Optum, a subsidiary of UnitedHealth, provides data analytics and infrastructure, a pharmacy benefit manager called OptumRx, a bank providing patient loans called Optum Bank, and more.
It’s not often that the American Hospital Association—known for fun lobbying tricks like hiring consultants to create studies showing the benefits of hospital mergers—directly goes after another consolidation in the industry.
But when the AHA caught wind of UnitedHealth Group subsidiary Optum’s plans, announced in January 2021, to acquire data analytics firm Change Healthcare, they offered up some fiery language in a letter to the Justice Department. “The acquisition … will concentrate an immense volume of competitively sensitive data in the hands of the most powerful health insurance company in the United States, with substantial clinical provider and health insurance assets, and ultimately removes a neutral intermediary.”
If permitted to go through, Optum’s acquisition of Change would fundamentally alter both the health data landscape and the balance of power in American health care. UnitedHealth, the largest health care corporation in the U.S., would have access to all of its competitors’ business secrets. It would be able to self-preference its own doctors. It would be able to discriminate, racially and geographically, against different groups seeking insurance. None of this will improve public health; all of it will improve the profits of Optum and its corporate parent.
Despite the high stakes, Optum has been successful in keeping this acquisition out of the public eye. Part of this PR success is because few health care players want to openly oppose an entity as large and powerful as UnitedHealth. But perhaps an even larger part is that few fully understand what this acquisition will mean for doctors, patients, and the health care system at large.
If regulators allow the acquisition to take place, Optum will suddenly have access to some of the most secret data in health care.
UnitedHealth is the largest health care entity in the U.S., using several metrics. United Healthcare (the insurance arm) is the largest health insurer in the United States, with over 70 million members, 6,500 hospitals, and 1.4 million physicians and other providers. Optum, a separate subsidiary, provides data analytics and infrastructure, a pharmacy benefit manager called OptumRx, a bank providing patient loans called Optum Bank, and more. Through Optum, UnitedHealth also controls more than 50,000 affiliated physicians, the largest collection of physicians in the country.
While UnitedHealth as a whole has earned a reputation for throwing its weight around the industry, Optum has emerged in recent years as UnitedHealth’s aggressive acquisition arm. Acquisitions of entities as varied as DaVita’s dialysis physicians, MedExpress urgent care, and Advisory Board Company’s consultants have already changed the health care landscape. As Optum gobbles up competitors, customers, and suppliers, it has turned into UnitedHealth’s cash cow, bringing in more than 50 percent of the entity’s annual revenue.
On a recent podcast, Chas Roades and Dr. Lisa Bielamowicz of Gist Healthcare described Optum in a way that sounds eerily similar to a single-payer health care system. “If you think about what Optum is assembling, they are pulling together now the nation’s largest employers of docs, owners of one of the country’s largest ambulatory surgery center chains, the nation’s largest operator of urgent care clinics,” said Bielamowicz. With 98 million customers in 2020, OptumHealth, just one branch of Optum’s services, had eyes on roughly 30 percent of the U.S. population. Optum is, Roades noted, “increasingly the thing that ate American health care.”
Optum has not been shy about its desire to eventually assemble all aspects of a single-payer system under its own roof. “The reason it’s been so hard to make health care and the health-care system work better in the United States is because it’s rare to have patients, providers—especially doctors—payers, and data, all brought together under an organization,” OptumHealth CEO Wyatt Decker told Bloomberg. “That’s the rare combination that we offer. That’s truly a differentiator in the marketplace.” The CEO of UnitedHealth, Andrew Witty, has also expressed the corporation’s goal of “wir[ing] together” all of UnitedHealth’s assets.
Controlling Change Healthcare would get UnitedHealth one step closer to creating their private single-payer system. That’s why UnitedHealth is offering up $13 billion, a 41 percent premium on the public valuation of Change. But here’s why that premium may be worth every penny.
Change Healthcare is Optum’s leading competitor in pre-payment claims integrity; functionally, a middleman service that allows insurers to process provider claims (the receipts from each patient visit) and address any mistakes. To clarify what that looks like in practice, imagine a patient goes to an in-network doctor for an appointment. The doctor performs necessary procedures and uses standardized codes to denote each when filing a claim for reimbursement from the patient’s insurance coverage. The insurer then hires a reviewing service—this is where Change comes in—to check these codes for accuracy. If errors are found in the coded claims, such as accidental duplications or more deliberate up-coding (when a doctor intentionally makes a patient seem sicker than they are), Change will flag them, saving the insurer money.
The most obvious potential outcome of the merger is that the flow of data will allow Optum/UnitedHealth to preference their own entities and physicians above others.
To accurately review the coded claims, Change’s technicians have access to all of their clients’ coverage information, provider claims data, and the negotiated rates that each insurer pays.
