Exploring Human Potential

Optum-izing Paul Ellwood’s HMOs.

Posted on | October 16, 2018 | No Comments


Paul Ellwood and Richard Burke

Mike Magee

According to Paul Ellwood, often labeled “The Father of the HMO”, the seeds of the Agency for Healthcare Research and Quality (AHRQ) were buried in a report that he delivered to the 34-year-old Assistant Secretary of Health, Phil Lee, in 1969.  As Ellwood recalled in 2010, “the emphasis there was on accountability for health care along with evaluating various structural and incentive arrangements for organizing health systems.”

Paul and his Minnesota based associates referred to themselves as “medical ecologists” and realized that health reform in the U.S. would “require a huge cultural shift.” What really stroked their interest was “the notion of measuring health outcomes as a means of determining who and what was effective.”

Ellwood in those early days was both optimistic and naive. In the early 1970’s, he had triggered the formation of an HMO and associated Independent Practice Association (IPA) with the local Minneapolis and St. Paul Medical Society – “a pioneering venture where individual private physicians shared risk and responsibility for the cost and quality of care for a population.”

When the leader of the new venture couldn’t persuade a wayward doctor to address his patients’ excessive length of stay, Ellwood sent over a 32-year-old staff member with “insurance expertise” to correct the problem. The messenger, Richard Burke, was hired, and “undiplomatically kicked the offending physician out of the plan.”

All hell broke loose, but not to worry. Richard Burke went on to start a little venture called Charter Med, a physician practice managed by insurers rather than physicians. A few years later, it was renamed United HealthCare.

While both Ellwood and Burke agreed that measurement could help direct outcomes, Ellwood envisioned a physician dominated system focused on clinical performance, while Burke concentrated on a business directed enterprise where cost-effective choices and and supply chain management fees could lead rapidly to outsized profitability.

For Burke, knowledge was power, but not quite the kind of power his former boss had envisioned. As the new information technology age was just beginning to reveal itself, Burke arguably was the first to realize that mining patient and provider data could be a gold mine. By 1984, he took the company private, and four years later retired – but not before launching Diversified Pharmaceuticals Inc, the first ever pharmacy benefits management firm (PBM).

Burke has remained involved as a strategic force for the company he started. He has been a Non Executive Director of parent company UnitedHealth Group Incorporated since 1977 and has been its Lead Director since September 1, 2017. And insurer United Healthcare has a new sibling, the healthcare IT company called Optum. When it first appeared, analysts thought it would be a future spin-off, instead it is rapidly becoming the center of the United Health Group Universe.

Optum accounted for 44% of UnitedHealth Group’s profits in 2017 ($6.7 billion on $83.8 billion in revenue), and includes data analytics, a PBM, a growing doctor groups in urgent care, primary care and surgical care, chronic care management and behavioral health. Formal Labels: OptumLabs (research), OptumIQ (data analytics), Optum360 (revenue cycle management), OptumBank (health savings account) and OptumCare (care delivery services).

Data management and skimming profits has been especially effective for OptumRx, their newest PBM. In 2017, it generated $64 billion in revenue by fulfilling 1.3 billion prescriptions. Their direct care arm, OptumHealth, is also on a steep upswing, from 60 million patients in 2011 to 91 million in 2017.

Money focused analysts like Burke’s vision of American health care a lot more than Paul Ellwood’s original schemes. Ellwood still holds on to his optimistic (and some would say naive) vision. In a 2010 interview, he reflected, “IT based care should emphasize openness, collaboration with largely free apps based on solid science.”

But Optum is as proprietary as it gets, and as one analyst noted, “…many of their competitors are now mimicking their strategy by trying to buy into some of the same capabilities.” (That would be you, vertical integrators CVS/Aetna and Cigna/ExpressScripts).

The reality is quite stark, if you can believe where OptumLabs has focused its’ energy. It’s still on data and disruption, as it was for Richard Burke in 1976, but faster, smarter, and more profitable – for them, not for you. Here are their three major concentrations:

1.  Machine learning.

2. Artificial Intelligence (AI)

3. Natural Language Processing.

A Disturbing Pattern: From OxyContin to Vitamin D

Posted on | October 5, 2018 | 6 Comments

Mike Magee

Winter is fast approaching, a time to bundle up and a grim reminder for many to load up on Vitamin D. Osteoporosis, osteomalacia, rickets, fragile fractures – there’s no end to the misery awaiting you if you fail to take this supplement. Or so we’ve been told, by many every-day doctors with the same assurance as they once used to explain that “pain is the 5th vital sign” and OxyContin is non-addictive.

If you’ve been oversold on Vitamin D, you can thank AMA Federation member, the Endocrine Society, and one specific Boston endocrinologist. Oprah loves this guy. So does Gwyneth Paltrow and Dr. Oz. And so do the drug makers, the blood testers, and the owners of tanning salons whose trade association, the Indoor Tanning Association which disbanded in 2017 gave BU $150,000 from 2004 to 2006 specifically to fund his research.

