Author Archive

The Future of Medicine and the Internet of Things

As previously noted on this blog, investments in digital health ventures doubled in 2014. Institutions, analysts and MDs envision the opportunity to reduce the colossal inefficiency of current medical practice by exploiting the Internet of Things.

According to a recent JAMA article, the number of mobile devices connected via the internet is doubling every five years, and there will be nearly seven connected devices per individual by 2020.


Source: Digital Medical Tools and Sensors from JAMA.

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Consumer-Driven Childbirth in the New Bronze Age

Birth rates fall during economic downturns — especially among lower-income women. A 2012 study found that birth rates declined 8% during the recession from 2007 to 2010. Presumably this was due to economic uncertainly, but could also be attributed to cost-sharing for a major medical event.

The out-of-pocket cost of having a baby is going up. High-deductible health plans (HDHPs) and their “Bronze” counterparts in Obamacare exchanges are expected to be the most common insurance arrangements for expectant mothers in the near future. A recent JAMA article  discusses the implications of high-deductible health plans and rising out-of-pocket costs on expectant mothers.

Childbirth is the most frequent reason for hospitalization in the United States. Although Obamacare mandates that insurers cover birth hospitalizations, its only limit on cost-sharing is through relatively high annual out-of-pocket maximums. According to the article:

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U.S. Ranks First in Intellectual Property Rights

The International IP Index, published by the U.S. Chamber of Commerce’s Global Intellectual Property Center (GIPC) was released earlier this week. The full report can be found here.

Now in its third edition, the GIPC Index provides data analysis intended to be a tool for governments to understand the key IP factors that drive business innovation. In addition, the index reflects indicators that companies monitor closely as they plan their R&D. Key IP inputs measured include: Patent protection, enforcement and international treaties.

As the first ranked country in the index, the report attributes the U.S.’s score to the following areas of strength:

  • Pharmaceutical-related patent enforcement and resolution mechanism
  • Patentability and strict definition of computer-implemented inventions
  • Digital rights management legislation
  • Protection of trade secrets
  • Deterrent civil remedies and criminal penalties
  • Commitment to and implementation of international treaties
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Electronic Health Records and Adolescents’ Privacy

This blog has written about complaints from both physicians and nurses regarding the costs and time devoured by using Electronic Health Records, which have been imposed on practices despite not adding value.

In a JAMA article published earlier this month, three physicians discuss EHRs’ challenge to adolescents’ and parents’ privacy. So-called minor consent laws permit adolescents to secure health care services without parental consent for drug use, pregnancy and pregnancy preventions, STDs and mental health. These laws underscore the professional consensus that absent confidentiality, adolescents will be reluctant to seek care for sensitive health issues.

With paper records, care provided under minor consent laws was segregated from other medical records and difficult to access. Because EHRs aggregate information for all health care provided within a so-called integrated system, parents have the means to electronically access confidential information, often facilitated by web portals to the records.

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Is the Medical-Malpractice Crisis Being Solved?

In a JAMA article published last month, Michelle Mello and colleagues review trends in medical-malpractice claims and med-mail insurance costs.

Data show a decline in the rate of paid claims against physicians: 6.3% annually for MDs and 5.3% for doctors of Osteopathy, from 1994 to 2013. Further, the average amount paid per claim has been unchanged in real (inflation-adjusted) terms for the past seven years.


Source: The Medical Liability Climate and Prospects for Reform from JAMA

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The Circular Firing Squad in U.S. Health Care

Who is to blame for the U.S. healthcare crisis? JAMA has published an opinion piece by three physicians illustrating a fundamental difficulty in identifying the causes of the healthcare crisis. Individuals construct “casual stories” to assign blame. Subjective narratives gain momentum among researchers, policy makers, journalists, and the public:

  • Payers: Insurers create barriers to health care (high deductibles and gatekeepers) and excessive administrative waste (billing and coding).
  • Life Science Industry: Manufacturers saddle patients and payers with excessively high prices and underinvest in novel therapeutics.
  • Physicians and Hospitals: Financial incentives have led clinicians and health care organizations to focus on delivering volume over value. Hospitals overinvest in high margin services (cardiology and oncology) and underinvest in essential services (obstetrics and psychiatry).

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U.S. Property Rights Maintain Global Rank

The 2014 International Property Rights Index (IPRI), published by the Property Rights Alliance, ranks the United States 17th place overall in the world (from 17th in 2013 and 18th in 2011 and 2012). The IPRI is an annual comparative study that quantifies the strength of physical and intellectual property rights and ranks countries accordingly. The U.S. improved its legal and political environment from 2013 to 2014 via marginal improvements in control of corruption, judicial independence, and political stability. Its physical property rights score improved due to increases in the country’s access to loans and real estate. Likewise, the U.S. intellectual property rights score increased due to improvements in the country’s copyright piracy score.

The NCPA has emphasized the importance of intellectual property protection in health care and this blog has written about how pharmaceutical innovation in today’s regulatory environment could not be financed without patent protection. According to the IPRI, such dynamics exist globally between many macro indicators: with each annual edition of the index, statistical strength between economic production and protection of property rights has grown.

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Reducing Readmissions Under Obamacare: Doctor’s Orders?

Last month I wrote about the rise of hospital readmission penalties in fiscal 2015 and questioned the Hospital Readmissions Reductions Program’s effectiveness in increasing quality of care, in part due to factors independent of the hospital that lead to readmission.

Hospitals attempt to combat readmissions by implementing transitional care interventions. The American Journal of Managed Care conducted a controlled trial to evaluate the impact of such programs. Patients were randomly assigned to either standard care or a 90-day hospital-based transitional care program featuring patient education ahead of discharge, post-discharge follow-up, an available hotline and additional interview sessions and symptom checks. No statistical difference in readmission rates between the standard care and intervention group was found. Their findings are consistent with other trials, which have shown that even robust and comprehensive interventions are ineffective in slowing readmissions.

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Per Patient Spending Higher in Hospital-Owned Physician Groups Than in Physician-Owned Groups

Hospitals and multihospital systems have been acquiring medical groups and physician practices at a rapid pace. One cause is the financial incentives provided by Obamacare for physicians to join hospital-affiliated accountable care organizations (ACOs).

Advocates claim that consolidation builds integrated delivery systems (professional, facility, laboratory, and pharmaceutical services) that lead to care that is better coordinated. This reduces duplication of tests and treatment and lowers total expenditures. Health economist James C. Robinson investigated the latter claim using data obtained on total expenditures for care provided to 4.5 million between 2009 and 2012. These patients were covered by commercial HMO insurance and excludes individuals covered by commercial PPO insurance, Medicare, or Medicaid.

The table below presents trends in total expenditures per patient between 2009 and 2012.

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400 Additional Hospitals Face Obamacare Readmission Penalties Totaling $428 Million in Fiscal 2015

The Hospital Readmissions Reduction Program was created by Obamacare to penalize hospitals with excess numbers of patients readmitted within 30 days of discharge following treatment for heart attack, heart failure or pneumonia. In fiscal 2013, the penalty was up to a 1% dock in Medicare payments. That figure increased to 2% in fiscal 2014 and now sits at 3% for fiscal 2015. In addition to the increased fine, the program has added measures: Readmission rates for chronic obstructive pulmonary disease and total hip and total knee replacements. Modern Healthcare reports that 2,610 U.S. hospitals will see their Medicare payments docked in fiscal 2015, while just 769 U.S. hospitals will avoid such fines. Over the course of fiscal 2015, Medicare estimates the fines will total $428 million. Perhaps the measures are

not achieving their stated goal of improving care if fewer than one quarter of eligible hospitals can avoid the fines.

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