Change also provides other services, including handling the actual payments from insurers to physicians, reimbursing for services rendered. In this role, Change has access to all of the data that flows between physicians and insurers and between pharmacies and insurers—both of which give insurers leverage when negotiating contracts. Insurers often send additional suggestions to Change as well; essentially their commercial secrets on how the insurer is uniquely saving money. Acquiring Change could allow Optum to see all of this.
Change’s scale (and its independence from payers) has been a selling point; just in the last few months of 2020, the corporation signed multiple contracts with the largest payers in the country.
Optum is not an independent entity; as mentioned above, it’s owned by the largest insurer in the U.S. So, when insurers are choosing between the only two claims editors that can perform at scale and in real time, there is a clear incentive to use Change, the independent reviewer, over Optum, a direct competitor.
If regulators allow the acquisition to take place, Optum will suddenly have access to some of the most secret data in health care. In other words, if the acquisition proceeds and Change is owned by UnitedHealth, the largest health care corporation in the U.S. will own the ability to peek into the book of business for every insurer in the country.
Although UnitedHealth and Optum claim to be separate entities with firewalls that safeguard against anti-competitive information sharing, the porosity of the firewall is an open question. As the AHA pointed out in their letter to the DOJ, “[UnitedHealth] has never demonstrated that the firewalls are sufficiently robust to prevent sensitive and strategic information sharing.”
In some cases, this “firewall” would mean asking Optum employees to forget their work for UnitedHealth’s competitors when they turn to work on implementing changes for UnitedHealth. It is unlikely to work. And that is almost certainly Optum’s intention.
The most obvious potential outcome of the merger is that the flow of data will allow Optum/UnitedHealth to preference their own entities and physicians above others. This means that doctors (and someday, perhaps, hospitals) owned by the corporation will get better rates, funded by increased premiums on patients. Optum drugs might seem cheaper, Optum care better covered. Meanwhile, health care costs will continue to rise as UnitedHealth fuels executive salaries and stock buybacks.
UnitedHealth has already been accused of self-preferencing. A large group of anesthesiologists filed suit in two states last week, accusing the company of using perks to steer surgeons into using service providers within its networks.
Even if UnitedHealth doesn’t purposely use data to discriminate, the corporation has been unable to correct for racially biased data in the past.
Beyond this obvious risk, the data alterations caused by the Change acquisition could worsen existing discrimination and medical racism. Prior to the acquisition, Change launched a geo-demographic analytics unit. Now, UnitedHealth will have access to that data, even as it sells insurance to different demographic categories and geographic areas.
Even if UnitedHealth doesn’t purposely use data to discriminate, the corporation has been unable to correct for racially biased data in the past, and there’s no reason to expect it to do so in the future. A study published in 2019 found that Optum used a racially biased algorithm that could have led to undertreating Black patients. This is a problem for all algorithms. As data scientist Cathy O’Neil told 52 Insights, “if you have a historically biased data set and you trained a new algorithm to use that data set, it would just pick up the patterns.” But Optum’s size and centrality in American health care would give any racially biased algorithms an outsized impact. And antitrust lawyer Maurice Stucke noted in an interview that using racially biased data could be financially lucrative. “With this data, you can get people to buy things they wouldn’t otherwise purchase at the highest price they are willing to pay … when there are often fewer options in their community, the poor are often charged a higher price.”
The fragmentation of American health care has kept Big Data from being fully harnessed as it is in other industries, like online commerce. But Optum’s acquisition of Change heralds the end of that status quo and the emergence of a new “Big Tech” of health care. With the Change data, Optum/UnitedHealth will own the data, providers, and the network through which people receive care. It’s not a stretch to see an analogy to Amazon, and how that corporation uses data from its platform to undercut third parties while keeping all its consumers in a panopticon of data.
The next step is up to the Department of Justice, which has jurisdiction over the acquisition (through an informal agreement, the DOJ monitors health insurance and other industries, while the FTC handles hospital mergers, pharmaceuticals, and more). The longer the review takes, the more likely it is that the public starts to realize that, as Dartmouth health policy professor Dr. Elliott Fisher said, “the harms are likely to outweigh the benefits.”
There are signs that the DOJ knows that to approve this acquisition is to approve a new era of vertical integration. In a document filed on March 24, Change informed the SEC that the DOJ had requested more information and extended its initial 30-day review period. But the stakes are high. If the acquisition is approved, we face a future in which UnitedHealth/Optum is undoubtedly “the thing that ate American health care.”
A growing body of research keeps undermining a key tenet of health economics, Axios’ Sam Baker writes — the belief that requiring patients to pay more out of their own pockets will make them smarter consumers, forcing the health care system to deliver value.
Driving the news: Even a seemingly modest increase in out-of-pocket costs will cause many patients to stop taking drugs they need, according to a new working paper from Harvard economist Amitabh Chandra.
