Should the President Exercise his Authority under the Defense Production Act?

In a week, it will be three months, let me say that again, three months- a quarter of a year – since all of us learned about the outbreak of the novel coronavirus infections in China.

No one could have predicted this?

Is it true that no one could have predicted this? No. As a hospital and health system CEO, I have been worrying about the threat of a new infection for at least two decades. Was I some kind of prescient genius? No. These concerns have been widely held. In fact, it was a good thing that the briefing room was not filled with physicians, health care executives, insurance executives, scientists, and even the government’s own U.S. Government Accountability Office (GAO) when the President asked, as he so often does, “who could have imagined this?” because every hand would have been raised.

How did we know?

  • This is not our first (and, unfortunately, will not be our last) pandemic. I am not even listing epidemics, here is just a list of pandemics:
    • 1918-1919 (yes, more than 100 years ago) H1N1 virus – this was an influenza pandemic – some call it the “Spanish Flu.”
    • 1957-1958 H2N2 virus – another influenza pandemic – the so-called “Asian Flu.”
    • 1968 H3N2 virus – another influenza virus- the so-called “Avian Flu.”
    • 2009 H1N1 virus – another influenza virus, which was completely new to animals and humans.
  • So, you say, well all of these were influenza pandemics. Perhaps we could have imagined another influenza pandemic, but could anyone have imagined this new coronavirus pandemic? Yes. We already dodged this bullet twice with new coronavirus outbreaks (in fact, one of these previous outbreaks was also from China) that could have, but thank God did not become pandemics. Remember SARS in 2003 and MERS in 2012? Like the current novel coronavirus – 2019, the SARS and MERS coronaviruses were also novel coronaviruses that made the leap from animals to humans.
  • Okay, so yes, we could have imagined another pandemic, and yes, we could have imagined a novel coronavirus emerging and potentially becoming a pandemic, but could we have imagined a novel coronavirus emerging from China and causing a pandemic. It turns out the answer is yes, and we did in…wait for it…2007. Scientists published an article entitled, “Severe Acute Respiratory Syndrome Coronavirus as an Agent of Emerging and Reemerging Infection” in Clinical Microbiology Reviews in 2007. Even just from the title, we get “Severe Acute Respiratory Syndrome” – that is SARS, ”Coronavirus”, “Agent” – cause, “Reemerging Infection.” Do you now what the scientific name for this novel coronavirus that we are currently battling is? SARS-CoV-2 – SARS Coronavirus – 2. In fact, in 2007, we knew that the 2003 SARS virus came from bats and civet cats. Guess where we think our current coronavirus came from – a bat.
  • Well, then in the President’s defense, you suggest people can hardly be blamed for overlooking one single article in 2007. Well, it turns out that the fear and high mortality that the 2003 SARS virus epidemic caused and the economic disruption that this virus caused resulted in more than 4,000 articles on this subject.
  • In fact, this article in Clinical Microbiology Reviews even identified the Chinese wet markets, where large numbers and varieties of exotic wild game animals are sold for food consumption in overcrowded cages with a lack of biosecurity measures, as a likely breeding ground for this virus and a risk for transmission from animals to humans. Guess where we believe the current coronavirus came from? You guessed it – a Chinese wet market in Wuhan.

Were we prepared?

If we have foreseen this for at least 13 years, were we prepared? No.

I have to say I was far more gullible than I should have been. All this time, as the hospitals and health system I oversaw prepared and then updated our pandemic plans over the past many years, I always thought that if things became bad, we would rely on the federal government and the Strategic National Stockpile. It turns out that in a time of crisis, states are largely left to their own and there isn’t nearly as much stockpiled in the Strategic National Stockpile as I thought there was. And, even what is there is pretty darn hard to access.

Unfortunately, because of inadequate stockpiles and inadequate federal response, our brave healthcare providers are on the front lines of fighting this “war,” as President Trump called it, without adequate supplies. To listen to the White House and White House Coronavirus Work Group press conferences, you would get the impression that we are having a few hiccups, but overall, our government’s response has been nearly perfect. Can you imagine if we were fighting a traditional war, and our troops were complaining that they don’t have adequate equipment and supplies and were going into battle vulnerable and exposed? Can you imagine what cries of outrage would emerge from our citizens? Well, that is what is happening in our war against the coronavirus. We are experiencing such severe shortages in protective equipment and supplies that we are sending in our healthcare providers in some parts of the country vulnerable and exposed.

So, don’t take it from me. Here are what some officials and health care providers from across the country are saying.

UCSF Medical Center

@UCSFHospitals

PLEASE SHARE: Help front-line UCSF providers caring for all who need it during the #covid19 pandemic by donating critical supplies such as masks, disposable gloves & more at three sites in #SanFrancisco and #Oakland starting tomorrow.

https://ucsfh.org/2WA28DG #coronavirus #sf

City of New York

@nycgov

“Our health care leadership here in the city has made it clear that supplies and medical equipment are a deep concern…but the most important factor is personnel.” –

@NYCMayor

on NYC’s need for supplies to fight COVID-19 Learn more at http://nyc.gov/coronavirus

In case you might be thinking, well that is California and New York that have been especially hit hard, but the rest of the country, my town or city should be fine, this is from the chairman of the department of emergency medicine at OSF LCMMC in Evergreen Park, Illinois, not necessarily a place most of us would think of as a hotbed of coronavirus activity:

Sunil A.

Chair of Emergency Medicine at OSF LCMMC

“Am I scared? I sent my wife and two kids to another state, as have other front line physicians. Exposure to them was a major factor but knowing full well that WE will need to cover for our sick colleagues made this a time when home and duty cannot co-exist…. Scared is the only logical emotion that can go along with that scenario. A nation that is ok with sending their troops in without protection needs to take a long deep look in the mirror and decide if this is what they wanted.”

It really is shocking that South Korea was performing more coronavirus testing in a day than we did in our entire country for the first more than two and a half months.

It is shocking that the world’s most advanced, richest country has not been able to provide enough testing kits, reagents, testing supplies (like swabs and viral transport media), gowns, masks, goggles, and face shields, even as of today. Our government’s solution, despite the fact that it is not consistent with the manufacturer’s advice is to wear masks for extended periods of time and sanitize the masks periodically with hand sanitizer (which is also in short supply). Worse, imagining the time when we are completely out of masks, the CDC has advised providers to wear scarves or bandanas over their mouths and nose as if we were some developing country.

So, should the President have exercised authority under the Defense Production Act?

Yes, about two months ago. At that time, the President had not yet implemented his “travel ban” from China, yet the disease was not isolated to China. It had already spread to more than 20 other countries. We also knew that this was a novel virus for which no one in the world had immunity. Given the globalization of economies and travel, I don’t think any epidemiologist would have told the President that the virus could not come into the U.S. and spread swiftly through the population.

Further, while many of us believed that there were ample supplies in the Strategic National Stockpile and the President could rapidly deploy those, we were mistaken. Here we are two months later and hospitals, physicians, nurses, mayors and governors are begging for these supplies. Surely the President’s advisors informed him that there was no way the federal government could meet the needs of hospitals all across this country were the virus to spread.

