Fighting Corruption in Health Care - Suggestions from Transparency International

The August issue of the Journal of Epidemiology and Community Health featured a number of articles on conflicts of interest (COI) and medical and public health education and research. One notable contribution included authors from the German chapter of Transparency International (Spelsberg A, Martiny A, Schoenhoefer PS. Is disclosure of potential conflicts of interest in medicine and public health sufficient to increase transparency and decrease corruption. J Epidemiol Community Health 2009; 63: 603-605. Link here, requires subscription.) Transparency International is a major international NGO respected for its stand against corruption, and for transparency and integrity.

The article's major premises deserve quotation:

When Transparency International was founded in 1993, the focus for fighting corruption was mainly on bribes and corruption of civil servants in developing countries. While our definition of corruption was broad from the beginning, that is abuse of power or of a powerful position for personal advantage or benefit, the concept of preventing corruption had to be adjusted more recently.

conflicts between private and professionally consigned interests—be it in public office or in the private sector—create susceptibility to corruption....

Conflicts of interests are now considered as a major gateway for corruption in medicine and public health.They predominantly affect the way that doctors evaluate and use the products of the pharmaceutical and medical device industry by a systematic and ubiquitous exposure during professional life, starting at medical school.

Independent clinical research which can produce reliable results on new drugs or new medical technology has almost vanished and has been progressively replaced by industry-sponsored studies which are dominated by marketing interest of the manufacturers, including misleading selection or extensive falsification of data and results. Consequently, evidence-based guidelines or practice guidance often can no longer be assumed to be unbiased and free of conflicts of interests. Meta-analyses are at risk of being seriously distorted, even after adjusting for publication bias, due to inaccessible, unpublished data on clinical trials or inappropriate, for example non-reproducible, inclusion of such data....

Nowadays, medical expert committees are obliged to disclose conflicts of interests. Nevertheless, rarely is any action taken to control or to exclude advisers or experts with conflicts of interest since the extensive ties to industry of panel members have become the norm. It is therefore illusory to expect that disclosure alone without sanctions will be sufficient to increase transparency and decrease corruption in medicine and public health. Even if adequate sanctions follow, individual professional behaviour may not suffice for reversing the detrimental dependency of the medical and scientific community on industry. By the same token, corporate responsibility endeavours of drug and medical device companies should not remain voluntary efforts without tangible sanctions.

Let me quote below their major recommendations, edited just a bit:

Individual level

Professional codes of conduct for physicians and other health professionals, individual drug and medical device companies, health maintenance organisations, sickness funds, research organisations, etc. The common denominator of such codices consists of the ban of offering/accepting any personal gifts, including food and travel.


Organisational level within the medical system

Codes of conduct for academic medical centres, medical associations, patient and consumer organisations, organisations of healthcare professionals and producers of pharmaceuticals and medical devices. Each institution or organisation in healthcare as well as each professional in these institutions or organisations should be obliged to make any payments, honoraria or other benefits by pharmaceutical or medical device companies transparent.

Public registry of all clinical trials and other research activities involving patients, including post-marketing and pharmacovigilance studies. Publication of all relevant outcomes and results including null results, adverse effects and stopping rules, administrated and monitored by an independent institution such as the National Institutes of Health. Full disclosure of funding agencies, companies and responsible data centres.

Education of healthcare professionals including continuous medical education must be disentangled from commercial interests. The healthcare professional organisations should integrate graduate and continuing medical education in their codes of conduct.

Political level

Drug and medical device approval legislation: necessary prerequisites for starting drug approval process should include a complete and consistent disclosure (including amount) of beneficiaries of involved institutions, experts and organisations.

Implementing an expert anti-corruption agency for health at the national level authorised to take legal action. This includes activities in prosecuting conflicts of interest among health professionals and their institution, since such conflicts often result in rising healthcare expenditures without benefit for the public.
Society level

Monitoring of influence of commercial interests on public health and outcomes of medical interventions: annual reports to the public on health indicators and international comparisons including healthcare expenditures, estimated losses due to corruption and fraud in healthcare and recaptured resources by anti-fraud and anti-corruption measures.

Health Care Renewal readers may find it a useful exercise to compare these recommendations with their local situation. As far as I can tell, here in the US, almost none of these recommendations now obtain. Going through the list:

Individual level - In the US, codes of conduct promulgated by most medical societies do not completely ban accepting gifts. Not all drug and device companies, health maintenance organizations, insurance companies (the equivalent of sickness funds here), and research organizations have visible codes of conduct, and those that exist do not completely ban accepting or giving gifts.

Organizational level - Not all academic medical centers, medical associations, patient and consumer organizations, organizations of health care professionals, and drug and device companies have visible codes of conduct, and those that exist hardly make all payments, honoraria and other benefits completely transparent.

