Category Archives: Public Funding

Should some clinical services be considered a public good? 

Posted on by • Posted in Community Benefit, Health Policy, Master Planning, Public Funding, Public Good, Public Health, Regional Master Planning, Tax Exempt Status • Leave a comment

https://mailchi.mp/73102bc1514d/the-weekly-gist-may-19-2023?e=d1e747d2d8

We caught up recently with a healthcare leader who had spent time in Atlanta in a previous role, and the conversation turned to last year’s closure of Atlanta Medical Center.

One major impact: the closure immediately left the Atlanta metro region, home to over 6M people, with only one Level 1 trauma center (a second Level 1 center opened an hour north of the city in February). “It’s devastating for the community to lose those services,” he shared, “but I also get why the health system made that choice, given how hard the economy has hit hospitals.” When all health systems are feeling the worst margin pressures in more than a decade, most would be reticent to step in and launch a new trauma program, which despite bringing prestige, is often a money-loser. 


The conversation got us thinking about whether healthcare needs a new approach to securing essential services needed by the community which aren’t well supported by the payment system. 

Our current model largely relies on nonprofit systems to meet the community need as a tenet of that status. But as one CMO shared, “If there’s more than one system in the market, we toss the responsibility back and forth like a hot potato.”

His solution: there needs to be top-down redesign of urgently needed critical services like trauma and behavioral health, as well as highly specialized services like transplant and pediatric subspecialty care, which he considered oversupplied in his market, with multiple subscale programs.

His hope was that health systems could cross competitive lines and collaborate to think about a rational approach to “regional healthcare master planning”, along with a new funding model.

It’s a tall order, he continued, but if health systems can’t find a solution on their own, they leave themselves open to government intervention that might mandate a solution—or further questions of the value communities are receiving from supporting nonprofit status. 

Coronavirus: Some college students returning to campus are being met with liability waivers

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https://finance.yahoo.com/news/colleges-students-liability-waivers-112753572.html

Schools that are choosing to reopen amid the coronavirus pandemic are attempting to protect themselves against possible legal blowback with legal liability waivers.

From universities to K-12 districts, some schools are sending forms with titles such as “Assumption of Risk” and “Waiver of Liability” to fend off any lawsuits should students contract coronavirus on campus or in the classroom.

“Institutions are basically trying to have it both ways,” Kevin McClure, associate professor of higher education at the University of North Carolina Wilmington, told Yahoo Finance. “They’re trying to say: ‘We are opening in the midst of significant risk, and at the same time we want you — as students or faculty or staff — to assume that risk and to not hold us responsible for the decisions that we’ve made.’”

‘Students’ ability to take responsibility both for themselves and each other’

Generally, the waiver forms note two things: That there is a risk of contracting the coronavirus if a student appears on campus and that the decision to come back cannot be held against the school.

“I know the challenge these circumstances present, but I also know our students’ ability to take responsibility both for themselves and each other,” Damon Sims, vice president for Student Affairs at Penn State, said in a press release. “If ever there was a time for them to do so, now is that time. We will do all we can to encourage that outcome, and we expect them to do all they can to make it so. We are in this together.”

Students returning to Penn State’s University Park campus, which usually houses more that 45,000 undergraduate students, are required to fill out the following “coronavirus compact” prior to their arrival on Penn State’s campus

‘This is the reality of the current situation’

Saint Anselm College in New Hampshire is another college asking its students to sign a waiver.

The liberal arts school is planning to conduct its fall semester primarily in-person, an option 30% of schools have chosen. Classes start for 2,000 students on August 19, university spokesperson Paul Pronovost told Yahoo Finance.

Aside from the usual safety measures — from reducing density in housing, classroom, and common spaces, restricting visitors, implementing distancing — the school is also going to administer two coronavirus tests on students upon their arrival: A rapid test and a fuller test. Saint Anselm is also planning to do surveillance testing throughout the semester.

Beyond social distancing, testing, and contact tracing, the university wants students and parents to “accept” the unique schooling situation.

There’s “simply no way for the College – or any College or institution, for that matter – to guarantee that our campus will not see cases of COVID-19,” Pronovost said in an email. “We believe it is important for students and families to understand and accept that this is the reality of the current situation.”

The liability waiver notes that students “forever release and waive my right to bring suit against Saint Anselm College, its Board of Trustees, officers, directors, managers, officials, agents, employees, or other representatives in connection with exposure, infection, and/or spread of COVID-19 related to taking classes, living or participating in activities on the Saint Anselm College Campus.”

