Action For Better Healthcare

Tuesday, August 31st, 2010

By Kester Freeman
Former CEO, Palmetto Health

There are so many untold stories about healthcare heroes. The people on the frontlines who go above and beyond everyday. We want to tell these stories and encourage you or your communications department to email us with your stories. What are you doing to change healthcare in the United States? How did your team make a difference?

Doctors and staff at Charity Hospital faced a complicated and frightening situation in the aftermath of Hurricane Katrina. We all heard about this to some extent, but now we hear from the doctors, nurses and staff members themselves. How did they get their patients to safety? How did they beat the odds? How did they scramble to develop their own rescue plan when they realized nobody was coming to help them?

Watch their story below. It is moving and inspiring.

We want to hear from you as well so we can share your stories with others. Let's all inspire each other!

Categories: Health videos, Hospital emergency plan, Nursing issues, healthcare heroes, hospitals, patient care, physicians
Comments: 1

Wednesday, August 25th, 2010

By Mike Daly
Former CEO, Baystate Health System

For some time now, we have discussed the importance of group purchasing organizations (GPOs) on our blog. Critics out there often question the business model of GPOs. Some wonder if contracting with suppliers, to offer cost savings to healthcare systems, really works. They wonder if the GPO contracts are somehow unfair to hospitals. Well, a recent high court ruling finds the answer to these questions is NO.

The plaintiff in a recent case questioned contracts that a company called Bard had, with a GPO, for catheter products. The arguement was that Bard’s GPO contracts and discounted prices were so attractive that hospitals could not afford to forgo them, which the plaintiff argued was in violation of antitrust laws. But on August 17, 2010, in the case of Southeast Missouri Hospital v. Bard, the 8^th Circuit Court of Appeals ruled that sole-source provisions, tiered pricing and bundled discounts in a supplier’s GPO contracts do not violate antitrust laws.

In making its ruling, the court made the following statements of fact:

1. GPO membership is voluntary and the marketplace is highly competitive, which benefits hospitals, payers and patients alike.
2. GPOs do not purchase supplies; member hospitals do under the terms of GPO-negotiated contracts.
3. GPO-member hospitals are not required to purchase through their GPO contracts. GPO-member hospitals can purchase supplies “off-contract,” negotiating their own prices with suppliers. However, purchasing off-contract may increase prices, as they forgo the discounts in their GPO contracts.
4. On average, hospitals pay 16 percent less by buying through GPO contracts.

This is a critical ruling that validates the GPO business model and helps illustrate that hospitals, GPOs and suppliers share the primary goals of improving patient care and safely reducing healthcare costs when establishing supply contracts.

I really hope others are able to gain a better understanding of GPOs given this ruling. The decision affirms that the GPO business model is in fact ethical and fair – something many of us have understood for a long, long time.

Categories: GPO, Medical Devices, hospitals, transparency
Comments: 1

Friday, August 20th, 2010

By Jennifer Mithell
Editor, Action for Better Healthcare

At least a dozen U.S. drug and medical device companies are currently under investigation by federal prosecutors for alleged misconduct. Prosectors want to know if the companies made illegal payments to doctors and health officials abroad in order to encourage use of their own products.

There is also concern the alleged payments may have influenced the outcomes of certain clinical trials. A recent report in The New York Times explains:

In previous investigations, federal officials have charged that some companies made these kinds of payments to encourage doctors abroad to order or prescribe their products. In the United States, companies routinely hire doctors as consultants to market drugs and devices to their colleagues and other health professionals at medical conventions and small gatherings. Such consulting arrangements are legal in the United States as long as the companies do not pay doctors directly to write prescriptions for their products.

But in much of the rest of the world, doctors are government employees. And even consulting arrangements that would be considered routine in the United States might violate the Foreign Corrupt Practices Act, particularly if the payments are outsize or the arrangements are not disclosed to the governments.

Of even greater concern to prosecutors in the United States are unusually large payments made to foreign doctors who oversee the growing number of clinical trials that drug and device makers conduct abroad.

Merck, Eli Lilly and Johnson & Johnson are among several companies that have disclosed that they are cooperating with federal authorities regarding business they do abroad. In fairness, this does not mean they are guilty of any crime.

A former federal prosecutor has a word of advice though – saying “drug company executives would do well to remind their foreign subsidiaries not to bribe local officials or doctors. They should set a tone at the top that makes it clear to a company’s international sales force that these types of payments are unacceptable.”

Categories: Medical Devices, conflict of interest, medical supply companies, pharmaceutical, physicians, transparency
Comments: 0