Government Executive - Authors - Marilyn Werber Serafini

Three insurers move up age for young adult eligibility

Marilyn Werber Serafini — Thu, 22 Apr 2010 00:00:00 -0400

Health and Human Services Secretary Kathleen Sebelius has announced that three major health insurers have agreed to let young adults stay on their parents' plans after they would normally lose their eligibility.

Blue Cross Blue Shield plans, Kaiser Permanente and Humana, she said Tuesday, have adopted the new health care law's higher age limit before they're required to at the end of September. Sebelius has been encouraging insurers to step up ahead of that deadline.

Carriers have traditionally allowed young adults to stay on their parents' plans only until they graduate college, and that has pushed many onto the ranks of the uninsured, if they haven't found jobs that offer coverage.

"The Affordable Care Act, and the voluntary actions of insurers to eliminate the coverage gap for young adults on their parents' plans, will give greater health security to millions of American families," Sebelius said in a statement. "Insuring younger Americans is a top priority for the administration and we will continue working to expand the opportunity for children and young adults to have access to quality, affordable care."

"The entire Blue Cross and Blue Shield system, which provides coverage to nearly 100 million Americans in every ZIP code in the nation, is committed to working collaboratively with the administration, Congress, state regulators and all stakeholders to provide for an effective and workable implementation of the new health care reform law," said Scott P. Serota, BCBSA CEO. "By proactively making this change now, Blue Cross and Blue Shield plans are working to enhance and preserve coverage for as many Americans as possible."

The Blues plans will make the coverage available to those insured through their employer accounts.

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Security glitch slows early arrivals at Democratic convention

Marilyn Werber Serafini and John Maggs — Mon, 25 Aug 2008 00:00:00 -0400

The problems were solved after a few hours at the 9th Street entrance and the lines shortened to about five minutes by 3:30 pm. But as the police and the media traded blame for the snafu, it wasn't clear whether the incident presaged future problems.

Malcolm Wiley, spokesman for the Secret Service, said that security officials unwisely chose to channel news media, many carrying large amounts of electronic equipment, through the same three metal detectors that were being used to clear official DNC staff. "Once we determined that this was happening, we were able to separate out the DNC staff and things moved much more smoothly," Wiley said.

Not quickly enough for some DNC workers. Even those with important jobs awaiting them inside the center couldn't seem to figure out a way in. "We're the people who built the whole [voting] system, so if they were trying to vote right now, it wouldn't work," said one staff member waiting in the security line on Auraria Parkway who asked to remain anonymous.

Three other DNC staffers who had waited a few minutes at the back of the intimidating line at the 9th Street gate--which looked like it would take hours to work through--heard a rumor that the gate by the Pepsi Center light rail stop had opened, so they walked about 30 minutes to get there. But there they were turned away because they had electronics that the sole police officer manning that checkpoint said she didn't have time to check. They, and many others, were ejected to nearby Elitch Gardens and told to walk around the entire convention complex.

What did the DNC staffers plan to do from there? They just weren't sure whether it was worth the trek back to the 9th Street gate. "They should have planned better," said one. "The whole convention has been like this."

Part of the problem was that media people had been advised that the convention area would be closed until noon for a security sweep, when the sweep actually ended by 10 a.m. "We were here for an hour or two and no one showed up," said one police sergeant at the gate. "Then they all came at the same time."

Wiley said that security officials had ample numbers of personnel and metal detectors to deal with the large increase of convention-goers expected on Monday. "We had a minor problem, and we dealt with it," he said.

Ashley Johnson contributed to this report.

For full coverage of the Democratic National Convention, go to NationalJournal.com.

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HHS secretary keeps it real on blog

Marilyn Werber Serafini — Wed, 26 Mar 2008 00:00:00 -0400

Got something to say to Mike Leavitt, secretary of the Health and Human Services Department, but can't get an appointment? Try his blog, at secretarysblog.hhs.gov.

Last August, Leavitt became the first Cabinet member to hit the blogosphere, although others have followed suit. Leavitt's self-written blog is chatty and reflective, in comparison with the more formal (and mostly staff-written) one for Homeland Security Secretary Michael Chertoff.

"I'm sitting at my desk with a bowl of soup for lunch. I have 30 minutes and I'm thinking this might be a good time to respond to a few comments you have sent," Leavitt wrote on January 30. While slurping his soup, he responded to postings about bird flu in Latin America, health care reform, import safety, and electronic medical records as a means of lowering Medicare spending.

Leavitt doesn't shy away from critics, such as one who wrote on January 22: "Instead of talking about 'safe' topics such as India or Guatemala, why don't you address meaningful topics to the American people, such as what efforts you and the administration are undertaking to fix our health care system?"

Leavitt defended the overseas entries, and the trips themselves, saying they directly affect the health of Americans. "Most of my time in India was focused on products Americans consume," he said. However, he added, "I should also confess that I use this blog as a way to keep track of what I learn on these trips as a journal of sorts."

Leavitt does some of his blogging on overseas flights. On airplanes between destinations in China and India, he kept readers up to speed about his progress on import safety negotiations with government officials. The blog entries often offer personal impressions of the people and places he's visited, and what he's learned from the experience.

On January 7, Leavitt wrote about a cardiologist he met in Chennai, India, who had trained in the United States. "He returned to India to set up private hospitals. His company, Apollo Hospitals Group, now has 46 hospitals. I want to write more about this later, because one of their hospitals' trademark characteristics is, they make their results public and post their prices. They have results that rival the best U.S. hospitals, and their costs are a fraction of U.S. prices."

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Lawmakers want answers on unspent flu vaccine funds

Marilyn Werber Serafini — Mon, 22 Oct 2007 00:00:00 -0400

Rep. Kay Granger, R-Texas, a member of the House Republican leadership, is hoping to call HHS Secretary Mike Leavitt on the carpet at a hearing to explain the holdup. Granger and six other GOP leaders sent a letter to Leavitt in June asking why the money hasn't been spent.

"We are concerned about the slow progress in completing key elements of the department's preparedness plans. One of the most notable of those elements is the planned stockpiling of anti-virals," they wrote. "The planned anti-viral stockpile remains incomplete despite the fact that ample resources are available now to put that part of the plan firmly in place."

Signers included House Minority Leader John Boehner of Ohio, Minority Whip Roy Blunt of Missouri, and Republican Conference Chairman Adam Putnam of Florida.

There is no bird flu vaccine yet, so the federal government asked Congress for money to stockpile anti-viral medications -- the kind that people take when they get seasonal flu -- as part of its National Strategy for Pandemic Influenza. A vaccine would take at least six months to develop after a pandemic strikes, and scientists say that the best treatment in the interim would be anti-viral drugs, which reduce the severity of flu symptoms.

The reserve is designed to have enough medication by 2008 to give 25 percent of the U.S. population five days of treatment. That translates to 81 million courses of treatment. The federal government was supposed to purchase 50 million courses, and HHS encouraged states (by offering a subsidy) to buy the remaining 31 million. So far, HHS has spent $3.6 billion of the $6.1 billion appropriated since 2005.

But to date, the reserve holds enough anti-virals to cover only 15 percent of the population, according to Thad Cochran of Mississippi, the Senate Appropriations Committee's ranking Republican.

HHS spokeswoman Holly Babin said that Congress has approved only two-thirds of the money that President Bush requested in 2005 for anti-viral medications and that HHS is waiting for an additional $248 million that it requested in this year's appropriations process.

Granger says that Leavitt never responded to her letter, so she called him last week. "He said no, that he didn't intend to use the unobligated funds. This is very disturbing. He said there was a timeline, and that there are other needs that he must put ahead of that. I wasn't satisfied with his answer."

Granger said that Leavitt seemed to be hoping that a bird flu vaccine will be developed, although it would be hard to make an effective one without knowing which strain of influenza virus has mutated to start a pandemic.

"Public health experts estimate that a pandemic of even relatively low severity could potentially cause 90,000 deaths if appropriate precautionary measures are not put in place," Cochran said in a September 10 letter to Leavitt. "In lieu of a vaccine that has yet to be completely developed, and knowing that even the experimental vaccine would not be available in sufficient quantities at the outset of an influenza pandemic, I urge you to designate any unobligated funds under [the National Strategy for Pandemic Influenza] toward the completion of purchases of anti-virals for the stockpile."

House Majority Leader Steny Hoyer, D-Md., and two other House Democrats sent a similar letter in August. Hoyer did not get a response, according to an aide in his office. "Mr. Hoyer is still concerned that we're not fully prepared to face a flu pandemic, and it's concerning that Secretary Leavitt has not responded to several requests," said Hoyer's spokeswoman, Katie Grant.

It's not that the drugs don't exist. Indeed, the Swiss-based pharmaceutical manufacturer Roche has geared up its production of anti-virals and is awaiting authorization to fill a U.S. order. Roche manufactures Tamiflu, which makes up the bulk of HHS's stockpile because it is widely considered the most effective medication against bird flu. GlaxoSmithKline makes another anti-viral, Relenza, but it has been the second choice partly because it requires an inhaler.

At the government's request, Roche set up a self-contained manufacturing operation for Tamiflu in the United States, so that the company would not be dependent on any other country to supply Americans in a pandemic. (The concern is that governments would require drugmakers within their borders to treat their citizens first.) The company increased its production capacity from 80 million treatment courses a year to 400 million and switched from blister packs to bottles, also in response to U.S. requests.

Already, however, the company has had to "tailor down to meet demand, which is much lower than what we anticipated," said Mike McGuire, Roche's vice president of anti-infectives. If orders don't pick up soon, McGuire predicted that smaller manufacturers that have subcontracted with Roche to help it produce the 400 million treatment courses a year will turn to other drug projects.

Even if HHS signed a contract with Roche today to fulfill the Tamiflu orders, it would take two to three months for the company to deliver, McGuire said. Roche has some Tamiflu in production, but it won't complete the process until it has a contract, to ensure the longest possible shelf life for the product, according to McGuire.

"There's a six-step process to manufacturing Tamiflu," he said. "We have made various amounts of the product at each step. We never really produce in anticipation of an order. If we produced 10 million more, and the government doesn't buy it until March, we've lost some dating. We want to give them the best dating." Tamiflu can be stored for as long as 60 months, the manufacturer says.

In the meantime, if other governments or corporations signed contracts with Roche to buy Tamiflu, Roche would tap that "almost ready" supply. If subcontractors have moved to other projects, it could take up to eight months for the company to resume deliveries to HHS, McGuire said.

"If we were to get orders from the government, we would do everything we could to manufacture it as quickly as possible," McGuire said. "But in all of our discussions, all the way to our CEO, our mantra has been, once a pandemic starts, it will be too late, and that's why we need to be prepared now, and part of it is stockpiling."

States also have not met their goal of purchasing anti-virals. Under the National Strategy for Pandemic Influenza, the federal government has called on states to hold a total of 31 million treatment courses, as part of the 81 million overall. As an incentive, the U.S. is covering 25 percent of a state's bill. But states are not required to comply.

States have purchased 12.7 million treatment courses of Tamiflu, according to McGuire. Altogether, he said, 38 states have ordered Tamiflu from Roche, and 15 of them ordered their full allotment.

Part of the problem is logistical. Some state legislatures meet only during certain months, and that has slowed funding decisions. In addition, some state leaders have been hesitant to buy the medications, concluding that their money might be better spent on other protective measures.

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National Institutes of Health feels budget squeeze

Marilyn Werber Serafini and Neil Munro — Fri, 14 Apr 2006 00:00:00 -0400

Now, facing a third year of losing ground to inflation, the biomedical researchers who depend on government funds are complaining that there isn't enough money to go around. Conflicts are brewing that could pit new priorities such as finding vaccines to stop bird flu against long-standing efforts such as developing drugs to combat Alzheimer's.

Much of NIH's $28.6 billion budget flows to university researchers through the agency's 26 centers and institutes devoted to different specialties. According to the American Association for the Advancement of Science, the NIH request would fund $27.8 billion in research and development.

Traditionally, the research community's varied disease groups, such as the American Cancer Society and the American Heart Association, have presented a unified front in pressing for research dollars. That comity may erode as competition increases for slices of a budget pie that has stopped growing.

The signs of tension are sometimes subtle. The American Cancer Society raised eyebrows when it won an earmark in the Senate's budget resolution. At an April 6 hearing before the House Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies, members supported greater overall spending on biomedical research. They then urged NIH Director Elias Zerhouni to focus more on specific problems, such as mental health, or on particular groups, such as women and racial minorities.

"If the knives are going to come out, now is when it will happen," said Samuel Gandy, who chairs the scientific advisory panel of the Alzheimer's Association. His group depends on the roughly $650 million spent annually by NIH on Alzheimer's research. That amount, though, makes its cause an also-ran compared with the $4.8 billion devoted to cancer. But Gandy's association says it won't try to snag other groups' funding, because "we may need [support from] the dentists and cancer guys tomorrow."

The disease groups won a round on March 16, when the Senate voted to add $7 billion to the budget for health, education, and labor programs, with several senators citing the need to help NIH. In the House, the budget was pulled from the floor partly because a group of moderate Republicans led by Rep. Mike Castle, R-Del., was pushing for a similar increase, while conservatives stood firm.

In the end, "the highest likelihood is that [NIH's budget] will be flat in real dollars," said Rep. Dave Weldon, R-Fla., who sits on the Appropriations subcommittee. Other lawmakers said that Congress may find enough money to keep up with inflation, but not more. That's still enough of a squeeze to send researchers tussling for dollars.

The Bush administration requested $28.6 billion for NIH, the same funding it received in fiscal 2006. That level would result in $1 billion of lost purchasing power when adjusted for inflation, according to Rep. David Obey, D-Wis., who is the ranking member on the Appropriations Committee. (Inflation in the medical field ran about 4.1 percent last year, compared with a 3.4 percent rise in consumer prices.) Advocates say that NIH's purchasing power has fallen by roughly 10 percent since 2003.

Obey argued that President Bush's tax cuts for the wealthy should be traded for more NIH money. Obey estimates that the proposed budget would translate into 656 fewer research grants than in fiscal 2006, and 1,570 fewer than in 2004. It would cut funding for clinical trials by 8 percent over 2005 levels, he said, and for research on critical diseases such as diabetes, stroke, Parkinson's, arthritis, and Alzheimer's.

Other biomedical programs would fare no better. The $8.2 billion proposed for the Atlanta-based Centers for Disease Control and Prevention represents a cut of $179 million from the current year.

The biomedical research budget has grown much faster than other important areas, such as the funding for physical science and NASA, said Weldon, who has a large NASA facility in his district. Still, members of Congress are loath to directly reject the advocates' calls for greater funding. "I'll try for more than a flat budget," Rep. Ralph Regula, R-Ohio, chairman of the Appropriations subcommittee told National Journal, while also cautioning that money is tight.

Internal budget changes within NIH are reducing the pot of money earmarked for specific diseases. The White House is backing Zerhouni's effort to promote collaborative research by taking roughly $332 million from the semi-independent NIH research centers and placing the money in the director's "Roadmap for Biomedical Research."

Because of worries about natural and man-made plagues, the White House has been directing more funds to the National Institute of Allergy and Infectious Diseases. This year, it is seeking a 6.2 percent increase for the NIH's "biodefense research" program to bring its budget up to $1.9 billion.

