• Messing with the data, law school edition

    One important outcome measure for law schools is employment of their graduates, especially jobs for which bar passage is required and are long-term, full-time jobs (BPRFTLT). If a law school can boost that number, it will appear to be better than its rivals. A job is “long-term” if it is expected to last at least a year. Can you guess what many law schools have done? Hired dozens of their grads for a little more than a year:

      Funded BPRFTLT2012 / 2013 2012 % of Employed BPRFTLT 2013 % of Employed BPRFTLT
    GEORGE WASHINGTON 119 / 88 25.5% 20.7%
    WILLIAM AND MARY 35 / 43 23.3% 25.9%
    UMASS DARTMOUTH 3 / 3 23.1% 10.3%
    VIRGINIA 54 / 58 15.7% 16.7%
    NYU 58 / 42 13.2% 8.3%
    GEORGETOWN 41 / 73 8.9% 13.5%
    EMORY 17 / 64 8.7% 26.0%
    COLUMBIA 38 / 29 8.7% 7.0%
    CHICAGO 17 / 13 8.3% 6.5%
    YALE 11 / 9 6.0% 5.6%
    ILLINOIS 7 / 20 5.3% 11.9%
    MINNESOTA 7 / 5 4.5% 2.6%
    HARVARD 16 / 11 3.1% 2.2%
    UCLA 7 / 25 2.9% 9.6%
    PENN 7 / 13 2.7% 5.5%
    STANFORD 4 / 5 2.4% 2.9%
    WASHINGTON UNIVERSITY 4 / 4 2.0% 2.0%

    (First column is the law school; second is the number of law-school funded jobs that the law school described as bar passage required, full-time, long-term (BPRFTLT) to the ABA for the classes of 2012 and 2013; third and fourth columns are the % of BPRFTLT jobs funded by the school for the classes of 2012 and 2013, respectively. The chart includes all schools in the ABA data set who reported more than 2% BPRLTFT funded jobs for the class of 2012. Schools are ordered descending by column 3.  The class of 2013 data was released by the ABA this week.)

    Some comments:

    1. Most of this activity is by relatively wealthy law schools, who can afford to pay people to hire their grads.

    2. Some of these jobs are surely excellent opportunities for public interest groups to obtain free interns/lawyers of the highest caliber and for students to gain interesting experience, but that does not explain the recent dramatic expansion.

    3. In 2012, GW and William & Mary led the pack by significant margins. Other highly-ranked schools with large percentages of school-funded BPRFTLT positions include Virginia and NYU (UMass is a special case, with small numbers).

    4. This is a game with repeat players. In 2013, several other schools joined the fray, significantly increasing their funded jobs, most notably Emory, Georgetown, Illinois and UCLA.  Schools who don’t play this game more aggressively each year are punished in their USNews ranking.

    5. The pace is accelerating. In 2012, only 17 schools funded 2% or more of the jobs. For 2013, 41 schools hit that mark (data not shown here). But the competitive gains under USNews go to the schools who do it more than their peers.

    6. Is this a form of post-graduation tuition rebate? If so, unlike most law school financial aid, these funds may well be allocated based on need, not merit.

    7. Are law schools feeding optimism bias (again)?

    A prediction: If USNews stopped counting these jobs in the “best” category, 90% would disappear.


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  • The business model for antibiotics is broken

    High volume sales of antibiotics drive evolutionary resistance. So why do we allow most of the supply chain to make money based on the volume of sales?

    This wasteful practice might be tolerated if antibiotic innovation was easy and plentiful. But in the world we live in, alternative business models are needed for antibiotics. See the quick summary in Nature Medicine:

    What is indisputable is that the status quo is untenable. An estimated 48,000 people die in Europe and the US each year from infections caused by antibiotic-resistant bacteria, and this number is very likely to increase in years to come. “This is a global issue and a moral issue that needs to be dealt with in collaboration,” says Otto Cars, of the Swedish Institute for Communicable Disease Control in Solna. “Delinkage is a necessary element [to] get rid of market-driven overuse. We need simply to find another model, and that is a responsibility for everyone to realize.”