His bio says that  “He served as the chair for the Endocrine Society’s Practice Guidelines on Vitamin D, authored more than 400 peer-reviewed publications, and has written more than 200 review articles, as well as numerous book chapters.” What it doesn’t say is that he is credited for almost single-handedly launching the “billion dollar vitamin D sales and testing juggernaut.”

Michael Holick, MD, PhD is an endocrinologist from Boston University. He chaired the Endocrine Society’s clinical guidelines publication in 2011 that concluded that “vitamin D deficiency is very common in all age groups” and that normal levels should be between 30 and 100 nanograms per milliliter. That was only months after an IOM consensus group concluded that “all individuals meet their needs at intake levels provided in this report” and that 20 nanograms per milliliter were more than enough.

As with the new tighter levels for cholesterol, Holick’s team greatly expanded the list of Americans who were vulnerable and would require treatment. The new Endocrine Society pronouncement targeted the majority of U.S. population for testing, and gullible physicians were more than happy to comply. Quest and LabCorp immediately adopted Holick’s normal level of 30, making an estimated 80% of the adult US population deficient of Vitamin D. By 2016, doctors were ordering more than $10 million worth of the tests at a cost of $345 million, with patient co-pays varying from $40 to $235 dollars.Vitamin D tests were now the 5th most common test reimbursed by Medicare.

Since then, here’s what we’ve learned about Dr. Holick:

1. He has been a consultant for Quest for over four decades and is still paid $1000 per month.

2. Between 2013 and 2017, he received $163,000 from Sanofi-Aventis, Amgen, Roche, and others.

3. He has described “tanning beds” as a “recommended source” of vitamin D.

4. Recent studies have found no link between low levels of Vitamin D and fractures in elderly, heart disease or cancer.

5. However, studies have revealed that levels of 50 nanograms per milliliter or above carry an increased risk of death. The United States Preventive Services Task Force in 2018 recommended that older Americans outside of nursing homes not take vitamin D supplements to avoid falls.

There will always be Sackler’s and Holick’s in medicine. That’s probably unavoidable. But overselling opioids or vitamin D tests wouldn’t have been possible without AMA specialty society cooperation and an army of naive physician prescribers.

Endocrine Society: 2018 Corporate Liaison Board:

NEJM Weighs in on Preventing Gun Violence

Posted on | September 27, 2018 | 1 Comment

In an article this week on prevention of gun violence , Garen Wintemute offers this list of solutions:


  • Improve background-check policies
  • Require background checks for private-party transfers
  • Require state and local agencies to report prohibiting events
  • Fully implement the existing federal background-check requirement
  • Clarify definitions of prohibiting events
  • Strengthen enforcement efforts
  • Consider a permit-to-purchase approach
  • Prohibit release of firearms until background checks are completed
  • Enact gun-violence restraining order policies

“The Commitment to Mutuality is Fragile in the U.S.”, Says Berwick.

Posted on | September 25, 2018 | No Comments

Mike Magee

Earlier this month Donald Berwick published a thoughtful article in JAMA titled “Politics and Health.”  It touched on a range of themes that I addressed in a speech in 2005 at the Library of Congress.

In that speech, I said, “There is a growing political disconnect between those who make health policy and those most affected by health policy. While the former continue to reinforce silos and the status quo, the latter seek broad, fundamental and comprehensive reform. Such reform might include expansion of insurance coverage, realignment of financial incentives toward prevention, increased reimbursement of physicians and nurses for team coordination that includes home health managers, support for early diagnosis and screening, and expansion of education and behavioral modification for individuals and families.”

Berwick’s current commentary touches as well on this disconnect. He says, “Presidents, governors, senators, and congressmen take no oath to serve patients. Their oath is to a broader, vaguer duty: to uphold the Constitution. Nonetheless, their choices invade the clinical arena continually.”

The disconnect is fueled by money and power. The Medical-Industrial Complex now consumes 1 in 5 dollars, and clearly its financial objectives and the needs of everyday Americans are often at odds. As Berwick notes, “A nation that values entrepreneurship and protects private profits cannot expect that those motives will fail to engage the enormous financial opportunities through every possible channel of influence. The fragmentation of ownership, governance, and oversight of US health care makes it possible for a vast industry of political pressuring to flourish.”

Adding fuel to the fire:

1. Disagreement over state versus federal prerogatives.

2. Lack of trust in science in the era of Trump.

3. Hijacking health care in support of religious ideology.

4. An American mythology that over weights individualism and self-determination.

Without saying it, Berwick suggests that the health care battle is really a cultural battle. In his words, “Politics enters health care through attitudes toward solidarity…Government, and therefore politics, is the avenue for the expression or the negation of that sense of solidarity.”

Berwick suggests with some deference that “the commitment to mutuality” is “fragile in the United States.” He places the onus on physicians (and health professionals) subtly suggesting they lead the way stating:  “The basic credo of physicians—to put the interests of patients before their own—at its best reflects a form of solidarity: that those who are fortunate are duty-bound to help those who are less fortunate.”

Polls leading up to the 2018 mid-terms are now clearly demonstrating that the majority of Americans agree that when it comes to health care in America, Berwick is right. We are all in this together.