We first relied on a flawed CDC test. Finally, this month, the government allowed large commercial labs to offer the testing. At least two of those labs have been overwhelmed and stopped accepting specimens, at least temporarily. The others have been ramping up testing, but the turnaround for these tests can be 4 – 5 days, compared to the public health labs’ capability to turn these tests around in less than 24 hours. Further, providers still face shortages of testing supplies to be able to submit specimens to these labs. And, current testing puts the person testing at risk, so they have to have personal protective equipment, and this remains in short supply.

So, private businesses have not saved us so far and neither has the federal government. We are told that is about to change, however, we have been told that for more than a week. Now, in the world’s most medically advanced country, we are telling providers to reuse their supplies, to use scarves and bandanas to cover our faces, to consider using ventilators for multiple patients, and volunteers in our communities are sewing home-made face masks for us.

We are told that the private sector will come through for us. Let’s pray that happens, because the federal government has failed us.

Please Donate Blood

This is a scary time – there is no doubt. But, I am amazed by the generosity and caring of Idahoans. Instead of feeling like victims of having to give up social events, having to take their classes online from home instead of attending school, or having to work from home, Idahoans are rising to the occasion finding ways to help each other and volunteering their skills and talents to hospitals and donating to worthy cases.

I am so proud of our health care workers – their dedication to helping people, even if doing so means putting themselves at risk. But did you know that you can save lives?

Unfortunately, the coronavirus pandemic has caused the cancellation of many blood drives. While we are absorbed with this health threat, we must not forget that every day, patients across the country need nearly thirty-six thousand life-saving units of red blood cells, seven thousand units of platelets and ten thousand units of plasma. Every single day. While we may feel helpless to prevent the coronavirus deaths, we can make sure that kids and adults with cancer or other medical conditions or those with life-threatening injuries don’t have to needlessly die due to lack of blood.

If you have fever, cough, shortness of breath or have been diagnosed with or had close contact with a person with COVID-19 in the last month, stay home and protect others. But, if you are healthy and feeling well, please reach out to your local donor center, schedule a donation, and encourage your friends and family to do so, as well. Blood donation is safe and instead of staying home and watching tv, you can save a life. Visit www.redcross.org. I have donated 27 units of blood in Idaho and I will be back to donate again next month!

COVID-19: What I am Worried About

Recently, I was interviewed for an article about hospital surge capacity in Idaho. I indicated that I was not worried about that right now – we have many options to expand the number of beds for treatment of COVID-19 patients. At the time, we had no hospitalized patients with COVID-19 in Idaho, and while I had many things to worry about, that was not in the top 25 of my worry list.

That prompted the expected next question – would I share my top 25 worries on my blog? No, I won’t share the entire list. That just wouldn’t be responsible. People are already fearful and I don’t want to add to those fears with things that people don’t need to spend time and emotional energy worrying about. There are plenty of us worrying about the technical things. I just want the public to worry about the things that will cause them to take actions to make themselves and their families safer.

So, I am going to share some of the things I am worried about. I am going to start by just pointing out a few things that you are worried about that I am not. Maybe you can take these off your list of worries. Toilet paper. I assure you. We are going to have sufficient toilet paper. In fact, there is no reason at this time to believe that our commercial grocery supply chain is going to be disrupted. Sure, we have grocery stores with some bare shelves, but that was because of an irrational run on the stores. Production has already increased, and distributors anticipate that store inventories will be restored next month. Masks. I have written before that there is no need for you to wear a mask (unless you are infected or suspected to be infected or you are a health care professional). It won’t help prevent you from contracting coronavirus, and in fact, it may increase your chances.

What I am afraid of:

1. Politics has no place in the management of an emergency. I have never before in my professional life ever doubted the public health guidance we have received from the federal government. There have been occasions that I have questioned it during this health crisis. Most of my concerns have arisen from comments and actions taken by politicians. And, we have heard promises made and not kept.

During my long career as a CEO, I have had the occasion on quite a number of occasions to have to lead our organization through emergencies, public health threats and natural disasters. We would set up incident command and I never ran the command center. I left that to people who were more experienced and expert and who can handle the thousands of logistical issues that arise. Certainly, I would visit the command center and I would make the decisions that would carry the most risk or make the most impact. However, I stayed out of the details and trusted my experts.

2. We need better communication. It is really hard to over-communicate during a crisis. Yes, our state and federal government set up websites and issue guidance, but people and businesses often don’t know what that guidance means for their circumstances or their businesses. I probably spend 10 hours a day answering questions and providing advice to people and companies, even though there are many people who are far more expert than me, because people don’t know who to turn to or how to reach someone from the state or federal government that can provide them with advice. Very few parents and business leaders understand public health and are equipped to understand what they need to do to protect their families or their employees. Plus, a lot of public health guidance doesn’t make sense. Why would the CDC say gatherings of 50 people or more should be avoided, but schools should not close. There is a reason, but few other than infectious disease or epidemiology experts would understand why that might be.

3. We were not prepared and we should have been. This is the third novel coronavirus that has jumped from animals to humans. After SARS in 2002 – 2003, we knew it was only a matter of time before a new strain would emerge. Yet, we decreased funding for our national pandemic response, eliminated the top expert dedicated to preparing us for a pandemic, and even though we were far underway with the development of a vaccine against the coronavirus, we cut off all funding that would have allowed it to be fully tested and ready for deployment in the future. Now, starting from scratch, we are 12 -18 months away from a vaccine. (that is still record time, but there was no reason this should not have been completed.) I hope that when this is all over, that the countries of the world will put pressure on China to prohibit the exotic animal markets that appear to have provided the opportunity for two of these three novel strains to jump from animals to humans.

4. The federal government has failed us and our health care providers. The first case of COVID-19 was announced 12/31/19. I am writing this in the middle of March and every state has a severe shortage of testing capability and providers have a severe shortage of testing supplies needed to procure samples for testing. One might think, well it is a new infection, obviously, it takes time to develop these new tests. To an extent that is true, but let’s put it in perspective. South Korea performed more tests in one day than we have during the entire time we have been testing in the United States.

On one hand, perhaps the lack of testing is less critical, because there really aren’t any known treatments for COVID-19, so does it matter? It turns out it does. First, in cases that we admit to the hospital because the person is sick and we just don’t know whether the person might have COVID-19, we are using a lot of a very limited supply of personal protective equipment (PPE). These include gowns, gloves, facemasks, etc. that are expensive and in short supply. The longer it takes to get a test result, the longer we have to keep the patient under this intensive isolation. Additionally, for those who aren’t very sick, unless they have a known exposure or concerning travel history, we just don’t have the capacity to test them. So, we send them home for self-isolation. But, without confirmation of COVID-19, we are assuming that most of these cases are colds and flus – and they probably are. But, because of this low concern, we have not routinely advised that all family members need to stay home and self-isolate, as well. We now have reason to believe that family members may in fact be one of the major sources of spread of this virus.

Because of this limited testing capacity and the limited testing supplies, if you are well, we simply cannot afford to use up a testing kit to test you. And, even if you are sick, unless you have had a known exposure or have traveled to a high-risk country or are sick enough that you need to be hospitalized, we are usually not going to have enough supplies to test you. So, please just stay home, self-isolate, take medications for symptom relief, and remain home for at least a week, and specifically for 3 days following the resolution of your symptoms. I am confident that we eventually will have more testing capability, but for now, do all of us a favor and just stay home.

