesn’t exist anymore,' says Elizabeth Woeckner, president of Citizens for Responsible Care and Research, which campaigns for the safety of medical research volunteers."

Dr. Poses then notes: "So given the push to do research rapidly at the lowest cost, the lack of supervision and regulation by the FDA, the hiring of physicians with problematic backgrounds, the willingness to take vulnerable patients desperately motivated by money, can we trust that the nice, clean, detailed descriptions of clinical trials implemented by contract research organizations presented in research articles and trial registries have anything to do with the reality of what went on? If not, what then should we make of the validity of the results of such trials?...This is yet another reason to ask whether we need to take research on human subjects meant to evaluate commercial products or services out of the hands of the companies that make those products and provide those services."

In other words, bait and switch. Get everyone used to research on human subjects while research institutions are running the shop and people who sign up as subjects have at least some motivation to behave in the interests of science. Then gradually change the system so that it's all about money and one can no longer trust the results. The money affects different players in different ways-- the companies and the CROs have their financial motives, the "guinea pigs" have theirs--but the one thing we can count on is that the money plays a role that's different from the ideal of scientific research. The end result is that things look legitimate up front, and all the people involved have strong motives to do what's less legitimate behind the scenes. We have no idea how that plays out in terms of scientific rigor.

And this is now how drugs are tested before we use them.

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08/11/2014

From Christopher Gregory: What’s Wrong with Profits in Medicine?

Now I'm turning the blog over to Dr. Christopher M. Gregory, a fellow Texan who runs the DocOnomics blog (http://www.doconomics.com/blog/). He sent an e-mail recently which so nicely, and briefly, captured a large issue that has perplexed me that I couldn't help but ask him to reprint, and he kindly consented:

This Modern Healthcare article Another Year of Pay Hikes for Nonprofit Hospital CEOs galls me. Almost as much as this articlethat reported the director of interventional cardiology at NY Mt Sinai was paid almost $5 million a year for being the rainmaker there, where far more stents are done than the national average.    



As I consider the proliferation of waste in the form of freestanding ERs, urgent care clinics, and shiny new hospitals popping up, and more doctors being bought off into economically forced subservience, I see nothing but the extreme excesses in our system. And for that there is a small group of these so-called “not-for-profit” CEOs getting pay packages that would choke a horse. Boards and compensation consultants continue to cite market forces—the need to keep up with peers to hold onto skilled healthcare leaders—as the main reason for the increases. The market forces they refer to are the market forces of excess, waste and profits that continue to make life increasingly intolerable for the group of physicians – primary care physicians – that would make this system much better if we let sanity retake the high ground. These high-talent CEOs are especially valued for the business smarts needed to make sure we are continuing to pay such disproportionate amounts for the unnecessary, costly care in this country .


To be precise, these pay packages are needed to keep these high-power hospital businessmen in the business of maintaining the well-oiled machine that is swallowing up nearly 20% of our GDP. And yet, millions of Americans can’t afford to get the care they need.  


Total cash compensation grew an average of 24.2% from 2011 to 2012 for the 147 chief executives included in Modern Healthcare's analysis of the most recent public information available for not-for-profit compensation. Of those 147 CEOs, 21, or 14.3%, saw their total cash compensation rise by more than 50%.


I talked with Dr Bob Kramerthis morning. He said that it will be an uphill battle getting ologists to passionately endorse a cutback in the sorts of conspicuous consumption that nets them many multiples of what PCPs are paid, and continues to siphon off the ranks of potential primary care doctors in training. We are going to reap a medical, economic whirlwind for all of this foolishness as we continue to lose the numbers of physicians who would serve us best on the front lines. If only we could overcome the entrenched stupidity of organizations like the AMA and the RUC, that keeps PCPs from making the economic and care-centric progress that would make our healthcare system run so much better.


What can be done – what group of physicians around the country – will stand up and make a definitive statement that the intensifying black hole of the overheated healthcare “business system”, with its goal for more money and more influence, is taking us in a terribly wrong direction? As my Canadian healthcare friend once pointed out, there is a healthcare noose around our national neck, and the “system” is the hangman. 


Christopher M. Gregory

DocOnomics


1705 River Birch Drive


Flower Mound, TX75028


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08/11/2014

From Health Care Renewal: The Free Market and Drugs

Let's see what's going on over at the Health Care Renewal blog, courtesy Dr. Roy Poses. Dr. Poses has been noting that there are some pharmaceutical developments that could easily help us out in the case of Ebola virus, which seems right now to be expa...

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07/29/2014

More on Guinea Pigging–The Quality of Pharmaceutical Research

Two longish articles by our old friend Dr. Carl Elliott and by Peter Aldhous:https://medium.com/matter/did-big-pharma-test-your-meds-on-homeless-people-a6d8d3fc7dfehttps://medium.com/matter/why-are-dope-addicted-disgraced-doctors-running-our-drug-trial...

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