Privacy again is at issue
From Medscape Medical News
Ban on Use of Prescriber Data for Marketing Ruled Unconstitutional
Robert Lowes
November 29, 2010 — A Vermont law that prevents pharmaceutical companies and their sales forces from obtaining data on a physician's prescribing behavior without his or her approval is "an impermissible restriction on commercial speech" and therefore unconstitutional, a federal appeals court ruled last week.
That court, the US Court of Appeals for the Second Circuit in New York City, reached a conclusion opposite from the one a federal appeals court in Boston, Massachusetts, reached when it declared similar laws in Maine and New Hampshire to be constitutional. These clashing appellate decisions increase the odds that the Supreme Court will eventually put the matter to rest.
For years, pharmaceutical representatives — also known as drug reps or detailers — have had an intimate knowledge of physicians' prescribing habits thanks to so-called data-mining companies such as IMS Health, SDI, and Source Healthcare Analytics. These companies buy prescription data from pharmacies, aggregate them on a physician-by-physician basis, strip out anything identifying individual patients, and then sell the information to pharmaceutical companies.
Pharmaceutical companies use the data for a variety of purposes, such as conducting clinical trials and postmarketing surveillance. The litigation, though, centers on just one use — marketing brand-name drugs to physicians. On the basis of the intelligence they get from data-miners, pharmaceutical representatives can identify heavy prescribers, customize sales pitches to what these clinicians order for patients, and if they persuade a physician to use their product, monitor his or her scripts from month to month — tactics some physicians view as intrusive.
In 2007, the Vermont legislature passed a law banning the sale, transmission, and use of such prescriber-specific data for marketing purposes unless physicians give their assent. Besides wanting to protect physician privacy, state lawmakers cited a public health rationale; they view pharmaceutical marketing as a source of "incomplete and biased information" on the safety and effectiveness of medicines.
In addition, there was a money angle. By depriving pharmaceutical representatives of valuable prescription data, lawmakers hoped that physicians would be less persuaded to order expensive, brand-name drugs for their patients, and instead resort to low-cost generics when appropriate. Such drugs would be less of a drain on the state's Medicaid program.
Among the backers of the Vermont legislation are the Vermont Medical Society, which favors more widespread use of generic drugs and questions the accuracy and completeness of drug-rep communications.
Vermont Law Takes Ill-Advised Shotgun Approach, Court Rules
Data-miners IMS Health, SDI, and Source Healthcare Analytics sued the state of Vermont in a federal district court in Brattleboro to overturn the 2007 law, contending that it violates their First Amendment right to free speech — specifically, commercial speech. They also maintained that the law jeopardizes patient safety because the prescription data help pharmaceutical companies educate physicians on how best to use their products.
The federal district court upheld the law in early 2009, so the data-mining companies turned to the appellate court in New York. On November 23, a 3-judge panel overturned the district-court ruling in a 2-to-1 decision.
The appellate court stated that the law fails to satisfy a legal standard for limiting commercial speech. Under that standard, a statute like the one in Vermont must directly advance a major state interest (such as public health and cost control). Another requirement is that less restrictive limits on commercial speech will not achieve the desired goal.
The court stated that the Vermont law can have only an indirect effect on public health and cost control, because cutting off the flow of prescription data to pharmaceutical companies is several steps removed from physicians prescribing more generic drugs. In addition, the law takes an ill-advised shotgun approach because it targets every brand-name medication, "regardless of whether it is a less tested version of an existing medication or a breakthrough drug with no reasonable alternative," according to the court. Finally, Vermont can rely on other, "less speech-restrictive means" to encourage generic prescribing, such as academic detailing.
In a dissenting opinion, US Circuit Court Judge Debra Ann Livingston wrote that she is unwilling to agree with the court majority that companies trafficking in prescription data "have an inherent right to invoke the First Amendment as a shield against reasonable regulation simply because their business deals in 'dry information' rather than 'dry goods'."
Pathways to the Supreme Court
In a press release, IMS Health senior vice president and general counsel Harvey Ashman said his company is pleased with last week's decision. "Patients will benefit from a more transparent, safer, and more competitive healthcare system as a result of this ruling," stated Mr. Ashman.
Bridget Asay, an assistant attorney general for Vermont, told Medscape Medical News that she is disappointed with the outcome, and that her office will review its legal options. These include asking the 3-judge panel to reconsider its decision, requesting that all 10 active judges in this appellate court hear the case, and appealing to the Supreme Court.
The Supreme Court declined to consider an appeal of the decision reached by the US Court of Appeals for the First Circuit in Boston that affirmed the constitutionality of New Hampshire's 4-year-old law banning the use of prescription data for most commercial purposes. However, the next move in the court battle over Maine's law, passed in 2007, is not clear. That law, which withholds prescription data from pharmaceutical companies only if a prescriber signs a special form, was upheld in August by the federal appeals court in Boston.