5. Lack of personal protective equipment (PPE). I said at the beginning of this blog piece that I was not yet spending a lot of time worrying about hospital surge capabilities. I know we can greatly increase our number of beds. However, the lack of PPE does concern me. If we don’t have enough PPE, and we don’t, it does not matter how many beds we have because we will not have staff who can be adequately protected to care for these patients.

Partly because of irrational buying up of masks and other supplies by people for home use and people coming into hospitals and clinics and stealing these supplies, health care providers are facing shortages. For two weeks I have been pleading for the President to declare a national state of emergency in order to free up our strategic national stockpiles. First, I was told that wasn’t necessary because Congress appropriated $8.3 billion in funding for preparedness. But, I pointed out it was not a money issue. Hospitals and urgent care clinics could not get the supplies even if they could pay for them. Suppliers and distributors indicated that they have supplies, but could not dip into those until an emergency was declared. Last week, I was thrilled that the President declared an emergency. This week I am deeply disappointed that only small amounts of the strategic national stockpiles have been released and that today, the President encouraged health care providers to use their typical, private supply chains (which I already indicated cannot keep up with our demand). This is going to have devastating effects in Washington state and New York if the federal government cannot figure out how to mobilize the strategic national stockpile.

6. Sustainability. There have been a lot of schools and businesses talking about closing for 2 weeks, a month or 2 months. No one knows how this story ends, but let me tell you I have not encountered an expert yet who thinks this will be over in 2 months. I hope that the disease activity will decline over the summer months, but I fear that we will be dealing with this infection until we reach levels of immunity that can only be achieved through vaccination and therefore, I think we will be dealing with this infection for another year or two. I hope I am wrong. I did hear the President say that he thought this would end in July, August or September, but I simply can’t figure out why that would be, except for one potential explanation that I find very unlikely. Therefore, I worry about our ability to sustain social distancing. I worry about our elderly and those with chronic medical conditions being largely confined to home for that period of time. It is hard to contemplate school closures for that length of time (though there are many of us who feel that is not necessary and might not even be beneficial).

So, let me conclude. There are a lot of things I am worried about, but it would not be responsible to share all those things. I believe in productive worrying. Don’t have people worrying about things they can’t do anything about and let’s leave the worrying about things that aren’t going to impact people’s daily lives to the many outstanding leaders and professionals that are worrying about these things.

While I have a number of frustrations with our federal government’s response, let me tell you that Governor Little has shown true leadership. Further, I have been impressed by the many state and public health officials and workers who have worked long hours and tirelessly to confront this crisis and keep Idahoans safe. We are incredibly fortunate to have the expertise that we have in our Idaho Department of Health and Welfare.

And, let me say this about Idaho hospitals, clinics, physicians, nurse practitioners, physician assistants, laboratory scientists, infection control practitioners, nurses, respiratory therapists, radiology technologists and technicians, pharmacists, phlebotomists, EMS, receptionists, and everyone else who come into work every day to take care of Idahoans. Keep in mind we have people avoiding events, pulling children out of school, and otherwise freaking out, yet these health care workers come to work to see and evaluate all the patients with respiratory symptoms and fever, placing themselves at risk because that is what we do. We care for people. We do it nights when you are asleep. We do it on the weekends when you are home and off work. And, we do it holidays. These people inspire me with their selflessness, their caring, their compassion and their dedication to helping others. And, many times, their spouse or other family members are at home supporting their loved one in their chosen profession, but hoping that they remain safe and healthy. Thank you health care professionals – some of the most amazing people you will ever meet.

Coronavirus Update

More Information on the Coronavirus

  1. The World Health Organization today declared that the coronavirus disease is now a pandemic. What does that mean and what is the significance of this?

It turns out that there is no widely accepted definition of what a pandemic is. The World Health Organization (WHO) defines it as the worldwide spread of a new disease. Technically, coronavirus has not spread world-wide. There are confirmed cases in at least 117 countries. How many countries are there, you ask? Well, it turns out that we don’t all agree on that number either. It depends on what you call a country. For example, is Palestine a country? So, depending on who you ask, you for the most part get numbers ranging between 189 and 196. (The United Nations has 193 member nations). So, coronavirus has not spread worldwide.

It turns out that the technical answer to whether coronavirus disease is now a pandemic doesn’t actually make a huge difference to our actions, though the leader of the WHO has indicated that he does not believe that all leaders across the world are doing all that they should be doing and hopes that calling coronavirus disease as a pandemic may get some of these leaders to step up.

2. There are now 1,039 confirmed cases in the U.S. and 30 deaths (WA – 24, CA – 2, FL – 2, NJ – 1 and SD – 1). Presumptive and confirmed cases now involve 39 states. There continue to be no cases in Idaho.

3. I continue to get many great questions, the answers are not always known, but we are learning more and more and we will have more answers in the future. Meanwhile, as I have warned in my prior blog pieces, there is bad information out there and there are unscrupulous individuals and companies taking advantage of people’s fear. There are products being advertised and sold on the internet to prevent and/or treat coronavirus. Unless it is bar soap, don’t buy it! There is no remedy that you can by over the internet that has medically been shown to prevent someone from acquiring coronavirus or that will treat or cure a coronavirus infection. Again, at best you are just wasting your money; at worst, some of these products will harm you.

I just learned of a new hoax. First, people were fearing that alcohol (Corona beer) could give them coronavirus (hopefully, by now, especially if you are a reader of my blog, you know this is not true), but now I have heard claims that you can drink alcohol to cure coronavirus infection. This is not only untrue, but it is dangerous. So, let me repeat. There is no remedy that you can by over the internet that has medically been shown to prevent someone from acquiring coronavirus or that will treat or cure a coronavirus infection.

4. Is it time for us as a society to abandon hand shaking? Probably. This tradition dates back to 5th century B.C. Greece, when people would shake hands in a demonstration that they were not carrying a weapon. This does not seem to have the same benefit today. And, we may be promoting the spread of germs, not just coronavirus, especially during cold and flu season. So, maybe Howie Mandel has had it right all along. But frankly, perhaps even better than his preferred fist bump is the newer version elbow bump. So, whether we abandon this tradition permanently, lets at least make it our practice until we have controlled the spread of coronavirus.

5. I wrote a blog piece previously in which I explained that wearing a typical face mask is not going to prevent you from acquiring the coronavirus infection. At the end of that piece, I stated that if you felt compelled to wear something, you would be far more protected to wear gloves, and I suggested in my next blog piece where I provided you with my coronavirus shopping list that you might add disposable gloves if you need to care for someone who is sick, for example emptying their trash. My wife, the nurse, told me that I need to tell readers who decide to do so, how to properly take disposable gloves off after they are contaminated. So here you go https://www.cdc.gov/vhf/ebola/pdf/poster-how-to-remove-gloves.pdf. Further, she gives extremely good advice when she reminds people who dispose of their gloves that they then need to wash their hands!

Answers to Questions you have about Coronavirus that you are Afraid to Ask

First of all, two disclaimers. I am providing you with my thoughts. These are not official positions of the federal government or the state of Idaho, though I do think my advice is consistent with government guidance. For official advice, go to coronavirus.gov or coronavirus.idaho.gov.

