The Incidental Economist

I imagine most readers of this blog are aware of Health Wonk Review, a biweekly roundup of the best health policy posts from the blogosphere. Each edition is hosted by a different blog. Aaron and I are regular contributors. Frustratingly, you can’t just subscribe to the HWR, you’ve got to find out where it is every two weeks. Today it is at InsureBlog. Check it out!

Just getting something (else) off my chest.

True story: very early in my experience as a blogger I linked to a prominent journalist in health care, among other topics. Unknown to me at the time I violated a common courtesy in the blogosphere. With my link I was using the journalist’s credibility and freely-provided work to support my argument. That’s fine. But I didn’t actually name the individual. I think I wrote something like (though probably not exactly), “Support for this notion can be found elsewhere [link].”

To my surprise, the journalist wrote me to say that I should include his/her name if I’m going to use his/her work in my argument, even if only via a link. Just stating “elsewhere” is a bit dismissive and is poor “netiquette.” I didn’t know! But I do now. By the way, this was back when I was blogging anonymously on a personal finance blog (not this one). That the journalist bothered to contact me illustrates how seriously people take blogging ethics and norms.

Lately, I’ve begun to appreciate how that journalist may have felt. I’ve seen my work plagiarized and other more minor violations of this blog’s terms of reuse. Sometimes my words or those of co-bloggers are quoted without a link or the author’s name is misspelled (that’s just a mistake, but still bothersome). It’s really annoying! As time permits, and commensurate with the transgression and its degree of visibility, I track down bloggers and journalists and point such things out to them. Almost always they do the right thing. When they do, they are completely forgiven. I hold no grudges about honest and then corrected mistakes.

I am certain most who quote or reference this blog or its authors do not intend to irritate. The best way to demonstrate that is by a graceful recovery. I don’t mind my words being used elsewhere, nor do this blog’s other authors. That’s what they’re for. I just ask that they be done so according to the copyright to which we’re entitled (see also the footer of every page of this blog).

Enough on this. I feel better now.

While I’ve still been getting plenty of email, it seems to come from mostly people who’ve followed me from my old blog.  What’s the matter, TIE regulars?  You’re not afraid of me, are you?  I have three small children you know.  I’m not scary.

My blog email address is aaron@mdcarroll.com.  It seems my work email address is discoverable, as well, but I try and keep that separate.

Every so often it seems appropriate to remind folks that this blog has a comments policy. All who comment are assumed to have read it. All who disagree with it will find no audience for their grievances here. (Starting one’s own blog is very easy, you know.) To date, blog administrators have never deviated from the policy. We intend to keep it that way, for our benefit and yours.

Many of the emails and some of the comments I got yesterday made me realize that there are some serious misunderstandings out there about the difference between name-brand drugs and generics, as well as some bizarre assumptions about the merits of newer drugs.  So here’s a quick primer on how you (and everyone else) are sometimes not getting accurate information about your pharmaceuticals:

As a society, we’re addicted to drugs.  Almost all of them are legal, and we’re not abusing them per se, but we want them desperately.  The problem is that so many of the new prescription drugs we take are no better than old drugs that are less expensive.  Since new drugs are almost always more expensive, we’re wasting money.  In some cases, the older drugs are actually better – meaning that we’re spending more for less benefit.  Even more concerning, sometimes new drugs aren’t actually “new” at all, making their production and marketing suspect at best.

I want to state clearly the following caveats: I don’t hate drug companies.  I don’t hate people who work for drug companies. I don’t even hate drugs.  In fact, I, as a practicing physician, have seen drugs save lives, improve health, and make daily life incredibly better.  But that doesn’t mean the pharmaceutical industry gets a free pass.

Often, completely new drugs come to market along with a huge advertising campaign and the promise of research showing their effectiveness.  The problem is that to get FDA approval, drug companies only need to show that their drug is more effective than a placebo.  That’s right – effective doesn’t mean better than what is already available, it means better than nothing.  And often, unless a drug company pays for a head-to-head comparison, this type of research just won’t happen.