     My research paper mentioned in the article is on the Chatham House website.
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  • Riding the epi curve to glory

    That’s the wonderful title of a post by Eli Perencevich (Iowa), in one of my must-read blogs, Controversies in Hospital Infection Prevention. Hospital epi is filled with single-hospital observational studies. Did the intervention cause the infection outbreak to diminish, or was it on the wane in any event and the intervention just rode the epi curve to glory? (see also:  regression to the mean). Some hospital infections show seasonal patterns, making interventions in September appear to be more successful than the same interventions in May. From the post:

    What if we waited to start interventions to control our peak in summertime pseudomonal infections until September (Intervention B)? I could then ride the epi curve to glory each fall as I reduced infections by 28%. I could then publish my findings and would be asked to write SHEA guidelines recommending what you should do. On the other hand, what if I tried to get ahead of things every spring and start intervening in May (Intervention A)? What if pseudomonal infections went up 5% over the next three months? In that case, I would be told my interventions didn’t work, I wouldn’t publish my findings and you’d certainly never let me write a SHEA guideline.

    epi curve to glory


    The moral of the story: the details of methods in health policy research really matter.


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  • More on Halbig

    If you are looking for deeper analysis of the issues in the premium tax credit cases (DC Circuit Court’s oral arguments are today in Halbig v. Sebelius), see Nicole Huberfeld at HealthLawProf and Abbe Gluck at Balkanization. Professor Huberfeld finds little coercion in the federal offer to help states set up exchanges, contrasting the surprising holding in the ACA case, NFIB v. Sebelius. Professor Gluck plays whack-a-mole with six arguments circulating on conservative blogs and the briefs that might come up today.


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  • The other oral argument on Tuesday

    The opponents of the Affordable Care Act certainly know their way around a courtroom. Oral arguments in the contraception mandate case (Hobby Lobby) will be heard on Tuesday at the Supreme Court. That same day, another challenge will be heard in a federal courtroom nearby, in the Court of Appeals for the DC Circuit (the WSJ photo identifies the wrong court).

    To the Cato Institute, the tax credit cases (Halbig v. Sebelius and a related case in the Fourth Circuit, King v. Sebelius) represent their last shot to cripple the four-year-old law by wiping out health insurance subsidies to millions of people in the 36 states that did not create state exchanges. (I’ve blogged about these cases before, and Cato folks have also posted summaries of the anti-ACA amicus briefs. Sunday’s WSJ ran an editorial following the Cato line).

    Today, I wanted to highlight the amicus brief filed on Thursday March 20, 2014 by the Commonwealth of Virginia in King v. Sebelius (the 4th Circuit case, not the one up for oral argument on Tuesday). I appreciate the beauty of this argument, for it uses a conservative victory in federalism to support the federal government, and it comes from the newly-elected attorney general who replaced an early opponent of the ACA. (Mark Herring won by only 165 votes, but #electionsmatter).

    I’m talking about the Pennhurst doctrine, which requires Congress to give states “clear notice” if conditions on states are attached to federal spending. So Virginia asks the very interesting question: Did Congress give “clear notice” that the penalty for failing to build a state exchange would be the loss of billions of dollars of health insurance subsidies?  When you put it that way, Cato’s argument collapses. From the brief:

    For no one can reasonably claim that the federal government gave Virginia clear notice that its citizens would be denied premium tax-credit assistance as punishment for the Commonwealth’s decision to forgo building its own health insurance exchange.

    And later:

     [The Plaintiffs argue] that everyone in Congress silently but mistakenly assumed that every State would create its own Exchange. (Appellants’ Br. 6, 42.) That claim finds no support in the record. The ACA was controversial when it was debated and adopted, and it was well known that numerous States objected to it and would not go along willingly.

    The brief also notes that no Member of Congress expressed such a view and even the architects of this litigation (Cannon and Adler) were surprised by this “glitch” after the fact. The brief also reviews the official correspondence to and from the Governor on this issue; any notice whatsoever is lacking, much less “clear notice.”