Second, this is a rapidly evolving situation and as we learn more, the advice may change.

What I am attempting to do is provide you with answers to questions for which I haven’t seen official guidance yet. Many of these are questions that I have recently been asked by friends or family – really!

1. Can I catch the coronavirus from Corona beer? No. The virus is not named for the beer. It is named for the appearance of the virus under the microscope in which it appears to resemble a crown – the Latin for crown is coronam.

On the other hand, in states or countries where there is significant community spread of the virus, going to a bar that is very popular and where you are in close proximity with a lot of people could increase your risks for coronavirus exposure, but that would be without regard to your specific drink of choice.

2. My sister is taking colloidal silver. She says it is supposed to kill strep, staph, the coronavirus and more. Should I take it? Absolutely not!!! First of all, there is no evidence that it does kill any of those organisms or prevents any of those infections, but there is evidence that long-term use can be dangerous to you -permanent skin discoloration, kidney damage and neurological problems. Let this be a lesson to everyone reading this. There are plenty of scams out there. Unfortunately, there are bad people and bad companies that take advantage of people’s fears to sell their products. If you see any advertisements for supplements, concoctions, potions, remedies or anything else that is suggested it will prevent or treat coronavirus, it is a hoax. At best, it will waste your money. At worst, it won’t provide you any protection and will actually harm you.

There are no known cures for the coronavirus. There is an antiviral drug that we are going to begin testing to see if it is effective in treating severe coronavirus disease, but let me repeat – at this time there is no known product that will prevent you from acquiring coronavirus infection or treat the infection once you get it. Anyone that tells you otherwise is peddling snake oil.

3. I am freaked out about coronavirus. Should I take my child out of school? No, unless your school has indicated it is closing or your child has an illness putting him or her at particular risk or there is a high-risk family member at home and there is a known case at the school. In general, children are at very low risk from the coronavirus, in fact, unlike the elderly, the case fatality rate for children from coronavirus is far less than that for influenza.

This is a good time to teach children about proper hand washing.

The problem with overreacting is that we really don’t know how long coronavirus will continue to be a threat. We don’t know whether it will subside during the warmer spring and summer months like many other cold and influenza viruses do or whether it will burn itself out like SARS virus did or whether it will return next fall and winter like influenza does. If coronavirus does not burn itself out, it is just not practical to keep your children out of school for the duration of the threat.

However, if there is reason for your child to be out of school, check with your school about the availability of online classes and work so that your child does not fall behind.

4. What about travel for spring break? This is a tough one. I wouldn’t do international travel right now because the situation is changing very rapidly, but if you are going to travel internationally, don’t go to the countries listed on the CDC’s website with level 2 or 3 travel advisories. As far as U.S. travel, if you are young and healthy, there is probably no restriction, though I wouldn’t travel to a state with widespread community spread, such as Washington state. If you are going to be bringing along anyone who is over age 70 or who has underlying medical conditions that would put them at increased risk, then consider travel that you can do in your car and activities that won’t involve large crowds.

5. What do I do? The stores are all out of hand sanitizer! First of all, take a deep breath and relax. I will tell you a secret. Bar soap is actually more effective than hand sanitizer in preventing the spread of disease. And, it does not have to be “antibacterial” soap. Most any bar soap will do the job. Just wash your hands all over – palms, back of hands, and particularly the fingers and fingertips for at least 20 seconds. Just use warm water. For the water to kill the virus, it would have to be boiling, and if you use boiling water, you will be getting medical attention for another reason. Warm water just helps disperse the soap better than cold water.

6. I was just at the store and they are out of toilet paper and distilled water. OMG! What do I do? Okay. Take another deep breath and relax again. I don’t even get this one. Why are people buying up toilet paper? Coronavirus doesn’t generally cause diarrhea. And, I haven’t even figured out what people are thinking about the distilled water. There is no evidence that you can get coronavirus from tap water and we wouldn’t recommend people drink distilled water instead of tap, bottled or filtered water anyway.

Since people now are just being crazy, here is my shopping list. It is based on two very unlikely scenarios – (1) I catch coronavirus or (2) we are worried that I have been exposed to coronavirus and I need to be self-isolated.

  • Two weeks of food supply for me and my wife. (This is the worst-case scenario that I am going to be confined to home and can’t go grocery shopping. However, I have learned from my millennial daughters that Amazon and grocery stores actually deliver stuff to your house! Wow! And, (hands moving out from my head indicating that my brain is exploding) it turns out that Uber, Door Dash and a variety of other services will actually pick up meals from restaurants for you and deliver them to your house! I thought that was just pizza, but turns out you can get just about anything!) Another tip, if you do get sick, your appetite may be suppressed and you may find that warm or hot soups are particularly soothing, so pick up some extra soup.
  • Two-week supply of your medications. This is a bit more challenging, but some insurance companies are approving early refills so that you can have an adequate supply on hand. This would be more of an issue if you are in an area with significant community spread and no family or friends that can run to the pharmacy for you. Also, there are more and more pharmacies that are beginning to offer delivery services.
  • Tylenol and over the counter cold and flu remedies (decongestant, expectorant and cough suppressant). Check with your pharmacist or physician if you have medical conditions that might restrict what medications you can take. While you are at it, don’t forget Kleenex.
  • Pet food that will last 2 weeks. Don’t forget our pets!
  • Garbage bags. Ideally, keep a trash bag near the person that is sick and have them put all their Kleenex and other waste in the trash bag and then double bag it before you put it out with the trash.
  • Detergent. Probably a good idea to wash sheets and bed clothes frequently if someone in the house does get sick. We just don’t know yet whether the virus survives on these items very long.
  • Antiseptic wipes (Clorox, Lysol, etc.). Good for wiping down surfaces in the house that the infected person comes into contact with or that are in proximity to the areas where an infected person is coughing or sneezing.
  • Optional – disposable gloves. You can use these for handling the trash or other items for the person who is sick. But, keep in mind, gloves are no substitute for hand washing. Even if you wear gloves, you should wash your hands after you take off the gloves.
  • Optional – disposable cups, utensils, plates and bowls. There is no reason to believe that dishwashers will not kill the virus, you may just want the convenience of throwing away eating utensils and other things that someone who does get sick handles and puts in their mouth.
  • Thermometer if you don’t already have one.
  • Good books. If you do have to be self-isolated for 2 weeks and turn out to be fine, you will need something to keep yourself occupied. Nothing like lying down with a good book! If you are a fast reader, you better get two.

Why You Still Shouldn’t Panic about Coronavirus

There are now about 225 confirmed cases of coronavirus diseases (COVID-19) and 14 deaths in the U.S., although these numbers may have changed by the time you read this. Yes, that is scary. But, let’s put that in perspective.

The virus has been in the U.S. for at least six weeks.

The population of the U.S. is more than 327 million. The population of Washington state where all but one of the deaths has occurred is more than 7 million.

At least seven of these deaths were residents of the same nursing home where this virus spread in a facility full of high-risk persons that likely were in close contact with each other.

In all of the death cases for which I can find information, most of the people were male and over age 70, and in the only case of someone younger, that person had significant underlying medical problems.