To offset the squeeze this year, NIH headquarters directed its various centers to slice 2.35 percent from the funding allocated for a variety of multiyear grants. Some centers choose to impose deeper cuts in particular projects.

For example, Gandy, the director of the Farber Institute for Neurosciences at Thomas Jefferson University in Philadelphia, said that his multiyear grant to develop an anti-Alzheimer's drug was sliced by almost 20 percent.

The biomedical sector has turned to several coalition groups, such as Research!America, and professional groups, including the Association of American Universities and the Federation of American Societies for Experimental Biology, to seek budget increases. The coalitions include universities, disease groups, and industry executives. The sector's lobbyists were able to more than double the research budget from $12 billion in 1996 to $28 billion in 2004.

But away from the cameras, the disease groups also compete against each other. They race to out-organize each other, to raise more money, and to attract more volunteers and revenue from pharmaceutical companies. They competitively lobby legislators, advertise, pitch their message to the media, and recruit the most-prestigious champions from Hollywood they can find.

The American Heart Association is one of the leaders in this race; it argues that heart disease causes 40 percent of American deaths, but heart research gets only 7 percent of NIH's budget. A flat budget in fiscal 2007, said Robert Eckel, president of the AHA, would mean that funding for cardiovascular research, when adjusted for inflation, would be 15 percent less than that spent from 2003 to 2007.

The bigger groups, such as the American Cancer Society, are powerful enough to push the limits of collegiality. In the Senate budget debate, for example, the society helped win unanimous support for an amendment introduced by three senators that reserved an extra $390 million for cancer research.

That boost is "a fair, rational, do-no-harm kind of growth," said Wendy Selig, the society's vice president for legislative affairs. "There is a very, very good story to tell in cancer, and I'm not saying there are not good stories elsewhere ... [yet] the promise for the cure of cancer is enormous," she said.

These groups, both large and small, worry that the draft NIH reforms being pushed by Zerhouni will drain more money from their priorities. In particular, the cancer society fears a proposal to reduce the autonomy of the National Cancer Institute.

The institute's unique status allows its director to submit his own budget request, in consultation with cancer-related disease groups, to the Office of Management and Budget without going through the NIH director or the Health and Human Services secretary. Although the larger disease groups worry that a reform will cause some of their money to be shifted to small groups, the smaller groups fear they may lose their shirt in post-reform lobbying blitzes.

"None of the stakeholders want to change, although they agree they need to," said House Energy and Commerce Chairman Joe Barton, R-Texas, who is writing an NIH reform bill that would give the director clout to force more collaboration among the semi-independent research centers. "I'd love to give them a 10 percent increase, but there's no money, so we have to use existing funds better," he said.

No government agency welcomes a flat budget, even when it is set at almost $30 billion. But because of the peculiar economics of the research sector, a flat budget at NIH causes intense pain to many researchers on several fronts:

Grants are worth prestige -- and more. Universities want grants, in part, to boost their status vis-a -vis their university rivals. The grants also allow researchers and universities to discover drug-related ideas that can be patented and then sold to biotech or pharmaceutical companies. In 2004, NIH distributed $14.7 billion to outside researchers, most of which was spent on drug development in universities. Surgery-related work at medical schools, which has less profit potential, got only $322 million.
Researchers' careers are at stake. If university researchers can't get grants, they find it difficult to publish scientific papers or to win patents. In turn, they lose laboratory space to campus rivals. The "kiss of death," said Gandy, comes when a university prods a researcher to do more teaching, thus reducing his or her ability to pursue grants and research. Many university researchers lack tenure, and serve as franchisees of their universities' brand -- Harvard or Columbia, for example -- and they keep those franchises only if they win grants.
It's hard for scientists to switch specialties. If scientists change specialties to follow funding shifts, they may lose time getting up to speed, and they would start low on the totem pole because they're competing against established scientists.

One sign that the rat race has begun: Worried about losing their funding, researchers are submitting multiple requests, driving the total from 28,368 in 2001 to 43,069 in 2005. That reduces the percentage of grants that actually get funded, forcing down a widely tracked marker of NIH's largesse called "success rate" or "pay-out line." When the rate falls, researchers get worried -- and then submit even more backup requests.

"Depending on where we're going in the future, there's going to be an undoubling" of NIH's funding, said Sue Nelson, vice president of federal advocacy at the American Heart Association and a former Democratic aide to the Senate Budget Committee. "It's like we made all this progress only to watch it erode before our eyes. This is not the time to be doing this, when we're facing the retirement of the Baby Boom Generation."

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HHS takes steps to bolster supply of flu vaccine

Marilyn Werber Serafini — Fri, 31 Mar 2006 00:00:00 -0500

National Journal about the nation's vaccine supply. Following are edited excerpts.

NJ: Could we make enough vaccine right now to combat an avian-flu pandemic?

Gellin: We have a long way to go. Global influenza vaccine manufacturing capacity is limited, and we currently have only a single manufacturer -- Sanofi -- that produces all components of influenza vaccine entirely within our borders. In a pandemic, vaccine will be in short supply everywhere, and we can't assume that vaccine produced elsewhere will be delivered here. There are other vaccine production facilities within the U.S., but influenza vaccine manufacturing uses dedicated facilities.

Because a pandemic will be caused by a virus that we've not experienced before, a pandemic vaccine is likely to be a much higher dose to achieve the immune response needed for protection. In studies that [the National Institutes of Health] conducted last year, we were sobered to learn that the vaccine dose was six times higher than what is in our seasonal flu shot and that two doses were required.

NJ: Right now, how many doses of a pandemic vaccine could be produced entirely within the United States?

Gellin: We estimate that if we were to ask Sanofi to dedicate their facilities entirely to H5N1 vaccine, they could produce approximately 30 million to 40 million doses of H5N1 vaccine in a year. At two doses per person, we could vaccinate only 15 million to 20 million Americans in a year. Of course, this would also mean that the company would have to stop making next year's flu vaccine in order to do this.

NJ: How is HHS helping to improve our vaccine preparedness for a pandemic?

Gellin: First, all licensed influenza vaccines are made in specialized live eggs -- not what's in the grocery store. Therefore, we've worked with manufacturers and egg suppliers to shore up the egg supply so that hundreds of thousands of eggs are available to produce a pandemic vaccine at any time.

Second, we are encouraging all people who are currently recommended to receive an annual flu shot to make this a habit. The [Centers for Disease Control and Prevention] recommends that over 185 million people receive a flu shot each year, but as a country we've never been able to achieve half of that. Increased annual demand will translate into increased capacity to provide this increased supply.

Third, we are working with companies to diversify the manufacturing of influenza vaccine so that we are not totally dependent on eggs. There are other ways to grow viruses in massive quantities. One that has received lots of attention is cell-based technology. This system is used for the manufacture of other vaccines -- for example, polio.

Fourth, we are encouraging companies and the scientific community to explore approaches that will allow the dose of a pandemic vaccine to be lower than what we found in the initial studies of the H5N1 vaccine. There is emerging evidence that this could work by adding an adjuvant or giving the vaccine into the skin rather than the muscle to enhance the vaccine's immune response.

Fifth, we are searching for a truly next-generation flu vaccine -- one that protects more broadly against a wide range of flu viruses so that we will no longer have to make a flu vaccine that is tailored specially to the viruses that are the threat of the day.

NJ: Why haven't companies switched to modern approaches?

Gellin: Unlike other parts of the pharmaceutical market, influenza vaccine manufacturing isn't very lucrative. Until very recently, the prices of flu vaccine were just a few dollars. Investing in new approaches to make a flu vaccine requires a significant expense.

NJ: What is the government doing to help companies make these transitions?

Gellin: A year ago we awarded a $97 million five-year contract to Sanofi specifically to accelerate the development of cell-based vaccine, to bring such a vaccine to the United States. That project is moving along, but we also recognize the need to increase the number of manufacturers. The appropriation provided by Congress in December allows us to build on this effort. We are in the final stages of evaluation and negotiation of proposals from a number of other companies.

NJ: How much should the government be helping drugmakers with their vaccine business?

Gellin: You can't build a business based on a pandemic market, so this is clearly an area where the government must help. The government is helping with equipment, designing facilities, clinical trials. So right now, we're doing all the things we can, short of building facilities. The government is making sure there are as many different approaches as possible to look at.

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Medicare officials seek to boost use of discount drug cards

Marilyn Werber Serafini — Fri, 27 Aug 2004 00:00:00 -0400

So, if the card is such a no-brainer, then why aren't seniors pushing their way to the front of the line? Why the slow uptake?

At the end of July, two months after the cards took effect, 4 million Medicare beneficiaries had a card, out of 33 million eligible people. And only 1.7 million had signed up on their own, while the other 58 percent had been enrolled automatically by their Medicare HMOs. About 1 million people were getting the $600 federal subsidy available to low-income beneficiaries, even though 7.2 million were eligible because their incomes fell below cutoff levels ($12,569 for individuals and $16,862 for couples). Even though such eye-opening savings are available, finding the best card is difficult, and many angry seniors refuse to try the system out.

If Medicare can't get seniors to sign up now for a temporary discount card, some health care analysts are asking, what will be the response when Medicare launches its more complicated, permanent drug benefit in 2006?

McClellan disputes that the start of the discount card program has been sluggish. He says that enrollment is picking up and that it's been speedier than for other new government programs in recent years, such as the state-level Children's Health Insurance Plan. Still, even proponents of the cards acknowledge that there's a long way to go and that emotions are running high because of the partisan fight over the legislation. While some Medicare beneficiaries are rejoicing at the discovery of big savings, other seniors are cursing Washington for enacting what they see as a skimpy benefit and are refusing the discount cards outright.

Wayne Richards, a 78-year-old Dayton, Ohio, resident, fits the "elated" category. Last year, he paid $1,548 for eight prescription drugs on an income of $5,000. This year, with a discount card, he's likely to pay less than $100. "This is terrific," Richards said in an interview. "I got Lipitor for nothing. I near-about flipped."

Baltimore resident Ellie Tickner, however, doesn't share Richards's enthusiasm. The irate senior says she has no idea whether a discount card would save her money and isn't going to find out. "I was tempted to call up, but then I saw a big article in the paper that the cards are not what they're supposed to be," she roared in a recent telephone interview, before slamming down the phone in fury.

"People feel the legislation was a rip-off by the drug companies, and most of their anger is directed at the failure to do something truly meaningful about skyrocketing prices," said Ron Pollack, executive director of the consumer group Families USA, which wants the government to use its power to force down drug prices.

Then there's the disagreement over savings. Medicare officials are praising the discounts, but Rep. Henry Waxman, D-Calif., says there's no reason to celebrate. "Seniors are confused, frustrated, and angry about the cards, and with reason. They're not saving seniors significant amounts of money," he said in an interview. The discounted prices are "up and down each week like a yo-yo. Medicare's Web site is riddled with errors. It's no wonder seniors are overwhelmingly rejecting these cards."

A study commissioned by the Henry J. Kaiser Family Foundation concludes that the cards can make a difference in spending for many people. The study compared discount-card prices against a combined Maryland retail price of $758 for a month's supply of 10 commonly used drugs. Kaiser found that seven discount cards resulted in combined prices ranging from $574 to $611. Mail order cost even less, ranging from $517 to $555.

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Senators seek more funding for HHS inspector general's office

Marilyn Werber Serafini and Emily Heil — Wed, 09 Jun 2004 00:00:00 -0400

That group, which includes Finance Committee Chairman Chuck Grassley, R-Iowa, and ranking member Max Baucus, D-Mont., is considering ways to move part of the $1 billion set aside for the implementation of the new Medicare drug benefit to the inspector general.

Responding to lawmakers' requests, the inspector general's office said it needs at least $25 million -- $10 million to carry out duties specifically outlined in the new Medicare law and $15 million for oversight of the massive new program.

Just a week into the new drug discount program, the office already is conducting inquiries into nearly 30 complaints from seniors claiming they inappropriately have been offered cards not endorsed by Medicare. In some cases, people have misrepresented themselves to seniors as government officials, according to the inspector general.

In addition to its new responsibilities, HHS Secretary Tommy Thompson also ordered the inspector general's office to investigate the complaints of the Medicare chief actuary that then-Centers Medicare and Medicaid Services Administrator Thomas Scully threatened to fire him if he shared cost estimates with members of Congress who had requested them. Despite the new responsibilities, funding for the inspector general's office has been flat for the last two years.

Grassley and Baucus first asked HHS in January to detail how it planned to fund its new oversight and enforcement of the new Medicare law, saying that the increased funding for State Health Insurance Programs, which conduct beneficiary education, as well as the inspector general, should come from the $1 billion Congress allotted for implementing the law.

"There is an overwhelming need for effective oversight, audits, evaluations and, where appropriate, investigations of these new programs and contractors," Grassley and Baucus said in a letter sent to Thompson in January.

"Under current law, funding ... is not set to increase sufficiently to allow the office to handle its new responsibilities in implementing and overseeing the act, while maintaining its current enforcement, investigative, and evaluative activities," they added.

The inspector general's office has sent a series of letters to concerned senators, including Grassley, Baucus and Sens. Bob Graham, D-Fla., and Tom Harkin, D-Iowa, responding to concerns about its ability to carry out its duties, given its flat funding.

In a Thursday letter, acting Principal Deputy Inspector General Dara Corrigan said she worried that funding caps on its largest funding stream, the Health Care Fraud and Abuse Control Program, could hamper the office.

"Resources for this program are capped at the 2003 level, resulting in annual reductions in OIG FTEs [full-time equivalent employees] and other operating expenses, making it increasingly difficult to carry out our mission," Corrigan wrote.

To make matters worse, the office has lacked a permanent director, which often is critical to making strong appeals for funding and taking on controversial investigations. Since last year, Corrigan has served as the interim head of the office.

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Group criticizes public health leadership as piecemeal, haphazard

Marilyn Werber Serafini — Wed, 14 Jan 2004 00:00:00 -0500

The organization, a nonprofit, nonpartisan group founded to raise the profile of public health matters, charges that the federal government and Congress have allowed the growing problem of animal-borne illness to be addressed in a diffuse and, therefore, needlessly haphazard way. "No one's truly in charge, and it leaves you at risk," said Shelley A. Hearne, the group's executive director. The trust's August report calculates that more than 200 government offices and programs have a hand in responding to the animal-borne diseases that have been making the news in the past few months.

In addition to mad-cow, apprehension has grown recently about monkeypox (from prairie dogs and Gambian giant rats), while fears persist over West Nile virus (from mosquitoes), Lyme disease (from deer ticks), and chronic wasting disease (from elk and deer). Add to that an underlying worry that terrorists could somehow use animals to infect Americans.

Hearne's group supports calls in recent years to create a new government agency to take the lead on food-safety matters, but Hearne says that the focus should be even bigger than that. "We need to look at overall leadership in public health in general....It can't be a piecemeal fix anymore," she said.

Still, most efforts at the federal level seem to address just part of the problem. Sen. Richard Durbin, D-Ill., for example, is planning to introduce a bill early this year to strengthen the federal government's role on mad-cow and other animal-borne disease; he sent a letter to colleagues this week urging their support for quick action.