- Raising Medicare recipients’ out-of-pocket costs by just $10 per prescription led to a 23% drop in overall drug consumption, and to a 33% increase in mortality.
- And seniors weren’t simply ditching “low-value” drugs. People at high risk for heart attacks or strokes cut back on statins and blood-pressure medications even more than lower-risk patients.
Between the lines: This research focuses on Medicare’s drug benefit, but higher cost-sharing is all the rage throughout the system, and there’s little evidence that it has generated “smarter shoppers.”
- Patients with high-deductible plans — increasingly common in the employer market — don’t shop around for the best deal, which is all but impossible to do in many cases even if you wanted to try.
The Department of Health and Human Services told hospitals in April that reporting to the vendor, TeleTracking Technologies, was a “prerequisite to payment.”
The Trump administration tied billions of dollars in badly needed coronavirus medical funding this spring to hospitals’ cooperation with a private vendor collecting data for a new Covid-19 database that bypassed the Centers for Disease Control and Prevention.
The highly unusual demand, aimed at hospitals in coronavirus hot spots using funds passed by Congress with no preconditions, alarmed some hospital administrators and even some federal health officials.
The office of the health secretary, Alex M. Azar II, laid out the requirement in an April 21 email obtained by The New York Times that instructed hospitals to make a one-time report of their Covid-19 admissions and intensive care unit beds to TeleTracking Technologies, a company in Pittsburgh whose $10.2 million, five-month government contract has drawn scrutiny on Capitol Hill.
“Please be aware that submitting this data will inform the decision-making on targeted Relief Fund payments and is a prerequisite to payment,” the message read.
The financial condition, which has not been previously reported, applied to money from a $100 billion “coronavirus provider relief fund” established by Congress as part of the $2.2 trillion Coronavirus Aid, Relief and Economic Security Act, or CARES Act, signed by President Trump on March 27. Two days later, the administration instructed hospitals to make daily reports to the C.D.C., only to change course.
“Another data reporting ask,” a regional official in the health department informed colleagues in an email exchange obtained by The Times, adding: “It comes with $$ incentive. We really need a consolidated message on the reporting/data requests, this is past ridiculous.”
A colleague replied, “Another wrinkle. What a mess.”
The disclosure of the demand in April is the most striking example to surface of the department’s efforts to expand the role of private companies in health data collection, a practice that critics say infringes on what has long been a central mission of the C.D.C. Last month, the federal health department moved beyond financial incentives and abruptly ordered hospitals to send daily coronavirus reports to TeleTracking, not the C.D.C., raising concerns about transparency and reliability of the data.
Officials at the Department of Health and Human Services say that the moves were necessary to improve and streamline data collection in a crisis, and that the one-time reports collected in April by TeleTracking were not available from any other source.
“The national health system has not been challenged in this way in any time in recent history,” Caitlin Oakley, a department spokeswoman, said in a statement, adding that TeleTracking offered a “standardized national hospital capacity tracking system which provided more real-time, better informed data to make decisions from.”
But critics remain alarmed.
“In the middle of a pandemic, the Trump administration is using funds meant to support hospitals as a tool to coerce them to use an unproven, untrusted and deeply flawed system that sidelines public health experts,” Senator Patty Murray of Washington, the ranking Democrat on the Senate Health Committee, said in a statement.
In a statement, TeleTracking said it has three decades of experience providing health care systems “with actionable data and unprecedented visibility to make better, faster decisions.”
Still, public health experts and hospital executives are puzzled as to why the health agency chose such a difficult time to employ an untested private vendor rather than improve the C.D.C.’s National Healthcare Safety Network, a decades-old disease tracking system that was deeply familiar to hospitals and state health departments.
The N.H.S.N., as it is known, had built up trust over decades of working with hospitals and state health departments. Administrators were reluctant to make the switch.
“People — especially in public health and clinical health — are very protective of their data, so that trust factor is certainly an issue,” said Patina Zarcone, the director of informatics for the Association of Public Health Laboratories. “The fear of having their data leaked or misused or used for a purpose that they weren’t aware of or agreed to — I think that’s the biggest rub.”
Ms. Oakley said the C.D.C.’s system was “not designed for use in a disaster response” and could not adapt quickly in a crisis. Allies of the C.D.C. say withholding taxpayer dollars from the CARES Act in lieu of cooperation was an inappropriate effort to push hospitals into a system they were reluctant to use.
“It’s an absolutely enormous lever,” said William Schaffner, an infectious disease expert at Vanderbilt University. “It’s a compulsion to oblige institutions to report to this TeleTracking system because they knew if it weren’t tied to money, it wouldn’t happen.”
The Pittsburgh company has no obvious ties to the Trump administration. Rather, the push appears to be part of a broader privatization. The Health and Human Services Department has also asked the Minnesota-based manufacturer 3M “to create, and continuously update, a nationwide clinical data set on Covid-19 treatment,” according to documents obtained by The Times.
