Archive | March, 2009

Teva On Year Of Affordable Healthcare

Teva (a generic drug manufacturer) has rolled out a new site call Year of Affordable Healthcare to celebrate the 25th anniversary of the significant generic legislation (Hatch-Waxman Act). As part of that, they have rolled out a few videos in the Mac vs. PC approach.


Taxing Cigarettes – For Health or Financial Purposes?

I heard this discussion on the radio this morning and found it very interesting.  Do we keep raising taxes on cigarettes to reduce smoking (i.e., improve health and long-term liabilities) or is it to drive money into our government since we don’t think people will quit?

It’s an interesting question because if it’s for health purposes then there might be lots of different things that could be done – subsidize patches (for example).

Economy On Food Choices

McDonald’s continues to do well in this economy although we all know fast food is not the healthiest food.  I think an interesting question is whether the lower priced meals being rolled out at TGIF, Chilis, and other chain restaurants will be good (on a relative scale) for us.

Without really drilling down, I would assume that maybe the economy will finally address the portion size issue.  One easy way to lower pricing would be to lower portion sizes and provide consumers with reasonably sized, simple meals at a reasonable price.

I think all of this points to how this economy (the Great Recession?) will make fundamental and long-lasting changes to our world.

Do Google Searches Tell Us Anything About Wellpoint Buyer?

I doubt it, but it is interesting.  After I first posted about Wellpoint’s PBM (NextRx) being for sale, most of the Google searches that came to my blog came from people searching using some string about Express Scripts buying NextRx.  Now, there are more searches coming from people searching about Medco buying NextRx.  I get some occasional ones about Wal-Mart and Walgreens but that’s about it.

Unfortunately, I don’t have much more context on the searches to know who’s doing them.

Marathon / Triathalon Deaths Per Million

An article that came out yesterday points out that there is a much higher risk of heart problems in the triathalon especially around jumping into the cold water for the open swim.  It puts the deaths per million participants at 15 compared to 4-8 deaths per million marathon participants.  Certainly, if you are jumping into either sport, you should train appropriately and talk with your physician about any concerns or ideally get checked out for any potential heart complications.

But, I think it’s also important to put these in perspective.  According to FARS (Fatality Analysis Reporting System), the statistics on fatalities from car accidents are:

  • 13.61 per 100,000 people
  • 16.05 per 100,000 registered vehicles
  • 19.96 per 100,000 licensed drivers

Given The Link Between Money And Health

As we have seen in numerous studies over the past six months, healthcare spending is clearly affected by the economy.  It is not “recession proof” as many had believed.  Adherence is down.  People are skipping preventative care.

With that in mind, I just thought I would point people to Clark Howard who is the new consumer “advisor” on CNN that focuses on current issues.

Some of The Worse Lunches

This whole article on restaurants is worth reading to show you just how bad some meals are for you.  Let me pull out a few of the scariest meals:


Large Prime Rib Cheesesteak Sub

  • 1,490 calories
  • 92 g fat (22.5 g saturated, 2 g trans)
  • 2,620 mg sodium
  • Fat equivalent: Like eating four Dunkin Donuts cheese danishes!


Crispy Sweet Chile Glazed Chicken Crispers

  • 1,930 calories
  • 112 g fat (17 g saturated)
  • 4,190 mg sodium
  • Calorie equivalent: Like eating an entire medium Pizza Hut 12″


Italian Combo on Ciabatta sandwich

  • 1,050 calories
  • 47 g fat (18 g saturated, 1 g trans)
  • 3,050 mg of sodium
  • Fat equivalent: Like eating 6 slices of Papa John’s cheese pizza!


2/3-lb Monster Thickburger

  • 1,420 calories
  • 108 g fat (43 g saturated)
  • 2,770 mg sodium
  • Saturated fat equivalent: Like eating 43 strips of Oscar Mayer bacon!


Triple Whopper Sandwich with cheese and mayo

  • 1,250 calories
  • 84 g fat (32 g saturated, 2.5 g trans)
  • 1,600 mg sodium
  • Fat equivalent: Like eating 10 slices of Papa John’s cheese pizza!