A spokesperson for IMS Health told Medscape Medical News that the company is still considering the option of appealing the decision on the Maine law to the Supreme Court.
On a similar note, a spokesperson for SDI said that as the company digests the implications of last week's appellate ruling on the Vermont law, it is "considering all legal options available to us in other jurisdictions."
Legal experts say that the Supreme Court is more likely to tackle an issue such as the use of physician-specific prescription data if appellate courts issue conflicting opinions on it.
Medscape Medical News © 2010 WebMD, LLC
Send press releases and comments to news@medscape.net.

The WSJ and the patient empowerment act
The Doctor Con …. WSJ 11.22.2010
Below is a recent op ed from the WSJ….
One of the tragi-comic sideshows of passing ObamaCare was the Democratic attempt to buy off the American Medical Association by promising a permanent fix to the Medicare payment formula for doctors. Apparently permanent is four weeks.
That's the upshot of last Thursday night's Senate vote to postpone an automatic 23% cut in Medicare physician payments, but only through New Year's Day. The House plans to approve the same deal next week, and you should think of this as Nancy Pelosi's housewarming gift for Speaker-presumptive John Boehner.
Democrats got their AMA endorsement of ObamaCare from immediate past president James Rohack, who was last seen leaving the Beltway on a turnip truck. But Democrats left a permanent fix out of the final ObamaCare bill in order to keep the official price tag below $1 trillion. Democrats planned to pass the $250 billion "doc fix" later in a separate bill, but somehow they never got around to it. Even liberals can't always conjure up a quarter-trillion dollars on demand, and some Democrats wanted the fix "paid for" with other spending cuts, real or invented.
The result has been a string of temporary last-minute reprieves. This will be the fourth this year, which is even worse than the annual "doc fix" fire drill that prevailed under both Democrats and Republicans until ObamaCare sopped up all the easy budget money. The Senate's latest one-month version costs $1 billion and is paid for by claiming to reduce certain outpatient therapy payments by about $100 million each year for the next decade. Anyone willing to bet on whether those cuts will ever happen? We'll take the "no" side of that wager.
In sum, Democrats deceived the AMA about the doc fix and are now deceiving voters about how they'll pay for even this four-week reprieve. And they're dumping the $250 billion bill on Republicans.
This doctor-payment charade has served both parties since it was created in 1997 as a palm-greaser for campaign contributions and to disguise the real costs of Medicare as part of the Bill Clinton-Newt Gingrich balanced budget deal. But these Democratic abuses are something else. Three of the four stopgaps this year have passed after the deadline set by the previous stopgap, so for a time Medicare simply stopped paying doctors, causing back-office disruptions nationwide. Imagine if a private insurer pulled these stunts.
A more stable payment system that reflects the real costs of delivering medical care while reining in federal health spending would mean dumping the Medicare price-control model that has led to the current mess. A good place to start are Wisconsin Republican Paul Ryan's Medicare reform ideas, which were endorsed last week by no less than the long-time Democratic budget hand Alice Rivlin. Maybe now that the AMA has been exposed as fools one more time, its new leaders will support genuine reform.
And this is my letter to the editor in response: …..
Thanks to the Wall Street Journal for elucidating the "doc fix" for what it is, a "con." As a member of the House of Delegates of the AMA, I can assure you that there were many doctors within the organization who tried to convince our colleagues that their political tactics were more than naive. Moreover, the SGR is a fixed payment system that denies the American public the opportunity to know the real costs of medical care. This type of fixed payment system also denies doctors our right to earn our own success and compete with one another to better serve our patients. The AMA was wrong to want to fix the SGR and they were wrong to continually ask the government for more money in any other fixed payment system. Things are not reformed if Congress only adopts a different formula that continues to redistribute any amount of capped dollars within the doctor community. Frankly, I want to work directly for my patients, not negotiate with anesthesiologists or orthopedists about who deserves what dollars.
The good news is that the AMA has finally voted productively and helped write the patient empowerment act. This legislation will allow patients to invest in their health and their lives by voluntarily contracting with their doctors for better care. That bill is ready for the Republican Congress to move forward in January. This bill will bring the free market back into the healthcare delivery system, allow for Medicare to make a defined contribution towards non-emergent medical procedures or doctor visits, and will allow doctors to post their prices and bill the patient UP TO the difference. As it is now, it is a felony for doctors to not charge the patient the 20% that Medicare does not pay. We would love to provide charity when appropriate but in order to do that we must be able to earn our success and compete with one another on behalf of our patients and their better care.