Once in a blue moon, however, these studies do happen.  One of the biggest and best of them was the Antihypertensive and Lipid-Lowering Treatment to Prevent Heart Attack Trial (ALLHAT).  Drugs for high blood pressure are intended to reduce the risk of complications or death due to coronary artery disease or other cardiovascular disease.  There were so many drugs to choose from for this trial (at different costs) that the National Heart, Lung, and Blood Institute (NHLBI) primarily organized and supported a randomized, controlled trial to examine which was best.  This study was enormous; it took place in 623 centers in the United States, Canada, Puerto Rico, and the U.S. Virgin Islands between 1994 and 1998, and included over 33,000 participants.  Patients received one of four drugs:

• Amlodipine, a calcium channel blocker
• Doxazosin, an alpha-adrenergic blocker
• Lisinopril, an angiotensin-converting enzyme inhibitor
• Chlorthalidone, a diuretic

The last of these, the diuretic, was the oldest of the drugs, and by far the cheapest.  However, at the end of the study, the results were clear.  This old, cheap diuretic was significantly better at preventing at least one of the major types of cardiovascular disease when compared to the other, newer drugs. Since the diuretic was also significantly less expensive, it should be the drug of choice in initial treatment of high blood pressure.  However, it usually is not.

The other drugs in the ALLHAT study were good faith efforts to create new molecules to treat a chronic disease.  However, in many other instances, new drugs are just sleight of hand “changes” to old drugs that have no expectation of being better.  When creating drugs through organic synthesis, mirror image molecules are created.

So, if drug D is created, in the last step you wind up with half D and half D’(the mirror image of D).  The mirror image is usually inert and has no effect on the drug or the individual taking the drug, but it is left in because there is an expense to remove it.  Years ago, the drug companies hit upon a brilliant idea.  If they removed that non-working, mirror image part of the pill, they could claim they devised a new drug!

Think this is rare?  Ever heard of Nexium (“the purple pill”)?  Nexium is just Prilosec, with the mirror image part removed.  And Prilosec is an effective, and now generic, drug for heartburn.  Prilosec is P + P’; Nexium is just P.  There is no reason to believe that equivalent amounts of the two drugs are not the same – and research supports this.  Four head-to-head studies compared 20 milligrams of Prilosec to 20 or 40 milligrams of Nexium.  But you have to remember – half of Prilosec is P’(filler)!  So these studies really compared 10 milligrams of P to 20 or 40 milligrams of P.  Shouldn’t more be better? One would think so, but it was barely so, and only in half the studies.  And, of course, none of the advertising stated that you could get the same improvement just by taking more Prilosec.

AstraZeneca, the maker of Nexium and Prilosec, isn’t the only drug company to do this.  Lexapro is “half” of Celexa (Forest Pharmaceuticals).  Nuvigil is “half” of Provigil (Cephalon).  Xyzal (Sanofi-Aventis) is “half” of Zyrtec (Pfizer).  Lunesta is “half” of Imovane (Sepracor).  Levaquin is “half” of Floxin (Ortho-McNeil Pharmaceutical).  Focalin is “half” of Ritalin (Novartis Pharmaceuticals).  And so on and so forth. In fact, since 1990, the proportion of these “half” drugs, among approved new drugs worldwide, has become greater than half of those new approvals.

These aren’t even the worst offenders.  In the worst cases, all that the drug companies change is the color of the pill.

Sarafem, marketed by Lilly for premenstrual dysmorphic disorder, is exactly the same molecule as that found in Prozac.  The only difference, besides the cost, is that Prozac has a green coating, and Sarafem’s is pink.  That’s it.  There is no reason you couldn’t just buy cheaper generic Prozac (Fluoxetine) and color it pink for the exact same experience and effect.

Are you on a high blood pressure medication that is not a diuretic?  Did your doctor explain why he thought the more expensive drug was necessary?  Do you think the cost is worth the difference?

Are you on Nexium?  Did your doctor explain to you the real difference between that and generic Prilosec?  Do you think the cost is worth the difference?

Are you on Sarafem?  Did your doctor explain to you that generic Prozac is the exact same molecule?  Do you think the cost is worth the difference?

Should insurance have to cover many of these?  Should the government?  Should you?

______________________________

Adapted from Don’t Swallow Your Gum! by Dr. Aaron E. Carroll and Dr. Rachel C. Vreeman. Copyright © 2009 by the authors and reprinted by permission of St. Martin’s Griffin.

Sources:

1.         Major outcomes in high-risk hypertensive patients randomized to angiotensin-converting enzyme inhibitor or calcium channel blocker vs diuretic: The Antihypertensive and Lipid-Lowering Treatment to Prevent Heart Attack Trial (ALLHAT). Jama 2002;288:2981-97.

