Academic Medicine – What’s To Become of the Triple Mission Under Universal Health Care?

Posted on | September 18, 2017 | Comments Off on Academic Medicine – What’s To Become of the Triple Mission Under Universal Health Care?

Hopkins Alumni Careers
1980-2012.

Mike Magee

A New York Times banner headline in 2016 read, “Harnessing the U.S. Taxpayer to Fight Cancer and Make Profits”. It documented the unusual partnership between Kite Pharma, a cancer immunotherapy start-up run by serial entrepreneur, Arie Nelldegrun, and the U.S. government. The underlying immunotherapy research was the output of Nelldegrun’s mentor, Steven Rosenberg, at the National Cancer Institute (N.C.I.). Taxpayers contributed about $10 million to Rosenberg’s lab since 2012. Kite kicked in an additional $3 million a year to accelerate drug development by the N.C.I., but not for free. They own rights to future profitability. In some of the deals (there have been 8 contracts since 2012), Kite receives patent use in return for promises of royalties paid to the N.C.I.

All this proceeds as daily we absorb case after case of over-marketing, over-pricing and over-selling of drugs and medical devices into an American market that consumes them at twice the rate of most civilized nations. Scientific progress appears to have been uniquely decoupled in our nation from human progress. How did we get here?

Since Vannevar Bush presented his “Science the Endless Frontier” to President Truman, and the President insisted on strong government control of federally sponsored research, there had been a prohibition on private ownership of patents that emerged from research discoveries supported by federal grant dollars.

So the federally funded discoveries and their patents sat in the government vaults, largely unused and undeveloped. In fact, by 1978, with the economy in chronic recession, 28,000 scientific patents had accumulated. Over the years, fewer than 5% had been commercialized. At that time, Indiana’s Purdue University was sitting on a number of new health related discoveries that had emerged from their research departments, supported by NIH grants. They approached their senator, Birch Bayh (D-IN), to help them control their patents and profitability.

At about the same time, the lobbyists discovered that Bob Dole had been exploring the same legislative territory. Bob was delighted to conspire with Bayh on a possible fix for the problem. Together they fashioned a solution that would allow individuals, small businesses and academic institutions to maintain ownership of their own intellectual property, even if it derived from government grant money.

The results of the Bayh-Dole Act were dramatic, at least for health care institutions. While 380 patents were granted to them in 1980, that number soared to 3088 by 2009. Those patents, now under the control of individual scientists and their parent academic institutions, were subsequently licensed to corporations for the development of a range of products and applications. According to one estimate, the resultant impact on the nation’s Gross Domestic Product (GDP) reached $47 billion in 1996, and soared to $187 billion a decade later.

Since 1980, over 2,200 new companies have appeared and generated more than 1000 new products. As important, the new technologies spawned entirely new industries in the United States including the field of biotechnology.

Of course, over time, it became clear that the legislation did have some unintended consequences. The licensing bounty for industry and academics was not insignificant. It rapidly grew from just over $7 million in 1981 to $3.4 billion by 2008. And major pharmaceutical companies were at the top of the food chain. Over the first three decades with the Bayh-Dole Act in place, 154 new drugs were approved by the FDA with worldwide sales attributed to these products of $103 billion.

This led The Economist, in 2005, to headline their reappraisal of the Bill, “Bayhing for blood or Doling out cash?”(7) As the article states, “Many scientists, economists and lawyers believe the act distorts the mission of universities, diverting them from the pursuit of basic knowledge, which is freely disseminated, to a focused search for results that have practical and industrial purposes.”

What’s to become of Academic Medicine’s triple mission – medical education, patient care and research? Giant, for all practical purposes, “for-profit” research institutes increasingly marginalize patient care and medical education just when we need leadership in these areas the most. As a nation, we are attempting to correct historic health care missteps in universality, efficiency, transparency, effectiveness and justice.

In this modern era, the triple mission is delivering an integrative and at times collusive professional career ladder, but not much else. What should Academic Medicine leadership and governance look like within a universal health care system?

Pharma Patents – A Good Bet For Casino Heavy Native Americans.

Posted on | September 11, 2017 | Comments Off on Pharma Patents – A Good Bet For Casino Heavy Native Americans.

 The Latest Pharma Campus?