What’s Your Blog’s Personality?

I found this an interesting “blog analyzer“.  You put in your blog’s URL and it tells you the Myers-Briggs personality type of the author.  Mine was right on – INTJ.  I guess it shouldn’t be too surprising, but I can imagine all the opportunities to use that information in scale in the future.  As blogs, Twitter, Facebook, and other sites become the norm, an analyzer like this could categorize people’s personality types.

If a service could be created, communications could be tweaked based on personality to best get people to respond.

Drug Importation

From what I saw this morning, it looks like the administration is going to go down this path.  I don’t think it’s a good idea.  I will point to my post from a few months ago on why.

My prediction is that it’s an arbitratage opportunity which will appeal to the public, but will cost us more in the long run.

On the flipside, I guess it’s better than having people take buses to Canada to buy drugs and sneak them into the country risking arrest.


Responsibility Based Healthcare

Are we finally to a point economically where healthy people will get tired of bearing the cost burden of supporting their sicker coworkers?  As costs continue to skyrocket, most people probably don’t realize that those are from a minority of their coworkers who have chronic conditions.  (Or in the case of Medicare, are from the costs incurred in the final year of life.)

If you’re like me, I generally don’t mind the risk pool concept (since I don’t know where I might end up any year).  And, I certainly don”t mind paying for people who are genetically pre-disposed to some condition (we all may be in that bucket someday), but I could take issue with paying for people who don’t comply with their physician’s recommendations (most of us), don’t act preventatively (most of us), abuse their body with things like smoking, and I could go on.

It got me thinking this morning about a model where we were able to push costs to people based on them taking responsibility for their care (i.e., “responsibility-based care”).  While we certainly won’t be at a place in the near future where genomics dominates and we can pull out people who can’t control their health, we can track things like compliance and adherence once we get an integrated HIT (healthcare information technology) system in place.

Additionally, we might get someday to a place where we can offer incentives based on active management and results which are self-reported by remote devices that track blood pressure, weight, cholesterol, etc.  But, many of these have issues around confidentiality and would challenge the risk pool process that we use today to underwrite medical costs.

I am not sure what the right answer is, but I think it’s about time for this debate to rear its head again with more energy.

PCMA Carve-Out Advertisement

I was a little surprised to see the latest PCMA advertisement that goes for the jugular on pharma companies that support generic carve-out legislation.


What is the “generic carve-out” concept – legislation which proposes making certain classes of drugs exempt from the ability of the pharmacy to substitute an A-B rated generic for its brand equivalent when the physician has not marked the prescription – Dispense As Written (DAW).

Correlation or Causality

This is a typical mistake that many people make.  They see correlation and mistake it for causality.


  • Correlation = the degree to which two or more attributes or measurements on the same group of elements show a tendency to vary together.
  • Causality = the principle of or relationship between cause and effect.

I see the difference as correlation shows two things that appear to be related (i.e., I ate a strawberry and had a rash the next day therefore I must be allergic.)  Causality is a direct relationship that is proven where one clearly causes the other (i.e., I went to the allergist and had a bunch of studies done.  I am allergic to strawberries).

There was an article in USA Today called “Many think they have drug allergies” on March 9, 2009.  Apparently many people think they have allergies when they don’t.  In one study discussed in the article, 90% of those people who said they were allergic to penicillin where not when a skin test was done to check.

  • People often mistake side effects with allergic reactions. (e.g., stomach ache)
  • People trust their mothers (i.e., relying on hearsay versus facts).
  • People trust their doctors (when tests may not have been conducted).
  • People grow out of some allergies.

The point of all this is that you need to rely on facts and isolate them to prove causality.  Don’t just look for things that happen at the same time.

How Easy It Is To Overeat

This is a good article that I saw on MSN this morning talking about calories in pizza, ice cream, orange juice, rice, and other foods and how quickly we overeat by simply not managing portions.

How many of us eat one slice of pizza for a meal (for example)?

$2.3T on Healthcare and 47M Uninsured – National Disgrace

Kaiser Permanente recently launched a series of advertisements that drive this message around health disparities home. It is (or should be) a concern for most of us.  Health outcomes and especially preventative care is driven by health literacy, our attitudes towards health, and our access to the healthcare system.  We should all be working with our families, our communities, and our country to try to make this better.