Colleges fear an avalanche of lawsuits 

The possibility of lawsuits worried colleges enough to lobby Congress for protections from liability.

Nearly 80 education groups sent a letter to congressional leaders back in May, stating that reopening schools involves not just “enormous uncertainty about COVID-19-related standards of care” but also the “corresponding fears of huge transactional costs associated with defending against COVID-19 spread lawsuits.”

Rutgers Law Professor Adam Scales argued that we may see an uptick in litigation, at least “until Congress or the courts firmly signal that COVID is not going to be ‘the new asbestos,’” adding that courts will not likely impose severe liability on public entities like schools.

“Just because a student can get into court does not mean the student can win,” Michael Duff, a law professor at the University of Wyoming, told Yahoo Finance. “So even if the waiver does not ‘work,’ and the student can get into court, there is no guarantee that a lawyer would take the case because the case may be weak.”

There is also the issue of proof.

“The idea that liability — whether caused by negligence or gross negligence — is easy to prove is a myth,” Duff said. “The student would first have to prove that the college did not act ‘reasonably’ in the COVID-19 context.”

Given that the definition of acting “reasonably” would not necessarily involve a college being perfect with its coronavirus mitigation, Duff added, gross negligence would be “a very hard thing to prove.”

At the same time, Scales added, a liability waiver could not serve as a “get-out-of-jail-free card” a school taken to court in a coronavirus-related case brought by a student.

‘A stark dilemma’

At the end of the day, McClure noted, colleges need students to return to campus and pay tuition to survive as institutions of higher education.

“I do genuinely believe that many institutions and the people running them want to do what’s right and keep people healthy,” McClure said. “On the other hand, there are the financial realities of attempting to keep an organization up and running, and an organization whose revenue is often very much tied to people coming to campus.”

Schools are thus faced with “a stark dilemma,” McClure added, of either bringing students and faculty back to campus or “make significant cuts because we are not able to pay our bills.”

That said, given that students are paying a lot more today than previous generations in terms of tuition and fees, there is a sentiment that “institutions actually have a greater duty of care to their students.”

That idea is being put to the test amid the coronavirus pandemic, McClure said, and the liability waivers — which essentially abandon the “duty of care” that these institutions should take — fly in the face of this “consumerist moment” in higher education.

“Anytime that you’ve got people that are forking over large amounts of money and making a significant investment,” McClure said, “you can expect that they’re going to want a certain level of service and are going to be unhappy when a company or an organization isn’t delivering their end of the deal.”

 

 

 

 

The Fed’s independence helped it save the US economy in 2008 – the CDC needs the same authority today

Posted on by • Posted in 2020 Election Issues, Centers for Disease Control & Prevention (CDC), Clinical Testing, Communication, Confidence, Conflicts of Interest, Contact Tracing, Coronavirus, Credibility, Crisis, Crisis Management, Data, Data Analytics, Data Control, Data Integrity, Data Interpretation, Data Management, Data Ownership, Decision Making, Decision Making Authority, Evidence-based Leadership, Evidence-Based Plan, Evidence-Based Policy, Expert, Expert Opinion, Federal Reserve, Honesty, Infection Control, Infection Control Plan, Infectious Virus, Integrity, Judgement, Leadership Messaging, Leadership Political, Leadership Trust, Mission, Mission Critical, Mortality, National Strategy, Pandemic, Partisanship, Public Funding, Public Good, Public Health, Public Opinion, Public Perception, Public Safety, Public Trust, Public Welfare, Quarantine, School Reopening, Scientists, Social Distancing, Transparency, Trust, Truth • Leave a comment

https://theconversation.com/the-feds-independence-helped-it-save-the-us-economy-in-2008-the-cdc-needs-the-same-authority-today-142593

Centers for Disease Control and Prevention

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.

Similarly, the White House undermined the CDC’s guidance on school reopenings and has pressured it to revise them. So far, it seems the CDC has rebuffed the request.

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.

Compare Fauci’s repeated comment that “there is much we don’t know about the virus” with President Donald Trump’s confident assertion that “we have it totally under control.”

 

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.

The Fed’s independence is sufficiently ingrained in our political culture that its chair can have a running disagreement with the president yet keep his job and 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.