    What bothers me the most about this litigation is Cato’s willingness to try to hurt millions of vulnerable people in order to score political points, even after losing the 2012 Presidential election and the first bite of the Supreme Court apple in NFIB v. Sebelius. The Virginia brief puts the emphasis on the people:

    Two sovereign interests compel the Commonwealth of Virginia to file this brief. First, the Commonwealth represents the interests of the hundreds of thousands of Virginians who depend on federal premium tax-credit assistance to afford the health insurance that is now available under the Patient Protection and Affordable Care Act of 2010 (the “Affordable Care Act” or “ACA”). Their interests are not represented by the Appellants here, four individual Virginians who do not want health insurance. Second, the Appellants’ legal theory contradicts the fundamental assumption on which the Commonwealth elected to forgo building its own health insurance exchange in favor of a federally-facilitated exchange: that doing so would not harm the interests of Virginians. The Appellants’ theory must be rejected under the Pennhurst doctrine, which prevents Spending Clause statutes like the ACA from being used to impose unusual conditions about which States were not provided “clear notice.” What is more, if Congress had actually done what Appellants claim — made State citizens financial hostages in a scheme to force State governments to adopt State-based exchanges —it would have violated the Tenth Amendment’s prohibition on coercing States to carry out federal policies. Accordingly, this Court should reject Appellants’ arguments and affirm the ruling of the District Court.

    h/t Tim Jost


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  • Regulating compounding pharmacies through insurance

    Compounding pharmacies have been under scrutiny since the fungal contamination crisis at New England Compounding Center (NECC) in Massachusetts. Governments reacted predictably, with calls for greater regulation.

    In the Drug Quality and Security Act, Congress restored to the FDA authority to regulate compounding pharmacies that had been placed in doubt by a 2002 Supreme Court opinion (background here). Congress also considered a new license category for large-scale sterile compounders. From my 2014 NEJM Perspective:

    Over the past year, most of the debate in Congress has centered on how to draw the line between traditional compounding and activities that require the new license. The legislative compromise leaves that choice up to the compounder.

    Congress left the real regulatory work to the states and to the market. The Perspective described what states and providers need to do. I’d like to add a new thought on the market.

    NECC is bankrupt, so the vast majority of the settlement funds to victims has come from insurance. The Boston Globe reports the settlement in the range of $100 million, funded primarily from insurance. For the victims, it was very fortunate that NECC had that level of liability insurance, but as far as I know this is not required by law.

    So my suggestion is for every state to set a high insurance requirement for all sterile compounding pharmacies doing business in their jurisdiction (perhaps $100 million aggregate), with much smaller limits for non-sterile compounders. Once these limits are set, the insurance companies would privately reward (or punish) compliance and risk through insurance premiums.

    Very simple and straightforward.


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  • Alternative payment models in the SGR fix

    A few weeks ago I threw some cold water on the SGR fix, noting that Congress faced hard choices on how to pay for it. On a more optimistic note, Mark McClellan, et al. describe in JAMA a potential 5 year SGR fix as a bridge to long-term payment reform. (Aaron’s take on this article is here)

    More interesting to me are the “alternative payment” methods in the bipartisan SGR fix bill. While details are thin, these models seem to be patterned on the alternative quality contracts in Massachusetts, gradually delinking physician payment from volume and intensity of services and procedures. From the JAMA article:

    The most fundamental change in the legislation is to give physicians an option to leave the traditional Medicare fee-for-service system behind. Physicians can receive bonuses of up to 5% per year from 2017 to 2022 for transitioning to “alternative payment models” in which payments are increasingly related to value defined as measured quality and total cost of care. In contrast, fee-for-service rates will be flat (0% annual increase). The alternative payment model must account for an increasing share of a physician’s practice, rising to more than 75% in the next decade. While the details of the alternative payment models are not clear, the alternative payment would generally involve augmenting or replacing some of the current fee-for-service payments with a patient-level payment amount not related to volume or intensity. To receive full payment in the alternative payment arrangement, physicians would have to meet meaningful measures of quality of care. Qualifying alternative payment systems must not increase overall Medicare costs.

    Another good reason to track the Massachusetts Health Policy Commission’s work on alternative payment models under Ch. 224.


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  • The Cato Institute loses again

    Judge Spencer (ED-VA) issued his opinion late yesterday in King v. Sebelius, the second case on whether the ACA’s tax credits are legal in states with federally-facilitated exchanges. The court granted the US government’s motion to dismiss, which will send the case on to the Fourth Circuit. As Austin explained yesterday, briefs were just filed in the parallel case Halbig v. Sebelius before the District of Columbia Circuit.*

    These cases are the mastermind of the Cato Institute. The core idea is that Democrats in Congress and President Obama intended to punish moderately poor people in any state that did not create a state exchange. It is a preposterous idea, based entirely on a drafting ambiguity (in 26 USC 36B) that would have been fixed by a bipartisan technical correction in any normal tax bill. But the ACA is no ordinary bill. It has become the forum for gladiatorial combat in the courts.