The effort is separate from the TeleTracking data collection. Tim Post, a company spokesman, said that because 3M already operates hospital information systems, it is “uniquely positioned,” with the permission of its clients, to submit information to the health department to help officials study disease patterns and recommend treatment options.
Some experts say this kind of cooperation with the private sector is long overdue. But the push also appears to be driven at least in part by an intensifying rift between the C.D.C., based in Atlanta, and officials at the White House and Department of Health and Human Services, the parent agency of the disease control centers.
Dr. Deborah L. Birx, the White House coronavirus response coordinator, and Mark Meadows, the president’s chief of staff, have taken a dim view of the C.D.C. and believe its reporting systems were inadequate. In a recent interview, Michael Caputo, the spokesman for Mr. Azar, accused the C.D.C. of having “a tantrum.”
Accurate hospital data — including information about coronavirus caseloads, deaths, bed capacity and personal protective equipment — is essential to tracking the pandemic and guiding government decisions about how to distribute scarce resources, like ventilators and the drug remdesivir, the only approved treatment for hospitalized Covid-19 patients.
The health agency has set up a new database, H.H.S. Protect, to collect and analyze Covid-19 data from a range of sources. TeleTracking feeds hospital data to that system.
But the public rollout of H.H.S. Protect has been rocky. The nonpartisan Covid Tracking Project identified big disparities between hospital data reported by states and the federal government and deemed the federal data “unreliable.”
The tension dates to March, when the novel coronavirus was making its first surge in the United States
On March 29, Vice President Mike Pence, charged by Mr. Trump with overseeing the federal response, informed hospital administrators that the C.D.C. was setting up a “Covid-19 Module,” and asked them to file daily reports which, he said, were “necessary in monitoring the spread of severe Covid-19 illness and death as well as the impact to hospitals.”
But around that time, TeleTracking submitted a proposal for data collection to the Trump administration, through an initiative, ASPR Next, created to promote innovation. On April 10, TeleTracking was awarded its contract.
The health department’s spokeswoman said the intent was to complement the C.D.C., not compete with it. Like the C.D.C.’s network, TeleTracking’s system requires manual reporting on a daily basis. But in June, Ms. Murray demanded the administration provide more information about what she called a “multimillion-dollar contract” for a “duplicative health data system.”
Some hospital officials also objected to the change.
“We have been directing our hospitals to N.H.S.N.,” Jackie Gatz, a vice president of the Missouri Hospital Association, wrote to a regional health and human services official in an email obtained by The Times, “and now this email with a much greater carrot — CARES Act distributions — is routing them to TeleTracking.”
When the order was delivered, flaws had already emerged in the new system.
“H.H.S. has acknowledged long wait times for those calling for technical support, and indicated that TeleTracking recently added 100 staff to respond to call center requests,” the American Hospital Association wrote to its members in a “special bulletin” on April 23. “They also are directing hospitals to leave a message if they are unable to reach someone live.”
At the time, hospitals had the option of making their daily coronavirus reports to TeleTracking or the C.D.C. Few were using the new database.
In June, the administration again used a stick to demand that hospitals report to TeleTracking, this time in order to obtain remdesivir. By July, with Dr. Birx pushing to bolster hospital compliance, the administration instructed hospitals to stop filing daily reports to the C.D.C. and to send them to TeleTracking instead.
One official at a major academic hospital, who spoke on the condition of anonymity for fear of angering officials in Washington, said the switch left her “unable to sleep at night.”
“Ethically, it felt like they had taken a very trusted institution in the C.D.C. and all of that trust built up with many public health people,” she said, then “moved it onto a politically and financially motivated portion of this response.”
Health and human services officials say the government now has a much more complete picture of hospital bed capacity, with more than 90 percent of hospitals reporting. But Dr. Janis M. Orlowski, the chief health officer for the Association of American Medical Colleges, who worked with Dr. Birx and the administration to bolster hospital reporting, said that she was “stunned” by the switch and that the increase in reporting came because of efforts by her group and others, not the TeleTracking system.
Dr. Orlowski said the data and maps now published on the administration’s H.H.S. Protect data hub are “just not as sophisticated as the C.D.C.”
The switch also generated pushback inside the C.D.C., where officials have refused to analyze and publish TeleTracking data, saying they could not be assured of its quality and had continuing questions about its accuracy, according to a senior federal health official.
Administration officials say the C.D.C. is working with a little-known office in the executive branch — the United States Digital Service — to build a “modernized automation process” in which data will continue to flow directly to the Department of Health and Human Services. But the project is in its infancy, one senior federal health official said.
Critics say that if the department believed the C.D.C.’s health network had problems, those should have been fixed.