- There is a clinical trials registry. I am not sure if it includes post-marketing and pharmacovigilance trials (readers may be able to help me here). I do not know of any independent institution that monitors in detail the publication of all study results.

- US education, including continuing education of health care professionals is considerably entangled with commercial interests. Codes of conduct relevant to the relationships among industry and education are weak.

Political level - Drug and device regulation does not require complete and consistent disclosure of payments to medical schools, medical centers, and other research organizations which implement relevant research.

- There is nothing resembling an expert anti-corruption agency for health at a national level. Nor do such agencies exist at the US state level.

Society level - There is no systematic ongoing monitoring of commercial influence on public health and outcomes of medical intervention. There are no national reports that cover fraud and corruption and health care.

So as best as I can tell, here in the US, we currently are following almost none of these recommendations.

Maybe in other countries things are a little better. It would be interesting to hear from readers around the globe about this.

As I have repeated again and again, I believe true US health care reform requires improved transparency, and mechanisms to improve integrity and ethics like those suggested by these Transparency International authors.

IRS Changes Form 990 to Make Not-for-Profit Organizations More Transparent and Accountable

In the US, many important health care organizations are not-for-profit organizations. Many US medical schools, and other health educational institutions, along with their parent universities are not-for-profit. (Essentially all the exceptions are supported by local or state government.) The majority of US hospitals and hospital systems, including academic medical centers, are not-for-profit. Some managed care organizations are not-for-profit. Medical and professional societies, health care advocacy groups, health care charities, and a variety of other groups are not-for-profit.

Not-for-profit health care organizations here have hardly been immune from leadership and governance problems. We have discussed numerous instances of ill-informed, conflicted, and even corrupt leadership of these organizations, and underlying problems with their governance, which may be unrepresentative of key constituencies, unaccountable, secretive and opaque, and not subject to clear ethical rules.

There may be some major changes coming, however, affecting leadership and governance of all US not-f0r-profit organizations, including health care organizations. The US Internal Revenue Service (IRS) has long required that not-for-profits that exceed certain minimums file and make publicly available certain information on a form 990. Relatively recent forms from most US not-for-profits are available online from Guidestar.org. The old forms provided for some minimal transparency. They displayed, for example, a list of the filing not-for-profit organization's trustees, and the salaries and retirement plans given to their five highest-paid employees.

The IRS has revised the forms starting with those to be filed in 2009, which will reflect 2008 data, so as to markedly increase organizational transparency. The actual forms can be found on this IRS web-page, and a discussion of key points can be found here on the GuideStar.org web-site.

For the first time, the forms will include information about certain aspects of leadership and governance.

Leadership Conflicts of Interest

The new form 990 will require each organization to establish the "independence" of the organizations' trustees, directors, officers, and key employees. Independent individuals would be those without any direct or indirect business relationships with the not-for-profit organization; without any relatives with such business relationships; and who were not serving as an officer, director, trustee, key employee, partner, or member of an organization doing business with the not-for-profit organization. The relationships preventing individuals from being independent would have to be documented.

It is likely that perusal of such information on the new form 990 would reveal to some extent the degree the organization's leaders are conflicted. Up to now, it has been very difficult to get information about conflicts affecting the leadership of health care organizations. We have reported numerous cases of seemingly high-level conflicts affecting leaders of not-for-profit health care organizations. It is likely that such conflicts affect the ability and inclination of leaders to uphold their organization's mission, that is, to fulfill their duty of obedience.

Leadership Compensation

The new form 990 will ask for detailed information about the total compensation given to officers, directors, and trustees, key and the five most highly paid employees, and former officers, directors, trustees, key and most highly compensated employees who continued to receive substantial amounts. This will include not only reportable and other compensation, but whether anyone received unusual compensation such as first-class or charter travel, companion travel, tax indemnification for gross-up payments, discretionary spending accounts, housing allowance or residence for personal use, payments for business use of personal residence, health or social club dues or fees, and personal services (e.g., maid, chauffeur, chef). Also, the form inquires about severance packages and supplemental non-qualified retirement plans.

Up to now, little information about the compensation of not-for-profit leaders beyond base salaries, contributions to employee benefit plans and deferred compensation, and expense allowances and the like was available. Clearly, while not reaching the stratospheric levels enjoyed by top leaders of for-profit health care corporations, some leaders of not-for-profit health care organizations have come to be paid enough to make them rich. It is possible that some now regard their positions as first a pathway to wealth, rather than a calling to improve the health of society, or to advance medical education or science. Furthermore, it is possible that some leaders have been receiving additional compensation which has made them even more wealthy, while particular "perks," like staffed houses, chauffeured cars, and first-class travel, has isolated them from the patients, clients, and/or students they are supposed to be serving.