Durbin, a member of the Senate Governmental Affairs Committee, says his legislation calls for tests that can diagnose mad-cow disease rapidly, in as little as four hours; for prohibitions on the slaughtering for consumption of cattle that exhibit neurological symptoms; and for a new national identification program so that infected cattle could be traced to their birthplace within 48 hours.

Even before the 2001 terrorist attacks that used airplanes and anthrax, Durbin and others were pushing for improved federal food-safety efforts. Indeed, Durbin was set to introduce a food-safety bill on September 11, 2001. He was then chairman of the Governmental Affairs oversight subcommittee. Durbin held a hearing, but his bill never advanced.

Durbin introduced his first food-safety bill in 1999, when he noted that more than 12 federal agencies were involved with food safety and that the overlapping jurisdictions often led to accountability gaps and to critical problems falling through the cracks. In addition to the mad-cow bill, Durbin said he will soon introduce an updated version of his earlier bill. The revised bill would consolidate all food-safety, inspection, and labeling functions into one independent agency, funded by the combined budgets of the current programs. The Agriculture Department now oversees meat, poultry, and egg products; the Food and Drug Administration oversees most other food products; and the Commerce Department's National Marine Fisheries Service inspects fish.

In recent years, both the General Accounting Office (in 2001 congressional testimony) and the Institute of Medicine (in a 1998 report) have backed the creation of a unified food-safety agency.

Trust for America's Health, meanwhile, says that the broader issue is strengthening the entire public health infrastructure so that it can address all food-safety and animal-borne illnesses, regardless of the source. The trust points to the confusing regulatory and enforcement maze that became evident during last summer's monkeypox outbreak.

The Centers for Disease Control and Prevention, which is part of Health and Human Services, initially had federal responsibility to investigate and manage the outbreak. When investigators finally linked monkey-pox to prairie dog pets that had been in contact with Gambian giant rats--the apparent source of the infection--jurisdiction became clouded. "While CDC has jurisdiction over national disease control and prevention," the trust report said, "it generally does not have the authority to regulate animals, agriculture, or food."

Instead, the report noted, the Agriculture, Interior, and Homeland Security departments, along with state and local governments, each must respond to different animal, wildlife, food-import, and food-security issues to supplement the efforts of HHS. For the monkeypox case, Agriculture's Animal and Plant Health Inspection Service was called in to investigate the movement of the suspect prairie dogs and giant rats.

In June, HHS banned imports of certain rodent species from Africa. States with potential monkeypox cases then had to devise their own animal-containment responses. "In total, four federal Cabinet departments, five federal agencies, and the corresponding departments in each of the impacted states and communities patched together monkeypox contamination solutions," the report said. The process, Hearne suggests, could have been a lot more efficient.

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Critics question value of huge homeland security exercise

Marilyn Werber Serafini and Siobhan Gorman — Fri, 09 May 2003 00:00:00 -0400

"The response will be as realistic as possible," Homeland Security Secretary Tom Ridge told reporters at a briefing on May 5. But many experts worry that this made-for-television exercise will be more reality TV than reality. Officials will know many details of the attack ahead of time, and that will undermine the value of the test to gauge America's-or even Seattle's and Chicago's-ability to respond to a terrorist attack. The greatest weapons a terrorist has, after all, are surprise and uncertainty. Ridge called Monday's exercise "a test of our response capacity." Yet, this high-profile and high-price test is a lot like a final exam where students get a sneak peek at the toughest questions.

"It's too big and too scripted," said Frank Hoffman, a homeland-security consultant who was a top aide to the Hart-Rudman Commission on terrorism, which presciently warned of terrorist attacks in February 2001. "There's no tolerance for failure. There's no risks being taken. It can't just be all choreographed in advance. You don't test anything."

For starters, the biggest decision makers-the president, his chief of staff, and his press secretary-have all made their decisions about the "crisis" ahead of time. Some top Bush administration officials even met to decide in advance how they would respond, and their stand-ins will merely be following a prepackaged playbook. "You lose the spontaneity; you lose that aspect of pressure which is so important," said Stephen D. Prior, research director for the National Security Health Policy Center at the Potomac Institute for Policy Studies. "Decision-making under pressure is a very different beast than decision-making with time on your hands, and without the pressure of everyone needing to know what your decision is in order to take your next action."

That Seattle Mayor Greg Nickels divulged to reporters the precise time and location of the attack was cause for consternation among veterans of the emergency-simulation world. The Center for Strategic and International Studies in Washington has run several such simulations, including one a year ago that detonated a dirty bomb on the National Mall. "You have to identify the city, but you don't have to tell them anything about the scenario," said Phil Anderson, a senior fellow at CSIS who has no shortage of praise for these exercises as a concept. "When we did our dirty bomb in D.C., they had no knowledge of the scenario. There's a lot of value in being forced to react to something you don't know about."

The main downside to this new exercise, Anderson said, is that it gives leaders at the federal, state, and local levels time to study up and practice in advance. In Chicago, that's exactly what they've done. Some emergency responders have actually clocked their travel time to the exercise site, and they will be waiting close by for their cues. If it took a fire squad seven minutes to arrive during practice, they'll have to wait seven minutes before coming onto the scene.

Decision makers can study the law in advance-such as whether they have the authority to establish a quarantine-Hoffman noted, although he said he is pleased that the drill is heavy on local participation. He added that the scenario also won't be able to replicate the "cascading effects" of the public's reaction to events, such as 1,000 people flooding a local hospital because they've come down with the sniffles and think they're on the brink of death.

Still, says Amanda Dory, an international affairs fellow at CSIS, the exercise is not valueless. Much of the benefit will come from placing people in the environment, even with an artificial element, and allowing them to make connections with people they don't connect with on a regular basis. "I hate to think of these exercises as a meet-and-greet opportunity," but there's some benefit to that, she said.

And Dave McIntyre, deputy director of the ANSER Institute for Homeland Security, contends that the exercise shouldn't be viewed as a test, but rather a chance to show the homeland ground troops "what it should look like when I get it right." A former Army colonel, McIntyre compared it to the massive "Reforger" war game that NATO conducted for a generation in Europe.

Next week's exercise, dubbed "TOPOFF 2," is the second in the congressionally mandated TOPOFF series. The first was held in 2000 in Denver and in Portsmouth, N.H., which were hit respectively by mock pneumonic plague and mustard gas. But differences between the first exercise and this one abound. In the Colorado-New Hampshire scenario, participants were not told where or what the threat would be. Instead, they were told only that it would happen within a 10-day window. So when the emergency rescue teams in 2000 left the scene after tending to the first victim of this fictitious attack, they took the pneumonic plague home with them and spread it. This time, said Hoffman, "if you tell them this is a drill with pneumonic plague, everyone shows up with the bio suit on, and they don't treat people like they have a cold."

Congress established TOPOFF in 1998 to get top officials-hence the name-to pay attention to homeland-security issues. To that end, the new exercise will be seen as the first big test of the federal redesign that produced the Homeland Security Department. With the experience of the 2000 exercise as a baseline, the expectation is that the grade on this test will be higher than the last one. And the fact that Chicago will encounter the same disease that Denver did makes the situations all the more comparable. Given that TOPOFF 1 was an exercise in chaos, the baseline is pretty low. But in the post-September 11 world, public tolerance for failure will also be quite low.

At their May 5 briefing, Homeland Security officials sought to dampen public expectations of perfection. "None of us expect that the nation's response over the five days of the exercise will be perfect," said Ted Macklin, assistant director for the department's Office for Domestic Preparedness. "Shortcomings will be found, preparedness planning gaps will emerge, but we will learn from what happens, and we will be stronger and better prepared nationally and internationally from the results."

These exercises also have inherent limitations, and the largest is how to translate the experience into a set of "lessons learned." One of the biggest problems with the Denver-Portsmouth experience was that it never produced a public report. Because the findings were deemed too sensitive, the Justice Department never released the report. In the upcoming exercise, firefighters responding to the fictional dirty-bomb attack in Seattle don't have the security clearance to read about the security gaps they-or their Chicago counterparts-uncovered. "You don't want to help the enemy," Anderson said, "but that's a problem when you don't get all the information to all the people who could benefit from it."

Experts also question why pneumonic plague and a dirty bomb were chosen for the exercises, and whether these crises will yield the most-fruitful lessons. Both could be considered relatively "easy" cases, because pneumonic plague is highly treatable with antibiotics and a dirty bomb is unlikely to produce mass casualties.

Good reasons exist for choosing a potential bioterrorism agent, such as plague, which spreads more slowly and can be treated with drugs, said Prior of the Potomac Institute. "Some bioterrorism agents are exceedingly contagious, and everything is out of control. With a slower-burning fuse, you can learn something as you go." Another advantage to choosing plague is that it tests the ability of the federal government to get drug treatments and vaccines to the scene, as well as the ability of local public health officials to disseminate those treatments. "You couldn't exercise this with smallpox, because antibiotics don't work on it," Prior said. Indeed, public health officials came under fire during the 2001 anthrax attacks because confusion abounded over who should get what antibiotic, how much, and through what outlet.

In Denver, the drug-dispersal effort afforded some practical lessons. When the military plane arrived

at the city's airport, health workers quickly learned that the ladders built for commercial airliners weren't long enough to reach the door of a military plane. And when the crew discovered that the pills were packed 900 to a bag, perhaps in the name of efficiency, they had to figure out the fastest way to break the package down into 14-pill single servings, Hoffman said.

For better or worse, some terrorism experts suggest that the most challenging kinds of attacks were left off the exercise list to ensure success and calm public fears. The previous exercises got badly failing grades, said Lawrence O. Gostin, a legal adviser for the exercises who is director of the Center for Law and the Public's Health at Georgetown University. "Maybe this test is to get better grades," he said. "I'm sure public fear is part of the calculation. I'm sure they're trying to test the system and allay public fears about a catastrophic event."

That's not necessarily a bad motive, says CSIS's Dory. "To the extent a dirty bomb is done and handled, it would be tremendously reassuring," she said. "It's useful to reassure participants in the exercise that it's easy, as well as the general public."

At the same time, however, Dory said that if the decision had been hers, she would have tested a chemical attack before a radiological bomb. "Chemical is more potentially deadly than a dirty-bomb scenario. A dirty-bomb scenario ... has potential casualties, but it's more to annoy and instill fear than to have destructive effects. Chemical is well beyond annoyance."

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Health plans search for bioterror symptoms

Marilyn Werber Serafini — Fri, 25 Apr 2003 00:00:00 -0400

In matters of homeland security, experts on all sides have long been saying that more cooperation is needed among various levels of government and the private sector in preventing and coping with terrorist attacks. Well, it now looks as if a pilot program of teamwork between the Centers for Disease Control and Prevention and some private health plans is bearing fruit.

The CDC and a handful of health plans are about a year into a collaborative project whose aim is earlier and better detection of potential bioterrorism attacks-spotting disease outbreaks before emergency rooms are suddenly flooded with victims. In essence, the streams of data coming into health insurance plans-phone calls to nurse-help lines and doctors' diagnoses, for example-are sifted by computer programs to look for disease and symptom patterns sorted by ZIP code. Such a system may already be proving valuable in tracking early signs of Severe Acute Respiratory Syndrome, or SARS, as the dreaded and sometimes-deadly illness begins creeping into the United States.

The CDC awarded a grant of $1.2 million about a year ago to Harvard Pilgrim Health Care, a large health plan that serves New England, to begin collecting and analyzing information about certain respiratory and gastrointestinal symptoms that might mark the beginning of a bioterrorism attack. Soon, a handful of other large health plans will begin feeding their patient information to Harvard Pilgrim, which will act as the data-processing hub. New participants will include United Healthcare, HealthPartners in Minnesota, and Kaiser Permanente in Colorado.

Even before this project began, many state-level public health agencies were upgrading their tracking techniques to monitor emergency-room visits and sales of over-the-counter drugs such as anti-diarrhea medicine. The hope is that conducting surveillance through health plans will be quicker than tracking emergency-room visits. "A lot of people are looking at emergency rooms and hospitals, but perhaps the nurse call-in lines and primary-care physicians may be a day or two ahead in the epidemic," said Blake Caldwell, a CDC contractor who is the senior consulting epidemiologist for this pilot project, called the National Bioterrorism Syndromic Surveillance Demonstration Program.

Karen Ignagni, president of the American Association of Health Plans, which worked with the CDC to set up the project, has been considering such collaborations since the terrorist attacks of September 11. "As we began to talk about this issue with medical directors, it became clear that we had a unique set of skills and a unique set of competencies that could provide a real public health benefit," she said.

Members often report symptoms to their health plan first, Ignagni said-sometimes more than a week before they might go to an emergency room. The symptoms of most communicable diseases that could indicate a coming epidemic begin slowly and quietly, she explained; they are not major life-interrupting events, such as heart attacks, that can collapse a patient in short order. Some of the symptoms associated with the most-feared potential biological weapons, such as smallpox and anthrax, may resemble the flu for days before more-telling signs set in.

"When you first start having symptoms, they're not serious enough to drive to the emergency room," Ignagni said. "But you have symptoms, and you feel strange and you don't understand why they're occurring, so you want to talk to somebody." More often than heading for the emergency room, people visit their doctor or seek advice from the nurse call-in lines that many insurance plans make available to their members as a kind of first-line triage.

Early evidence shows that the project is working to spot spikes in the rates of natural disease in Massachusetts, said Richard Platt, principal investigator, and professor of the Ambulatory Care and Prevention Department at Harvard Pilgrim. According to Platt, Harvard Pilgrim has already anticipated increases in hospitalizations for respiratory infection. During this winter's flu season, he said, his system was able to predict an upswing in respiratory infections about two weeks before hospital admissions started to rise.

The idea behind the CDC/Harvard Pilgrim demonstration is to collect information in a variety of ways and then merge it all to reveal trends. A participating doctor's practice, for example, installs sophisticated computer technology that essentially scans the diagnoses that doctors assign to the patients they see in any given day, looking for symptoms associated with commonly suspected bioterrorism agents.

With more doctors keeping patient information electronically, such reporting and collecting should be able to grow quickly, according to Ignagni. Currently, only those physicians who store patient medical records electronically can participate. However, Caldwell said she hopes that the program will soon expand to include physicians who file insurance claims electronically.

Here's how the system works: At the end of each day, the computer at the doctor's office, clinic, or nurse call-in line automatically checks the day's records for specified symptoms. The findings from each office are transmitted-without any names or identifying information-to Harvard Pilgrim, which combines all the data. Harvard Pilgrim sorts the final data by ZIP code and compares it to epidemiological norms for the region and the time of year.

Caldwell noted that health plans and patients should not be concerned about confidentiality. The health plans initially report only the number of people in a particular ZIP code with either respiratory or gastrointestinal trouble. If a worrisome number of people within a particular ZIP code report similar symptoms, Harvard Pilgrim and public health officials can go back to the health plan and ask for more information. The health plan can then look at the individual patient records in question and determine if there is a reasonable explanation for the illness, or whether the patients can be linked in some alarming way. If there is reason to fear an outbreak, the local public health agency then has the right to ask for the identities of the affected patients.