Mike Magee

In the immediate aftermath of WW II, the U.S. government decided to join hands with industry and academia and fund a campaign to “defeat disease” as they had defeated the Nazi’s. Defeat disease and health will be left in its wake was the thinking of the day. What they could not have predicted was that a native American tribe in Upstate New York would ultimately be one of the recipients of this food chain.

Nor would the starch collar academic William Wardell, the inventor of the phrase “drug lag” in 1973 that ultimately unleashed four decades of FDA liberalizing legislation, have predicted its long term impact. While these actions arguably have accelerated scientific progress, in many ways they’ve left human progress to fend for itself.

But this is America’s Medical-Industrial Complex where profit trumps patients at every turn. The latest episode began early this year when a Dallas law firm, Shore Chan DePumpo, successfully defended their client, the University of Florida, in a medical device patent dispute with Covidien. They claimed that the state owned institution had state soverign immunity, and thus its patent could not be challenged. They went before a specially liberalized administrative-review panel created to shield industry from the trials and tribulations of normal patent law and they won!

What happened next was predictable. The law firm went trolling for their next client. As one legal expert noted, “Indian tribes have sovereignty that is stronger than states.” So they identified an Upstate New York tribe, the St. Regis Mohawks, that had done a patent protection deal with a Tech firm. They were anxious to continue to diversify being over-weighted in Casinos. Now all that they needed was a desperate partner with deep pockets. They found that in Allergan who’s #1 product is Botox. But right behind it is their billion dollar winner Restasis – for desperately dry eyes.

As patent expiration on Restasis approached, the company filed six extra patents of dubious merit a year or two ago that were accepted by the new and very accommodating Patent Trial and Appeal Board. This would have protected Allergan against generic intrusion till 2024. But again predictably, the litigious generic company, Teva, challenged the patents.

The patent gold rush is not a new phenomenon. It’s origins date back forty years. In 1978, five years after the “drug lag” accusation had first surfaced, with the economy still lagging, 28,000 federally controlled scientific patents had accumulated and sat largely idle. Historically, there had been a prohibition on private ownership of patents that emerged from research discoveries supported by federal grant dollars. As the thinking went, such discoveries, supported by public dollars, should be available to all, without the patent restrictions of a private company. But in reality, the lack of ownership of the intellectual property, and any market products or applications that would derive from it, frightened away private investors.

Over the years, fewer than 5% of these federal patents had been commercialized. At that time, Indiana’s Purdue University was sitting on a number of new health related discoveries that had emerged from their research departments, supported by NIH grants. In face of the country’s “economic doldrums”, they decided to invest a bit of money on lobbyists to see if they might somehow wrest control of the patents, and future profitability tied to their inventions. They approached their senator, Birch Bayh (D-IN), and were delighted to see that he was receptive.

At about the same time, the lobbyists discovered that Bob Dole had been exploring the same legislative territory. With Dole’s support, the technology transfer legislation swept through the Senate Judiciary Committee with unanimous support. Bayh then negotiated the Bill’s inclusion in the House’s version. With just a few days left in his single term Presidency, Jimmy Carter signed the bill.

The results were dramatic, at least for health care institutions. While 380 patents were granted to them in 1980, that number soared to 3088 by 2009. Those patents, now under the control of individual scientists and their parent academic institutions, were subsequently licensed to corporations for the development of a range of products and applications. According to one estimate, the resultant impact on the nation’s Gross Domestic Product (GDP) reached $47 billion in 1996, and soared to $187 billion a decade later. Since 1980, 2,200 new companies appeared and generated more than 1000 new products. As important, the new technologies spawned entirely new industries in the United States including the field of biotechnology.

As an economic change agent, few legislative actions could compete with this one. Of course, over time, it became clear that the legislation did have some unintended consequences. The licensing bounty for industry and academics was not insignificant. It rapidly grew from just over $7 million in 1981 to $3.4 billion by 2008. And major pharmaceutical companies were at the top of the food chain. Over the first three decades with the Bayh-Dole Act in place, 154 new drugs were approved by the FDA with worldwide sales attributed to these products of $103 billion.

This led The Economist in 2005 to headline their appraisal of the legislation, “Bayhing for blood or Doling out cash?”(67) As the article states, “Many scientists, economists and lawyers believe the act distorts the mission of universities, diverting them from the pursuit of basic knowledge… it makes American academic institutions behave more like businesses than neutral arbiters of truth…”

What will happen next on the Indian reservation is anyone’s guess. Chose your favorite – Teva or Allergen. In American Medicine’s Wild Wild West, the winner will be either bad or worse. And not one American will be the healthier for it.