Organizational Policies

The new form 990 will ask whether the organization has a written conflict of interest policy, and if so, how compliance is monitored and enforced, and a written policy to protect whistle blowers.

Summary

In my humble opinion, the IRS' new form 990 could make substantial improvements to the transparency and accountability of not-for-profit health care organizations. Review of form 990's filed starting this year could provide important information about conflicts of interest affecting organizational leaders, whether they have been distracted by new-found wealth, or decoyed by luxurious perks, and whether their organizations have clear policies meant to maintain certain ethical standards.

However, while the IRS will mandate that such information becomes available, it is not clear what it will do about the information so revealed. Additionally, the wealth of information that will be provided could easily bury the few watchdogs, including the Health Care Renewal bloggers, that have been trying to monitor the governance and leadership of health care organizations.

However, the new information provides an important opportunity to other people concerned about these issues. For example, perhaps some health professionals have concerns about how their alma maters are lead and governed. Maybe they will peruse the new information provided, and then try to use it to make their alma maters more accountable. It is at least possible to be optimistic.

What Is to Be Done?

If you are concerned about a particular not-for-profit health care organization, you can prepare for the availability of more information from the revised form 990 in several ways, by searching for already publicly available information. You can peruse older form 990s, which at least provides the names of trustees and officers, and officers' and key employees' salaries.

In addition, the web makes it possible to identify some conflicts of interest affecting current leadership. For example, try first entering each leader's name, surrounded by quotes, into Google, to look for biographical information that could reveal conflicts. Next, try searching on the name plus terms like "board of directors," "board of trustees," "consultant," or "advisory board," which may uncover some additional conflicts. If you find anything of concern, consider making it more public.

Remember, the best way to improve health care leadership is to hold it accountable to an activated public, preferably strongly infused with health care professionals who want to uphold their professionalism.

Aetna Settles

As reported by the Hartford Courant:

Aetna will reimburse more than $5.1 million on 73,000 health claims for college students it underpaid between 1998 and April 1, 2008, under a nationwide agreement announced Monday by New York Attorney General Andrew M. Cuomo.

The claims involved out-of-network care in which Aetna Student Health — formerly called Chickering Student Health — paid physicians what it considered reasonable and customary. Doctors whose charges were higher could bill students for the balance.

Aetna will reimburse students if they paid such a balance. If a student wasn't balance-billed, Aetna will reimburse the doctor. The company says its under-payments averaged $25 each nationwide.

The inadequate claim payments stem from outdated information that Aetna and other insurers used from the databases of Ingenix, a UnitedHealth Group unit.

The $5.1 million agreement is in addition to the $20 million Aetna agreed to pay in a settlement last month of Cuomo's investigation of the out-of-network payment system.

We had posted earlier here about a settlement UnitedHealth made related to its use of the database run by its Ingenix subsidiary.

Note first that Aetna and UnitedHealth are supposed to be fierce competitors. Yet they used the same database, a database constructed by a UnitedHealth subsidiary. This is a reminder that although many have promised that a competitive, market-based health care system would decrease costs, improve access and improve quality, the system that was supposed to be competitive mostly was not. In this example, multiple, supposedly competing managed care organizations/ health insurance companies all appeared to use one company's database. (We have also noted how nearly all managed care organizations/ health insurance companies all basically use a payment schedule for physicians provided by the US government.) Various such anti-competitive practices by managed care organizations / health care insurance companies have to date mostly elicited yawns from health care and policy researchers, the press, government regulators, and the legislature.

Second, note that Aetna's use of the UnitedHealth Ingenix database allowed it to underpay physicians, sometimes resulting in excess out of pocket expenses for students. That does not seem to square with Aetna's high-minded mission statement:

Aetna is dedicated to helping people achieve health and financial security by providing easy access to safe, cost-effective, high-quality health care and protecting their finances against health-related risks.

Aetna surely was not protecting these students' "finances from health-related risks."

This is, of course, just one of many examples we have discussed of cynical marketing techniques by health care corporations. Every big health care organization seems to boast about how it enhances high-quality, accessible, reasonably priced care. But few really seem to do so.

Paul Trossel defined organizational integrity as "how top management of an organisation lives by its own standards." Here again is an example of a failure of organizational integrity in health care, and its (in this case) financial adverse effects on patients.

For a company the size of Aetna, a $25 million settlement is practically petty cash. And like many previous settlements we have discussed, it enacts no penalties on the leaders who actually made the decisions in question. Thus it is unlikely that further settlements like this will promote better organizational integrity, more competition in the health care "market," lower costs, better access, or better quality.