Copyright © 2007 by Regina E. Herzlinger. Click here for terms of use.
In 1973, the American people generously decided that we would use our taxes to pay for the care of patients with permanent kidney failure. Before then, most patients died prematurely because they could not afford dialysis.
We could have channeled this money in a number of different ways. We could, forexample, have given it to the people most directly affected by the money and the disease—the patients themselves. After all, it is our tax money that is paying for virtually all this medical care, and we could have chosen to put it directly under Jack Morgan's control. Had we given the patients the money, they could have decided who among the providers of dialysis gave them the best value.
Instead, the U.S. Congress decided to confiscate Jack's decision for itself. It did this by prescribing what kind of care he needed and then buying it, without consulting Jack or his doctor. Congress decided he would receive dialysis three times a week; that he would not have much in the way of diagnostic testing and even less in helping him to promote his healthstatus; and that he would be given a whole lot, perhaps too much, of a hormone, erythropoietin, that controls the anemia that typically plagues the victims of kidney disease. With this set of decisions, Congress likely hastened Jack Morgan's death.
When the U.S. Congress confiscated our tax money and declared itself both our shopper and our doctor, it assumed an unusual role for a government. After all, Congress does not set the prices for your car, your clothes, your food. Yet it sets the prices paid to the doctors, hospitals, dialysis centers, pharmaceutical firms, and other providers for kidney care. Congress does not determine the size of the refrigerator in your kitchen, at least not yet; but remarkably, it did set the level of hematocrit—a marker for the amount of red blood cells in a kidney patient's blood—that must be achieved for the medical care providers to be paid. This level could best be attained through use of the drug erythropoietin (Epogen), or epo.
Did Congress really hone in on Jack and interfere with his medical treatment? No, our elected representatives in Washington didn't know Jack from a hole in the wall. That's the problem. They took it upon themselves to prescribe his treatment and that of every other kidney patient in the country without any knowledge of their individual characteristics and circumstances.
How did the U.S. Congress come to dictate Jack's kidney care?
In the 1950s, patients and their families were paying for the then relatively new, costly dialysis therapy, mostly out of their pockets. Although some patients could draw upon medical insurance benefits, research grants, or private donations, the high costs of dialysis in 1965 led to fewer than 150 people being dialyzed, while tens of thousands were qualified for treatment.1The kidney patients who were not dialyzed were essentially consigned to death. Because there were so few paying patients, there was also an acute shortage of capacity at the time. Many hospitals set up dialysis and transplant committees to select who would receive dialysis and who would not, who would live and who would die. One member of the Seattle-based Swedish Hospital's "Death Committees" has since recalled, "I am still haunted" by these activities.2
To dramatize the need for funding, a patient testified while being dialyzed in front of the House Ways and Means Committee. Our representatives, shocked to learn that we were rationing this life-giving form of medical care, responded. On October 30, 1972, the legislation that created the national End-Stage Renal Disease Program (ESRDP) was passed after only 30 minutes of debate with only one dissenting vote. Senator Vance Hartke (D-Indiana) declaimed:
In what must be the most tragic irony of the 20th century, people are dying because they cannot get access to proper medical care. We have learned how to treat or to cure some of the diseases (that) have plagued mankind for centuries, yet those treatments are not available because of their cost. Mr. President, we can begin to get our priorities straight by undertaking a national effort to bring kidney disease treatment within the reach of all those in need. 3
Once again, the fingerprints of Richard Nixon, our jowly, five-o'clock-shadowed, furtive-eyed president, are all over this one: he championed not only managed care organizations but also the federal government's takeover of payments for kidney disease. Ostensibly a Republican conservative, when it came to health care, Nixon continually expanded the control of government and big bureaucracies over it.
The cost of kidney dialysis and related services for men of Jack's age, in their fifties, currently amounts to around $65, 000 a year.4If the patients have private health insurance, their insurer must pay for 33 months of care. After that, Medicare, the U.S. government's health insurance for the elderly, pays, regardless of the patient's age. Medicare accounts for 90 percent of ESRDP payments and about 300, 000patients. People with ESRD are virtually the only non-elderly covered by Medicare.5
Because the U.S. Congress approves the government budget for Medicare, in effect, every senator and representative helps to determine the treatment and to set the price for Jack Morgan's kidney care.
Normally, when we buy something, you and I decide the bundle of things we want and what we are willing to pay for it.