I am not trying to minimize this. Of course, this is serious and we must take appropriate actions, which the federal and state governments are. My only purpose in writing is to help the many people that I talk to that are very scared to understand that while we do need to take precautions, let’s be reasonable and not overreact.

We are going to see this get worse, before it gets better. There will be more infections and more deaths. But, with few exceptions, this does not need to disrupt your daily life.

What would I recommend at this time:

  1. This is a great time to go all Howie Mandel – fist bumps, or better yet, elbow bumps, as our Idaho Governor Brad Little demonstrated this week.
  2. If you have fever, cough, shortness of breath or feel ill, stay home and call your doctor if your symptoms are severe or worsening.
  3. If you need to seek medical attention, call first and alert your doctor, the urgent care facility or emergency room. We will take precautions to make sure you don’t put health care workers or others in waiting rooms in jeopardy.
  4. Wash your hand with soap and water for 20 seconds before meals, after coming into contact with groups of people, after coughing or sneezing, or after touching banisters, counter tops, or doorknobs in public places.
  5. Spring break is coming up. If you are not elderly and you are in good health, generally speaking, there is no reason you should not plan to take your planned vacation. While I probably wouldn’t recommend travel to Washington state right now, other travel in the U.S. can be considered as relatively low risk. International travel will pose more risks, and if you plan to travel internationally, avoid the countries on the CDC’s level 3 travel warnings, and unfortunately, that means Italy, but frankly, I would avoid even level 2 countries for right now. If you do choose to make that travel despite the warning, just do us all a favor and work from home for the first two weeks following your return to the U.S.

Breaking News – Supreme Court Unexpectedly Decides to Hear Obamacare Case

The United States Supreme Court just granted a request to hear the case challenging the constitutionality of the Affordable Care Act (ACA) that I wrote about on my blog on January 27, 2020. At that time, it was called Texas v. United States, but for some confusing reasons that we don’t need to get into right now, it has actually become two cases that will be heard together called California v. Texas and United States House of Representatives v. Texas.

So, let’s break this all down so you know what this means, what the implications are, and what could happen.

Background

  1. The Affordable Care Act was passed in March of 2010.
  2. The constitutionality of the requirement that everyone (subject to certain exceptions) purchase qualifying insurance (called the individual mandate) was upheld by the United States Supreme Court in June of 2012. Congress may not pass laws requiring people to do or not do things unless it has a constitutional power to do so. The Supreme Court ruled that the Commerce Clause (that gives Congress the power to regulate commerce among and between the states) does not give Congress the power to compel people to enter commerce (which requiring people to purchase insurance would do). However, the Supreme Court saved the Affordable Care Act from being ruled unconstitutional by determining that while the ACA required people to purchase insurance, people still had a choice whether to do so or pay the penalty, which the Court construed to be a tax, in part because it raised revenue for the federal government. Thus, the requirement was a constitutional act of Congress based on it taxing power.
  3. The Republican Congress tried many times, but unsuccessfully, to vote to “repeal and replace Obamacare”.
  4. Finally, in 2017, Congress enacted the Tax Cuts and Jobs Act which in part, zeroed the penalty associated with the individual mandate to zero.
  5. A number of Republican states challenged the constitutionality of the individual mandate as being unconstitutional now that the penalty could no longer be construed as a tax given that it would raise no revenue.
  6. The district court judge ruled that (1) the individual mandate was no longer constitutional because it could no longer be construed as a tax, and Congress has no other authority other than the taxing power to enact such a requirement that requires people to purchase insurance; and (2) that because the individual mandate was so foundational to the ACA, the individual mandate could not simply be severed from the ACA, but rather the entire ACA must be struck down.
  7. The case went up on appeal to the U.S. Court of Appeals for the Fifth Circuit (5th Circuit) and that court ruled (2-1) to affirm the lower court’s decision that the individual mandate was unconstitutional, but remanded the case (sent it back for reconsideration) to the lower court to go through the ACA provision by provision to determine which provisions must be struck rather than just summarily concluding that the entire law must be struck.
  8. A request was made to the U.S. Supreme Court to take the case up for review on an expedited basis. Had expedited review been granted, it was likely the case would be heard and decided prior to the 2020 elections. Most experts agreed that this would be a bad outcome for Republicans running in the 2020 election. That request for expedited review was denied.
  9. However, a request for review in the normal course of review by the Supreme Court was also requested and today, the Court granted that review.

Why would the Supreme Court agree to hear this case?

To me, this is the million-dollar question. Frankly, I was quite surprised that the Court agreed to hear this case. First of all, it is quite unusual for the Court to take a case prior to it having worked its way through the lower courts. This case was back in the hands of the lower court for the severability analysis. I would not have expected the lower court’s decision on that issue until next year. From there, I would have expected the case to be appealed once again to the 5th Circuit. If the outcome coming out of the 5th Circuit was that the individual mandate was unconstitutional and it could be severed from the rest of the ACA leaving it as the law of the land, I would not have been surprised if the Supreme Court denied a request to hear the case.

Second, the Supreme Court has many more requests to hear cases than they have the time and ability to hear and decide. Therefore, the Court denies the vast majority of requests for appeal. For this reason, it has seemed to me that the Court does not often agree to hear cases just so it can affirm the lower court’s opinion, especially when there are no other lower courts coming to a different decision. In this case, the only matters that has been decided by the lower courts are that the plaintiffs were entitled to bring the lawsuit and that the individual mandate is unconstitutional. It seems overwhelmingly likely that the Supreme Court would come to the same decision about the individual mandate, especially in view of their prior ruling in 2012 I referenced above.

The Supreme Court does not indicate its reasons for agreeing to or denying a request to hear a case, so I am left to speculate. Of course, it is possible that the Court concluded that this is a case of tremendous impact to the country and the millions of people whose health insurance coverage under the ACA could be threatened, and therefore the Court should hear the case just to provide clarity and allow a more speedy resolution to all the uncertainty that exists given the initial ruling in this case. I don’t think this is the reason. I think if this were the case, the Court would have granted the request for expedited review, which it did not.

Another reason could be that a sufficient number of justices on the Court feel that the 5th Circuit is plainly wrong and doesn’t want this case to spin in the lower courts for another year or two. I don’t think this is the reason, either. In fact, it seems to me that the decision about the individual mandate is plainly right, and consistent with prior Supreme Court rulings.

 Another possibility that could explain why the Supreme Court is willing to jump in when the case has not run completely through the lower courts could be on a foundational question – did the plaintiffs who brought the case have standing to do so?

Standing is a legal concept that limits who can bring a lawsuit. To greatly oversimplify this, in essence, you cannot bring a lawsuit unless you have suffered a personal and identifiable harm that someone else wrongly inflicted. As an example, if someone were to wrongly terminate my sister from her employment, I might very well be outraged, but I do not have legal standing to sue anyone about that. My sister would be the one with a cause of action, if there was one. In this case, the question is far less clear and much more interesting to legal minds. Can someone be harmed if a law requires them to do something, but there is no penalty or consequence for not doing it? The individual plaintiffs assert that they have standing because they are law-abiding citizens, and if the law requires them to buy insurance that they otherwise would not have purchased, they have been harmed, even though there would not have been any consequence imposed upon them if they had merely decided not to comply with the mandate. Similarly, the states that brought this lawsuit are arguing that they have been harmed because, among other things,  employers in their states will still be burdened administratively by the requirement to report IRS form 1095 for their employees that verifies that the employee had qualifying insurance coverage for the tax year, even though there is no penalty to the employee for not having had such coverage. This is a very interesting legal question, one that I am not aware that the Court has ever addressed, and it could be that the Court wants to handle this issue before the lower courts spend a lot more time going through the severability analysis.