I am a firm believer that one of the best ways to start to manage cost is to find a viable strategy to get universal coverage.  The costs of emergency care and absenteeism all get passed on to us in one way or another.  And, as the government is the dominant payor of healthcare (Medicare, Medicaid), long term costs are a significant issue for our economy.  If there is a systemic way of improving it, we should seek that out.

So, a cause that is both moral and economical…what more do you need?

Today, more than 50 percent of Americans and 75 percent of Californians without health care coverage are people of color.  Uninsured men, women, and children are far more likely to get sick and forego care simply because they lack coverage.  This is a national disgrace. We spend 2.3 trillion dollars on care in this country. Securing health care coverage for every American is the next great civil rights issue of our time. We can and should achieve universal coverage.


Some of the facts highlighted on their new website about disparities include:

  1. Disparities in health and health care impact everyone. African Americans, American Indians, Alaska Natives, Asians, Pacific Islanders, and Hispanics are most affected.

  2. 27% of adults report having no usual source of care. African-American (28%), Hispanic (51%), and Asian (23%) adults are all more likely to report not having a usual doctor.

  3. Uninsured adults are disproportionately, young, and minorities; 82% are between 19-49 years of age, and 41% identified themselves as black, Hispanic, or other.

  4. American Indian and Alaskan Native death rates from sudden infant death syndrome are the highest of any population groups.

  5. Asian Americans have the highest tuberculosis case rates of any racial and ethnic population.

  6. During 1996-2000, Native Hawaiians were 2.5 times more likely to be diagnosed with diabetes than non-Hispanic white residents of Hawaii of similar age.

  7. In 2005, African Americans accounted for 18,121 (49%) of the estimated 37,331 new HIV/AIDS diagnoses in a national poll which encompassed 33 states.

  8. 21.9% of U.S. children live in poverty, far and away the worst in the industrialized world. Comparable figures for the Nordic countries are 4.2% and less.

  9. Adults who have not finished high school are almost two times more likely than college graduates to be obese.

To learn more about the topic, you can go to their community of information.

How Does Optimism Bias Affect Us in Healthcare?

The optimism bias means people are less likely to believe that bad events will happen to them.  They overestimate their likelihood of success.  What are some probable implications in healthcare?

  • Don’t believe they will get cancer or some other disease and not act preventatively.
  • Believe they can improve their cholesterol by exercise and that they will exercise.
  • Don’t believe that the extra calories will add on pounds.
  • Don’t believe smoking will kill them.
  • Don’t believe they need insurance because they won’t get sick or hurt.


Is glass half-full or half-empty?

E-Mail No-No’s

While I am sitting on the plane doing hundreds of e-mails (finally catching up), I flipped thru the American Way magazine. It has an article on e-mail etiquette with a list of “The Top 10 E-mail Turnoffs” (March 15, 2009, pg. 16). [BTW – Only a frequent traveler quotes airline magazines.] I think it’s a good list and hits a lot of mistakes that you see. The other key that they talk about in the text is that increased probability of someone misreading your intentions when they don’t have a voice or actions to provide more context. (A problem with text messaging professionally also.)

10 – Get overly cutesy or slang-happy in a professional e-mail.

9 – Skimp on the subject line.

8 – Miss the Mr. or Mrs. mark.

7 – Send it off without running a spell check.

6 – Sprinkle your message with flowery language.

5 – CC: for all to see.

4 – Send an irate, angry, or potentially embarrassing message.

3 – Use your work e-mail for personal time (read: racy)

2 – Go all willy-nilly with the wingdings.

1 – Hit reply all.

[On a related travel note, I need to come up with some “term” for days where I eat each meal in a different state and time zone. Had another “opportunity” to do it this week, but I only hit two time zones.]

Negotiating Health Care Is Normal

Sure, most of us with employer sponsored care haven’t dealt with this but providers (MD, hospitals, labs) have been negotiating with plans for years.  With over $34B in uncompensated care in 2007 (a number which will certainly go up), your physician would rather get something than nothing.  Talk to them like a professional (not a used car dealer) and see if they can give you a break on the costs.  This article in Patient Money provides some additional thoughts.