Category: pharmaceuticals
Tags: Bayh-Dole Act > intellectual property > medical-industrial complex > patent protections > patents > pharmaceuticals

Do You Know Who Your Insurance Commissioner Is?

Posted on | September 6, 2017 | Comments Off on Do You Know Who Your Insurance Commissioner Is?

Who’s My Insurance Commissioner – and was she/he elected or appointed?

Find Out HERE.

Category: Uncategorized

The Changing U.S. Workforce

Posted on | September 6, 2017 | Comments Off on The Changing U.S. Workforce

With U.S. health care now consuming nearly 20% of a GDP, and somewhere between $4 and $5 trillion annually, its not surprising that jobs in the health field are exploding as well. But for every one US physician, 16 others are employed in non-clinical health care jobs. But American jobs aren’t what they were three decades ago. How has the American workforce changed from a Human Resources point of view? Here are a few of the shifts outlined in a recent WSJ report.

Category: Uncategorized

Compounding Our Weaknesses – Gray Market Drug Collusion.

Posted on | September 6, 2017 | Comments Off on Compounding Our Weaknesses – Gray Market Drug Collusion.

Mike Magee

In the realm of pharmaceutical disaster deja vu, Tennessee deserves special recognition. In early September, 1937, the S.E. Massengill Company of Bristol, Tennessee, distributed tainted elixir of sulfanilamide nationwide. Before the disaster ended, 104 patients, most of them children, had died. Nearly 80 years latter to the date, Dr. April Petit put in a call to the Tennessee Department of Health, reporting his suspicion that an injection of steroids received from a middle man manufacturer had caused a systemic fungal infection in a Tennessee patient. Systemic candidiasis is the most common fungal infection among hosptilized people in high-income countries, including the United States. Diagnosis can be difficult, especially when the Candida is not found in the bloodstream. To cure systemic candidiasis, you need to buy Diflucan online without rx

Seven days after that call, the FDA was called in and traced the source to the New England Compounding Center (NECC) of Framingham, MA. The next day, 17,000 vials of supposedly purified injectable steroids were recalled. But it was already too late. The product had been distributed to 20 states. By final count, 753 were infected and 64 died.

The problems were obvious at NECC, a compounding pharmacy firm whose inspection had fallen through the regulatory cracks of a deeply flawed and financially weaponized entrepreneurial American Health Care system. When the FDA did investigate the facility on October 2, 2012, one representative lot of the supposedly pure steroid vials had floating “greenish black foreign matter” in 83 samples. 100% of 50 vials tested were positive for microbial growth. Manufacturing equipment was spotted with “greenish yellow discoloration.” Cleaning and disinfection records had been forged, and air-conditioning (essential to the maintenance of a sterile environment) had been routinely shut off each night to save money. As one FDA official stated, “The entire pharmacy was an incubator for bacteria and fungus. The pharmacy knew about the contamination and did nothing.”

Fourteen NECC employees, including president Barry Cadden and pharmacist Glenn Chinn, were arrested in 2014. Cadden and Chinn were charged with second degree murder. Their company had already gone bankrupt after being forced to established a $200 million dollar compensation fund. Cadden was acquitted of the murder charges but convicted of conspiracy and fraud and sentenced to 9 years, after trying to shift the blame on his pharmacist, Chinn, who is plea bargaining.

Historically, U.S. drug law has always tracked disasters. Horse tetanus tainted typhoid vaccine killed 13 children in St. Louis in 1901, and led to improvements in drug labeling and oversight in the Pure Food and Drug Act of 1906. The Massengill tragedy gave FDR the boost he needed to pass the Federal Food, Drug and Cosmetic Act of 1937. And the Thalidomide tragedy fueled support for the Kefauver-Harris Amendments that demanded proof of efficacy as well as safety prior to FDA new drug approval.

In each of the cases above, victims could be quite certain that some lasting benefit would come from their personal sacrifices. But for families and friends affected by the NECC felonies, the final record is less clear. Large batch compounding of pharmaceuticals continues to fall between the cracks. They are not your neighborhood pharmacist laboring over mortar and pestle and they are not giant pharmaceutical houses strictly regulated to comply with Current Good Manufacturing Practices (CGMP) by the FDA. They are something in between, and they are growing, sometimes with the active financial participation of physicians.