Consider life insurance, for example. We may choose different levels of insurance and buy the policies from different companies. One of them, the Northwestern Mutual Life Insurance Company, is among the highest rated of all U.S. firms for consumer satisfaction.6We can choose from different firms and many different insurance brokers. The competition among them gives us better service, quality, choice, and price.
But victims of kidney disease do not have any choices and can make no decisions about their treatments. They cannot select a bundle of services or the price they are willing to pay for them. Their choice is limited to the site in which they will receive their care. Once they select the site, the U.S. Congress then muscles in and determines the services they will receive and their price.
Our congressional representatives are very able people; but they are not great shoppers. Why should they be? They're spending our money, not theirs, and they have no way of knowing our needs and preferences.
Of course, the congressional act that ensured public funding for the victims of kidney disease is laudable: inspired by a grave need and paid by a generous public, it has increased the life span of the victims of kidney disease. It could have been great legislation; but because it was implemented badly, it is not. It wrongly gave control of the money to the U.S. Congress, not Jack Morgan. The congressional overseers spent too much money on drugs and too little on diagnostic tests, health promotion, and dialysis.
Congressional oversight has been costly and, in some senses, the results have been a failure: while expenditures on kidney care soared, more than tripling from $5.1 billion in 1991 to $18.4 billion in 2004, the death rates in the first year of dialysis for end-stage renal disease patients remained the same from 1993 to 2004, as did hospital admissions and lengths of stay.7 All that money did not result in lower death rates or healthier patients. All too many patients did not receive the preventive care that could slow the progression of their diseases. And it now appears that the high levels of epo the U.S. Congress endorsed caused a significant increase in deaths and heart disease in some recipients.8
It is impossible to delineate exactly how kidney care would have changed if Congress had not meddled in it. Most likely, the care would have been more efficient, convenient, and focused on wellness. Had Jack Morgan controlled the payments to providers—rather than the U.S. Congress or his insurer—medical care providers unquestionably would have responded more to his individual needs. For example, they could have competed with each other by efficiently focusing on the individual needs of the patient—no cookie-cutter medicine practiced here—with an emphasis on wellness and health promotion and excellent care for the diseases that typically accompany kidney disease. They could have given him more frequent dialysis and less in the way of drugs. But because providers must follow Congress's recipe, kidney disease victims, like Jack Morgan, can die prematurely, injured by the shortage of the testing and health promoting services they need and the excessive drugs they received, and we likely paid too much for the wrong kind of care.
For sure, if Jack Morgan were a European or a Canadian, he likely would not have fared as well as he did in the United States. As Professor Eli Friedman noted in his seminal 1997 article, "Health Care Reform Engulfs All of Us, " some European countries and Canada have rationed kidney care and/or penalized doctors who provided it to too many people.9 France attempted to reduce its annual expenditure for health care "by issuing 'Health-Care Identity Cards' and tracking each physician's treatment costs.10.…[P]hysicians who 'overspend' will have their reimbursement reduced—clearly a signal to ration expensive services.…Canadian nephrologists are fixed by hospital and personnel funding reductions that constrain their acceptance of haemodialysis patients. As recounted by one, 'Each time I present a new patient for haemodialysis…I am viewed as an enemy.'" 11
Their relative performance in comparison to the United States had not improved by 2004. Although occurrences of kidney disease in the United States are only 50 percent higher than in Germany or Canada,12we performed double the number of transplants per million population as Germany13and many more than in Canada too.14
As for the United Kingdom, may the force be with you. The relative risk of death for a dialysis patient in the United Kingdom, with its government-run health care system, was significantly higher than in other countries where the government exercises less control, like Italy. Hospitalization rates for ESRD patients for heart disease were lowest in the United Kingdom, although its incidence was similar to those in other countries.15 The median waiting times for dialysis with vascular access there ranged between one week and nine months.16 The outer edge of this waiting time could be a death warrant.
Yet despite the favorable comparison of U.S. kidney care to that in other countries—more transplants, readier admissions to hospitals, and shorter waiting times—thesituation in the United States is far from optimal. In the process of spending our money, Congress pumped up funding for drugs and reduced incentives for crucial therapeutic and health promoting treatments.
One group clearly benefited, however. The businesspeople who understood the care and feeding of our Congress earned millions. For example, after earning $23 million in 2004, the CEO of DaVita, a firm that owns a fourth of all dialysis centers, earned over $25 million in 2005.17 As the head of the nominating committee in the firm that was the progenitor to DaVita, I helped to recruit its CEO, so I know that he is an able person. He revived the faltering firm. And most of his compensation came from the increases in the value of DaVita's stock during his tenure. He benefited in the same way as its shareholders.