 

 

 

 

Public Health Officials Face Wave Of Threats, Pressure Amid Coronavirus Response

Posted on by • Posted in 2020 Election Issues, Blame, Centers for Disease Control & Prevention (CDC), Clinical Testing, Contact Tracing, Coronavirus, Economic Crisis, Economy Reopening, Hydroxychloroquine, Infection Control, Infection Control Plan, Infectious Virus, Intimidation, Pandemic, Partisanship, Public Funding, Public Good, Public Health, Public Safety, Quarantine, Social Distancing, Threats, Whistleblower • Leave a comment

Public Health Officials Face Wave Of Threats, Pressure Amid Coronavirus Response

Public health officials face wave of threats, pressure amid ...

Emily Brown was director of the Rio Grande County Public Health Department in Colorado until May 22, when the county commissioners fired her after battling with her over coronavirus restrictions. “They finally were tired of me not going along the line they wanted me to go along,” she says.

Emily Brown was stretched thin.

As the director of the Rio Grande County Public Health Department in rural Colorado, she was working 12- and 14-hour days, struggling to respond to the pandemic with only five full-time employees for more than 11,000 residents. Case counts were rising.

She was already at odds with county commissioners, who were pushing to loosen public health restrictions in late May, against her advice. She had previously clashed with them over data releases and had haggled over a variance regarding reopening businesses.

But she reasoned that standing up for public health principles was worth it, even if she risked losing the job that allowed her to live close to her hometown and help her parents with their farm.

Then came the Facebook post: a photo of her and other health officials with comments about their weight and references to “armed citizens” and “bodies swinging from trees.”

The commissioners had asked her to meet with them the next day. She intended to ask them for more support. Instead, she was fired.

“They finally were tired of me not going along the line they wanted me to go along,” she said.

In the battle against COVID-19, public health workers spread across states, cities and small towns make up an invisible army on the front lines. But that army, which has suffered neglect for decades, is under assault when it’s needed most.

Officials who usually work behind the scenes managing everything from immunizations to water quality inspections have found themselves center stage. Elected officials and members of the public who are frustrated with the lockdowns and safety restrictions have at times turned public health workers into politicized punching bags, battering them with countless angry calls and even physical threats.

On Thursday, Ohio’s state health director, who had armed protesters come to her house, resigned. The health officer for Orange County, California, quit Monday after weeks of criticism and personal threats from residents and other public officials over an order requiring face coverings in public.

As the pressure and scrutiny rise, many more health officials have chosen to leave or been pushed out of their jobs. A review by KHN and The Associated Press finds at least 27 state and local health leaders have resigned, retired or been fired since April across 13 states.

In California, senior health officials from seven counties, including the Orange County officer, have resigned or retired since March 15. Dr. Charity Dean, the second in command at the state Department of Public Health, submitted her resignation June 4.

These officials have left their posts due to a mix of backlash and stressful, nonstop working conditions, all while dealing with chronic staffing and funding shortages.

Some health officials have not been up to the job during the biggest health crisis in a century. Others previously had plans to leave or cited their own health issues.

But Lori Tremmel Freeman, CEO of the National Association of County and City Health Officials, said the majority of what she calls an “alarming” exodus resulted from increasing pressure as states reopen. Three of those 27 were members of her board and well known in the public health community — Rio Grande County’s Brown; Detroit’s senior public health adviser, Dr. Kanzoni Asabigi; and the head of North Carolina’s Gaston County Department of Health and Human Services, Chris Dobbins.

Asabigi’s sudden retirement, considering his stature in the public health community, shocked Freeman. She also was upset to hear about the departure of Dobbins, who was chosen as health director of the year for North Carolina in 2017. Asabigi and Dobbins did not reply to requests for comment.

“They just don’t leave like that,” Freeman said.

Public health officials are “really getting tired of the ongoing pressures and the blame game,” Freeman said. She warned that more departures could be expected in the coming days and weeks as political pressure trickles down from the federal to the state to the local level.

From the beginning of the coronavirus pandemic, federal public health officials have complained of being sidelined or politicized. The Centers for Disease Control and Prevention has been marginalized; a government whistleblower said he faced retaliation because he opposed a White House directive to allow widespread access to the malaria drug hydroxychloroquine as a COVID-19 treatment.

In Hawaii, U.S. Rep. Tulsi Gabbard called on the governor to fire his top public health officials, saying she believed they were too slow on testing, contact tracing and travel restrictions. In Wisconsin, several Republican lawmakers have repeatedly demanded that the state’s health services secretary resign, and the state’s conservative Supreme Court ruled 4-3 that she had exceeded her authority by extending a stay-at-home order.