Though I suspect that the standing issue is the reason for the Court agreeing to hear this case, it is also possible, but less likely in my opinion, that the Court wants to intervene to provide guidance to the lower court as to how to conduct the severability analysis. When a court determines that a provision of a law is unconstitutional, that provision is, in essence, struck from the law. The next question for the court is whether the rest of the law can stand without that provision, and if not, which other provisions must be similarly struck down. The Supreme Court has in the past made clear that the presumption should be towards severability of the unconstitutional provision and not striking down the rest of the law, or any more of the law than is necessary, so as not to interfere with Congress’ constitutional authority to legislate. To some degree, courts have to grapple with the difficult decision of deciding what would Congress have intended had they known that the provision in question would be struck down – would it have wanted the remainder of the law to stand or fall? But, the answer to that question is seldom known. Sometimes Congress is clear and inserts a severability provision in a law that plainly states that if one provision of the law is struck, it is Congress’ intent that the remainder of the law stand. Such a provision was not included in the ACA.

For me, this case is much more easily decided on the question of severability. In this case, the only action Congress took to amend the ACA was to change the penalty to zero. Knowing that the individual mandate could no longer be enforced, and it was therefore not compulsory, Congress allowed the remainder of the ACA to remain unaltered. This seems to be the clearest evidence of Congressional intent, i.e., that if the individual mandate was no longer in effect – whether by Congress’ action of zeroing out the penalty, or by a court’s action of striking the provision as unconstitutional – Congress intended for the remainder of the ACA to stand.

It is possible that the Court wants to provide this guidance to the lower courts and avoid this case from dragging out for another couple of years while a lower court goes through the tedious and unnecessary process of reviewing a 2,700-page statute. That would not be typical of the Court, and therefore, I stick with my guess that the standing issue is the reason for the Court’s agreement to hear this case.

What are the implications and what might happen as a result of the Supreme Court’s review?

  1. This case will be heard during the Court’s 2020 term, which means that it will be heard and decided sometime between October of 2020 and June of 2021. The good news for Republicans is that the case will not be reviewed and decided prior to the election.
  2. The President, House of Representatives and Senate will be under great pressure to have a replacement bill at the ready in advance of the Supreme Court’s ruling, as the public will be concerned that the Supreme Court will uphold the lower court’s decision to strike down the entire ACA (I think this is the unlikeliest of all possible outcomes, but of course, my prediction could change if unexpectedly, one of the liberal-leaning justices was replaced with another conservative justice on the Court). However, with a Presidential election in November and many House and Senate seats up for election, the make-up of the White House and Congress could significantly change by January, and it may not be a result that facilitates agreement on a replacement bill (as it that was even likely with the incumbents).
  3. If I am correct and the Court focuses on standing and decides that the plaintiffs in this lawsuit do not have standing, then this case will be dismissed and all of the lower court decisions will be vacated (be of no effect and as if they were never made). This will be huge and will secure the ACA as it is today as the law of the land.
  4. If the Court does affirm the lower courts’ decisions that the plaintiffs do have standing, but overturns the lower court’s decision that the individual mandate is unconstitutional (I would be very surprised by this), then the case is over and the ACA remains the law of the land as it is today.
  5. If the Court does affirm the lower courts’ decisions that the plaintiffs do have standing and affirms that the individual mandate is unconstitutional, then I do think the Court will provide the lower courts guidance on the severability issue, otherwise, there seems like there was little reason for the Court to get involved in this case, earlier than would be customary. That could end up accelerating the lower court’s analysis and would lessen the chances that the case would go up on appeal again, so we could have a final decision later this year or early next year.

For those of us who want to solve the health care issues plaguing our country, even if we may find faults with the ACA, most of the scenarios I can imagine as an outcome of the Supreme Court’s review are favorable and not cause for alarm. Nevertheless, there can always be surprises, and certainly my speculations might be wrong. Fortunately, throughout history, the Supreme Court has considered the impact of its decisions and has largely tried to avoid situations that would plunge the country into chaos, which certainly striking down the ACA without a viable alternative would do. In more recent history (2012), we know that the Chief Justice went to considerable lengths to save the ACA from being ruled unconstitutional, even though he received great criticism from members of his own political party. At a time when I am unconvinced that politicians can set political interests aside for the best interests of the country, I remain convinced that the judicial system will set politics aside for the rule of law and the best interests of the country, perhaps not in all cases, but at least in the case of our Chief Justice.

Is Drug Importation the Answer to High Drug Prices?

In last week’s blog post, I discussed some of the legislation being considered in an attempt to control drug prices. I concluded that piece indicating that this week’s blog piece would address another proposal that President Trump has talked about – allowing for the importation of drugs from other countries as a way to make medications more affordable for Americans. I also indicated that, in my opinion, it is unlikely to work. Here’s why.

There is no question that Americans can cross the Canadian or Mexican borders and purchase their medications at much lower cost than those medications are available in the U.S. That is not what we are talking about when the President and a number of states propose drug importation. In those cases, they are referring to large scale importation of medications by the state or a state agency to lower the costs of drugs for their Medicaid programs, and in some cases, wholesalers and pharmacies could also import medications to offer them at a lower cost. The most common proposal is to import these medications from Canada.

There are a number of reasons I think this is unlikely to work.

  1. Insufficient supply

One only needs to consider that the population of Canada is about 1/10th of the population of the United States. In fact, the population of California alone is a tad more than the population of all of Canada. There simply would not be enough supply of medications in Canada to supply both Canadians and any significant portion of the U.S. Further, fearing drug shortages themselves in response to the discussion here in the U.S., Canadians are already pressing lawmakers to prevent the export of medications to the U.S.

  • Why would drug makers cooperate?

I cannot imagine that drug makers would increase the supply of medications to neighboring countries just so that they can turn around and sell those medications less expensively to Americans. Further, one can imagine that drug makers would create contractual obligations on foreign purchasers of their medications not to sell those medications outside of their country. And, it seems extremely likely that drug makers would legally challenge any legislation or rule here in the U.S. that allowed for drug importation. Finally, even if Canadian exporters could access the medications needed and legally export them, it must certainly follow that drug makers would increase the prices of those medications in these countries to make up for decreased revenues in the U.S., and foreign governments would have to respond to the pushback of their own citizens at increasing drug prices, and importation would make less and less economic sense.

  • Current U.S. proposals are likely to exclude many costly medications

While there is no new legislation or rule allowing for importation, it is considered very likely that certain medications that require special temperature controls and handling would likely be excluded, such as insulin and biological drugs. In addition, not wanting to exacerbate our current opiate problem in the U.S., it is suspected that many controlled substances might also be excluded from importation. In fact, with the added cost of the regulatory obligations that likely would be imposed to help decrease the chance for importation of counterfeit drugs, two states that have seriously looked at importing drugs have concluded that only a couple dozen drugs would likely save the states significant costs.