But was his compensation appropriate? Investors evaluate businesses on the basis of the returns, the profits, they earn for their owners, the people who own the shares of stock in the company. Risky businesses, such as biotechnology firms whose science is largely unknown, should earn higher returns to compensate their owners for the risk they take by investing in them. Dialysis is not nearly as risky a business as high technology, medical diagnostics, automobiles, or many others. Numerically, DaVita's risk—as measured by a statistic called beta —was only 60 percent of the stock market as a whole in December 2006.18 (At that time, DaVita's performance trailed that of its peers.) Why the low beta ? Because dialysis is a business in which the government essentially guarantees payment for all your customers.
Some may find it hard to justify this kind of income for the CEOs of firms withso little risk.19 But DaVita's board of directors wentalong with it. They too were well paid. Although DaVita's disclosure of its board members' compensation is murky, it appears that the one former head who sits on the board of the Medicare agency that determines payments for dialysis earned about $5 million since 2000.20
As for Amgen, the biotechnology firm that manufactures the drug primarily used for people on dialysis, its CEO was paid nearly $20 million in 2005, on top of nearly $50 million of options,21 while Amgen's stock was downgraded because it has "a pipeline gap" —that is, a shortage of important new drugs.22
Make no mistake about who paid the DaVita and Amgen CEOs all that money. It was you and I. After all, our tax money is one of the primary sources for Medicare expenditures, and Medicare is the primary source of payment for analysis.
To ensure that their voices were heard, the business leaders in the kidney care industry sprinkled considerable money on the U.S. Congress. Amgen spent $5.7 million on lobbying expenses in 200523and made $400, 000 in federal-level political donations in 2001 and 2002.24As for DaVita, the Los Angeles Times alleged that the $1 million it spent on federal lobbying in the first half of 2006 led to an annual $100 million increase in Medicare payments to dialysis providers.25
We are fortunate that so many able, dedicated people are willing to serve as our congressional representatives. Whenever I visit the U.S. Congress, my head spins at the range of complex issues they must review: the Middle East today, the homeless tomorrow. But congressional representatives need substantial money for their election campaigns, and they understandably pay close attention to those who donate it.
To oversee the billions of dollars in dialysis expenditures, Congress essentially created a recipe consisting of three ingredients: dialysis services, physician services, and drugs. It determined the amount of each ingredient by dictating its price. Imagine for a moment that Congress decided to oversee the preparation of beef stew in this way. It would pay for only three items: the restaurant where the cooking takes place, the stew chefs, and the beef and other ingredients. And it would dictate the price it would pay for each—$1 per stew preparation for the chefs, $4 for the restaurant, and $1.28 cents for the beef and other ingredients—take it or leave it. Since Congress is virtually the only payer, how could anyone "leave it"?
The congressional stew turned out to be heavy on the beef—the drugs, for which it paid $93 per treatment—and light on the restaurants, for which it paid less and less.26 Many stand-alone kidney dialysis facilities simply could not survive the ever-shrinking payments doled out by Congress. They either folded or sold out to businesses that ran chains of dialysis centers. The chains achieved economies of scale in the purchase of drugs, supplies, and equipment and in administration and billing. For example, the largest chains paid from 8 to 22 percent less for the three leading drugs than freestanding centers in 2003. Their drug acquisition costs were 6 percent less than the average; the freestanding centers' costs were 4 percent higher.27
Many independent dialysis centers went out of business or were essentially forced to become chain restaurants because of the stringency of congressional payment patterns. By 2005, 60 percent of all dialysis facilities were part of a chain.28 In 2006, after many rounds of consolidation, only two large dialysis chains were left: DaVita and Fresenius, each the product of many prior consolidations.29
Chains, or, in economics speak, horizontally integrated organizations, generally prosper in consumer-driven markets because they can be more efficient than one-off organizations. But a chain cannot respond as readily to the unique needs of its customers.