With the increased public scrutiny, security details — like those seen on a federal level for Dr. Anthony Fauci, the top infectious disease expert — have been assigned to state health leaders, including Georgia’s Dr. Kathleen Toomey after she was threatened. Ohio’s Dr. Amy Acton, who also had a security detail assigned after armed protesters showed up at her home, resigned Thursday.

In Orange County, in late May, nearly a hundred people attended a county supervisors meeting, waiting hours to speak against an order requiring face coverings. One person suggested that the order might make it necessary to invoke Second Amendment rights to bear arms, while another read aloud the home address of the order’s author — the county’s chief health officer, Dr. Nichole Quick — as well as the name of her boyfriend.

Quick, attending by phone, left the meeting. In a statement, the sheriff’s office later said Quick had expressed concern for her safety following “several threatening statements both in public comment and online.” She was given personal protection by the sheriff.

But Monday, after yet another public meeting that included criticism from members of the board of supervisors, Quick resigned. She could not be reached for comment. Earlier, the county’s deputy director of public health services, David Souleles, retired abruptly.

An official in another California county also has been given a security detail, said Kat DeBurgh, the executive director of the Health Officers Association of California, declining to name the county or official because the threats have not been made public.

DeBurgh is worried about the impact these events will have on recruiting people into public health leadership.

“It’s disheartening to see people who disagree with the order go from attacking the order to attacking the officer to questioning their motivation, expertise and patriotism,” said DeBurgh. “That’s not something that should ever happen.”

Many local health leaders, accustomed to relative anonymity as they work to protect the public’s health, have been shocked by the growing threats, said Theresa Anselmo, the executive director of the Colorado Association of Local Public Health Officials.

After polling local health directors across the state at a meeting last month, Anselmo found about 80% said they or their personal property had been threatened since the pandemic began. About 80% also said they’d encountered threats to pull funding from their department or other forms of political pressure.

To Anselmo, the ugly politics and threats are a result of the politicization of the pandemic from the start. So far in Colorado, six top local health officials have retired, resigned or been fired. A handful of state and local health department staff members have left as well, she said.

“It’s just appalling that in this country that spends as much as we do on health care that we’re facing these really difficult ethical dilemmas: Do I stay in my job and risk threats, or do I leave because it’s not worth it?” Anselmo asked.

Some of the online abuse has been going on for years, said Bill Snook, a spokesperson for the health department in Kansas City, Missouri. He has seen instances in which people took a health inspector’s name and made a meme out of it, or said a health worker should be strung up or killed. He said opponents of vaccinations, known as anti-vaxxers, have called staffers “baby killers.”

The pandemic, though, has brought such behavior to another level.

In Ohio, the Delaware General Health District has had two lockdowns since the pandemic began — one after an angry individual came to the health department. Fortunately, the doors were locked, said Dustin Kent, program manager for the department’s residential services unit.

Angry calls over contact tracing continue to pour in, Kent said.

In Colorado, the Tri-County Health Department, which serves Adams, Arapahoe and Douglas counties near Denver, has also been getting hundreds of calls and emails from frustrated citizens, deputy director Jennifer Ludwig said.

Some have been angry their businesses could not open and blamed the health department for depriving them of their livelihood. Others were furious with neighbors who were not wearing masks outside. It’s a constant wave of “confusion and angst and anxiety and anger,” she said.

Then in April and May, rocks were thrown at one of their office’s windows — three separate times. The office was tagged with obscene graffiti. The department also received an email calling members of the department “tyrants,” adding “you’re about to start a hot-shooting … civil war.”  Health department workers decamped to another office.

Although the police determined there was no imminent threat, Ludwig stressed how proud she was of her staff, who weathered the pressure while working round-the-clock.

“It does wear on you, but at the same time we know what we need to do to keep moving to keep our community safe,” she said. “Despite the complaints, the grievances, the threats, the vandalism — the staff have really excelled and stood up.”

The threats didn’t end there, however: Someone asked on the health department’s Facebook page how many people would like to know the home addresses of the Tri-County Health Department leadership. “You want to make this a war??? No problem,” the poster wrote.

Back in Colorado’s Rio Grande County, some members of the community have rallied in support of Brown with public comments and a letter to the editor of a local paper. Meanwhile, COVID-19 case counts have jumped from 14 to 49 as of Wednesday.

Brown is grappling with what she should do next: dive back into another strenuous public health job in a pandemic, or take a moment to recoup?