In the United States, up through the end of World War II, we relied primarily on local pharmacists to create and package pills and elixirs behind their counters following formulas laid out in the physician prescription. Drugs were tailor made, compounded and individualized on demand. Most of the drugs available today are produced by highly regulated large manufacturers. About 3% of drugs are produced by “compounders”, increasingly large enterprises selling across state lines. They are weakly and variably regulated within their own states.

The FDA was aware of quality concerns well before the 2012 disaster. Between 1990 and 2005, the agency catalogued 240 serious illnesses and deaths due to the products. Nothing was done about this because compounders were state vs. federally regulated if at all. Beyond safety, the FDA also found serious efficacy issues. A 2006 study by the agency revealed that roughly 1/3 of products tested lacked uniformity for potency and dosage compared to a failure rate of 2% with FDA regulated pharmaceuticals.

The FDA has been trying to get their arms around renegade compounders for two decades. In 1997 the Food and Drug Administration Modernization Act included the 503A section that exempted compounders from CGMP’s and the need to file new drug applications in return for prohibitions against advertising and promotion and soliciting prescriptions from doctors. But a group of compounders sued the government claiming their 1st Amendments right to speech had been denied, and the FDA was forced to abandon enforcement.

Even if they had the clear power or budget to enforce inspections, compounders have actively resisted. Between 2002 and 2012, the FDA was forced to obtain federal warrants to complete inspections eleven different times. After the 2012 event, legislation was passed – The Drug Quality and Security Act. One part of the law distinguished between local pharmacy compounding in response to specific patient prescriptions and large industrial compounders preparing inventory without prescription. According to their trade association, the International Academy of Compounding Pharmacists, we need these middle-men to fill the gray market gap. The association says compounders provide product when major manufacturers discontinue a medication (because it’s hard to make or unprofitable), for patients with special allergies or dosage requirements, for special combinations of drugs otherwise unavailable, and to create lotions and liquids when a patient can’t ingest pill forms.

But critics say these ever enlarging concerns are not compounding. They are manufacturing outside regulatory control. The 2013 law draws on the 1997 version, exempting large compounders from having to file a costly new drug application for each of their concoctions and allowing the unlimited manufacturing and sale of product without a prior prescription in return for voluntarily filing their company as a “outsourcing facility” which includes a willingness to submit to FDA inspections, comply with CGMP’s, and use only drugs on the official bulk ingredients list.

For those who choose not to register, they theoretically can be challenged on the basis of preparing “new drugs” without FDA approval, but this is unlikely in a federal agency already functioning with inadequate resources. Rather the FDA is actively encouraging hospitals and other providers to do their gray market purchasing only through compounders who have registered as a federally endorsed “outsourcing facility”. In addition, some states like Massachusetts have stiffened their laws with more inspections and better oversight. But this varies from state to state. The Office of Management and Budget is scheduled to do a three year analysis of the federal law to gauge the effectiveness of the voluntary compliance system in the near future. Currently 72 facilities have received the federal designation.

A continued gray area is “office-use medications”. In all states, physician’s prescriptive powers are broadly protected. And though not actively encouraged, the AMA and others allow physicians to sell pharmaceutical products out of their offices. This is common fare for oncologists, dermatologists, ophthalmologists, orthopedists, pain management specialists and others. Some entrepreneurs see this as a growth industry. For example, one firm, Physicians Compounding Alliance (PCA), advertises to doctors online saying, “Add thousands per month in additional income to your practice”, and claiming that “82% of physicians dispense on a daily or weekly basis, but only Physicians Compounding Alliance makes it possible to provide office-dispensed compounded prescriptions. Capture the extra business that you now send to others while providing your patients better care and greater convenience.” The AMA Code of Ethics provides ample wiggle room for such activities stating, “Physicians may dispense drugs within their office practices provided such dispensing primarily benefits the patient.”