Meanwhile, the chefs, the nephrologists, who were paid a flat sum for their services, spent less and less time on stew preparation.30 Congress did not offer special incentives for them to initiate the testing and wellness activities that could have mitigated progression of the other diseases that frequently accompany kidney disease.31
The results of these recipes and payment patterns? In 2004, patients adhered poorly to drug therapy that was essential to their health, likely because of inadequate medical encouragement and education in how and why to do it.32 In most chains and hospital-based centers, fewer than half the patients had good results for diabetes or the important tests for the heart diseases that typically accompany diabetes,33 and two-thirds had excessive levels of protein in their urine, a dangerous sign of the lack of efficacy of the dialysis.34 Although many patients are diabetics, less than half of these very sick patients received comprehensive diabetic monitoring in 200435 or flu vaccine, despite their appearance in the dialysis centers at least three times each week.36
Meanwhile, treatment with Epogen shot through the ceiling.37 The average patient received $6, 000 of it in 2002.38 Congress was very good to Epogen's manufacturer. It upped epo's usage by essentially increasing the level Congress required and favoring it in the cost-plus payment formula it chose for drugs. Then it gave the company a virtual monopoly by granting the drug a special designation as an "orphan drug" —a drug with fewer than 200, 000 recipients. The legislation was originally intended to encourage the commercialization of pharmaceuticals for rarediseases. As a result, the orphan drug law is a treasure trove for the industry: no similar drugscan go through the government's clearance process for seven years, and it grants a 50 percent tax credit on clinical trials and waiver of substantial user fees. With only 78, 000 patients in 1989, Epogen originally seemed like a wonderful candidate for the "orphan" designation.39 But by 2005, with sales in excess of $3 billion, epo was hardly an orphan.
Congressional control favored chains of dialysis providers over free-standing centers and the manufacturers of the drug epo. Congress reduced inflation-adjusted expenditures on dialysis, measured in 1974 dollars, from $138 per treatment in 1974 to $34 in 2002. Yet because Congress paid for epo at 6 percent over the average sales price, as computed by Uncle Sam, it was used heavily. Six percent may not sound like much; but because the average dialysis patient received $6, 000 worth of epo in 2002, it amounts to a whole lot of money.
The U.S. Congress decided to pay for the drugs used in kidney disease treatment at cost plus a mark-up. Because biological drugs can be digested, they cannot be swallowed. Instead, they must be infused via the intravenous (IV) line used in the course of the dialysis, or they must be injected by physicians. The treatment centers are paid not only for their services, but also for the difference between the cost of the drugs and the government's price.
You don't need a CPA to figure out what happens to costs when the federal government gives you a cost-plus contract, especially when the "cost" is difficult to determine.
The price the government pays for drugs is pegged at 1.06 of the average sales price (ASP) for some, average acquisition price for others, and reasonable costs for hospitals. These numbers can be pure mumbo-jumbo. The federal government has difficulty in determining exactly how much Dr. X in Waltham, Massachusetts, paid for the drug he injected. The dialysis clinics are estimated to earn nearly 40 percent of their profits from the spread in the price of epo between their cost and the government's price.40
The firm that sells the biggest of these drugs—the antianemia substance, epo—would like more and more of it to be used. And it has succeeded. In 2005, epo was Medicare's single largest drug expenditure, clocking in at $2.4 billion in 2006;41 but it accounted for only $840 million of Medicare's ESRD payments in 1998.42
Why did expenditures for epo grow so fast?
For one thing, Congress motivated clinics and doctors to use epo with its payment formulas. Then, the U.S. Congress began playing doctor, encouraging the use of even more epo by dictating the level of hematocrit —a measure of oxygen-carrying red blood cells that is directly affected by the use of epo. For example, one powerful senator personally requested that the Medicare administrators increase the upper end level of the hematocrit.43His request had more than a little clout because he chaired the subcommittee that supervises the budget of Medicare. In 2006, the upper level for hematocrit was increased once again. When Congress decided that the target hematocrit range should be increased by a mere 3 percent, from 30 to 33 percent to 30 to 36 percent, epo spending increased threefold, by about $500 million. The 3 percent increase required up to a 50 percent increase in epo dosage.44
The U.S. Congress was practicing medicine.
What scientific evidence informs the U.S. Congress in setting hematocrit levels?
Some warned the congressional doctor that he was practicing bad medicine.45 They claimed that the evidence from randomized clinical trials demonstrates that "patients assigned to higher hematocrit target levels do not show discernible improvements in survival, hospitalization, or cardiac outcomes. In fact, they could be prone to adverse cardiovascular events that include heart attacks and strokes."46 These warnings were prescient. An important 2006 study found that these high hematrocrit levels were increasing the chances of death, heart attacks, disease, and stroke, among other serious problems.47
Epogen is a great drug that improves patients' quality of life. Before its commercialization, kidney patients required blood transfusions to combat anemia. The transfusions not only were expensive and invasive but were also carriers of blood-borne diseases, like hepatitis. Epo's value was easily observable. Kidney disease profoundly affects the complexion. When epo's clinical trials began, in 1985, patients' once-ashen skin glowed pink.48
Amgen, a Thousand Oaks, California, firm that discovered and commercialized Epogen and a follow-on drug, reaped huge financial rewards. Its stock price grew by more than 50 percent annually in the 1990s. Its profit margin of 32 percent was bigger than Microsoft's in 2002.49It earned nearly $4 billion in profits in 2005.