When she told her 6-year-old son she no longer had a job, he responded: “Good — now you can spend more time with us.”

 

 

 

 

The Essence of Big Pharma

Posted on by • Posted in 2020 Election Issues, Access, Access & Quality of Healthcare, Big Pharma, Coronavirus, Corporate Greed, Employer-Based Health Insurance, Health Insurance Coverage Adequacy, High Deductible Health Plans, High Drug Prices, High Premiums, High Prices, Out of Pocket Expenses, Pandemic, Pharmaceutical Industry, Public Debate, Public Funding, Public Good, Public Health, Scientists, Underinsured, Uninsured, Vaccination, Vaccine, World Health Organization (WHO) • Leave a comment

 

BIG PHARMA PREPARES TO PROFIT FROM THE CORONAVIRUS

Posted on by • Posted in 2020 Election Issues, Big Pharma, Conflicts of Interest, Coronavirus, Dept of Health and Human Services (HHS), Food and Drug Administration (FDA), For-Profit, High Drug Prices, National Institute of Health (NIH), Pandemic, Pharmaceutical Industry, Pharmacy Benefits Management, Public Funding • Leave a comment

Big Pharma Prepares to Profit From the Coronavirus

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AS THE NEW CORONAVIRUS spreads illness, death, and catastrophe around the world, virtually no economic sector has been spared from harm. Yet amid the mayhem from the global pandemic, one industry is not only surviving, it is profiting handsomely.

“Pharmaceutical companies view Covid-19 as a once-in-a-lifetime business opportunity,” said Gerald Posner, author of “Pharma: Greed, Lies, and the Poisoning of America.” The world needs pharmaceutical products, of course. For the new coronavirus outbreak, in particular, we need treatments and vaccines and, in the U.S., tests. Dozens of companies are now vying to make them.

“They’re all in that race,” said Posner, who described the potential payoffs for winning the race as huge. The global crisis “will potentially be a blockbuster for the industry in terms of sales and profits,” he said, adding that “the worse the pandemic gets, the higher their eventual profit.”

The ability to make money off of pharmaceuticals is already uniquely large in the U.S., which lacks the basic price controls other countries have, giving drug companies more freedom over setting prices for their products than anywhere else in the world. During the current crisis, pharmaceutical makers may have even more leeway than usual because of language industry lobbyists inserted into an $8.3 billion coronavirus spending package, passed last week, to maximize their profits from the pandemic.

Initially, some lawmakers had tried to ensure that the federal government would limit how much pharmaceutical companies could reap from vaccines and treatments for the new coronavirus that they developed with the use of public funding. In February, Rep. Jan Schakowsky, D-Ill., and other House members wrote to Trump pleading that he “ensure that any vaccine or treatment developed with U.S. taxpayer dollars be accessible, available and affordable,” a goal they said couldn’t be met “if pharmaceutical corporations are given authority to set prices and determine distribution, putting profit-making interests ahead of health priorities.”

When the coronavirus funding was being negotiated, Schakowsky tried again, writing to Health and Human Services Secretary Alex Azar on March 2 that it would be “unacceptable if the rights to produce and market that vaccine were subsequently handed over to a pharmaceutical manufacturer through an exclusive license with no conditions on pricing or access, allowing the company to charge whatever it would like and essentially selling the vaccine back to the public who paid for its development.”

But many Republicans opposed adding language to the bill that would restrict the industry’s ability to profit, arguing that it would stifle research and innovation. And although Azar, who served as the top lobbyist and head of U.S. operations for the pharmaceutical giant Eli Lilly before joining the Trump administration, assured Schakowsky that he shared her concerns, the bill went on to enshrine drug companies’ ability to set potentially exorbitant prices for vaccines and drugs they develop with taxpayer dollars.

The final aid package not only omitted language that would have limited drug makers’ intellectual property rights, it specifically prohibited the federal government from taking any action if it has concerns that the treatments or vaccines developed with public funds are priced too high.

“Those lobbyists deserve a medal from their pharma clients because they killed that intellectual property provision,” said Posner, who added that the language prohibiting the government from responding to price gouging was even worse. “To allow them to have this power during a pandemic is outrageous.”

The truth is that profiting off public investment is also business as usual for the pharmaceutical industry. Since the 1930s, the National Institutes of Health has put some $900 billion into research that drug companies then used to patent brand-name medications, according to Posner’s calculations. Every single drug approved by the Food and Drug Administration between 2010 and 2016 involved science funded with tax dollars through the NIH, according to the advocacy group Patients for Affordable Drugs. Taxpayers spent more than $100 billion on that research.