    The biggest problem with Cato’s argument is federalism. If Congress wanted to threaten states in such a dramatic fashion (build state exchanges or suffer the consequences), then Congress must give “clear notice” so the states see the choice clearly. This is the Arlington rule, an opinion by Justice Alito joined by the other 4 conservative justices.

    Lacking evidence of such “clear notice,” Judge Spencer found that Congress could not possibly have intended such a result, especially when it would upend many other provisions in the statute. The key paragraph:

    What is clear is that there is no direct support in the legislative history of the ACA for Plaintiffs’ theory that Congress intended to condition federal funds on state participation. Halbig, 2014 WL 129023, at *i6 (holding that there is no evidence in the legislative record that the House, the Senate, any relevant committee of either House, or any legislator ever entertained the idea of conditioning federal tax credits upon state participation in the creation of the Exchanges). As previously discussed, had Congress intended to condition tax subsidies it would have needed to provide clear notice. While on the surface, Plaintiffs’ plain meaning interpretation of section 36B has a certain common sense appeal, the lack of any support in the legislative history of the ACA indicates that it is not a viable theory. The legislative history of the ACA “reveals an intent to grant states the option of establishing their own Exchanges, rather than an intent to coerce or entice states into participating.” Halbig, 2014 WL 129023, at *17. Further, the text of the ACA and its legislative history evidence congressional intent to ensure broad access to affordable health coverage for all. See, e.g., 42 U.S.C. § i8o9i(2)(D)-(G); S. Rep. No. 111-89, at 4; see also H.R. Rep. No. 111-443, vol. II, at 977.

    * Kathleen Sebelius might be setting a record as a defendant in high-stakes health care litigation.

    h/t to Tim Jost for the opinion


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  • Paying for the doc fix

    Now that we appear to have a bipartisan agreement on the doc fix, the question is how will they pay for the $136.1 $150.4 billion price tag (CBO, including the extenders).  (prior CBO cost estimates here and here)  UPDATE: the latest official CBO score on the doc fix sets the price at $115.1 based on S.1871; the latest bipartisan agreement between the House and Senate has not yet been scored by CBO but informal reports suggest the cost will be $126 billion (without extenders) or $170 billion with extenders. h/t to Loren Adler.

    The CBO has a general list of 16 fiscal options relating to health:

    CBO fiscal options1CBO fiscal options2Many of these options are quite controversial.  Reduce funding for the NIH? Reduce benefits for some veterans? Raise Medicare eligibility to 67? Convert Medicare to a premium support system? Cap Medicaid, removing the entitlement? Eliminate subsidies in the exchanges above 300% FPL? 

    The deal’s not done until they’ve agreed on how to pay for it.


    Updated to reflect CBO cost estimates

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  • Obamacare heading back to the Supreme Court

    In 2014, SCOTUS may hear the federally facilitated exchanges (FFE) tax credit cases, in addition to the contraception mandate cases (Hobby Lobby and many others; BNA has a nice gated summary; Sotomayor just granted a delay for the plaintiffs pending full review).

    The contraception mandate, while high profile, will not threaten the ACA. It is not actually a constitutional challenge, but a statutory issue under the Religious Freedom Restoration Act. No matter how the Supreme Court rules, the ruling will not gut the rest of the law.  (Back in the NFIB ruling in June 2012, four justices said the ACA was not “severable” from the Medicaid expansion; that threat isn’t present in the contraception mandate cases). So – an interesting question of religious freedom for privately held corporations, but no fundamental upheaval of the ACA.

    The same cannot be said for the FFE tax credit cases, which were designed by the Cato Institute to wreck havoc. The most prominent federal district court cases are Halbig v. Sebelius in Washington, D.C. and King v. Sebelius in Virginia. The conventional wisdom is that SCOTUS won’t take the bait and the law is safe (see the McDermott Will & Emery briefing here). That was my prediction back in July 2012.

    (Disclosure:  MWE is one of the nation’s premier tax and health care law firms, with many clients in the industry; I was an income partner there many years ago)


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