Another good article in this area is “Advice To The Jobless On Getting Health Coverage“.

Using Twitter For Health Care

Last week, I talked with a reporter about using Twitter for health care.  It can add a new dimension to communications, but I am not sold on it replacing current communications.

Some of my jumbled thoughts on this:

  • I like the one to many concept of Twitter with the opt-in concept (preference-based marketing), but it doesn’t personalize to the individual the way the information is delivered.
  • It definitely provides a stream of consciousness which is interesting.  I see a lot of application for a reality show type of health tools…like Biggest Loser via Twitter.
  • I like the idea of posting a question to a broad audience for quick response – Does anyone have research showing the impact of statins on asthma patients?
  • I don’t see this helping with patient to provider communications.  Do I really want my blood sugar posted to Twitter and sent to my physician from my smart device?  Do I (the physician) really want to see all that real-time data?  No.  What about HIPAA…from what I know Twitter is not meant to contain confidential information.  There are plenty of rules engines which can be used to capture data; look for things outside the norm; and then send an alert.
  • A lot of healthcare information has caveats and requires more than 140 characters to get across the message.  Most clinical things couldn’t be send this way.
  • As with most inbound things (i.e., I have to register or search it out), Twitter feeds get those that know what they are interested in and are active in their health management.  It still doesn’t help to drive action from those that aren’t engaged in their healthcare.
  • I can certainly see it as an alert to information, but since one tip to productivity is to batch things, do I really want them broken out during the day in a bunch of Twitter feeds.  I would rather get a daily synopsis from a website (which might be created by Twitter feeds).

Some things I found when looking on the web about this topic:

Here is a presentation on Twitter (they even have one of my old posts in there…which was a pleasant surprise to me) around healthcare.

So, my general perspective is that there is some value in pushing basic information out, reality show type of healthcare (Twitter surgery), capturing feedback, and developing community, but it’s not a tool for the corporate to individual communications that I typically deal with.

BioGenerics, Text Analysis, and Transparency

Here are a couple of blog posts from other blogs worth reading:

  • David Williams on the “Folly of BioGenerics” which talks about why they won’t be just like generic drugs.
  • James Taylor on Text Analysis which if ever figured out would be very helpful in taking inbound e-mails, letters, and call center notes and using them for customer relationship management.
  • Gilles Frydman on “Opaque Inc.” and how difficult it is to understand the US healthcare system.

Why Did The PBMs Get Into Specialty?

Thanks for all the questions lately.  I love to answer them (although I get backlogged sometimes with the real job).

Someone asked me why the PBMs got into specialty pharmacy over the past 5+ years.

  • Commoditization
  • Money
  • Opportunity

As the traditional PBM business continued to get squeezed and “transparency” was being pushed, there was a fear of commoditization.  That fear caused the PBMs to look more aggressively at what companies like CVS had been doing in the specialty pharmacy world.

The PBMs have typically been very financially motivated.  If you look at the basics, there is clear financial opportunity.

  • The value of an average specialty script is $1,200+ versus $80 for a normal script.
  • The majority of the scripts traditionally were filled outside the pharmacy network on the medical side creating lots of opportunity for cost management (and therefore spread).
  • Some specialty drugs have limited distribution meaning that you can be the only pharmacy (or one of a few) that stock the drug driving immediate marketshare.

Finally, to a lesser extent, I believe specialty created an opportunity for them to showcase more “care management” types of activities.  They could work more actively with the patient (member) to save them money and help them deal with their chronic condition.

Walgreen’s vs. CVS PBM Ownership

Another question I got yesterday was on retailers (specifically Walgreen’s versus CVS) owning PBMs.  The question was since they make so much money on foot traffic and selling non-pharmacy items why would they want to be in the PBM business.  DATA!

They both have similar fundamental concepts which are aggregating patient touchpoints – PBM, Clinic, Retail, Specialty.  If they can figure out how to aggregate and mine the data to better serve the patients and the plan sponsors, they can be a key influencer in driving health outcomes.  