A National Disgrace: Immigrant Children Imprisoned – # Growing

Posted on | September 21, 2018 | No Comments

Source: NYT, 9/12/2018

Are Wars on Cancer and Alzheimers a Good Substitute for a National Health Plan?

Posted on | September 20, 2018 | No Comments

Lipitor Revenue

Mike Magee

Arguably, the pharmaceutical “age of the blockbusters” ended nearly 20 years ago with Pfizer’s hostile takeover of Warner-Lambert which rewarded them richly with the nation’s 5th statin, Lipitor. In 2006, it delivered almost $13 billion in revenue, and yet the company was in a full blown panic, as reflected in the firing of their CEO that year, because the 2012 patent cliff was fast approaching, and large biologics for small audiences were overtaking small chemical drugs for the multitudes.

Despite the promises of genetic optimists like NIH’s Francis Collins, and “personalized medicine” entrepreneurs at Stanford, and Columbia, and U Penn and hundreds of other academic medical palaces, the reality was this:

  1. Pharmaceutical discoveries had collapsed.
  2. Genetic and stem cell cures were over selling their promise and under selling the risk. (see Jesse Gelsinger case)
  3. Funding for cures for diseases – especially those affecting older white male senators and congressman – were exploding, but public health funding was nowhere to be found.

The War on Disease has always appealed to Americans. “Defeat disease like we defeated the Nazi’s”, was the battle cry, “and health will be left in the wake.” Why do the hard work of preventing disease by investing time and energy in nutrition, education, housing, a clean environment, gun-control, and human empathy when you can just rest content in the belief, promoted by medical scientists, that cures for dreaded diseases are just around the corner.

Case in point, Nixon’s “War on Cancer”, promised to deliver in the 70’s – except it’s more likely to be in 2070 than 1970. We’re now repeating the folly with Alzheimer’s Disease, promising a fix by 2025. The year Lipitor went off patent, the HHS push for expanded Alzheimer’s funding began in earnest. By 2016, NIH funds to study the disease approached $1 billion, a 56% increase over the prior year. By 2018, the National Institute of Aging (NIA), a middle of the pack agency solidly in the center of the NIH’s 27 institutes and centers, became the 5th largest institute with an appropriation of $2.6 billion.

NIH’s Francis Collins says, “Our continued investment will pay dividends for the millions of families affected by Alzheimer’s.” Others aren’t so sure. Long time University of Washington aging researcher Matt Kaeberlein notices a pattern of “following the money.” He says, “Nearly everyone I know is putting the words ‘Alzheimer’s disease’ in their grants in an effort to tap into the money.” Alzheimer researcher Samuel Gandy at the Icahn School of Medicine is even more pessimistic. He says, “I am convinced that we are destined to fail to make the 2025 goal and therefore look like we have failed at our promise.”

Former NIH director Harold Varmus, also feels the shadow of Nixon’s “War on Cancer” in setting a date for a breakthrough at 2025. He says, “No one denies the enormous need to make progress against Alzheimer’s. (But) I wish a date were not attached.”

What has been left unsaid is that the American belief, launched in the wake of WW II with the support of the AMA and America’s pharmaceutical industry, that a free-enterprise assault on disease was a reliable substitute for national health planning, universal coverage, and investment in the social determinants of health, has been proven naïve and false. What we have needed all along is a comprehensive national health plan for this country.

Cardinal Bernardin to Trump on Health and the Lost Children.

Posted on | August 31, 2018 | No Comments

Source: Wash Post 8/27/2018

For health professionals, committed to healing, providing health, and keeping families and communities whole, the many actions of President Trump are deeply offensive on multiple levels – but none more than the deliberate separation of immigrant children from their parents. According to the Washington Post, 528 children remain separated and 23 of these are under the age of 4. This affront to our humanity and our profession can not stand.

Cardinal Bernardin addressed a gathering of AMA members shortly before he died in 1996 and made the case that health was integral to human potential and that doctors and nurses and all health professionals played a pivotal role in assuring the survival of a caring society.

Were he alive today, he would not be silent in the face of this President and those in leadership who have gone invisible and mute in the face of a clear threat to our democracy and our humanity.

Bernardin’s guiding philosophy was a “consistent ethic of life.” In addressing health leaders, he said, “Because of its central importance to human dignity, I have felt a special responsibility to devote a considerable amount of attention to health care at both the local and national levels…grounded in the respect we owe the human person. To defend human life is to protect the human person … the core reality in Catholic moral thought.”

Bernardin would likely be especially offended by President Trump’s callousness and cavalier branding with insult and vulgar labels. Of this, he might repeat his words, “Attitude is the place to root an ethic of life…We cannot urge a compassionate society and vigorous public policy to protect the rights of the unborn and then argue that compassion and significant public programs on behalf of the needy undermine the moral fiber of the society or are beyond the proper scope of governmental responsibility.”

The images of children, forcibly separated from their desperate parents, would have been unthinkable to the Cardinal as he approached his death in Chicago two decades ago. “The dignity and value of human persons is a basic value …. [L]et it be said that the energizing vision of healthcare must be this commitment to the dignity of human persons.” Those were his words then.

How will each of us bear witness now?

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