  • The threat of counterfeit medications is real

CanadaDrugs.com, which appeared to be legit and have the appropriate documentation was sentenced to pay $34 million in fines and forfeitures in 2018 for introducing misbranded drugs into interstate commerce. That is just one company. There is a black market for drugs and many more will enter the fray if the opportunity to distribute their fake or adulterated medications is facilitated by a change in U.S. policy concerning drug importation.

So far, four states have enacted laws or are considering laws to allow for drug importation if the U.S. adjusts its policy to allow for it – Colorado, Florida, New Hampshire and Vermont.

There are other, more effective ways to reduce drug prices. Importation is not likely to do so.

If You are Freaked Out about the Coronavirus, Read This!

There is no doubt that the situation concerning coronavirus has worsened. I certainly felt more encouraged when the overwhelming majority of cases were confined to China. The spread of cases (but, keep in mind, we are talking very low numbers of cases) to 58 countries is disappointing and suggests early efforts to restrict travel were not entirely successful. But, many of these countries have only 1, 2 or 3 confirmed cases, and, in some cases, these persons were known to be at risk because of travel and therefore were kept under quarantine in their home country during which time the infection was identified, so in fact, public health measures have helped constrain the spread of this virus.

It is important to maintain perspective. Although things can change over time, thus far, the magnitude of infections has not eclipsed that of influenza (the “flu”). Further, there are reasons to believe that while certainly there is person-to-person spread, the effectiveness of spread of this virus from person-to-person is less than some of the other viruses we have dealt with. Why do I say that? First, lets keep in mind that this infection became recognized in early December. Here we are at the end of February. There are close to 83,000 cases world-wide. The infection began in Wuhan, China, so it is the geographic area where the virus has had the most time and opportunity to spread. Yet, we have less than 80,000 identified cases in all of China, but the population of just Wuhan is 11 million people.

Further reassuring is the fact that while we now know that this virus can be spread from an infected person even when they have not yet developed symptoms (which this fact would raise the risks for community spread of the virus), in the US, we have only just now identified the second case in which this community spread of the virus appears to have occurred. To be clear, I am expecting many more cases in the coming weeks and months, my point is this is not spreading like wildfire.

I certainly do not mean to convey that we should be dismissive of the threat or not take our preparedness and response seriously, I am just calling for us to keep things in perspective, at least until such time as we know the situation has changed.  

So, let me address the most common question I get – “should I be wearing a mask?” Last night I heard a reporter on television indicate we should. This is NOT correct. There are two groups of people who should be wearing masks – people infected with the virus and those caring for them.

Let me explain why. The coronavirus is incredibly small. You cannot see it without advanced microscopic imaging techniques. It is so small that it can easily penetrate the porous material that masks that you can buy at the drug store or on the internet are made of. The reason we put masks on patients is that though the virus is extremely small, when it is projected form the lungs, throat and mouth of an infected person, it is surrounded in a mix of secretions that make it a bigger droplet. The size of that droplet is largest when it leaves the patient’s mouth or nose and at this size, it can often be trapped in the mask, but when the person is not wearing a mask, the surrounding secretions rapidly are dispersed into the air and evaporate or land on surfaces as they travel through the air, and the further it travels, the smaller it becomes, to the point that by the time it reaches another person standing several feet or more away, it has decreased to this ultra-microscopic size again, that can relatively easily penetrate a mask, or probably more often, be breathed in by the person wearing the mask as the virus enters the person’s nose that is not covered by the mask, or if it is, around the sides of the mask which are not air-tight and often have significant gaps, or even through the mask material itself.

That is why in the hospital, when we are caring for patients such as these, our health care workers do not wear these kinds of masks. They wear a special kind of mask that can filter out 95 percent of particles the size of these viruses and for which our personnel are specially fitted to ensure that there are not even tiny gaps, let alone the kinds of gaps that are quite common with commercially available masks.

You might say, well, even if the mask will not offer me good protection, it might offer me some protection, and I feel better wearing it. That is the problem. I am very concerned that people wearing masks will actually be at more risk because they may be complacent and not take much more effective measures, such as washing their hands.

Although we are still learning about this particular virus, it is often the case with viruses that people become infected with the virus through contact with the infected person’s secretions through direct contact or contact with a surface nearby in close proximity in time and space to the person that has coughed or sneezed and then put their own hand up to their eyes, nose or mouth. People would be far better off just to wash their hands with soap and water for at least 20 seconds, or use a hand sanitizer, frequently, and certainly before eating or after having close contact with other people or touching surfaces often being used by large numbers of the public – handrails, doorknobs, etc. So, if you are really determined to wear something, wear gloves instead of a mask!

The best advice for coronavirus and other colds and flus – stay home if you are ill. Do not expose your colleagues to whatever you have. Don’t send children to school or daycare when they are sick, especially, if they have fever. Wash your hands frequently. Cover your mouth when you cough or sneeze and then wash your hands. If you do believe that you might have coronavirus – you have had travel outside of the US in the past 2 weeks or you have been in contact with someone who is believed to have coronavirus, call your physician or the emergency room before showing up. This way they can meet you before you come in the office or emergency room, put a mask on you and take you to a special isolation room where we can minimize your exposure to others and our healthcare workers can be protected until we have a chance to determine whether you likely do or don’t have coronavirus. Remember, if you have cold or flu symptoms and have not had recent international travel or exposure to someone known or suspected to have coronavirus, it is extremely likely you just have a cold or the flu, and very unlikely that you have coronavirus.

Legislating Drug Prices

Loyal readers of my blog (both this one and my prior blog for St. Luke’s Health System) know that I try very hard to present health care issues fairly, objectively and from a non-partisan viewpoint. I try to outline both sides to these issues, state the pros and cons, and write my analysis in a way that non-medical people can understand and make their own judgment. However, at the end of these pieces, I also state where I come down on the issue, because some readers want to know. But, I am very careful to be clear when I am presenting facts and when I am presenting opinion.

I don’t know if I can do it this time. I won’t have any problem being objective about the specific proposals. Frankly, while I do think one is better than the others, if I were asked to solve the drug pricing problem (and I haven’t, but Mr. President, you know how to reach me), I would propose a completely different scheme.

The problem that I will have is in not rolling my eyes and making faces at some of the utterly ridiculous things being said as reasons some legislators do not want to support any regulation of drug prices. So, I am going to give it a try, but my apologies in advance.

Well, I am going to fail right off the start. I have to editorialize about the crazy drug pricing methodology that is being embraced by drug manufacturers and academicians. There is no need to get into all the complexity to explain the problem of it. Let’s just understand that this new and prevailing drug pricing philosophy is that the drug price should be tied to the number of Quality Adjusted Life Years (QALY). This measurement accounts for both the quality and quantity of life added by a treatment. If a treatment were to cure a disabling disease that generally took the lives of children, but those treated children would now lead normal lives with normal adult life expectancies, then the QALY would be very high. The QALY is then multiplied by a value of a year of added life and the number can be quite high, which explains why we now have medications on the market with six and seven figure price tags, including one for which a course of treatment costs more than $2 million.