The follow on question was what’s different.  Without getting into behind the scenes, the one thing that I think is publicly different is the CVS ExtraCare program.  They have a loyalty program that gives them visibility into the non-medical behavior of members.  Why is that important?  From a PBM perspective, it’s important because they can make sure to focus on channel optimization.  By that I mean that people that go to the pharmacy and shop at a CVS are people they want to keep in the stores.  But, patients that simply pick up prescriptions are probably people they want to move to mail.  Mail order is a lower cost fulfillment option for them and if those consumers aren’t buying other stuff, then they should look to convert them to mail.

Would / Should Express Scripts Overpay For Wellpoint’s PBM?

This was a question I was asked yesterday.  If you assume the final bidders come down to Express Scripts and Medco, would Express Scripts overpay for Wellpoint?

  • Strategically, this would be an important acquisition for them.  They lost Caremark to CVS.  Losing Wellpoint to Medco would make them a distant third.
  • Financially, they run a very smart company.  George Paz (CEO and ex-CFO) would be unlikely to pay more for an acquisition than he thought it was worth financially.  Which is a good thing for shareholders.
  • The questions of course that the due diligence team would be asking is what costs can be cut and when.   Is there slack in the current operations or does this address capacity needs?  Are there economies of scale?  And, as I talked about the other day, what is the lock-in on lives?

It will be interesting to see, but it is a hot topic of discussion these days.

Kaiser Family Foundation: Medicare 101 Webinar

I thought this sounded interesting so I thought I would post it for those of you that are interested…


On Monday, March 16 at 12:15 p.m. ET, the Kaiser Family Foundation and the Alliance for Health Reform will co-host a briefing with a panel of experts discussing the Medicare program. Medicare covers nearly 45 million beneficiaries, including 38 million seniors and 7 million younger adults with permanent disabilities. The program is expected to cost the federal government approximately $477 billion in 2009, accounting for 13 percent of federal spending and 19 percent of total national health expenditures.

Panelists will address questions such as:

  • Whom does Medicare serve and what services does it cover?
  • What are Medicare Parts A, B, C and D?
  • How is it structured and financed?
  • What drives Medicare’s costs?
  • How does Medicare reimburse providers and hospitals?
  • What future challenges face the program?

A live webcast of the discussion will be provided by

WHO: Ed Howard, JD, executive vice president of the Alliance for Health Reform and Diane Rowland, ScD, executive vice president, Kaiser Family Foundation and executive director, Kaiser Commission on Medicaid and the Uninsured will co-moderate the discussion with panelists:

  • Juliette Cubanski, PhD, principal policy analyst, Kaiser Family Foundation
  • Marilyn Moon, PhD, vice president and director, American Institutes for Research
  • Tom Gustafson, PhD, senior policy advisor, Arnold & Porter LLC

Fake Research – Ridiculous

Sometimes, I just can’t believe certain things.  The fact that people fake drug studies.  Come on.

Baystate Medical Center in Springfield, Mass., has asked several anesthesiology journals to retract the studies, which appeared between 1996 and 2008, the WSJ reports. The hospital says its former chief of acute pain, Scott S. Reuben, faked data used in the studies.

Personal E-mail Replaced By Social Networks

This plays into my post earlier about changes in communication patterns…

I certainly have begun to see more of my social (personal) online communications moving from e-mail to social networking tools like Facebook, LinkedIn, and Plaxo.  I almost never trade e-mails with my siblings any more.

So, it wasn’t a big surprise when I saw the blurb in the USA Today which said that “social networks and blogs” have moved ahead of personal e-mail as the most popular online activities (per Nielsen report).

A few facts:

  • 1 of every 11 minutes is spent on these social networking and blogging sites.
  • Time spent on the sites is growing 3x faster than overall Internet usage.
  • 2/3rds of the world’s online population visit these sites.
  • The US was third (after Brazil and Spain) with 67% of the population visiting these sites.
  • Facebook is visited by 3 in 10 people monthly.
  • 10.6M people in the US access these sites through their mobile devices.