The irony is that this simple change in the law would bring the marketplace back to the healthcare industry. Care would once again be affordable and accessible. Voluntary contracting saves the Medicare system and cuts governments spending in this mammoth, almost bankrupt entitlement program. Finally, when doctors start to post their prices and patients become aware of the real cost of care, they will be better able to practice their right of self determination and exercise their right to invest in their health and in their life.
As for your reference to the AMA past president and turnip trucks, a phrase that Johnny Carson popularized back in the 60's, allow me to suggest that the patient empowerment act is the AMA's introduction into a position of bold leadership. Rather than sitting at the government's table and partake in a conversation we didn't author, we have grown the confidence to know that America's doctors must be the nation's leaders in health care. We are taking back the profession.
Concierge medicine news ….
| $40 For Unlimited Doctor Visits? |
| By Aaron Crowe, |
WalletPop
At prices as low as $40 a month, some medical groups are offering something that's cheaper than a gym membership, and just as good for your health — unlimited access to their services without having to go through an insurance company.
With 70 million Americans uninsured or under insured — with 59 million of them without health insurance for part of 2010 –it's a big market. Dan, a 35-year-old Symbeo patient, a direct medical practice in Bloomfield, N.J. [who didn't want his last name used], told WalletPop that he joined the group in June because at the time he didn't have health insurance.
He's self-employed and a student, and now has other health insurance. He plans on keeping his direct medical care coverage with Symbeo because it's an inexpensive way to get a second opinion, which he says makes his $40 monthly fee "priceless."
"I don't have the money to pay for what each individual doctor's appointment would cost me," he said.
| BUSINESS Concierge Medicine Companies Enter "Pink" Ocean Concierge Medicine Consultants: Once Few In Number, Now Number In The High 30's, Possibly 40's. "Not for every doctor," boutique practices remain a niche segment of the health care system but these companies now registering more physicians than ever.
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Posted Nov. 2010.
Many strategic business thinkers and leaders understand the wildly popular marketing strategy entitled "Blue Ocean Strategy." The concept illustrates the enormous growth and profits that can be obtained when few organizations create new demand in an uncontested market space, or a "blue ocean." Based on three years of research, CMT estimates the amount of concierge medicine or direct care consultants now assisting physicians across the U.S. in transitioning their practices from a traditional insurance-based business model into one of the 'Big 2' is over forty.
The majority of these companies (i.e. consultants) have emerged in the past 20 months as a response to the increasing popularity of concierge medicine in the media, health care reform uncertainty, metropolitan areas and the Internet.
"I don't envision that it is going to be 20% to 30% of health care," said Wayne Lipton, managing partner of Concierge Choice Physicians, based in Rockville Centre, N.Y. "A couple percent is probably more realistic. It's not for every doctor."
According to Michael Tetreault, Editor-In-Chief of CMT and Executive Director ofThe Concierge Medicine Research Collective says "We know for a fact that physicians are being offered intolerable reimbursements…once upon a time and only a few years ago, 120% of the Medicare fee schedule was considered to be a frightfully low reimbursement. Insurers are now offering reimbursements at 75% or even lower in some cases." "Our practice took a 32% pay cut from our most frequently performed procedure," said Martha Boone, MD. "What small business can take an acute 32% pay cut and stay in business?" More than 430 MDVIP doctors now practice in 31 states, seeing 138,000 patients. The growth, nearing 25 percent a year, persuaded Procter & Gamble to become 100 percent owner of MDVIP in December 2009. Meanwhile, its concept has been copied, and some observers put the number of concierge consultants nationwide at closer to 45." (Tetreault, 11/11).All in all, the number of physicians signing on with concierge practice companies has increased and will continue to increase, according to statements issued in September and October by two large organizations offering these services. Contributing Writers: Victoria Stagg Elliott, AmedNews Staff and Michael Tetreault, Editor-In-Chief, Concierge Medicine Today |
CONCIERGE PHYSICIAN POLL | November 2010
How many total office staff do you employ in your direct care/concierge medical practice?VIEW RESULTS >> |
| As Hospitals Shrink In Response To Compliance — Concierge Medicine Will Grow.
Hospitals Likely to Consolidate In Response To
Compliance Regulations, Paving The Way For More Innovative Practice Environments |
| Hospital consolidations are expected to increase in the coming year, leading to fewer independent hospitals and doctors, a trend some critics fear could lead to higher health care prices and diminished quality of care. "You're going to see more concierge medicine-for a fee, a doctor will treat you and your family. This will lower costs for physicians, and they can cut their overhead, personnel, paperwork, and compliance costs," Edmund Haislmaier, a senior research fellow at the Heritage Foundation. |