So far, about once a month, Harvard Pilgrim has notified public health officials about spikes in respiratory or gastrointestinal symptoms. In the end, none of those spikes has turned out to be related to bioterrorism.

The beauty of the effort is that collecting and sorting the information is mostly automatic, Platt said. "There's no active human involvement in this. The computer program runs every night and extracts the information that's needed.... It's not asking any of the clinical providers to collect any additional information or to record additional information or to take steps to notify anybody. This information is collected in the course of routine health care delivery," he said. "This is important, because we need a system that is sustainable."

This month, United Healthcare will join the project, gathering information from its nurse call-in line, called Optum. Bob Harmon, vice president and national medical director of Optum, said he's sure his system can help. He cited a study of a 1993 outbreak in Wisconsin of cryptosporidium, a waterborne parasite that comes from animal waste. That outbreak sent 4,400 people to the hospital, killed 50, and sickened hundreds of thousands in Milwaukee. At the time, patients began contacting nurse call-in lines several days before the emergency rooms started to report victims.

"This was the kind of thing that led to this particular project, realizing that this could be valuable for a bioterrorism event, and also for a public health outbreak," Harmon said.

Optum is the largest company offering nurse telephone triage in the United States; it serves more than 23 million people through six call centers. About 400 nurses are on hand to talk to health plan members about symptoms and concerns. Of course, not all 23 million members call the nurse line for help. According to Harmon, up to 10 percent place a call in any given year. But that's more than enough calls to detect a problem, said Reed Tuckson, the senior vice president for consumer health and medical care advancement at United Healthcare. "If there were to be an increasing incidence of disease that was occurring, we are in a position ... from people's use of our service, to be able to detect some of that," Tuckson said.

To be sure, this isn't the only surveillance effort under way. The CDC is still encouraging local authorities to monitor emergency room visits and sales of over-the-counter medications, for example. "The theory now at CDC is to let a thousand flowers bloom," Ignagni said.

"Encourage a variety of systems to develop so that they can have the best of those systems, and see what they want to keep over time and what they want to discard over time."

But Ignagni believes that private health plans can provide one of the earliest warning signs in detecting a possible biological attack. Indeed, as the pilot project begins its second year, AAHP is asking for a larger federal grant, and more health plans want to participate. Kaiser Permanente in California is ready to go, and Caldwell is asking CDC for the funding to get Golden State participants in the system. Several other large health insurers, including Aetna, are considering participating in the project.

Caldwell cautions that this is still a localized demonstration project. But, she said, "I'd like to think that this will grow tremendously. We just have to prove that the system works."

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New HHS center stands ready to track bioterror attacks

Marilyn Werber Serafini — Mon, 24 Feb 2003 00:00:00 -0500

Health and Human Services Secretary Tommy Thompson has wasted no time in constructing a state-of-the-art command center to handle any bioterrorism or public health emergency that might arise. In less than 60 days' time, Thompson finished the job, with the ribbon-cutting on the $3.5 million center occurring in December.

The center is just across the hall from Thompson's office in the main HHS building at the foot of Capitol Hill, and it won't require plastic sheeting and duct tape to keep out germs and chemicals. The center has a self-contained ventilation system that allows government officials to take refuge there for an extended period of time, even if the rest of the building is crawling with anthrax or another harmful chemical or biological agent.

The center's purpose is to provide timely, accurate information and intelligence to the secretary so that he can make quick, well-informed decisions about a public health situation anywhere in the country. Special equipment can map and display the progression of illness outbreaks.

Tracking is key, Thompson said in an interview just after the center opened. If, for example, a chemical agent were released in a Minnesota town, officials at the command center could plug in the location and the weather forecast and then predict direction and travel time for the toxic plume. HHS could then advise people in Minnesota about which areas to evacuate and which hospitals to avoid.

The technology can also track non-terrorism events. It has already been used in tests to monitor the West Nile virus, the recent pharmaceutical plant fire in North Carolina, and the December typhoon in Guam. In the West Nile case, HHS was able to show, county by county, how and when the disease was spreading and how many people were dying.

The mapping also aids the monitoring of food poisoning cases, Thompson said. "We can have FDA saying we have this food poisoning in Milwaukee, and we have a map we can put up on that screen showing the quadrants in the city, and see how it's spreading." He added, "We can have the hospitals there. We can have NIH, some of their experts here, and we can develop a plan right from here with CDC, FDA, and NIH all working together with one map telling us how to do it."

It's also important for Thompson to be able to quickly locate his resources, including personnel. The command center keeps tabs on the 50 tons of medical supplies stashed in secret places throughout the country, and on 8,000 medical responders who are ready to sprint to the site of an emergency.

The technology allows HHS to know the exact locations of its secret pharmaceutical stockpiles and medical supplies, which are split among 12 sites. "We can move 50 tons of supplies into any city in America, Alaska, and Hawaii within seven hours," Thompson said. In December, for example, Thompson sent a response team to Guam to handle the medical emergency from the typhoon. Other responders were put on alert. "If we have a crisis, we want to make damn sure we can call them up and they know what they're going to do-so we're putting more training in ... putting them on alert," he said.

The command center combines various forms of communication-including ground-based and satellite systems-to ensure that if one fails, a backup is available. The computers, radios, and telephones in the network can also talk to one another. The idea is to be able to share information with state and local entities and with HHS's own relevant, but geographically dispersed, agencies, including the National Institutes of Health in Bethesda, Md.; the Centers for Disease Control and Prevention in Atlanta; and the Food and Drug Administration in Rockville, Md. In addition, the center has lines to other federal partners, such as the Federal Emergency Management Agency, the FBI, and the CIA.

The center houses 26 workstations for Thompson and other top HHS officials, including the surgeon general. It also has desks for representatives from the FBI, the CIA, and the Homeland Security Department. HHS says the center fills the gaps in communication that federal, state, and local agencies encountered during the 2001 terrorist attacks.

Video conferencing for up to 10 participants is also possible. If a biological or chemical event occurs in Boston, for example, officials at the command center can watch the local news reports and use the video-conferencing tools to hook up the Massachusetts governor, the Boston police chief, the Homeland Security Department, and various federal agencies (the CDC, NIH, FDA, FBI, and CIA) and give the participants real-time, interactive communication. "We've got 10 screens here. We can interact," said Thompson.

Nine 60-inch-wide plasma TV screens allow HHS officials to monitor developing public health emergencies through 4,000 channels across North America. HHS can also view local television stations from up to 10 cities to monitor breaking events in different regions.

Normally, the command center is staffed with a few public health officials, whom Thompson refers to as his army. They keep an eye on trends and resources. Now, with the heightened terrorist alerts, at least half a dozen HHS workers are staffing the center. Thompson pops in at least once a day to get updates and to make sure that his baby is running smoothly.

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Public health officials nervous about plan to move HHS agencies

Marilyn Werber Serafini — Tue, 24 Sep 2002 00:00:00 -0400

The jockeying over the proposed Department of Homeland Security has sometimes resembled a tense game of musical chairs, as federal agencies nervously wonder whether they'll have as good a seat when the music stops as the one they started out with. That's particularly true for agencies involved in bioterrorism-one of the few areas in which a new department could splinter programs rather than consolidate them.

Currently, public health functions, including defenses against bioterrorism, exist almost exclusively within the Department of Health and Human Services. HHS houses the National Institutes of Health (which is the federal government's premier medical research entity), the Centers for Disease Control and Prevention (the expert agency on infectious disease), the Food and Drug Administration (the regulator of vaccines, drugs and food safety), the national pharmaceutical stockpile (home of the smallpox vaccine and the anthrax drug Cipro), and the Office of Emergency Preparedness (the coordinating agency for responding to public health emergencies).

Under just about any scenario, a Homeland Security Department would peel off some of HHS's bioterrorism responsibilities. And the questions of who goes and who stays, which leaders make which decisions, and who controls the pocketbook have scientists and public health experts feeling a bit uneasy.

"It's possible that the establishment of a Department of Homeland Security will overall improve our biodefense initiative," said Thomas Inglesby, deputy director of the Johns Hopkins Center for Civilian Biodefense Strategies. "But we have to be mindful of uprooting programs that are having early successes. It could lead us down a path of slowdown or decreases in efficiency."

Indeed, the Health and Human Services Department has generally gotten good marks this year for its focus on bioterrorism. HHS has put new money into bioterrorism research at NIH, developed grant programs to help state and local public health offices beef up their labs and communication systems, and updated the pharmaceutical stockpile to include important bioterrorism remedies.

Some officials and scientists steeped in bioterrorism defense fear that moving bioterror experts away from the public health community at HHS could hamper their ability to make informed decisions quickly during an emergency. They say that the Homeland Security Department would have to re-create some HHS functions in order to develop that bioterrorism expertise, and they doubt that the president or Congress would be willing to spend enough to make that happen.

The medical community has been complaining for years about the federal government's lack of attention to public health issues. Now health experts fear that some of the proposed changes could make public health even more of a stepchild. Having two sets of decision makers (at HHS and at Homeland Security) could create an unhealthy competition for money for medical research and first responders, they say, and they predict that terrorism-related diseases such as anthrax and smallpox would always win out over, say, West Nile virus.

"It's not a perfect fit," said one congressional Republican aide. "You've got a bunch of jigsaw puzzle pieces that don't fit well when you move them from one side to the other." But then, the aide said, the status quo is not ideal, either. In the present setup, "you just don't have the kind of coordination that's necessary to fight bioterrorism," the aide said. "How can the public health community work with the FBI? It's critical that we do, but otherwise it's a joke. The FBI isn't that capable on its own" of making decisions about bioterrorism.

President Bush kicked off the debate earlier this year with a series of far-reaching public health proposals, including recommendations to move several hundred staff members and more than $1 billion in funding from Health and Human Services to Homeland Security. Among those to be transferred would be scientists at NIH, and disease investigators and first responders at the CDC.

But Bush's proposals met with sharp criticism from the public health community, with many arguing that his plan went too far. Members of Congress on both sides of the aisle agreed with the critics, and the House-passed legislation and the Senate bill under consideration would each uproot far fewer programs and people. Nevertheless, the medical community continues to fear that two Cabinet-level decision makers with similar responsibilities could muddle priorities for public health and bioterrorism and could force a duplication of effort. At the very least, the two-headed chain of command would make effective liaisons and communications essential.

Part of the rationale behind forming the new department is to consolidate similar functions within a single agency. For example, Homeland Security would bring border control, customs services and immigration policy together in one department. The goals are to foster cooperation and collaboration, and to improve operational effectiveness. But moving bioterrorism programs from Health and Human Services doesn't accomplish these goals, according to Tara O'Toole, director of the Center for Civilian Biodefense Strategies at Johns Hopkins University. Testifying at a House Energy and Commerce subcommittee hearing in June, she said, "Ideally, one would design bioterrorism response systems that also serve routine organizational purposes."

Even the congressional proposals could jeopardize opportunities to work concurrently on bioterrorism and on general public health, said Jeffrey Koplan, a former CDC director and now vice president for academic health affairs at Emory University in Atlanta. "Epidemiologists, public health specialists, continuing to work together and dealing with problems on a daily basis, are the best defense against bioterrorism."

Who's Packing?

Both the House-passed bill and the Senate's committee-passed bill modified President Bush's original proposal by cutting back the number of HHS positions to be transferred to the Department of Homeland Security. Still, medical professionals worry that even these proposals could do more harm than good.

All three of the plans currently under debate-House, Senate, and White House-address five areas within HHS's purview.

Bioterrorism research at the National Institutes of Health. Bush would transfer funding for bioterrorism research to Homeland Security, whose secretary would then determine priorities and set regulations for those programs. But the research scientists would still be under the supervision of HHS-Homeland Security would contract with HHS to do the bioterrorism research. The goal would be to bring bioterrorism experts into closer contact with the intelligence community, so that better decisions could be made about which bio-agents the scientists should research. At the same time, scientists could give intelligence experts a better scientific understanding of what bioterrorists are capable of brewing.
The House-passed bill, like the president's plan, would authorize Homeland Security to set policy and strategy for research. But there's one important difference: The House bill wouldn't transfer NIH funding to the new department. The Department of Homeland Security would set homeland security priorities, and HHS would carry out its research based on those determinations.

The Senate legislation, which was approved by the Governmental Affairs Committee and is being debated on the Senate floor, would move both funding and authority for bioterrorism research from NIH to Homeland Security. But pressure from the American Society for Microbiology and other scientific groups could spur the Senate to move closer to the House language, say congressional aides.
Centers for Disease Control and the Health Resources and Services Administration. Bush would transfer funding for bioterrorism work currently performed by these agencies to the Department of Homeland Security, which would determine priorities and set regulations for those programs. The president's proposal included few details about how to split off the CDC's bioterrorism functions, and filling in those blanks would have been difficult had Congress chosen to follow Bush's plan. The CDC is responsible for investigating and containing any unusual or significant disease outbreak, and its work on bioterrorism has increased dramatically in the past year. The CDC provides funding and technical support to state, and some local, health departments to help them improve their detection and response capabilities for bioterrorism, and to upgrade communications systems and public health laboratories.
HRSA, a division of HHS that works to improve access to health care through funding community health centers and other facilities, has played a significant role in delivering terrorism grants since September 11. The agency has handed out a total of $45 million in emergency grants to health centers and other medical entities to help them provide support services in the wake of the 9/11 attacks. It also gives grants to help hospitals improve their preparedness and their trauma/emergency medical services.

Under the House and Senate bills, HHS would retain full funding for bioterrorism programs, although Homeland Security would establish priorities for grant-making.
Pharmaceutical stockpile. The president's proposal and the House bill would move custody of the national pharmaceutical stockpile to the Homeland Security Department, although HHS would continue to determine the contents. Bush's idea would maintain the authority of HHS scientists to decide which vaccines and antibiotics are placed into the stockpile, but charge Homeland Security with guarding it. Some critics say HHS has been lax in its protection of the stockpile. Indeed, confusion abounds about what's actually in the pharmaceutical stockpile and who has access to it.
Under the Senate bill, HHS would maintain the stockpile and determine its contents.
Bioterrorism priorities. Bush proposes removing from CDC the responsibility for identifying which bioterrorism agents pose the greatest threat and keeping track of who possesses them. Again, the idea is that bioterrorism experts currently housed at HHS would benefit from working more closely with the intelligence community, within the Homeland Security Department. The House bill would keep the office within HHS, while the Senate bill would transfer the office to Homeland Security.
Office of Emergency Preparedness. Under the president's plan, the entire Office of Emergency Preparedness would move from HHS to the new department, along with the Federal Emergency Management Agency. The goal is to improve the day-to-day coordination among the nation's first responders by consolidating them within one department.
The president's proposal would shift Jerry Hauer, the assistant HHS secretary for public health emergency preparedness, plus 51 staff positions, about half of which are now filled. Both congressional bills would move the functions and staff of the office to Homeland Security, but keep the assistant secretary's position at HHS.

Calling the Shots

As Congress well knows from its own turf battles, when two leaders share power, jurisdictional disputes are sure to arise. So, who would have the final say when two Cabinet secretaries share control over the nation's response to bioterrorism? And how many of the answers must be spelled out in statute?