Some worry that physicians, as small business people, are more price conscious than hospitals and health systems. For these customers, low price may win out over federal “outsourcing facility” designation. As a NEJM piece cautioned, “If providers constantly seek out the cheapest compounded drugs, then the unregulated compounders will have an unfair competitive advantage…”

Category: Gray Market Pharmaceuticals, pharmaceuticals, Uncategorized
Tags: 503A Section > AMA Code of Ethics > compounders > fda law > gray market drugs > NECC > PCA > pharmaceuticals > Physicians Compounding Alliance > The Drug Quality and Security Act

Labor Day Recovery and Resilience: Insights From Patrick Kennedy

Posted on | September 4, 2017 | 2 Comments

Mike Magee

Today, Labor Day, I was greeted by a comment to “moderate” on a piece I wrote 2 years ago. The comment read: “Hello Mike – This post is so touching. Thanks for sharing.” It’s the nature of writing a weekly column for the past 10+ years that it’s often difficult to recall the subjects, let alone the words, you’ve written. And when you go back to review and recall, often they resonate in a different way because the environment has changed.

When I originally wrote the piece below, the 2016 election was still a year off. Today, the citizens of Texas, Louisiana and the surrounding areas, having struggled to survive Hurricane Harvey, are now laboring to envision a pathway forward. How and when will they put their lives back together? The piece below, about Patrick Kennedy’s struggles with mental health, his courage and resilience, and his leadership on behalf of justice and health parity continue to instruct us all. I share it today – Labor Day – in that spirit.

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This week, on October 6th, I hung on to “Morning Joe” a bit longer than I normally do to hear the interview of Patrick Kennedy by Joe Scarborough. My interest was personal, knowing some of the players, but also as a member of a large Catholic family (12 kids) with our own credo of family loyalty and our own share of trials and tribulations.

Two days earlier, Lesley Stahl had interviewed him on “60 Minutes”, his first public interview promoting his new memoir, “A Common Struggle”. That interview had veered off subject to Patrick’s father – Was he an alcoholic? Did he suffer from PTSD in the wake of his brothers’ assassinations? Valid questions I suppose, but coming close to suggesting this as just another book about America’s most famous (and tragic) family.

But in reality, Patrick’s book is much more than that. In it, he displays a modern understanding of the meaning of health as “human potential”. He clearly explains that unhealthy behaviors are often inherited, as both genetic and social constructs. And most importantly, he reveals that families, in their conspiracy of silence, often contribute to the problem rather than to the solution – and that communities and leaders are complicit.

In thirteen minutes, last Tuesday, Patrick Kennedy provided more health education on the subject of alcohol addiction, mental health, and their treatment, than I received in nearly a decade of training to be a physician.

As the interview opened, Joe Scarborough alluded to the fact that Patrick had broken some silent code, and at least some family members had reacted angrily. Why did he write the story?

Patrick’s answer, a simple three word sentence, declared his emancipation, and his right to both health and happiness, for he and his wife and children. He said simply: “It’s my story.” But what came through was, “It’s my life, and I’m taking control of it.”

He explained, “Often times you’re expected to keep your parents secrets. And yet it will bedevil you your whole life because we all grow up to be our parents. And everything that happens to you as children, we will live with that for the rest of our lives. And what makes that worse is keeping that secret or thinking that you’re keeping that secret…What I’m saying is that my story about keeping quiet in my family is like every other family in America who has these illnesses. Say nothing! Do nothing! See nothing!”

Patrick goes on to explain that the book explains in detail the policy issues involved with achieving expanded coverage and care for those suffering from mental illness and and addiction. He explains how he and his father wrote the Parity Law. Back then, law makers wanted nothing to do with it. As Patrick said, “No one wanted to be the author of Parity. No one wanted the words mental health and addiction next to their name.” When it did pass, he says, insurance companies wasted little time in figuring out how to renege on their obligations.

It is an individual disease marked by shame. In his words, “One of the biggest barriers is no one wants to be known as a patient who is getting mental health treatment or addiction treatment.” But that shame, for him, was uniquely reinforced by a secret code of silence. This extended not only to his parents, siblings and extended family, but also to the many important visitors and guests who wandered the hallways of his famous home in his formative years. Routinely, he was forced to witness his inebriated and incapacitated mother wandering in bathrobe midday past friends and family, heads down, all of whom refused to acknowledge, let alone confront, the disease. That was its’ cruel power over the family, and in part, over him, until recently.