Why?
Well, it had scientific prowess, especially in its early days; but it has also excelled as a brass-knuckled legal combatant. Amgen repeatedly sued its "partner, " Johnson & Johnson, which had bailed Amgen out of financial troubles with a 1985 licensing deal, and others who dared to tread on its patents. Give Amgen an A for marketing too. It developed a new version of Epogen, whose main virtue was that it required less frequent dosing because it was more difficult for the body to excrete it through urination.
But Amgen also owes its success to the U.S. Congress. When the bureaucrats who run Medicare deemed the new version of epo as "functionally equivalent" to the old, they were decreeing that Medicare would pay the same price for the old and new versions of epo. Guess what happened? Congress ruled that the Medicare administrators could no longer use the functional-equivalence criterion.50
Like the Magi, the U.S. Congress gave Amgen three gifts: First, it voided functional equivalence; second, it provided for the continual expansion of required hematocrit levels; and third, and perhaps the most generous, it gave Amgen an orphan drug monopoly over epo.
Congress decided that Epogen, which by 2005 had earned $22 billion in revenues for Amgen,51was an "orphan drug." Remember, the orphan drug designation was meant to induce pharmaceutical investment in rare diseases; but, by 2001, 50 percent of the world's bestselling biotech drugs were "orphan drugs, " including human growth hormone.52The prices of these drugs are typically so high that they could cause patients considerable hardships; for example, one orphan drug user, an accountant who worked in a small firm, was forced to find new work as a door-to-door salesman in a larger firm because his small firm could not afford the costs of his health insurance.53
Typically, a high-priced product incurs high costs. But orphan drugs require lower expenses than the massive amounts that pharmaceutical companies typically spend for clinical trials and marketing for a blockbuster drug. The number of participants in clinical trials for an orphan drug is not only smaller than those for a blockbuster, but the costly trials are also easier to implement because there are fewer doctors who care for patients with the rare disease. The smaller number of patients and doctors also reduces marketing expenses.54
So why are the prices for orphan drugs so high? The biologicals among them are more expensive to manufacture, but the absence of competition is also a major factor in enabling the high price of orphan drugs. Of course, if the drug is truly an "orphan, " with a small number of users, a monopolistic status may be needed to encourage investment in the costly R&D that drugs typically require. But Congress enabled Amgen's Epogen to maintain its orphan drug status when it ultimately commanded a huge market.55Would it not make more sense to designate orphans on the basis of the dollar value of their revenues rather than by the number of individuals who need the drug? After all, it is the dollar size of the market that determines whether drug companies are willing to invest in the expensive research and development required.
Amgen, which recognized the value of the gifts that Congress has showered on it, is extremely skilled in rewarding the hand that feeds it: In 2004, Amgen's 20-person D.C. government relations office spent $122, 186 in soft money contributions.56Former President George H. W. Bush's press secretary headed its D.C. office.57
The U.S. Congress pays for kidney dialysis services by site of care. If your kidneys are dialyzed in a hospital, your providers will be paid a different, higher price from what they would be paid if you were dialyzed in a local center. Congress pays hospitals $132 per treatment and the dialysis centers $4 less.58
Yet a detailed government analysis has determined that, despite the higher hospital costs, dialysis patients receive essentially the same services at each site. Further, hospitals are less productive.59The hospitals cost more because they cannot attain the economies of scale and focus of the dialysis centers.
Normally, when two places deliver exactly the same services and one costs more than the other, the costlier one will go out of business. But Congress happily subsidizes the hospitals' inefficiency by paying them more, again, with our money.
Do you think that maybe the $17 million that hospitals and their kin spent on lobbying and contributions in 2004 had a little something to do with this decision?60
Traditionally, the U.S. government performs three important functions: it redistributes income from the rich to the poor, in accordance with the wishes of the citizenry; it provides public goods that could not be delivered by the private sector, such as defense; and it protects consumers against the potential excesses of unfettered markets, such as collusion, excessive concentration, and false advertising. But to control health care costs and reward high quality, Congress is now practicing medicine.