When it comes to research, for example, both congressional bills say that Homeland Security would set priorities for bioterrorism research, and NIH would decide how to accomplish those goals. It's a similar story for the Centers for Disease Control and Prevention. Under both congressional bills, CDC personnel would remain within HHS, but Homeland Security would set the priorities for bioterrorism research and have some decision-making power over some grant-making.

Splits like these may lead to competing demands, said Ronald Atlas, president of the American Society for Microbiology. "For example, NIH may be developing a better-quality vaccine [to replace] something with limited safety now. A security department may say, `We don't care about safety, but we want a vaccine in the stockpile now.' If the decision on how to spend the money is made by those who don't understand the science," Atlas said, "then you don't get good science."

And what happens if a natural disease outbreak such as West Nile virus, or a natural disaster such as an earthquake, occurs simultaneously with an anthrax or smallpox attack? The same public laboratories test for both bioterrorism toxins and natural diseases, and the same national responders would be on the line for both emergencies (activated through the Office of Emergency Preparedness and the CDC). If Homeland Security were doing the deploying, would the priority go to the bioterrorism threat?

The Office of Emergency Preparedness, which would move all 51 of its staff positions to Homeland Security under all three proposals, mobilizes the 5,000 members of the Public Health Service Commissioned Corps. These people are public health professionals who, when mobilized, become federal employees. They responded to the hantavirus outbreak in the Southwest in the 1980s, Hurricane Andrew in Southern Florida and Louisiana in 1992, the Northridge earthquake in California in 1994.

"At the time of natural disasters, for example, the local morgue is typically overrun. There are all sorts of responses that don't fall under terrorist activities," said one public health analyst. "The Office of Emergency Preparedness coordinates all of that." What if the hantavirus outbreak had occurred at the same time as a terrorist threat? "What if someone says it's a code red day" for terrorism, the analyst asked, "and they can't release these [public health officers] because they're expecting something big?"

Uncertainty also surrounds the role of Surgeon General Richard Carmona, who was recently sworn into office. As a medical school professor at the University of Arizona, Carmona was responsible for developing and implementing plans for the university and the Arizona community at large for responding to attacks using weapons of mass destruction. But despite Carmona's expertise in terrorism preparedness, his new role might be limited. Under all three proposals, the Office of Emergency Preparedness, now to be part of Homeland Security, might have the authority to activate the commissioned corps.

"If they brought in a new surgeon general with an eye toward being more effective on terrorism, but they take away the responsibility for the corps-it's kind of a contradictory message," the analyst said. "What will his role be, if they take away his power to coordinate? Just a spokesman?"

Getting Results

Regardless of who's calling the shots, the most important question is how best to protect the public from bioterrorism without compromising the overall public health mission. Many experts, including members of Congress in both parties, gave the president's original proposal bad marks on answering that question.

Stephen D. Prior, research director of the National Security Health Policy Center at the Potomac Institute for Policy Studies, said he saw little merit in moving scientists from NIH, for example. "Any of us is only as good as the support team around us," he said. "It's the peer group, the collegiate element. It's being able to throw out ideas and have several people bat them around."

Leaving the scientists at NIH, but setting their priorities at Homeland Security, he said, may provide the best of both worlds. Homeland Security would work with its intelligence experts to determine which bio-agents pose the greatest threats, then charge NIH with the responsibility of conducting the research on those priorities, whether smallpox, tularemia, or Ebola, for example. NIH scientists could move toward those goals with great flexibility, bolstered by the support of a research environment.

Indeed, while a consensus is growing that this kind of shared responsibility might be beneficial, the biggest question now appears to be how to build in adequate coordination between the two departments. "This is a concern," said one aide to a congressional Democrat, although "there's some level of coordination required even if there's no [Homeland Security] Department." Members of Congress are now deciding how best to ensure effective communication between the two departments. One possibility is to create a liaison office.

Then there's the question of red tape. Susan Polan, director of government relations for the Trust for America's Health, a nonprofit public health advocacy organization, says she's concerned that the new department will create more bureaucratic hoops for local and state offices to jump through to get financial assistance in emergencies. Polan doesn't like the idea of moving FEMA into Homeland Security. "It will be a more convoluted process for getting money out to the states," she said.

But allowing the status quo to persist is also dangerous, according to Prior. In essence, he said, the traditional role of public health in disease management, and the primary capabilities of the Centers for Disease Control and Prevention simply don't match the requirements for defense against the threat of bioterrorism.

"The very nature of a bioterrorist incident-i.e., the deliberate release of a biological agent for the purposes of disruption and destruction-begins with the terrorist ensuring that the choice of agent, the method of dissemination, the effect on the target population, etc., can overcome the routine methods of disease control that are employed." Terrorists, Prior said, can readily circumvent the "normal" means of disease control by choosing an "exotic" agent, by attacking with large quantities of an agent, or by delivering the agent in an unexpected way.

Moreover, some fear that leaving bioterrorism responsibilities within HHS could allow complacency to set in. "If biodefense activities do not reside in the Homeland Defense Department, there is some peril that these crucial functions will be neglected," O'Toole said at the June Energy and Commerce subcommittee hearing.

Prior recommends creating a "red team" within Homeland Security, to be composed of independent, private-sector bioterrorism experts. The red team would collaboratively examine the emerging strategies, critique them, and develop a coherent defense capability. The goal would be to test existing and proposed capabilities continually, to pinpoint weaknesses, and to offer solutions.

All in all, it's a delicate balance, according to public health and bioterrorism experts. That was the message from Margaret Hamburg, vice president of biological programs at the Nuclear Threat Initiative, a private group funded by CNN founder Ted Turner to reduce the risks of nuclear, biological, and chemical weapons.

At the June subcommittee hearing, she said, "A new Cabinet-level Department of Homeland Security can potentially improve coordination of U.S. government activities such as border security, customs procedures, and aspects of emergency response." She warned, however, that "improving coordination of activities related to bioterrorism prevention, preparedness, and response is a greater challenge."

Julie Gerberding, director of the CDC, supports the new department, but says she's pleased that most of her team will stay put. "We have to create government organization capacity to respond to the fact that it wasn't just something that happened last fall," and it could happen again, she said. At the same time, she added, "I'm very pleased that as the implementation of the proposals goes forward and the details are being worked out, the responsibilities for the public health piece are remaining with Health and Human Services."

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HHS seeks a new generation of leaders

Marilyn Werber Serafini — Fri, 02 Aug 2002 00:00:00 -0400

Thompson has launched a new program called "Emerging Leaders" that will take outstanding graduates from universities and put them through a two-year management internship program in various sectors of the vast department. Then, if they perform well and become permanent employees, they can move up the bureaucratic pay scale and management track faster than normal.

In the program's initial year, out of an applicant pool of 8,000, Thompson has selected 62 recent university graduates with bachelor's or master's degrees to participate. The recruits begin their internships this month, and the program has sparked interest from several other Cabinet secretaries, according to Thompson. (His Cabinet colleagues also want to get their hands on the list of 7,938 applicants who didn't make the cut at HHS.)

The program is designed to attract "exceptional individuals into public service in a variety of occupations within HHS," Thompson said in a July 15 speech at the Excellence in Government conference. "The positive response to this program, as evidenced by the thousands of applications received, clearly shows that young people are interested in pursuing careers in public service," he added later in a statement.

"Young" is the key word here. The whole reason for launching the program is to find replacements for the many department employees-particularly scientists and researchers at the Centers for Disease Control and Prevention and the National Institutes of Health-who are aging and approaching retirement.

"We're looking at a pretty serious retirement situation of our scientists," said William Pierce, deputy assistant secretary for public affairs for Thompson. At "NIH and CDC, there are a lot of retirements staring us in the face. This is an attempt to recruit people to replace those folks."

The problem is that more than half of the department's 64,343 employees (56 percent) are eligible for retirement from now through fiscal year 2006. Nearly 32 percent are eligible for regular retirement, and another 24 percent are eligible for early retirement.

In contrast, through fiscal year 2001 the numbers were smaller, although still significant: A total of 29 percent of department employees were eligible to retire-14 percent qualified for regular retirement, and 15 percent for early retirement.

Many of the employees looking to retire soon were hired before 1984, when federal government retirement benefits were generous. These workers are eligible to retire at age 55, and some may retire earlier, if they don't mind accepting something short of a full pension.

For people who entered the federal government before 1984, retirement benefits are calculated using a formula that is based on the annual earnings from the three most lucrative years of their career. In most cases, it doesn't pay to keep working when the retirement benefits are so rich. In some cases, employees retire, begin receiving their benefits, and then come back to work for the department as contractors.

The retirement package is different for people who joined the federal government in 1984 and afterwards. Indeed, the benefits for those employees are more comparable to those of private-sector benefit plans. Post-1984 workers do, however, get some Social Security benefits, unlike their colleagues who were hired earlier.

Aside from the economic benefits, scientists have another reason to take the retirement option. Although as federal employees they can earn some royalties for their research, they can earn larger royalties in the private sector-and a greater sense of ownership in their discoveries as well.

Of Thompson's 62 recruits for Health and Human Services, eight are scientists, and 17 have training in public health matters. NIH will get the most recruits, with about 14 slated to end up there. The CDC will get about six, and the Food and Drug Administration about five. The Centers for Medicare and Medicaid Services will also get about six of the trainees.

Each of Thompson's young recruits will be hired at the GS-7 or GS-9 pay grades, which in the Washington area amounts to roughly $31,000 or $38,000 a year, respectively. They will begin with six to eight weeks of training that includes project management, leadership, and "visionary" skills.

Although each recruit is hired by a particular office or agency within HHS, all of them will spend their first year rotating among different parts of the department, guided by an individual mentor along the way. In their second year, recruits will begin to work full-time for the office or agency that hired them.

After two years, the department may permanently hire the recruits, raising them to a pay grade as high as GS-12, where they could earn $50,000 a year to start. But there's no guarantee. Retention beyond two years will depend on performance.

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One-stop-shop on bioterrorism at HHS may be split up

Marilyn Werber Serafini and National Journal — Fri, 21 Jun 2002 00:00:00 -0400

President Bush's proposed reorganization would end HHS's dominant role by transferring 300 employees and $4 billion from HHS to a new Department of Homeland Security--a move that Thompson says would allow bioterrorism experts to benefit from other intelligence data. Some members of Congress, however, worry that the transfer could create a duplication of effort and uproot some public health specialists from their traditional home at HHS.

"I don't know a lot of the details [about the HHS transfers], but I'm very uneasy about it," said Sen. James M. Jeffords, I-Vt., who sits on the Health, Education, Labor and Pensions Committee, which has jurisdiction over public health. "It's strange to think it's going to be a wonderful thing."

Sen. Bill Frist, R-Tenn., said that important questions need answering. "I'll be concerned if they start to separate scientific research and begin fragmenting it to the point where it's losing the synergies of having one place," he said, adding he's starting to talk to "friends" at HHS to see whether the move "makes sense or not."

Currently, Thompson has a one-stop shop at HHS. He has authority over the Public Health Service, which includes the Centers for Disease Control and Prevention (the experts on infectious disease); the Food and Drug Administration (the regulator of vaccines, drugs, and food safety); and the National Institutes of Health (the premier medical research entity). Moreover, HHS is home to the Office of Emergency Preparedness, which seeks to ensure that hospitals and other bioterrorism responders are ready to meet the challenge of an attack. In addition, Thompson has created the Office of Public Health Preparedness to coordinate the department's many efforts on bioterrorism.

Kevin Keane, assistant secretary for public affairs at HHS, said he expects the national pharmaceutical stockpile, the Office of Emergency Preparedness, and the new Office of Public Health Preparedness to move. Keane also believes the proposed department would take control of most of the bioterrorism grants that Thompson recently approved for states and cities to build up their public health systems.

But any division of labor could run into problems. Many NIH scientists working on bioterrorism have other responsibilities as well. "If you're an infectious-disease specialist, you know smallpox, but you also know West Nile virus and influenza," said Keane. One possibility being considered, Keane said, is to leave CDC and NIH personnel where they are, but to have the new department contract with them for bioterrorism-related work.

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VA partnership could result in landmark health care service

Marilyn Werber Serafini — Mon, 14 Jan 2002 00:00:00 -0500

It's not as if Colorado's veterans dislike their autonomous health care network. Indeed, veterans have historically sought to maintain control over their unique care-delivery system. In 1992, Edward J. Derwinski, then VA Secretary, recommended opening several underused VA hospitals located in rural areas to poor civilians. Besieged by angry veterans, Derwinski eventually resigned.

But that was 10 years ago, before health care had become so expensive, and before the development of so much breakthrough--and costly--diagnostic and treatment equipment. It was also before many veterans hospitals started looking old and, some say, outdated.

Today, when veterans show up at their hospital in Denver, they see a 50-year-old facility in dire need of modernization. They like their doctors and nurses, but many patients are cared for on wards, not in the semi-private rooms that civilians typically enjoy, and they must hobble or wheel down the hall just to use the toilet. Moreover, certain state-of-the-art equipment can't be installed because the building cannot physically support it.

"Historically, veterans have wanted their own health care. But now they're concerned about two classes of care," said Dennis C. Brimhall, the president of the University of Colorado hospital. "VA buildings are changing. They're aging. The quality of care is high, but perceptions, because of the aging of facilities, are not keeping up."

To make matters worse, Brimhall's university hospital, which is currently just down the block from the veterans facility, is moving. And when it goes, so do some of the sharing arrangements on which the VA depends. Moreover, university physicians who help staff the veterans hospital may decide not to make the longer commute.

"For 50 years, they've been right next to each other," said Terry Batliner, who is in charge of VA health care in the Rocky Mountain region. "There was always an attempt to put VA hospitals next to civilian hospitals. They recruit people together. Nearly every physician at the VA Denver medical center has a faculty appointment at the University of Colorado."

But the university's decision to move its hospital spurred invention, and the project is seen as a test of how the private sector and the VA can provide better health care for less money when they pool their resources. The situation in Colorado presented a unique opportunity because the university hospital was already moving onto land that had been made available for new construction. While not all VA hospitals will have such an opportunity, some smaller collaborations, both with the private sector and with the Defense Department, are already under way.

President Bush recently created the President's Task Force to Improve Health Care Delivery for Our Nation's Veterans, headed by Gail R. Wilensky. Wilensky is a senior fellow at Project HOPE, an international health education foundation, and a former administrator of Medicare and Medicaid at the Health and Human Services Department. The 15-member group is looking for ways to better coordinate the activities of the VA and the Defense Department, and it will submit recommendations to Bush in 2003.

Currently, the two most-extensive collaborations are in Nevada and New Mexico. The Mike O'Callaghan Federal Hospital at Nellis Air Force Base in Nevada is a modern health care facility that serves both veterans and current Air Force personnel. The Air Force hospital commander is also the hospital's CEO. At Kirtland Air Force Base in New Mexico, the VA and the Defense Department share a common structure, but each maintains its own distinct health care operations, including separate staffs.