“We have a public health system that depends upon communication from hospitals to state health departments to the C.D.C.,” said Dr. Schaffner, the Vanderbilt University infectious disease expert. “It’s very well established. Can it be improved? Of course. But to cut out the public health infrastructure and report to a private firm essential public health data is misguided in the extreme.”
The order to reroute CDC hospitalization figures raised accuracy concerns. But that’s just one of the problems with how the country collects health data.
TWO WEEKS AGO, the Department of Health and Human Services stripped the Centers for Disease Control and Prevention of control of national data on Covid-19 infections in hospitalized patients. Instead of sending the data to the CDC’s public National Healthcare Safety Network (NHSN), the department ordered hospitals to send it to a new data system, run for the agency by a little-known firm in Tennessee.
The change took effect immediately. First, the hospitalization data collected up until July 13 vanished from the CDC’s site. One day later, it was republished—but topped by a note that the NHSN Covid-19 dashboard would no longer be updated.
Fury over the move was immediate. All the major organizations that represent US public health professionals objected vociferously. A quickly written protest letter addressed to Vice President Mike Pence, HHS secretary Alex Azar, and Deborah Birx, the coordinator of the White House’s Coronavirus Task Force, garnered signatures from more than 100 health associations and research groups. The reactions made visible the groups’ concerns that data could be lost or duplicated, and underlined their continual worry that the CDC is being undercut and sidelined. But it had no other effect. The new HHS portal, called HHS Protect, is up and running.
Behind the crisis lies a difficult reality: Covid-19 data in the US—in fact, almost all public health data—is chaotic: not one pipe, but a tangle. If the nation had a single, seamless system for collecting, storing, and analyzing health data, HHS and the Coronavirus Task Force would have had a much harder time prying the CDC’s Covid-19 data loose. Not having a comprehensive system made the HHS move possible, and however well or badly the department handles the data it will now receive, the lack of a comprehensive data system is harming the US coronavirus response.
“Every health system, every public health department, every jurisdiction really has their own ways of going about things,” says Caitlin Rivers, a senior scholar at the Johns Hopkins Center for Health Security. “It’s very difficult to get an accurate and timely and geographically resolved picture of what’s happening in the US, because there’s such a jumble of data.”
Data systems are wonky objects, so it may help to step back and explain a little history. First, there’s a reason why hospitalization data is important: Knowing whether the demand for beds is rising or falling can help illuminate how hard-hit any area is, and whether reopening in that region is safe.
Second, what the NHSN does is important too. It’s a 15-year-old database, organized in 2005 out of several streams of information that were already flowing to the CDC, which receives data from hospitals and other health care facilities about anything that affects the occurrence of infections once someone is admitted. That includes rates of pneumonia from use of ventilators, infections after surgery, and urinary tract infections from catheters, for instance—but also statistics about usage of antibiotics, adherence to hand hygiene, complications from dialysis, occurrence of the ravaging intestinal infection C. difficile, and rates of health care workers getting flu shots. Broadly, it assembles a portrait of the safety of hospitals, nursing homes, and chronic care institutions in the US, and it shares that data with researchers and with other statistical dashboards published by other HHS agencies such as the Center for Medicare and Medicaid Services.
Because NHSN only collects institutional data, and Covid-19 infections occur both inside institutions such as nursing homes and hospitals, and in the outside world, HHS officials claimed the database was a bad fit for the coronavirus pandemic. But people who have worked with it argue that since the network had already devised channels for receiving all that data from health care systems, it ought to continue to do so—especially since that data isn’t easy to abstract.
“If you are lucky enough to work in a large health care system that has a sophisticated electronic medical record, then possibly you can push one button and have all the data flow up to NHSN,” says Angela Vassallo, an epidemiologist who formerly worked at HHS and is now chief clinical adviser to the infection-prevention firm Covid Smart. “But that’s a rare experience. Most hospitals have an infection preventionist, usually an entire team, responsible for transferring that data by hand.”
There lies the core problem. Despite big efforts back during the Obama administration to funnel all US health care data into one large-bore pipeline, what exists now resembles what you’d find behind the walls of an old house: pipes going everywhere, patched at improbable angles, some of them leaky, and some of them dead ends. To take some examples from the coronavirus response: Covid-19 hospital admissions were measured by the NHSN (before HHS intervened), but cases coming to emergency departments were reported in a different database, and test results were reported first to local or state health departments, and then sent up to the CDC.
Covid-19 data in particular has been so messy that volunteer efforts have sprung up to fix it. These include the COVID Tracking Project—compiled from multiple sources and currently the most comprehensive set of statistics, used by media organizations and apparently by the White House—and Covid Exit Strategy, which uses data from the COVID Tracking Project and the CDC.
Last week, the American Public Health Association, the Johns Hopkins Center, and Resolve to Save Lives, a nonprofit led by former CDC director Tom Frieden, released a comprehensive report on Covid-19 data collection. Pulling no punches, they called the current situation an “information catastrophe.”