In health care, governments have encroached into traditional business functions. For example, pay-for-performance (P4P) initiatives enable governments to tell health care providers how to practice medicine.
The federal government did not always play this role. Initially, it paid those who provided services to Medicare enrollees for their costs. Not surprisingly, the costs of health care providers increased substantially. To control them, Congress used a system through which it determined fixed prices for the procedures performed by doctors, hospitals, and other suppliers of medical care, such as home health.61 But this system was flawed: the incompetent was paid the same price as the superb. To reward those who provided higher-quality medicine, Congress turned to a new pricing system, which it dubbed "pay for performance." The higher the performance, the higher the pay.
We normally think that "performance" means quality. A high-quality car is safe, reliable, environmentally friendly, and does not guzzle gasoline. Similarly, high-quality hospital surgeries do not kill their patients, do not infect them, and do not cause potentially deadly blood clots, but they do enable their patients to improve their quality of life. But the health care system lacks such metrics of performance.
Despite its name, P4P does not pay for performance —the attainment of improved health at a reasonable price. Instead, it pays for conformance —adherence to a government-dictated recipe for the provision of health care. The government pays for adherence to its recipes for the process of delivering health care rather than for the outcomes. If P4P were used for cars, the government would not reward a safer, more fuel-efficient automobile. Instead, it would reward automobile manufacturers who followed congressional instructions on how to build a car.
Government P4P recipes, like those for kidney care, are specified as if they were the 11th commandment; but there is no one recipe for medical care. Treatments must be tailored to the patient's unique characteristics. Are drugs that lower blood pressure as mandatory for heart failure patients as one government recipe avers? Not to the observant doctors who keep some elderly patients' pressure slightly elevated to help the blood circulate in their rigid vessels. These doctors will be penalized under cookie-cutter government recipes. Further, medicine is the youngest science, studded with frequent flip-flops in accepted treatment. Yesterday's must-do painkillers, such as Vioxx, are today's tort lawyer bonanzas.
Government recipes for medical care are delineated largely through "peer review" and statistical "meta-analysis." Those jaw-breaking titles imply saintly physicians who use the rigorous tools of science to dispassionately evaluate the merits of each other's work. But medical "peers" often become brass-knuckled gutter fighters when their expertise is threatened. They use consensus, rather than rigorous scientific experimentation, to inform them in developing the recommended process of medical care. The history of medicine is filled with shameful suppressions of important innovations, such as one cancer researcher's inability to gain publication of his Nobel Prize–worthy theories in "peer-reviewed" journals.62 Cancer patients paid the price of "peer review" with a delay of nearly a decade in the use of promising drugs, such as Avastin, that his theories have since enabled.
Although medicine has long been practiced, it lacks the explanatory powers of a science like physics. Yesterday's must-do estrogen treatments for menopausal women are now considered to have caused breast cancer. Much of what is now viewed as correct medical practice will change in the future—but we do not know what will change. For this reason, some analysts view P4P process measures with concern. The focus on process may divert doctors from focusing on outcomes.63 They also worry that the measures are too rigid and that surgical P4P process measures, for example, "could be harmful for older persons with several comorbidities [additional problems]."64
The government created a recipe for kidney care that consisted of fixed quantities and prices for drugs, doctors, and dialysis.65
But many experts disagree with the congressional recipe. A number of nephrologists believe the victims of kidney disease need more dialysis, perhaps daily.66 Nevertheless, Congress, with its relentless eye on the Epogen meter, instead chose to continuously increase those expenditures, despite mounting evidence that the higher doses of epo are bad for your health.
Suppose Jack Morgan were given the $65, 000 or so that Congress spent on his dialysis.67 Do you think that some entrepreneurs would have offered him kidney care bundled into one package of doctors, dialysis, and drugs? Do you think he might have opted for less epo and more dialysis? Less epo and more physician visits? Less epo and more preventive care?
Would someone in the community formed by Jack Morgan and his colleagues have called the New York Times or 60 Minutes to shine a public spotlight on the profits earned by Amgen, the firm manufacturing Epogen, and the dialysis chain DaVita, their CEO compensation,and their lobbying expenses and political contributions?
Would kidney care have become more diverse, more organized, more effective, more efficient as a result of these efforts?
How do you spell "you bet"?
Because the U.S. Congress believed it was a better shopper than Jack, it too helped to kill him. But how did Congress become so convinced that it possessed the skills needed to become Dr. Sam? Blame the academic policy advisors who educated and advised its members.