Among the drugs that were developed with some public funding and went on to be huge earners for private companies are the HIV drug AZT and the cancer treatment Kymriah, which Novartis now sells for $475,000.

In his book “Pharma,” Posner points to another example of private companies making exorbitant profits from drugs produced with public funding. The antiviral drug sofosbuvir, which is used to treat hepatitis C, stemmed from key research funded by the National Institutes of Health. That drug is now owned by Gilead Sciences, which charges $1,000 per pill — more than many people with hepatitis C can afford; Gilead earned $44 billion from the drug during its first three years on the market.

“Wouldn’t it be great to have some of the profits from those drugs go back into public research at the NIH?” asked Posner.

Instead, the profits have funded huge bonuses for drug company executives and aggressive marketing of drugs to consumers. They have also been used to further boost the profitability of the pharmaceutical sector. According to calculations by Axios, drug companies make 63 percent of total health care profits in the U.S. That’s in part because of the success of their lobbying efforts. In 2019, the pharmaceutical industry spent $295 million on lobbying, far more than any other sector in the U.S. That’s almost twice as much as the next biggest spender — the electronics, manufacturing, and equipment sector — and well more than double what oil and gas companies spent on lobbying. The industry also spends lavishly on campaign contributions to both Democratic and Republican lawmakers. Throughout the Democratic primary, Joe Biden has led the pack among recipients of contributions from the health care and pharmaceutical industries.

Big Pharma’s spending has positioned the industry well for the current pandemic. While stock markets have plummeted in reaction to the Trump administration’s bungling of the crisis, more than 20 companies working on a vaccine and other products related to the new SARS-CoV-2 virus have largely been spared. Stock prices for the biotech company Moderna, which began recruiting participants for a clinical trial of its new candidate for a coronavirus vaccine two weeks ago, have shot up during that time.

On Thursday, a day of general carnage in the stock markets, Eli Lilly’s stock also enjoyed a boost after the company announced that it, too, is joining the effort to come up with a therapy for the new coronavirus. And Gilead Sciences, which is at work on a potential treatment as well, is also thriving. Gilead’s stock price was already up since news that its antiviral drug remdesivir, which was created to treat Ebola, was being given to Covid-19 patients. Today, after Wall Street Journal reported that the drug had a positive effect on a small number of infected cruise ship passengers, the price went up further.

Several companies, including Johnson & Johnson, DiaSorin Molecular, and QIAGEN have made it clear that they are receiving funding from the Department of Health and Human Services for efforts related to the pandemic, but it is unclear whether Eli Lilly and Gilead Sciences are using government money for their work on the virus. To date, HHS has not issued a list of grant recipients. And according to Reuters, the Trump administration has told top health officials to treat their coronavirus discussions as classified and excluded staffers without security clearances from discussions about the virus.

Former top lobbyists of both Eli Lilly and Gilead now serve on the White House Coronavirus Task Force. Azar served as director of U.S. operations for Eli Lilly and lobbied for the company, while Joe Grogan, now serving as director of the Domestic Policy Council, was the top lobbyist for Gilead Sciences.

 

 

 

California hospital secures $20M to stave off closure

Posted on by • Posted in Bankruptcy, Chapter 11, Health System, Hospital, Hospital Bankruptcy, Hospital Closure, Mergers & Acquisitions, Private Equity, Public Funding, Venture Capital • Leave a comment

https://www.beckershospitalreview.com/finance/california-hospital-secures-20m-to-stave-off-closure.html?utm_medium=email

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The San Mateo County (Calif.) Board of Supervisors voted March 10 to allocate $5 million annually over the next four years to keep Seton Medical Center in Daly City, Calif., open, according to Bay City News.

The county supervisors voted 4-1 to give $20 million in funding to the company that buys the hospital from El Segundo, Calif.-based Verity Health. The funding package will come with conditions, including that the purchaser must keep the hospital open and fully functional.

Verity entered Chapter 11 bankruptcy in August 2018. In January, the health system closed St. Vincent Medical Center, a 366-bed hospital in Los Angeles, after a deal to sell four of its hospitals fell through. The system had been planning to close Seton Medical Center as soon as this week, according to the report.

There are currently two companies bidding to purchase the hospital in Daly City and Seton Coastside in Moss Beach, Calif. The funding will help ensure Seton Medical Center, which sees roughly 27,000 patients per year, keeps its doors open.