The US, they found, does not have national-, state-, county-, or city-level standards for Covid-19 data. Every state maintains some form of coronavirus dashboard (and some have several), but every dashboard is different; no two states present the same data categories, nor visualize them the same way. The data presented by states is “inconsistent, incomplete, and inaccessible,” the group found: Out of 15 key pieces of data that each state should be presenting—things such as new confirmed and probable cases, new tests performed, and percentage of tests that are positive—only 38 percent of the indicators are reported in some way, with limitations, and 60 percent are not reported at all.
“This is not the fault of the states—there was no federal leadership,” Frieden emphasized in an interview with WIRED. “And this is legitimately difficult. But it’s not impossible. It just requires commitment.”
But the problem of incomplete, messy data is older and deeper than this pandemic. Four scholars from the health-policy think tank the Commonwealth Fund called out the broader problem just last week in an essay in The New England Journal of Medicine, naming health data as one of four interlocking health care crises exposed by Covid-19. (The others were reliance on employer-provided health care, financial losses in rural and primary-care practices, and the effect of the pandemic on racial and ethinic minorities.)
“There is no national public health information system—electronic or otherwise—that enables authorities to identify regional variation in the demand for, and supply of, resources critical to managing Covid-19,” they wrote. The fix they recommended: a national public health information system that would record diagnoses in real time, monitor the materials hospitals need, and link hospitals and outpatient care, state and local health departments, and laboratories and manufacturers to maintain real-time reporting on disease occurrence, preventive measures, and equipment production.
They are not the first to say this is needed. In February, 2019, the Council of State and Territorial Epidemiologists launched a campaign to get Congress to appropriate $1 billion in new federal funding over 10 years specifically to improve data flows. “The nation’s public health data systems are antiquated, rely on obsolete surveillance methods, and are in dire need of security upgrades,” the group wrote in its launch statement. “Sluggish, manual processes—paper records, spreadsheets, faxes, and phone calls—still in widespread use, have consequences, most notably delayed detection and response to public health threats.”
Defenders of the HHS decision to switch data away from the CDC say that improving problems like that is what the department was aiming for. (“The CDC’s old hospital data-gathering operation once worked well monitoring hospital information across the country, but it’s an inadequate system today,” HHS assistant secretary for public affairs Michael Caputo told CNN.) If that’s an accurate claim, during a global pandemic is a challenging time to do it.
“We were opposed to this, because trying to do this in the middle of a disaster is not the time,” says Georges Benjamin, a physician and executive director of the American Public Health Association, which was a signatory to the letter protesting moving data from the NHSN. “It was just clearly done without a lot of foresight. I don’t think they understand the way data moves into and through the system.”
The past week has shown how correct that concern was. Immediately after the switch, according to CNBC, states were blacked out from receiving data on their own hospitals, because the hospitals were not able to manage the changeover from the CDC to the HHS system. On Tuesday, Ryan Panchadsaram, cofounder of Covid Exit Strategy and former deputy chief technology officer for the US, highlighted on Twitter that data on the HHS dashboard, advertised as updating daily, was five days old. And Tuesday night, the COVID Tracking Project staff warned in a long analysis: “Hospitalization data from states that was highly stable a few weeks ago is currently fragmented, and appears to be a significant undercount.”
When the Covid-19 crisis is over, as everyone hopes it will be someday, the US will still have to wrestle with the questions it raised. One of those will be how the richest country on the planet, with some of the best clinical care in the world, was content with a health information system that left it so uninformed about a disease affecting so many of its citizens. The answer could involve tearing the public-health data system down and building it again from scratch.
“This is a deeply entrenched problem, where there is no single person who has not done their job,” Rivers says. “Our systems are old. They were not updated. We haven’t invested in them. If you’re trying to imagine a system where everyone reports the same information in the same way and we can push a button and have all the information we might want, that will take a complete overhaul of what we have.”
The image of scientists standing beside governors, mayors or the president has become common during the pandemic. Even the most cynical politician knows this public health emergency cannot be properly addressed without relying on the scientific knowledge possessed by these experts.
Yet, ultimately, U.S. government health experts have limited power. They work at the discretion of the White House, leaving their guidance subject to the whims of politicians and them less able to take urgent action to contain the pandemic.
The Centers for Disease Control and Prevention has issued guidelines only to later revise them after the White House intervened. The administration has also undermined its top infectious disease expert, Dr. Anthony Fauci, over his blunt warnings that the pandemic is getting worse – a view that contradicts White House talking points.
And most recently, the White House stripped the CDC of control of coronavirus data, alarming health experts who fear it will be politicized or withheld.
In the realm of monetary policy, however, there is an agency with experts trusted to make decisions on their own in the best interests of the U.S. economy: the Federal Reserve. As I describe in my recent book, “Stewards of the Market,” the Fed’s independence allowed it to take politically risky actions that helped rescue the economy during the financial crisis of 2008.