The more collaboration the better, says David J. McIntyre Jr., president of TriWest Healthcare Alliance, a for-profit corporation that administers the VA central region's Tricare, the health insurance program for the uniformed services. For example, McIntyre said, the veterans medical center in El Paso, Texas, and the William Beaumont Army Medical Center in Fort Bliss are close, but the two have not partnered. In addition, he has advocated a higher level of partnership at the Gerald Champion medical facility in Alamogordo, N.M. The community hospital sits on Holloman Air Force Base; the Air Force currently uses the hospital as an outpatient facility and Air Force staff provide the care. There is a planned veterans outpatient facility in Alamogordo, and Gerald Champion hospital is interested in having it located on its campus, McIntyre said in testimony before Bush's task force.

But the Colorado project would be the first grand-scale collaboration involving veterans and civilians. It all started several years ago, when Aurora, Colo., Mayor Paul Tauer acquired land from the now-closed Fitzsimons Army Medical Center and offered it for free to the University of Colorado Health Sciences Center to build a new health care campus. The university has already broken ground on a $147 million, 12-story tower at Fitzsimons. Initially, however, only six floors will be outfitted. That part of the hospital, which will include 100 beds and an emergency department, will open by late 2003. This month, a working group representing the University of Colorado and Colorado veterans organizations is submitting a proposal to the VA seeking its participation. The VA has a year and a half to decide whether it wants to be a part of the project. If the VA decides to stay put in Denver, the university will outfit the remaining floors in Aurora as it pleases.

The University of Colorado jumped on the opportunity to move its medical center to Fitzsimons. Already on the campus are an outpatient pavilion, a cancer pavilion, an eye institute, and a perinatal research center. Still to come are a Native American building, the inpatient hospital, two research complexes, two education facilities, a center for humanities, a clinical-education facility, an office building, a library, a student center, and a school administration office. So what do Colorado's veterans think about sharing their waiting rooms with civilians? They like the idea of collaboration, but they needed some assurances, says Marvin L. Meyers, who sits on the board of the United Veterans Committee of Colorado, a nonprofit coalition of veterans organizations. "The major concern that vets had when the idea came out was loss of identity, that the university would take over everything and there would no longer be a VA presence," he said. "Veterans feel they know what they've been getting at a VA hospital."

But Meyers said that concerns have dissipated as veterans learned of the benefits of partnership. "We have to point out that the good services they're getting now are coming from the university," Meyers said. "When they come to understand the genuine positive relationship that's afforded by this collaboration and they've gotten their questions answered, they realize this is a unique campus.... We could have one dietary [department], one set of operating rooms, share highly expensive, but needed, medical equipment. We could share laundry facilities."

Congress will have to approve the partnership before Principi can give the go-ahead, and money is a big issue. Appropriators will have to come up with between $250 million and $300 million to help build the hospital and an outpatient clinic, according to Brimhall. But early cost studies indicate long-term savings from the collaboration. Indeed, the VA could save close to $1 billion over 20 years by moving its hospital to Fitzsimons instead of renovating its existing facility, according to a preliminary study jointly sponsored a year and a half ago by the University of Colorado and the VA. A new study with more-precise numbers should be ready in the next month or two.

One House Republican aide said that coming up with the money may be a problem: "We haven't had a construction project of that magnitude for a very long time." Moreover, the aide said, plenty of VA hospitals are in worse shape, and the VA will need money to fix them and to bring some into compliance with federal laws on seismic safety. But, the aide added, Congress may be more interested if there are long-term savings.

There are still many questions that must be answered about how the prospective hospital would operate. Who would be in charge? Would veterans be subject to the decisions of a private, university chief? The VA's Batliner said he expects the new entity to be a quasi-governmental corporation. The VA would have governance input into the organization at the board level, and a senior vice president for veterans care might be appointed. But, he added, there would likely be one CEO, who, he expected, would be a university official. Batliner said he's also been trying to answer other questions, such as how to integrate VA employees who want to work in the new organization but maintain their status as federal employees. "We're doing some things that are so unique that I think it will require some enabling legislation," Brimhall said.

McIntyre suggested that veterans are open to new collaborations, so long as their benefits are protected. "It's important to make sure that people have access to a benefit that's uniquely tailored to their needs. People historically thought that meant they wanted their own systems," McIntyre said. "By collaborating together, they get more than if they stood on their own. They get a more complete system."

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FDA fights bioterrorism without a leader

Marilyn Werber Serafini — Fri, 14 Dec 2001 00:00:00 -0500

"It's a problem," said Sen. Bill Frist, R-Tenn., who is a member of the Senate Health, Education, Labor, and Pensions Committee's Public Health Subcommittee. Frist is the author of bipartisan legislation, now pending in the Senate, that would authorize spending $3.2 billion to combat bioterrorism. "The FDA is critically important so that we can target [bioterrorism] agents or figure out how to treat smallpox," he said. "If there's no leadership at the top, it's hard for scientists to know what to do." (The Bush Administration also hasn't nominated a director for the National Institutes of Health, but Frist predicted that the FDA selection would come first.) Up until 1988, the Senate did not confirm FDA commissioners, a situation that had made it easier to fill the post.

Among FDA-watchers, the absence of a commissioner raises several troubling questions: Who's evaluating the speed of drug approvals? Who's deciding how to expedite reviews of drugs and vaccines to counter bioterrorism threats? Who's answering questions about RU-486, the abortion pill? Who's deciding the FDA's role in, and position on, controversial cloning issues?

So far, the White House's efforts to fill the position have been unsuccessful. President Bush was prepared to nominate Michael Astrue, a biopharmaceutical company executive, when a powerful group of Senate Democrats objected. In a July 13 letter, Senate Health Committee Chairman Edward Kennedy, D-Mass., and six other Senate Democrats urged Bush not to nominate anyone with links to the pharmaceutical industry. Astrue is senior vice president of administration and general counsel for Transkaryotic Therapies Inc. in Cambridge, Mass. He was a presidential legal adviser in the first Bush Administration and was later general counsel at the Health and Human Services Department.

"It would be unprecedented for the commissioner to be appointed from an industry regulated by the FDA," the letter stated. "To do so could raise irresolvable conflicts of interest, undercut public confidence, and undermine the agency's worldwide reputation as the gold standard of public health regulators." With Kennedy in charge of the confirming committee, and with the Senate so closely divided, the Administration yielded. Astrue withdrew his name from the running at the end of October.

Since then, FDA observers say, it's unclear how aggressively the Administration is pursuing the nomination of its current front-runner, Lester Crawford, a veterinarian and the head of a food-safety research group. Crawford is the choice of Health and Human Services Secretary Tommy G. Thompson, but industry observers say that the White House continues to interview other candidates. Crawford has a doctorate in pharmacology and is executive director of the Center for Food and Nutrition Policy at Virginia Polytechnic Institute and State University.

The FDA is important in the fight against bioterrorism because it's the agency that approves new drugs and vaccines. Fears of bioterrorism are spurring the debate about how to speed up the drug-approval process in emergency situations without compromising safety. (HHS, FDA's parent department, recently signed a contract with a private company to expedite the production of more than 200 million doses of a new smallpox vaccine.) The FDA is also responsible for food safety; some experts worry that food could become a terrorist target.

Congress must reauthorize the FDA modernization act next year, and big questions have arisen about how the agency's expedited review process for new drugs is working. Initially, the FDA sped up drug reviews for AIDS treatments, then for other potentially lifesaving remedies, to get the drugs to market faster. But questions remain about which drugs should qualify for quicker reviews and whether safety is at stake. "We've seen an exploitation of [the quicker process], where you have high blood pressure and diabetes drugs going through the process," said Mary Beth Buchholz, vice president of the Sheridan Group, a lobbying firm that works with consumers.

Moreover, there are serious new policy questions about the FDA's role in protecting the food supply--particularly imported food. Bush's emergency relief budget included a request for $61 million to allow the FDA to hire 410 new food inspectors, lab specialists, and other experts, and to invest in new technology and equipment to monitor food imports. In his bill, Frist is requesting $524.5 million to give additional tools to the FDA to ensure that proper records are maintained by those who manufacture, process, pack, transport, distribute, receive, hold, or import food.

Right now, Thompson is making the most-critical decisions for the FDA. But for the most part, the FDA's second leadership tier is running the agency, and observers say it's just not as good as having a political appointee who can represent the administration in high-level interagency meetings. The FDA is "operating on autopilot," said one industry analyst. "In terms of policy leadership, there has been no one there for some time who is able to execute policy leadership." Still, FDA observers say a nomination can't be expected anytime soon.

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Health and Human Services

Marilyn Werber Serafini and Gia Fenoglio — Thu, 28 Jun 2001 00:00:00 -0400

Established: 1953 (as the Health, Education and Welfare Department)
Address: 200 Independence Ave. SW, Washington, DC 20201
Phone: 202-619-0257
2001 Budget:: $429 billion
Employment:: 63,100
Web Site: www.dhhs.gov
Functions: HHS administers more than 300 health and service programs, including medical and social science research; disease prevention and control; food and drug regulation; Medicare and Medicaid; substance abuse treatment and prevention; preschool education and services; health services delivery for American Indians and Alaska natives; child-support enforcement; maternal and infant health; and financial assistance to low-income families.

Tommy G. Thompson
Secretary
202-690-7000
Thompson, 59, has been calling himself a compassionate conservative for years. Indeed, he may be best remembered in Wisconsin, where he was elected governor for an unprecedented four terms, for aggressively getting more than 80 percent of the state's welfare population off the dole, while at the same time substantially increasing spending on state child care, health care, and other programs to support people who leave welfare for low-paying jobs. Now the Elroy, Wis., native is in charge of the very federal agency that frustrated him when he was governor. Thompson complains that HHS held his program proposals hostage by taking too long to approve waivers from federal laws. Determined to give states more flexibility to test ideas, Thompson now directs his employees to find ways to say yes-and quickly. But Thompson's take-charge attitude has some observers worried about his ability to get along with the White House, especially since his ideas about Medicare and the uninsured aren't always the same as President Bush's. Thompson has also shown an ability to adjust his approach to suit different jobs, however. Indeed, he approached his position as minority leader of the Wisconsin state Assembly and his post as governor very differently. In the Legislature, Thompson was an aggressive partisan, while as governor he showed some flexibility in working with Democrats. Thompson began his public service career in 1966 in Wisconsin's state Assembly, becoming minority leader in 1981. He was elected governor in 1987, and he has served as chairman of the National Governors Association. Thompson earned both undergraduate and law degrees from the University of Wisconsin (Madison).

Claude Allen
Deputy Secretary
202-690-6133
States may find a friend in Allen. Like HHS Secretary Thompson, the 40-year-old conservative has pledged to give states greater flexibility to develop their own health care programs, and "only step in when the states are not measuring up." Said Thompson: "Claude's experience and state-level perspective are just what we need." Allen comes to HHS from Virginia, where he became secretary of health and human services in 1998. He played a leading role in Virginia's welfare reform, patients' rights and children's health care initiatives. Allen has been criticized as being too ideology-driven, and some blame him for not drawing more children into the state Children's Health Insurance Program. But even critics say that his Medicaid background will be a big help in the new job. As Thompson's second in command, Allen will be spending some time with members of Congress, and he's familiar with the ways of the Hill, having worked on the staff of the Senate Foreign Relations Committee for two years. Allen grew up in North Carolina, and received his undergraduate degree from the University of North Carolina (Chapel Hill). He also has a law degree from Duke University.

Janet Hale
Assistant Secretary (designate) for Management and Budget
202-690-6396
Hale, 52, a virtual unknown in the health care world, has extensive experience in the political and budget arenas. An Ohio native, she held high-level jobs at HUD, the Transportation Department, and the all-powerful OMB during the Reagan and first Bush Administrations. When Clinton took office, Hale became an executive vice president at the University of Pennsylvania, where she managed a $1.7 billion operating budget and a $300 million capital budget. She served as chief lobbyist for the U.S. Telephone Association, as policy director for Elizabeth Dole's failed presidential bid, and, most recently, as chief finance officer for the House. Hale is said to have a keen understanding of the appropriations process, knowledge that will serve her well at HHS. A former colleague also praises her ability to sift through bureaucratese and "ask the right questions." Hale received an education degree from Miami University in Ohio and a master's in public administration from Harvard's John F. Kennedy School of Government.

Bobby Jindal
Assistant Secretary for Planning and Evaluation
202-690-7858
In 1998, when Jindal was chosen to head the staff of the National Bipartisan Commission on the Future of Medicare, Washington cynics chuckled, because Jindal was just 26 years old and had had little experience in Washington or with Medicare. But Jindal won praise for helping to shape a proposal that laid the groundwork for today's Medicare reform debate. Now, three years later, at the age of 30, Jindal has returned for a second stint in Washington, this time as the person responsible for developing major health reform initiatives, including modernizing Medicare and expanding coverage for the uninsured. Although some health care policy makers prefer a more seasoned candidate, Jindal has plenty of fans who point to his political and management savvy. Before working on the Medicare commission, Jindal turned around Louisiana's financially troubled Medicaid program. After the commission disbanded, Jindal became president of the University of Louisiana system and a professor of management there. Jindal grew up in Baton Rouge, La. He received an undergraduate degree from Brown University and a graduate degree from the University of Oxford.

Tom Scully
Administrator, Centers for Medicare and Medicaid Services
202-690-6726
Scully is taking on one of the most important-and potentially volatile-jobs at HHS. Key members of Congress are pursuing an overhaul of the Medicare and Medicaid agency, which until June 14 was known as the Health Care Financing Administration. This overhaul could diminish the agency's power, perhaps tearing it in two, with one part responsible for Medicare and the other for Medicaid. Even if it remains intact, the CMS (one of the M's was dropped from the initials to make the short name easier to say) will likely be reorganized to place a greater emphasis on private health plan participation. Whatever its form, the CMS will be "more efficient and effective," Scully promises. At 43, the baby-faced, well-liked Scully is giving up a high-paying job as head of the Federation of American Hospitals to return to the federal government. During the first Bush Administration, Scully served as an associate director of OMB, and later at the White House as deputy assistant to the President. After Bush's father left office, Scully became a partner in the Washington firm of Patton Boggs. Scully, who grew up in Pennsylvania, earned an undergraduate degree from the University of Virginia and a law degree from Catholic University. He then spent time on Capitol Hill as a staff assistant to Sen. Slade Gorton, R-Wash.

Return to Main Story

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The Medicare Maven

Marilyn Werber Serafini — Mon, 05 Mar 2001 00:00:00 -0500

Administrator, Health Care Financing Administration President Bush's plans to revamp Medicare could take years to run the legislative gauntlet. But he could sidestep Congress by implementing some of his ideas through the regulatory process -- in particular, through the Health Care Financing Administration.

HCFA, which is a branch of the Health and Human Services Department, runs the Medicare program for the elderly and oversees the federal-state Medicaid program for the poor. By promulgating -- or dismantling -- regulations, the head of HCFA may be able to spur more participation by private managed care health plans in both programs. Providing additional managed care options for Medicare and Medicaid recipients is a key part of Bush's health care platform; currently, more than 80 percent of seniors still use Medicare's traditional fee-for-service program.

"Democrats had their foot on the brake on Medicare+Choice," the HMO part of Medicare, a health care lobbyist said. "They clearly didn't like private health plans." A Republican-led HCFA, to the contrary, could promote Medicare HMOs by cutting back on regulations, better publicizing managed care options, and asking Congress for more money for Medicare HMOs.