2.         Levocetirizine: new preparation. Me-too: simply the active enantiomer of cetirizine. Prescrire Int 2003;12:171-2.

3.         Agranat I, Caner H, Caldwell J. Putting chirality to work: the strategy of chiral switches. Nat Rev Drug Discov 2002;1:753-68.

4.         Wahlqvist P, Junghard O, Higgins A, Green J. Cost effectiveness of esomeprazole compared with omeprazole in the acute treatment of patients with reflux oesophagitis in the UK. Pharmacoeconomics 2002;20:279-87.

5.         Angell M. The truth about the drug companies : how they deceive us and what to do about it. 1st ed. New York: Random House; 2004.

Now that my opinions on things are publicly available, I get to see how people outside my usual circle of friends, family, and colleagues respond to them. It’s fascinating.

The most significant thing I’ve noticed is that people extrapolate, a lot. For example, if I write, “Egg yolks are too slimy,” many people seem to think that means, “I hate eggs. You should too.” I get egg industry advocates sending me e-mail. I see snarky posts citing me on pro-egg blogs. You get the idea. (Par for the course, I know.)

I try (I really, really try) to be precise with my words. I can think of only one or two cases in which I later felt I mischaracterized my own views on something. And those are borderline cases. I also distinguish such cases from the evolution of my views. I learn stuff and the world changes. What I believe today about X is not necessarily what I believed about X in 2009. If I’m not learning something new I wouldn’t blog. That’s why I blog, to learn and to practice articulating what I’ve learned.

Being careful in my writing means that I say what I mean and only what I mean. So, if I write, “Egg yolks are too slimy,” that’s exactly the full extent of my opinion on eggs that you can accurately infer. If I wanted to convey that I hate eggs I’d write, “I hate eggs.” It’s really that simple.

Given that, what can you tell about my full views on private plan participation in Medicare from recent posts? Wouldn’t it be easy to infer I detest them and think they should be abolished? Or that I think they are wonderful and work well in all respects? Both would be inaccurate extrapolations. I’ve said no such thing!

I know this is tricky and nuanced, but so is the world, so is research, so is life, and so is this blog. I don’t expect everyone to get it. It’s enough that most regular readers do, or at least those who regularly comment and correspond. For you, I am grateful. It’s nice to have you along for the ride.

Aaron’s posts this week have generated a lot of interest, citations, and e-mail, and it is only Wednesday. I (we) are very grateful for the link-backs and feedback. Some of it credits me, not Aaron for the posts. So, I just want to be sure that folks realize that much of what they are reacting to isn’t my work. It’s Aaron’s.

I’m not saying that because I’m getting flamed (I am not). I’m saying that because the feedback is enormously positive and supportive and Aaron deserves the credit. So, before you fire off that e-mail or cite us in your blog post, be sure to check the by line. You can contact Aaron directly by e-mail. I’m reachable via a contact form.

I’m flattered that folks think I could pump out that many good posts in three days. I do write quickly, but I’m not that productive.

Because the media is super-fickle, I made it a point on my old blog to tell people on Twitter when I was going to be on the radio or TV.  It’s too much to keep updating that on blog posts.

If, for interest, you want to know when I will be on Stand Up! today on Sirius 110 or XM 130, you should follow me on Twitter.

The following has been included in the 19 August 2010 edition of Health Wonk Review.

Jonathan Cohn has a smart piece up at The American Prospect on the daunting task of getting insurers to comply with the new regulations of the PPACA:

First, the good news: The most important new restrictions on insurance-company behavior are also the most straightforward. These are the rules guaranteeing that people who represent high medical risks because of their personal characteristics or pre-existing conditions have access to policies at the same prices as healthy people do. For the most part, this is already true for people who get insurance through large companies — but not for people who buy on their own or through small businesses. As of 2014, under the law, insurers that sell to these markets will have to practice “community rating” (charging everybody the same rate for a given policy) and “guaranteed issue” (selling policies to anybody willing to pay the premiums).

The Affordable Care Act leaves relatively little to chance here. The law spells out the requirement unambiguously, allowing insurers to vary rates only by geographic area, tobacco use, and age (on a three to one ratio between old and young). In 2014, the prices for all policies will be publicly listed on the new insurance exchanges, where people can sign up for them. Enforcing the rule will be a simple matter of checking what insurers are charging for policies and investigating any reports of discriminatory pricing in policies sold outside the exchanges.