That’s why I believe we should give the CDC the same type of authority as the Fed so that it can effectively guide the public through health emergencies without fear of running afoul of politicians.
The paradox of expertise
There is a paradox inherent in the relationship between political leaders and technical experts in government.
Experts have the training and skill to apply scientific knowledge in complex biological and economic systems, yet democratically elected political leaders may overrule or ignore their advice for ill or good.
This happened in May when the CDC, the federal agency charged with controlling the spread of disease, removed advice regarding the dangers of singing in church choirs from its website. It did not do so because of new evidence. Rather, it was because of political pressure from the White House to water down the guidance for religious groups.
The ability of elected leaders to ignore scientists – or the scientists’ acquiescence to policies they believe are detrimental to public welfare – is facilitated by many politicians’ penchant for confident assertion of knowledge and the scientist’s trained reluctance to do so.
Experts with independence
Given these constraints on technical expertise, the performance of the Fed in the financial crisis of 2008 offers an informative example that may be usefully applied to the CDC today.
The Federal Reserve is not an executive agency under the president, though it is chartered and overseen by Congress. It was created in 1913 to provide economic stability, and its powers have expanded to guard against both depression and crippling inflation.
At its founding, the structure of the Fed was a political compromise designed make it independent within the government in order to de-politicize its economic policy decisions. Today its decisions are made by a seven-member board of governors and a 12-member Federal Open Market Committee. The members, almost all Ph.D. economists, have had careers in academia, business and government. They come together to analyze economic data, develop a common understanding of what they believe is happening and create policy that matches their shared analysis. This group policymaking is optimal when circumstances are highly uncertain, such as in 2008 when the global financial system was melting down.
The Fed was the lead actor in preventing the system’s collapse and spent several trillion dollars buying risky financial assets and lending to foreign central banks – decisions that were pivotal in calming financial markets but would have been much harder or may not have happened at all without its independent authority.
Putting experts at the wheel
A health crisis needs trusted experts to guide decision-making no less than an economic one does. This suggests the CDC or some re-imagined version of it should be made into an independent agency.
Like the Fed, the CDC is run by technical experts who are often among the best minds in their fields. Like the Fed, the CDC is responsible for both analysis and crisis response. Like the Fed, the domain of the CDC is prone to politicization that may interfere with rational response. And like the Fed, the CDC is responsible for decisions that affect fundamental aspects of the quality of life in the United States.
Were the CDC independent right now, we would likely see a centralized crisis management effort that relies on the best science, as opposed to the current patchwork approach that has failed to contain the outbreak nationally. We would also likely see stronger and consistent recommendations on masks, social distancing and the safest way to reopen the economy and schools.
Independence will not eliminate the paradox of technical expertise in government. The Fed itself has at times succumbed to political pressure. And Trump would likely try to undermine an independent CDC’s legitimacy if its policies conflicted with his political agenda – as he has tried to do with the central bank.
But independence provides a strong shield that would make it much more likely that when political calculations are at odds with science, science wins.
The Trump administration told hospitals to stop reporting data to the CDC, and report it to HHS instead. Vice President Mike Pence said the information would continue to be released publicly. It hasn’t worked out as promised.
In mid-July, the Trump administration instructed hospitals to change the way they reported data on their coronavirus patients, promising the new approach would provide better, more up-to-the-minute information about the virus’s toll and allow resources and supplies to be quickly dispatched across the country.
Instead, the move has created widespread confusion, leaving some states in the dark about their hospitals’ remaining bed and intensive care capacity and, at least temporarily, removing this information from public view. As a result, it has been unclear how many people are in hospitals being treated for COVID-19 at a time when the number of infected patients nationally has been soaring.
Hospitalizations for COVID-19 have been seen as a key metric of both the coronavirus’s toll and the health care system’s ability to deal with it.
Since early in the pandemic, hospitals had been reporting data on COVID-19 patients to the U.S. Centers for Disease Control and Prevention through its National Healthcare Safety Network, which traditionally tracks hospital-acquired infections.
In a memo dated July 10, the U.S. Department of Health and Human Services told hospitals to abruptly change course — to stop reporting their data to the CDC and instead to submit it to HHS through a new portal run by a company called TeleTracking. The change took effect within days. Vice President Mike Pence said the administration would continue releasing the data publicly, as the CDC had done.
Almost immediately, the CDC pulled its historical data offline, only to repost it under pressure a couple days later. Meanwhile the website for the administration’s new portal promised to update numbers on a daily basis, but, as of Friday morning, the site hadn’t been updated since July 23. (HHS is posting some data daily on a different federal website but not representative estimates for each state.)