Managed care executives cite burdensome administrative regulations as a main reason why HMOs have fled Medicare and are beginning to leave Medicaid. And the executives are hopeful that the new HCFA chief, who has yet to be chosen, will lighten the load. "We're hearing an attention to the administrative issues here, which is very encouraging," said Karen Ignagni, president of the American Association of Health Plans, which represents managed care health plans.

HCFA could test Medicare reform concepts through demonstration projects, said Gail Wilensky, a former HCFA administrator who chairs the Medicare Payment Advisory Commission, which advises Congress on Medicare policy. HCFA could also create demonstrations to test prescription drug coverage proposals and competitive bidding arrangements, she said.

Medicaid, too, has the potential to undergo huge change under a new HCFA chief. In particular, HCFA could give states more latitude to structure Medicaid rules to their liking. Ron Pollack, executive director of Families USA, a consumer advocacy group, says he fears the result could be a Medicaid with fewer benefits and higher costs for participants. At worst, it could mean an end to Medicaid's entitlement status, he said. "HCFA will play a crucial role in granting or not granting waivers," Pollack said. "For states that don't want to follow the law that exists, there are waivers."

For example, he said, North Carolina placed a cap on enrollment in its Children's Health Insurance Program. States can't do that for Medicaid, because it's an entitlement program. Not without a waiver, that is. "There are potentially huge consequences," according to Pollack.

Pollack says that no one should underestimate HCFA's power. "They can achieve through the back door what they couldn't get through the front door."

One possible candidate for the HCFA post is Tom Scully, president of the Federation of American Hospitals, the trade association that represents for-profit hospitals. Scully, who was the lead health care adviser at OMB under former President Bush, is politically savvy and well connected to key members of Congress -- both Republicans and Democrats. Another possible candidate is Bobby Jindal, who was the staff director for the Bipartisan Commission on the Future of Medicare in 1998. Return to main story

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Beefing up the bureaucracy to promote marriage

Marilyn Werber Serafini — Mon, 05 Feb 2001 00:00:00 -0500

Patrick F. Fagan, a senior fellow at Heritage, is urging Bush to take funds from three welfare programs within the Health and Human Services Department to begin a new Office of Marriage Initiatives. The idea is that the office could help address, in a compassionate conservative way, of course, what Fagan says is one of the root causes of poverty--the breakdown of the institution of marriage.

Bush has been on the marriage bandwagon himself for a while. He and Laura, his wife of 23 years, enthusiastically promoted marriage during the campaign. Last June, the couple praised the work of the Marriage Movement, a bipartisan group of clergy, lawmakers, and social workers whose mission is to strengthen marriage.

"Strengthening marriage will help families and children, build up civil society, boost opportunity, and spread social equality," the Bushes said. "Children in single-parent homes are more likely to live in poverty, have problems at school, bear children out of wedlock, and fall victim to the lure of illegal drugs and other risky behavior."

Fagan proposes reallocating some funds currently used by the government's main cash assistance program--Temporary Assistance to Needy Families--from the Child Support Enforcement Program, and from the Office of Family Planning into the new Office of Marriage Initiatives. Fagan also wants to merge the offices responsible for adolescent-pregnancy prevention and sexual-abstinence programs with the new office.

The office's mission would be to reduce the divorce rate (currently estimated at about 40 percent) and out-of-wedlock births (about a third of all babies) each by 30 percent, especially among welfare recipients, within the next decade.

Specifically, the new office would research and identify successful pro-marriage programs, share information about those programs, and design government-funded demonstration projects based on the findings. It would advise states on how to use surplus welfare money to increase marriage and decrease divorce and out-of-wedlock births.

The office, for example, could find and replicate the high school curricula most effective in encouraging marriage and teen-age sexual abstinence. It could rebuild the federal-state system for gathering data on marriage and divorce, and orient it more toward analyzing the impacts of divorce and out-of-wedlock births on federal spending.

Surplus funds in the Temporary Assistance to Needy Families program were close to $7 billion at the beginning of 2000, according to Fagan. "One of Congress's mandates to the states in the Welfare Reform Act was that they take steps to restore marriage among recipients, yet virtually no TANF money has been spent on such activities," Fagan wrote in his proposal. "An Office of Marriage Initiatives that acts as a repository of expertise on what states are doing to increase marriage, decrease divorce, and increase abstinence before marriage, thereby reducing out-of-wedlock births, would jump-start this process. Congress should require the states to devote a certain percentage of their [welfare] funds to these efforts."

No one knows whether the President will endorse Fagan's idea, but during the campaign, Bush did say, "As a society, we face few greater challenges than to ensure that more of America's children are raised by mothers and fathers in strong, healthy marriages."

The ring, please.

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Thompson brings pragmatic approach to HHS

Marilyn Werber Serafini — Fri, 02 Feb 2001 00:00:00 -0500

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Should FEHBP be the model for Medicare reform?

Marilyn Werber Serafini — Thu, 11 Feb 1999 00:00:00 -0500

A plan under consideration by a bipartisan commission would model Medicare after the Federal Employees Health Benefits Program, the much-praised system that insures members of Congress, federal workers, and White House officials. But not everyone is sold on the idea.

The FEHBP has experienced its own financial turmoil since its creation in 1959, and it may not work as well for the elderly as it does for younger, healthier federal employees, critics contend.

"Saying that the FEHBP ought to be a national plan is like saying the Redskins are a good football team," said Bruce C. Vladeck, professor of health policy and geriatrics at Mt. Sinai School of Medicine in New York City, and a member of the National Bipartisan Commission on the Future of Medicare, noting the Redskins' losing record. Vladeck was appointed to the panel by President Clinton.

There are plenty of misconceptions about the FEHBP, said Rep. James A. McDermott of Washington, a Democratic appointee to the commission. "People who don't know [the FEHBP's] history walk around saying things that simply are not true. It's such an easy slogan or bumper strip. Give everyone the same thing we give Congress."

The leading proposal under consideration by the Medicare commission is called "premium support." The term refers to the principle that government pays for most of the premium for standard health care plans. Premium support is based on the FEHBP concept, and it is expected to be the centerpiece of the recommendations that the commission makes to the White House and Congress on March 1. The idea is to give Medicare beneficiaries more health plans to choose from and to make the system more cost-efficient by creating a greater private-sector influence over Medicare.

The FEHBP is the largest employer health plan in the United States, covering about 9 million federal workers, retirees, dependents, and survivors. The Office of Personnel Management has contracts with more than 300 health plans of varyious types to serve federal employees in different states. In some places, federal workers can choose from as many as 20 plans.

Early in the year, the OPM sends a letter to all of the participating insurance carriers, telling them what changes it wants to make in the program. For example, it may require coverage for a new benefit. The health plans then respond. Based on their previous year's experience and their projected costs, they calculate what the new premium is likely to be. (Health plans must provide a minimum set of benefits, but many offer more, usually at a higher premium.) Then the OPM sets the federal contribution based on what a handful of the largest health plans say they'll need. The idea is that the government payment covers most of the premium in a basic plan. Federal workers who want a plan with richer benefits would have to pay more. Workers who opt for a bare-bones health plan pay less. Toward the end of the year, the OPM sets the federal contribution based on what a handful of the largest health plans say they'll need.

The FEHBP has demonstrated during the past several years that it can offer people numerous choices and still keep premiums down (annual increases have been as low as 2 percent). Annual premium increases dropped from double digits in the late 1980s to below the rate of inflation in the past four years. Health care analysts attribute the recent small premium increases to the plans' adoption of tighter management controls, such as closely monitoring hospital stays.

But the idea that FEHBP premiums have been any less volatile since the program started in 1959 than premiums in the private marketplace is false, say health care analysts. For example, when inflation was high in the 1970s and 1980s, premium increases in certain years were 20 percent. Some analysts said the health plans were increasing premiums to make up for earlier years when they kept premiums low to build market share. Others speculated that the health plans were trying to make up for losses in their private-sector businesses.

"There was a lot of uproar about how significant premium increases were, [while] at the same time, employees weren't getting much in the way of pay raises. There were questions with regards to holes in the benefits package," said one consultant familiar with the FEHBP. "When you move onto the premium roller coaster, it's easy to move onto the benefits roller coaster."

In 1982, when faced with large premium increases, the government directed health plans to reduce benefits by 13 percent. What resulted, according to McDermott, was "across-the-board implementation of deductibles, co-insurance rates, and a hospital pre-admission certification that halved what would have been an average 1982 premium increase of 35 percent, and permanently reduced the enrollees' value of FEHBP benefits."

Moreover, some critics warn that what works for relatively young and healthy federal employees might not work for the elderly. Simply figuring out the complicated information brochures for numerous plans may be difficult for the elderly, critics say. "This whole business that you put 35 million seniors out there with a book in hand and have them try to pick a program that fits their needs is erroneous from the start," said McDermott.

The FEHBP is small in comparison with Medicare, and the beneficiaries are different. "When you get to Medicare, you're dealing with a lot of poor people and people who are in trouble in terms of making decisions," said Stuart H. Altman, a professor of national health policy at Brandeis University's Florence Heller Graduate School, and a Clinton appointee to the commission. Altman generally likes the idea of premium support for Medicare, but cautions that Congress would have to make sure that benefits couldn't be taken away.

Advocates of premium support point out that Medicare is already moving in the direction of giving seniors more choices. Even so, seniors are less likely to have as many choices in health plans as federal employees have, if for no other reason than federal workers are concentrated in metropolitan areas. Generally, it's easier for health plans to provide service in a metropolitan area than a in rural area, where there are fewer doctors, clinics, and hospitals. And that demonstrates why the FEHBP is one of a kind, said Vladeck.

Still, the FEHBP has experienced several problems directly related to the large number of options it offers. For instance, some FEHBP health plans that offer a broad set of benefits have attracted a disproportionate number of older and sicker people, according to a March 1998 briefing paper of the National Health Policy Forum, a nonprofit group affiliated with George Washington University.

Attracting a sicker population puts health plans at a competitive disadvantage because other plans have healthier enrollees and sicker people cost more to insure. When the government has based FEHBP premiums on the costs of its health plans with relatively sick members, it sometimes has ended up spending more than it intended on other health plans in the program, according to the briefing paper.

Advocates of premium support insist that the FEHBP model can work for Medicare, with adjustments to account for differences in the two populations being served. "It's the same concept, where we'll negotiate on premiums and price, but the marketplace will design the system for the elderly," said Sen. John B. Breaux, D-La., chairman of the Medicare commission.

For instance, Breaux's premium support proposal would base premiums on the weighted average of bids submitted by all health plans participating in Medicare, not just a few.

Altman praises the FEHBP for its flexibility in adjusting to changing circumstances. For example, Altman says that Blue Cross, Blue Shield faced financial problems in the 1980s, when older federal workers were enrolling disproportionately in its plans. Altman credits the FEHBP with providing the flexibility that Blue Cross, Blue Shield needed to survive.

In fact, he added, last year's exodus of health plans from the Medicare market shows how adding flexibility would help Medicare. Altman says that much of the blame should be placed on the government, because it wouldn't allow health plans to adjust premiums and benefits so they could remain in the Medicare markets.

Commission leaders need 11 of the 17 members to vote for premium support in order to make it an official recommendation for Medicare. All of the commission's eight Republican appointees are expected to vote for the recommendation, and several of President Clinton's appointees are leaning toward supporting it. Breaux, the chairman, is leading the charge for premium support. Two additional Clinton appointees who may back premium support are Altman and Laura D'Andrea Tyson, dean of the Haas School of Business at the University of California (Berkeley). In particular, Altman and Tyson are looking for assurances that there will be an adequate benefits package, including a prescription drug benefit, that will be available at a price seniors can afford.

But even if premium support doesn't get the necessary 11 votes, Breaux and Rep. William M. Thomas, R-Calif., the commission's administrative chairman, both said on Feb. 1 that they will pursue the concept in Congress this year. House Majority Leader Richard K. Armey, R-Texas, said that he hopes the House will take up Medicare restructuring this year.

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Senator: Let Seniors Into FEHBP

Marilyn Werber Serafini — Tue, 17 Mar 1998 00:00:00 -0500

Ask any 10 Republican policy makers about President Clinton's proposal to let early retirees buy into Medicare and you'll get the same answer back: It's on the right track, but the approach is all wrong. According to the conservative mantra, using Medicare to extend health care coverage would expand a federal bureaucracy that's already bloated and inefficient.

Now, after months of negative reaction, the first serious alternative approach is getting some notice. Sen. John B. Breaux, D-La., chairman of the National Bipartisan Commission on the Future of Medicare, is even walking around with a copy of the counterproposal under his arm.

The new plan--to let people age 62-65 buy into the Federal Employees Health Benefits Program (FEHBP) instead of Medicare--was put forward by David B. Kendall, senior analyst for health care policy at the Progressive Policy Institute, the centrist think tank of the Democratic Leadership Council.

Breaux quickly endorsed the idea. "I've shared and showed it to anyone who's willing to listen," the Louisiana Senator said in an interview. "I asked the President to look at the papers. I am sending it to all of the [Medicare] commission members, to congressional leaders and Members of Congress."

Both Breaux and Kendall praised President Clinton for returning the nation's attention to health care access, but he said the FEHBP would be a better choice than Medicare for covering early retirees. It has restrained costs more successfully than Medicare, they said, because it has created competition between private health plans instead of relying on the "bureaucratic price controls" of Medicare.

Kendall added that the FEHBP also offers a greater variety of health plans, letting participants pick the plan that best suits their needs. Moreover, he argued that the FEHBP plans offer comprehensive benefits, whereas most Medicare recipients end up buying supplemental insurance policies to cover the costs of prescription drugs, co-payments and deductibles.

There are also political reasons Clinton should look at the FEHBP instead of Medicare, Kendall said: If the goal is universal health care coverage, then putting forth a proposal Republicans can't support creates an immediate stumbling block. Clinton's opponents have "already asserted that a Medicare buy-in will lead inexorably to an expansion of Medicare and increased government control of the health system," he said.

Still, the President needs to produce some kind of comprehensive health policy, especially since the Republicans won't, Kendall noted. "Their just-say-no reactions to his proposal contribute to a political vacuum in which extreme ideological positions prevail and gridlock results. By using FEHBP as a model for a competitive system that restrains the public costs of subsidizing health care coverage, the President and Congress could galvanize broad public support and avoid the many pitfalls associated with expanding Medicare."

The Medicare commission is sure to examine the plight of uninsured early retirees this year. In fact, Congress directed it to do so, after proposals to raise Medicare's eligibility age from 65 to 67 nearly passed as part of last year's balanced budget act. The Senate passed the proposals, but the House-Senate conference committee eventually removed it and a couple of equally controversial provisions from the bill. In congressional discussions about adding 65-67-year-olds to the ranks of the uninsured, another issue--that nearly 15 per cent of Americans between the ages of 50 and 65 don't have health insurance--was also brought to light.

Breaux has shown a particular interest in the FEHBP. Last year, he proposed an extensive demonstration project to test the FEHBP approach for Medicare, although that proposal was trimmed to include just a few pilot programs. Meanwhile, Senate Minority Leader Thomas A. Daschle, D-S.D., introduced legislation that would use the FEHBP as a model to insure many Americans.