Anytime I hear someone claim that a law or regulation leaves relatively little to chance, I get a little shiver.  Give credit where credit is due.  Insurance companies are very, very good at what they do.  And, while many politicians and activists are still campaigning and crying for a repeal of PPACA, you’re not seeing that from the insurance companies.  They are (probably smartly) much more concerned with doing the best they can under the new landscape.

I have no doubt they will succeed.  I made this argument a while ago talking about the limits of the public option’s power, but it still applies here.

In an important paper in the New England Journal of Medicine in 1997, researchers examined how people moved in and out of Medicare HMO plans and traditional Medicare.  See, back in the 1990′s there was a swing to “managed care”.  Private HMOs began to offer their services to Medicare recipients.  If you were over 65, you could choose a Medicare HMO or regular Medicare on a month-to-month basis.  If you chose the Medicare HMO, you had to use their providers and hospitals, but otherwise it should be similar.  So, here were the rules if you were eligible for Medicare:

• You could choose any plan
• You could switch up and back
• No one could deny you access to their plan
• The benefits in the plans could go over a specific minimum (public Medicare), but not below

Got that?  No cherry picking allowed.  It’s Medicare, so it’s one big community rating.  This looks very similar to how plans would function in the exchange (except here, there was a public one).  So what happened when this was set up and let loose?  Guess:

Methods We used Medicare enrollment and inpatient billing records for southern Florida from 1990 through 1993 to examine differences in the use of inpatient medical services by 375,406 beneficiaries in the Medicare fee-for-service system, 48,380 HMO enrollees before enrollment, and 23,870 HMO enrollees after disenrollment. We also determined whether these differences were related to demographic characteristics and whether the pattern of use after disenrollment persisted over time.

What did the researchers do?  They looked at Medicare billing records for over 375,000 elderly Americans over a number of years.  This allowed them to look at how much inpatient care those people used.  They also looked specifically at how much care they used in the year before anyone went to an HMO and the three months after they left an HMO.  If there is no cherry picking, then they should find that the amount of care used should be the same in all of those groups and times.

Results The rate of use of inpatient services in the HMO-enrollment group during the year before enrollment was 66 percent of the rate in the fee-for-service group, whereas the rate in the HMO-disenrollment group after disenrollment was 180 percent of that in the fee-for-service group. Beneficiaries who disenrolled from HMOs re-enrolled at about the time that their level of use dropped to that in the fee-for-service group.

What did the researchers find?  People who wound up joining the (private) HMOs used 66% less care before joining than those who stayed in the (public) Medicare group.  Somehow the private insurance HMOs figured out a way to get the healthy people to jump ship out of the another plan into theirs!

Not only that, but people who left the (private) HMOs and went back to the (public) Medicare used 180% more care after leaving than the people who stayed.  Somehow the private insurance HMOs figured out a way to convince the sicker people to jump ship back to the public plans.

So we had a system where plans were in an exchange like environment.  Regulations prevented cherry-picking.  And yet, the insurance companies figured out a way to preferentially cover healthy people.  And this was competing with a giant government program.

Insurance companies are very, very good at what they do.  I don’t doubt that they will find ways to remain profitable. That’s not a moral judgment.  I don’t hate them for it; it is their nature.

The Medicare-HMO revolving door–the healthy go in and the sick go out. Morgan RO, Virnig BA, DeVito CA, Persily NA. N Engl J Med. 1997 Jul 17;337(3):169-75.

Malcolm Gladwell credits the source of genius in large part to the love of (or obsession with) one’s craft. That is precisely why I will never be a genius at web design and related endeavors. I detest them.

But others seem to have far more tolerance of, if not love for, them. I have some of those folks to thank for solving the RSS problem I described in a post this weekend. TFB and Zack Grossbart both contributed to the solution. Thank you! The former is the smartest blogger on personal finance I know (go see for yourself). The latter has co-authored my favorite WordPress plug-in (he’s doing lots of other things too–go see).

Aaron did the grunt work. He’ll say it wasn’t that big a deal. To me it was. I’ll happily wrestle for weeks with an identification problem in an econometric analysis of the effect of insurance generosity on outcomes. I’ll slave for months over a paper describing my latest research. I’ll log hours, day after day, at the computer writing blog posts about our health system. I may not be a genius at any of these things, but I am at least obsessed.

But, when it comes to fixing the pesky technical problems that accompany running a blog, I have little patience. No obsession there! So, I’m grateful for the help.