Now, at first blush, you might think that a drug that cures a bad disease and allows a child to live a normal life expectancy should be priced high. But, the absurdity comes in when you apply this same pricing philosophy to anything other than drug prices. For example, if a child has a perforated appendix and is not operated on, a certain number of those children will die. Does that mean an appendectomy should be priced at millions of dollars? Heat and electricity can be life-saving to a child during the winter. Should our power bills be in the hundreds of thousands of dollars? What about water? Winter coats or blankets? In all other industries, the price for products and services has some correlation to cost. The reason drug manufacturers can think about pricing drugs in the hundreds of thousands or millions of dollars? Health insurance.

Now, if I did not convince you that pricing drugs (or anything else for that matter) based on QALYs is crazy, then consider this. Asking two questions has helped me immensely in setting out compensation methodologies, health care policy positions and making many other decisions. What incentives am I creating, and are they aligned to my objectives? Knowing the rules, how will people do end-runs around it to maximize their position to my detriment?

In this case, let’s just think about the first question. What incentives does this pricing methodology create? It incentivizes drug makers to place their investments in diseases of children that limit their life expectancy, because then the QALY can be quite high. Now, that is a good and worthwhile incentive. Nothing has broken my heart more than children who die of various diseases. But, let’s look at the second part of that first question – are those incentives aligned with our objectives? I want cures for children, but I would also like research into and development of cures for dreadful diseases like Alzheimer’s. If a huge part of the drug price is the number of years of additional survival, how much effort is going to go into developing a treatment for Alzheimer’s disease when the average age at diagnosis is 80? Additionally, we are facing a problem right now of drug makers not investing in antibiotics, at a time when we are seeing infections emerge whose causative organism is resistant to all or most all currently available antibiotics.

Okay. Enough editorializing for the moment. Let’s look at some of the current proposals.

Not surprisingly, Republicans and Democrats have very different approaches to this problem. The one approach that has general agreement is to cap seniors’ out-of-pocket spending under Medicare drug plans[1]. Currently, there is no limit on how much a senior might be required to pay for medications pursuant to co-pays and co-insurance. This is very important because surveys suggest that nearly 1 in 4 seniors struggle to pay for medications, and that due to costs, about 29 percent do not take their medications as directed, not filling prescriptions, skipping doses, cutting medication doses to spread their medication out more, or substituting their medication for something else over-the-counter.

Limiting seniors’ medication costs and ensuring that seniors take their medications as prescribed serves a very important policy objective. Given that medications are the mainstay of therapy to control congestive heart failure, diabetes, high blood pressure, asthma and many other conditions that if not controlled result in a high rate of hospital admissions, subsidizing the cost of these medications is far more economical than paying the much higher costs of hospitalization.

The House bill (Democratic)[2] would require the Medicare program to negotiate the prices of at least 35, but up to 250, prescription drugs a year[3] and cap the prices Medicare would pay for those drugs based on the prices paid in other countries[4]. The price negotiated by Medicare would also be available to commercial insurers, and drug-makers who declined to agree to a negotiated price would be subject to an excise tax of up to 95 percent of the gross sales of the medication. President Trump, early on, had given his support for this kind of approach pointing out that Americans were subsidizing the costs of drug development for the world. More recently, he has indicated that he would not support this bill. Given that Leader McConnell refuses to have hearings or a vote on this bill, it is DOA to the Senate.

The other significant bill on drug pricing comes out of the Senate Finance Committee[5] and is championed by Sens. Grassley (R-IA) and Wyden (D-OR). This bill would penalize drug-makers that raise their prices faster than the rate of inflation. As a point of reference, the current inflation rate is around 2 percent, and drug-makers typically announce drug price increases twice a year, with the first being in January and those price increases for 2020 averaged around 6 percent (Pfizer increased prices on 40 drugs by more than 9 percent). Unfortunately, there are only about ten Republicans in the Senate who have signed on to this bill and Sen. McConnell has thus far refused to put the bill before the Senate for consideration.

Okay. Prepare yourself. I am going to begin editorializing again. Republicans have objected to “price controls” and interference with a free market as reasons, including allowing the Medicare program to negotiate prices of drugs it pays for, not to support either bill. There is just one problem – the pharmaceutical industry is not a free market[6]. It is also ironic that while many have objected to price controls being applied to drug pricing, they have supported price controls in the context of surprise billing (that’s a whole other story).

In any other industry, when the government intentionally creates a monopoly or establishes a single provider of a service (much as it does with pharmaceutical companies when it grants them exclusivity through a prolonged period of patent protection), the government also imposes regulated rates. With the tremendous lobbying power of the pharmaceutical industry, Congress has refused to impose any rate regulation. Congress is even balking at limiting pharmaceutical companies from raising the price of drugs in excess of inflation. Instead, a number of pharmaceutical companies came out and stated that they would limit price increases to no more than 10 percent – that is five times the current inflation rate. And, these are drugs for which there is no substitute or competitor.

Now, the other more incredulous argument is that we cannot allow Medicare to negotiate drug prices because we must preserve a free market. I will admit right away that I am not an economist. But, isn’t negotiation the very hallmark of a free market? As far as I know, the sales of cars and houses occur in a free market. Would these legislators seriously want us to believe that they would just go in and offer the sticker price on a car or the listing price on a home (okay, maybe they would have to in Boise) without any negotiation?

I just wish we could have serious policy debates and negotiations in Congress. I would respect legislators who would just be honest about their opposition to these bills, rather than proposing a ludicrous rationale or insulting the intelligence of voters. If you want to argue that supporting these bills would inhibit development of new drugs, then we can have a rational debate about that. If you want to argue pharmaceutical companies are a powerful driver of our economy and we don’t want to do anything to hurt their earnings or their stock prices, okay then; lets discuss that. If you even just want to be honest and say that it is expensive to run campaigns and therefore you are dependent upon pharmaceutical company financial support, or alternatively, your re-election prospects would be hurt by negative ads sponsored by pharmaceutical drug companies against you if you did not support them; at least your honesty would be refreshing. But, when you say silly things like we have to protect the free market for medications, then we just don’t know whether you are clueless or whether you think we are.

In my next blog post, we’ll consider another proposal to control drug prices that is unlikely, in my opinion, to work – drug importation from other countries.


[1] The cap would be $2,000 under the House bill and $3,100 under the Senate Finance bill. To give you an idea of the problem being addressed, more than 1 million Medicare beneficiaries cross the catastrophic threshold for prescription drug costs every year, which in 2019 was $5,100 in out-of-pocket costs.

[2] The Lower Drug Costs Now Act of 2019 (H.R. 3).

[3] Under current law, the government is actually forbidden by legislation passed in 2003 from negotiating the prices of medications for the Medicare program.

[4] To be eligible for negotiation the medication would have to meet criteria of being costly and not having a competing generic version. In addition, insulin is specifically excluded from eligibility for negotiation. The countries whose drug prices would be averaged to set the benchmark would be Australia, Canada, France, Germany, Japan and the United Kingdom.

[5] S 2543. The Prescription Drug Pricing Reduction Act of 2019.

[6] Evidenced by federally-granted periods of exclusivity and patent protections that can last a number of years to 20 or more years and the statutory prohibition on the federal government against negotiating prices of medications for the Medicare program and on states for negotiating the prices of medications for the Medicaid program.