“The most pernicious portion of it is that at the state level and at the regional level we lost our situational awareness,” said Dave Dillon, spokesman for the Missouri Hospital Association. “At the end of this, we may have a fantastic data product out of HHS. I will not beat them up for trying to do something positive about the data, but the rollout of this has been absolutely a catastrophe.”
The Missouri Hospital Association had taken the daily data submitted by its hospitals to the CDC and created a state dashboard. The transition knocked that offline. The dashboard came back online this week, but Dillon said in a follow-up email, “the data is only as good as our ability to know that everyone is reporting the same data, in the correct way, for tracking and comparison purposes at the state level.”
Other states, including Idaho and South Carolina, also experienced temporary information blackouts. And The COVID Tracking Project, which has been following the pandemic’s toll across the country based on state data, noted issues with its figures. “These problems mean that our hospitalization data — a crucial metric of the COVID-19 pandemic — is, for now, unreliable, and likely an undercount. We do not think that either the state-level hospitalization data or the new federal data is reliable in isolation,” according to a blog post Tuesday on the group’s website.
Making matters more complicated, the administration has changed the information that it is requiring hospitals to report, adding many elements, such as the age range of admitted COVID-19 patients, and removing others. As of this week, for instance, HHS told hospitals to stop reporting the total number of deaths they’ve had since Jan. 1, the total number of COVID-19 deaths and the total number of COVID-19 admissions. (Hospitals still report daily figures, just not historical ones.)
“Massachusetts hospitals are continuing to navigate the dramatic increase of daily data requirements,” the Massachusetts Health and Hospital Association said in a newsletter on Monday. “MHA and other state health officials continue to raise concerns about the administrative burden and questionable usefulness of some of the data.”
“Hospitals across the country were given little time to adjust to the unnecessary and seismic changes put forth by the U.S. Department of Health and Human Services, which fundamentally shift both the volume of data and the platforms through which data is submitted,” the association’s CEO, Steve Walsh, said in the newsletter.
A number of state websites also noted problems with hospital data. For days, the Texas Department of State Health Services included a note on its dashboard that it was “reporting incomplete hospitalization numbers … due to a transition in reporting to comply with new federal requirements.” That came just as the state was experiencing a peak in COVID-19 hospitalizations.
California likewise noted problems.
A spokesperson for HHS acknowledged some bumps in the transition but said in an email: “We are pleased with the progress we have made during this transition and the actionable data it is providing. We have had some states and hospital associations report difficulty with the new collection system. When HHS identifies errors in the data submissions, we work directly with the state or hospital association to quickly resolve them.
“Our objective with this new approach is to collaborate with the states and the healthcare system. The goal of full transparency is to acknowledge when we find discrepancies in the data and correct them.”
Last week, HHS noted, 93% of its prioritized list of hospitals, excluding psychiatric, rehabilitation and religious nonmedical facilities, reported data at least once during the week. (The guidance to hospitals asks them to report every day.)
Asked about the lack of timely data on its public website, HHS said it will update the site to “make it clear that the estimates are only updated weekly.” HHS is now posting a date file each day on healthdata.gov with aggregate information on hospitalizations by state.
But unlike the prior releases from CDC, which provided estimates on hospital capacity based on the responses, this file only gives totals for the hospitals that reported data. It’s unclear which hospitals did not report, how large they are, or whether the reported data is representative.
It’s also unclear if it’s accurate. New York state, for instance, reported that fewer than 600 people were currently hospitalized with COVID-19, as of Friday. Federal data released the same day pegged the number of suspected and confirmed COVID-19 hospitalizations at around 1,800.
Louisiana says more than 1,500 people are currently hospitalized with COVID-19. The federal data puts the figure at fewer than 700.
Nationally, The COVID Tracking Project reports that more than 56,000 people were hospitalized around the country with the virus, as of Thursday.
The data released by HHS on Friday puts the figure at more than 70,000.
NPR reported this week that it had found irregularities in the process used by the Trump administration to award the contract to manage the hospital data. Among other things, HHS directly contacted TeleTracking about the contract and the agency used a process that is more often used for innovative scientific research, NPR reported.
An HHS spokesperson told NPR that the contract process it used is a “common mechanism … for areas of research interest,” and said that the system used by the CDC was “fraught with challenges.”
Ryan Panchadsaram, co-founder of the tracking website CovidExitStrategy.org, has been critical of the problems created by the hospital data changeover.
“Without real-time accurate monitoring, you can’t make quick and fast and accurate decisions in a crisis,” he said in an interview. “This is just so important. This indicator that’s gone shows how the health system in a state is doing.”
Dillon of the Missouri Hospital Association said the administration could have handled this differently. For big technology projects, he noted, there is often a well-publicized transition with information sessions, an educational program and, perhaps, running the old system and the new one in parallel.
This “was extremely abrupt,” he said. “That is not akin to anything you would expect from HHS about how you would implement a program.”