Kendall says he's also discussed his plan with Christopher Jennings, Clinton's top health care adviser. "There's some disagreement about which system would produce the best price for beneficiaries, but they're looking at it carefully," he said.

Kendall predicts that a buy-in to either Medicare or the FEHBP would attract about 300,000 takers, and that the cost at first would be roughly the same--about $300 per month. But Kendall explains that the FEHBP would be preferable because prices would rise and fall based on the market, while Medicare's prices are harder to adjust.

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Micromanaged Care?

Marilyn Werber Serafini — Mon, 15 Dec 1997 00:00:00 -0500

Sure, everyone's for improving quality in health care, especially as horror stories about managed care keep making headlines. Nonetheless, Members of Congress up for reelection next year might not want to promise too much.

The problem is that there are as many definitions of "quality" as there are Members eager to jump on the issue, and that profusion of views could squelch any attempt to enact comprehensive legislation next year.

Does quality mean finding out why only two-thirds of kids in health plans get immunizations? Does it mean collecting data so that patients can compare health plans for how easy they make it to see a specialist? Does quality mean that patients should have a chance to appeal decisions denying them treatment?

It all depends on who's doing the defining. Many Members--and not only Democrats--want far-reaching legislation that would go so far as to allow patients who are denied treatments to sue their health plans. Others want health plans to be forced to cover specific procedures, such as reconstructive surgery after a mastectomy.

But even if there's agreement on what issues should be addressed, there's still a big split on who should do the addressing. There's a move just under way to establish an independent health care regulatory agency, modeled after the Securities and Exchange Commission (SEC). The managed care plans, naturally, would prefer that someone other than politicians fix whatever's amiss. "How do you balance what the market should do and what government should do?" said Karen Ignagni, president of the American Association of Health Plans (AAHP), which represents most health maintenance organizations and managed care plans. "This is going to be a very thoughtful debate about where the lines should be drawn, which is the essential underlying question here."

The line has been moving. In 1993-94, President Clinton favored a heavy hand from government to guarantee health coverage to every American. That attempt failed miserably with the public and played a large part in the Republican takeover of Congress in 1994.

Since then, the government has let the marketplace take the lead. The result: the moving of 56 per cent of Americans into managed care and a slowdown in the rise of health care costs, which had been soaring. But at a cost. The public has become angry at the limitations of managed care and at the news accounts of people being denied treatments or prevented by "gatekeepers" from seeing medical specialists.

Last month, in endorsing the recommendations of his blue-ribbon commission on health care quality, Clinton characteristically chose a middle way. He vowed to put the panel's suggestions--such as making insurers pay for an emergency-room visit for a patient who suspects a heart attack but has indigestion--into effect for government-run health programs such as Medicare and Medicaid. For private-sector health plans, however, he only requested voluntary compliance.

Republicans are all over the lot. GOP leaders and some of the most conservative Republicans are sticking with an ideological predisposition to keep government out of health care markets. Many of the Republican rank and file, though, are going their own way, on an issue that has frightened a multitude of voters.

On the surface, it's a politically tempting issue. But when the combatants get into the morass of details and the inevitable disputes over what quality means and who should do something about it, nothing may happen.

Micro-Danger

To the enduring criticisms about managed care, Congress so far has responded piecemeal, with laws that dictate how many days a new mother may stay in the hospital and how much coverage insurers must offer for mental-health problems. Still, some Members--especially Republicans--charge that the latest batch of bills to ensure medical quality are simply a pretty mask for micromanaging managed care.

Take the bill that has attracted more than 200 House co-sponsors--Republicans and Democrats alike--and may become the vehicle next year for comprehensive legislation on quality. The author, Rep. Charlie Norwood, R-Ga., a dentist, says that the legislation has moved the debate over quality along because it wouldn't force health plans to cover specific new services.

"These little stopgap measures that treat one body part will never be the way to go, because there are too many body parts," Norwood, a conservative Republican, said in an interview. "There are too many diseases. I'm trying to look at this a little broader than how long you have to stay in the hospital for a mastectomy."

Norwood's bill would let patients sue their health plans and let them go to an emergency room without getting approval first if they think their health is in danger; it would also ban health plans from paying bonuses to doctors, hospitals or claims adjusters for limiting patients' care and would require health plans to accept all qualified doctors.

But even that is too much--and too expensive--for businesses and managed-care plans. M. Anthony (Tony) Burns, who is the chief executive officer at Ryder System Inc. and the chairman of the Business Roundtable's task force on health and retirement, contends that government-imposed mandates aren't the answer. "The market is changing rapidly," he said, "and we have to be careful to let the market respond and [we have to ensure] that programs coming out of Washington be voluntary." The legislation enacted last year to require insurers to cover mental health as fully as physical health, he said, is an example of a mandate that will cost businesses and their employees too much. "Most programs have some type of accommodation for mental health care," he said, "yet the mandate requires more than is needed."

The National Center for Policy Analysis, a conservative think tank, predicted last month that Norwood's bill could raise individuals' premiums for health insurance by an average of 23 per cent.

And that's without the sort of mandates--body part by body part--that strike fear into managed care officials' hearts. Businesses and health plans alike worry that any new mandates will make health insurance too costly. Consider breast cancer. Congressional Democrats pushed hard for two bills this year--and will resume their fight next year. One sponsored by Rep. Rosa DeLauro of Connecticut, with 214 co-sponsors, specifies that a woman may stay in the hospital for 48 hours if she undergoes a mastectomy and for 24 hours if she has a lymph node removed. Rep. Anna G. Eshoo, D-Calif., has proposed requiring insurance companies, in the case of a mastectomy, to fully cover reconstructive surgery, which is often classified as a cosmetic procedure, she says, and isn't covered by insurance.

A Middle Way

Clinton took pains to tread the middle of the road when his quality commission released its recommendations last month. The 32-member panel, co-chaired by Health and Human Services (HHS) Secretary Donna E. Shalala and Labor Secretary Alexis M. Herman, suggested many consumer-protection measures, which have drawn little opposition. The commission stressed the need for health plans to give consumers accurate, understandable information about their facilities and medical professionals. It also called on health plans to disclose any financial incentives medical practitioners might get that result in their denying care to patients, and to make sure that patients with dangerous or complex conditions get to see specialists.

Clinton didn't call for legislation--though he didn't rule it out--but merely urged businesses to follow the commission's recommendations. Still, business groups warned against using the recommendations as the basis for more government mandates--"at a time when the private health care market is providing innovative improvements for our employees," Ryder's Burns said. During the past couple of years, managed care officials at the AAHP have proposed adopting voluntary constraints as a tactic to avoid government-imposed ones. AAHP members took the position, for example, that new mothers may stay in the hospital longer than 24 hours if the doctor and the patient agree it's necessary.

Three of the group's large health maintenance organizations went even further--far enough to prompt criticism from within AAHP for exposing an internal split. Supporting legally enforceable national standards were Kaiser Foundation Health Plans Inc. of Oakland, Calif.; Kaiser/Group Health Inc. of Seattle; and HIP Health Insurance Plans of New York. They jointly announced their position with the American Association of Retired Persons and Families USA, a consumer group.

"We're getting hammered so constantly," said David Abernathy, a senior vice president in Washington for HIP, "that it comes down to one's political judgment about whether . . . there's such a hunger out there to do something legislatively that if you don't do something like this, you're going to get screwed." Otherwise, he added, "we'll keep getting disease-of-the-month legislation."

Another option for fending off micromanagement by Congress is to create an independent, nonpolitical regulatory body that would oversee health care quality, much the way the SEC regulates the securities industry. Its independence would allow it to supply comparative information for consumers and tough-minded enforcement of ethical standards, without excessive political interference, according to Lynn Etheredge, a health care policy consultant who has recommended the SEC as a model. Granting regulatory power over private-sector health plans to HHS, which already oversees Medicare and Medicaid, would be a mistake, Etheredge argued in the latest issue of Health Affairs, a bimonthly journal. The department "is run by political appointees," he noted, so that "its key regulatory decisions likely would be influenced by the White House."

Etheredge has in mind an agency that requires health plans to register with the government and makes sure that they meet national standards for disclosing information and for dealing fairly with consumers. It would have the authority to investigate questionable practices, impose penalties and seek civil injunctions. The standards would apply not only to managed-care plans but also to all types of health insurance, including "self-insured" plans. Most big corporations insure their own employees and thus operate under rules that critics say let them do whatever they want.

Etheredge also envisions setting up an equivalent of the Financial Accounting Standards Board (FASB), a private group of experts that develops standards the SEC enforces. A board on health care standards would "reflect the private sector's expertise and meet the real-world needs of market participants," he wrote. "There are a lot of things in quality assurance that relate specifically to medical questions that are moving fast, where the government is not nimble enough to be the entity that specifically defines the criteria."

If an FASB-like board had been around during the furor over how long new mothers may stay in the hospital, Ignagni of the managed care group said, "we would be at a very different place than where we are today, because we would have brought forth research, looked at the pros and cons and had a much more reasoned debate--as opposed to making these political footballs into political campaigns."

Saith the GOP Leader: Resist

Even with almost half the House as co-sponsors (and Alfonse M. D'Amato, R-N.Y., as its sponsor in the Senate), Norwood's bill--or any bill, for that matter--is far from enactment. A serious obstacle is opposition from GOP leaders and the most conservative among congressional Republicans to anything that involves Washington in regulating managed care.

"The marketplace adjusts to changes more quickly than the government can," a Senate Republican aide said, pointing to a growing number of health plans that let patients go to doctors outside the network if they're willing to pay more. "By the time government gets around to responding, they're responding to the wrong problem."

A memorandum last month from House Majority Leader Richard K. Armey, R-Texas, to House staff members spelled out the leadership's position: Resist. The memo aimed at Clinton's endorsement of his commission's recommendations but was clearly meant as a warning to any lawmaker who's thinking of writing a bill on the subject. "This new offensive--on `health plan quality'--follows a common Clinton pattern," Armey wrote. "First he identifies a `crisis,' usually in the fall before an election year. Then he highlights it in his January State of the Union. And then he calls on Congress to send him, by Election Day, some Kennedy-Blank bill to `solve' this crisis." The conservative Texan likened Clinton's latest thrust to his earlier health care plan. "It will address a different 'crisis,' " Armey ventured--"quality, instead of access--but the practical result will be the same: Washington bureaucrats defining people's health care choices."

But if the quality commission's recommendations angered GOP leaders and upset business executives, the Norwood bill should terrify them. Letting patients sue their health plans, for instance, is anathema to many Republicans, who for ages have sought to limit medical malpractice awards. Armey's memo didn't specifically criticize Norwood's bill, but GOP leaders don't like that approach any better than Clinton's.

Still, Norwood's bill has drawn the most congressional support to date. Norwood said he's conducting "friendly negotiations" with Armey to work out some of the Majority Leader's concerns about too many mandates.

House Speaker Newt Gingrich, R-Ga., has stayed relatively quiet on a subject that has pitted Republican against Republican. But he has offered encouraging words, Norwood said. "Last year when I was talking to him about this, I told him what we were doing and he said, `When you get 200 co-sponsors, come back, and we'll take a look.' We've come back, and we're in the process right now of working with the [leadership] staff."

Another bill that's at least as broad as Norwood's--and of a surprisingly similar complexion--was introduced this year by Edward M. Kennedy of Massachusetts and John D. Dingell of Michigan, respectively the top Democrats on the Senate Labor and Human Resources and the House Commerce committees. That bill addresses many of the same issues as Norwood's, though in a more government-friendly way. For instance, it would create an Office of Health Insurance Ombudsman to assist patients. It would prohibit plans from denying access to "appropriate care," such as visits to specialists, and would give doctors more authority to decide what care the patient should get.

Senate Labor and Human Resources Committee chairman James M. Jeffords, R-Vt., has been working on a bill of his own, which he may wind up co-sponsoring with Kennedy. Jeffords, the only Senate Republican who backed Clinton's health care plan in 1993, has been warned by GOP leaders to proceed carefully.

An Iffy Public

What the public thinks about the quality of medical care will probably determine how the issue plays out next year, as Members worry about the midterm elections. But the thing is, the public doesn't seem to know what it thinks.

That's evident from an opinion poll that the Henry J. Kaiser Family Foundation released last month. "The public has anxieties about managed care and supports consumer protections," Drew Altman, the foundation's president, said in an interview."But they're also leery of the government and worried that government regulation will drive up costs. . . . The survey showed very clearly that the way in which this issue is framed and what spin the public buys will be critical to the outcome of the debate."

Fifty-two per cent of the respondents said the government should protect managed care consumers, but 40 per cent found intervention by the government wouldn't be worth the additional cost. The public also showed itself of mixed mind about who should regulate managed care plans--19 per cent named the federal government, 18 per cent preferred state government and 34 per cent favored an "independent organization." Sixteen per cent said that managed care plans shouldn't be regulated at all.

But in Altman's view, the survey's most powerful finding was that the public sees the horror stories about managed care as something commonplace, not as rare events. "As the marketplace has changed, more and more people have been brought into managed care, and people are anxious and a little worried about managed care and what it means for them," he said. "It's not that they're unhappy with their own plans, but that managed care might not be there for them if they're really sick." He suggested that consumer advocates for should frame the issue as offering solutions to problems that patients face on a day-to-day basis--" `Can I go to the emergency room?' for example"--while opponents will want to bash government regulation that drives up costs.

The sad fact, Altman added, is that the proposals are truly modest but will be viewed by ideology-driven Republicans as extreme, by the time the debate ends. He sees political motives. "Many of the most conservative Republicans have always viewed health care as a Democratic issue, one that they can never win on," Altman said. "It's always seen as an issue [for which], in the end, the Democrats get more political credit."

But one huge factor suggests something may happen, HIP's Abernathy said. In the end, "this stuff's easy to do. It sits well with voters," he explained. "We're facing a tremendous amount of public pressure out there." The managed care lobbyist sees a lot of reason to believe that Congress will do something about health care quality next year--"I don't think people are going to get over this frenzy."

Sens. John H. Chafee, R-R.I., and Joseph I. Lieberman, D-Conn.--a moderate Republican and a centrist Democrat--are trying to nudge the process along. They've formed a bipartisan, bicameral task force that will start meeting next year to study what to do about the quality of health care. Chafee has convened this group before, to provide a mainstream approach to ideologically divisive health-related issues. Faced with the President's bill during the health care reform debate of 1993-94, Chafee's coalition crafted a moderate alternative that nearly gained enough support to pass the Senate. "I don't think we've seen an end to body-part legislation," Chafee said. "Each is very appealing. But we've got to balance mandates versus costs. Too often, costs aren't considered."

Still, whether Congress will succeed in finding a middle ground is problematic. Democrats are sure to find legislation tempting--and Republicans may, too. There's more support among rank-and-file Republicans than among GOP leaders for a wide-ranging bill like Norwood's. Rank-and-file Republicans have been known to defy their leadership before, such as when they forced their Senate leaders last year to allow a vote on a bill--later enacted into law--to make it easier for workers to carry insurance from one job to the next. A few Republicans have introduced comprehensive bills to improve the quality of managed care.

But even with all these pressures to pass legislation, getting from here to there won't be easy. Too much is at stake, for too many people, for a political consensus to be obvious.

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