How The Recession Could Impact Communications Forever

This recession (or depression) has the potential to systemically impact how people communicate.  Some potential impacts:

  • Death of newspapers (discussed last week)
  • Death of the land line (everyone has a mobile phone)
  • Death of magazines (similar to the newspaper issue – drop in advertisements)
  • Reduction in mail (as costs go up and if service were dropped to 5 days a week)
  • Short-term reduction in use of high speed Internet (save money)
  • Short-term reduction in use of text messaging (save money)
  • Less use of cable (being replaced by online TV shows)
  • Move to digital coupons

I think some of these will also be affected by the green movement where printing massive amounts of paper and sending those to people (who can get the same information online) will become important.  [Although this has been talked about for years, costs may finally make it a reality.]

Some other things that could change:

  • Reduction in the value of co-branding information as the employer relationship becomes less long-term and more fragile [Traditionally, this has been an important strategy in direct mail from health plans and PBMs where using the employer has improved response rates.]
  • Improvement in use of online tools (Health 2.0) as people move away from print
  • Increased use of virtual meetings and further loss of face-to-face contact as companies move to virtual offices and cut travel budgets

If you combine cost driven changes with environmental driven changes with likely technology changes, I suspect that the way we communicate and interact with people over the next 10 years will dramatically change.  In the short-term, we may even see an increased number of new Luddites (people who shun technology to save money and over frustration with our overall economic situation).

More Lies In E-mail

A pair of recent studies suggest that e-mail is the most deceptive form of communications in the workplace–even more so than more traditional kinds of written communications, like pen-and-paper.

More surprising is that people actually feel justified when lying using e-mail, the studies show.

“There is a growing concern in the workplace over e-mail communications, and it comes down to trust,” says Liuba Belkin, co-author of the studies and an assistant professor of management at Lehigh University. “You’re not afforded the luxury of seeing non-verbal and behavioral cues over e-mail. And in an organizational context, that leaves a lot of room for misinterpretation and, as we saw in our study, intentional deception.”[See article]

This certainly raises a few flags as letters become a “historical tool” for communicating and everything becomes more about technology.  This certainly says a lot for virtual teams and remote management.  You can’t rely just on e-mail.  You need to pick up the phone and talk.  You need to visit face-to-face (F2F).

Does this mean that MDs shouldn’t trust e-mails from patients?

Does this mean that deals shouldn’t be negotiated through e-mails?

Every 2 Weeks A Language Disappears

According to Ethnologue, there are 6,912 languages in the world.  Lots of these are at risk of being lost.  It is estimated that one “disappears” every two weeks as the last person who can speak the language dies.

The Living Tongue Institute for Endangered Languages is rapidly trying to capture and document them before they disappear.

Wellpoint PBM for Sale

Not that it wasn’t known, but the rumor is now out on the street.  Wellpoint is putting their PBM on the market.

How do you value it…It’s difficult. The question is how long of a contract will Wellpoint sign with the acquirer and will they plan to keep any of their assets – mail pharmacies, call centers, claims systems, etc.  But that’s not it.  You also have to understand how many of their contracts are going to be up for renewal and when.  PBM contracts with payors are usually 2-3 years so that would likely be much less time than Wellpoint would commit to.

Who will buy them? Everyone seems to think CVS Caremark, Medco, or Express Scripts.  Why not Walgreens, Wal-Mart, or Prime Therapeutics?

I can’t imagine CVS Caremark buying them after the Longs and RxAmerica acquisition.  Medco doesn’t usually buy PBM lives.  And, both of them are more focused on building out a healthcare solution than growing the traditional PBM offering.  So, of the top 3, I would have to predict my old employer – Express Scripts.  I guess that’s a way to grow quickly.

An acquisition by Prime who is owned by the non-profit BCBS plans would be interesting to begin to consolidate the payors under one PBM, but I doubt that’s the likely suitor.  It will be interesting to see how this plays out.

Brand Companies Make Generics

People are always surprised when I point out that 50% of generics are made by brand manufacturers.  And, the company that has been most aggressive against generics – Pfizer – has recently made several deals to strengthen their generic subsidiary – Greenstone.

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