At the core of his family was this secret, eating away at everyone’s health. As Patrick experienced it, “It’s an illness and we are running away from it. My family does not want to be identified with mental illness. That should tell you something about the shame and stigma that still surrounds this issue.”

So where did he find the courage to stand up to it? For whom, and why now? He said, “I have kids now. I don’t want my kids to feel ashamed because they have a genetic predisposition for mental illness and addiction. I want them to get treatment for them. I don’t want them to keep secret the fact that they have an emotional life, a spiritual life. We ought to be paying as much attention to their mental health as the rest of their physical health.”

The reaction from the family has been mixed. His older brother and his mother have issued statements disavowing and criticizing the book. Most family members have remained silent. And a few of the extended family have voiced support. Those who have focused on his right to speak out. In his words, “… a number of members of the family said I love your message that this is about breaking the silence and shame because all of us are saddled with the hangover of a shame that comes with growing up where you are not supposed to tell anything about what happened to you personally. That affects somebody if they are growing up in a family where everything is supposed to be kept quiet.”

As for the disapproval of his older brother, he said simply, “I love him, and I will always love him.” And added, “All I can do is do the next right thing and pray that my brother will understand that what I’m trying to do here is bigger than both of us. And that’s what my dad was all about – trying to make a difference for more people. I’m trying to move the ball forward as he did in his life.”

_____________________________________________________________

For Health Commentary, I’m Mike Magee

Category: leadership, Uncategorized
Tags: Hurricane Harvery > Labor Day > Patrick Kennedy > recovery > resilience

Universality is The Goal: Incremental Movement Toward Single Payer Options Makes Political Sense.

Posted on | September 1, 2017 | Comments Off on Universality is The Goal: Incremental Movement Toward Single Payer Options Makes Political Sense.

Mike Magee

As Trump continues to dabble in undermining the ACA, Democrats are pushing forward on an internal debate over the future of Obamacare. And although tactics and strategies are up for debate, there is close to a consensus on one issue – our government should guarantee universal health insurance coverage for all citizens. Our Code Blue campaign contains five core principles, listed below, that provide common ground in the debate.

The weaknesses of our current approach are now well-established including:

1. Not Universal: A CBO report predicting 27 million remaining uncovered by 2026.

2. Reporting Requirements: “Mind numbing” and time consuming requirements for documentation and reporting.

3. Administrative complexity: Robs time with patients.

4. Limited comprehensiveness: A trend toward “skinny plans” which are little better than no coverage at all. Physician and hospital panels are narrowing.

5. Underinsurance: A tripling of deductibles and “punishingly high copayments” paid by consumer.

6. Failure to Control Costs: ACA “has elicited ubiquitous gaming of risk adjustment and quality measure” incentives, spawning giant moves toward hospital and insurer consolidation.

7. Market-Based: “Any method of payment can create perverse incentives in a market-based system.”

The tension points in the internal debate were drawn into sharper relief when Sen. Brian Schatz (D-HI) released a new plan that would allow anyone in participating states to extend the opportunity to “buy-in” to their state Medicaid program. Essentially this would create open enrollment. According to Schatz’s vision, reimbursement rates for doctors and hospitals would rise to match Medicare rates insuring broad provider panels. Currently Medicaid reimburses at 72% of the rates of Medicare. Of course, states that passed on ACA Medicaid expansion (29 states under Republican governors) might pass on this offering as well.

The competing Democratic approach as outlined in a bill sponsored by Rep. John Conyers (D-MI) would go all-in on a national single-payer system. This has the virtue of actually achieving universal coverage since all individuals would be mandated to participate. The downsides include a predicted political firefight, massive disruption of the private insurance market (which would be relegated to providing supplemental insurance plans only – though back door involvement through plans mirroring Medicare Advantage might survive), and tax increases in the area of 10% likely to help finance the effort.

Schatz’s plan is not brand new. The Nevada legislature passed just such a plan this year, but Republican Gov. Brian Sandoval vetoed it. Way back in 1965, when Canada endorsed a single payer approach for all Canadians, Americans did the same – but only for those over 65. We called it Medicare, and while it has had issues over the past half century, Americans long ago decided they couldn’t live without it. Of course, until now, they also consented to widening income disparity and health inequality based on a system of “have’s” and “have-not’s” when it comes to the good fortune (or lack of the same) of possessing health insurance.

Medicaid expansion under the ACA celebrated a new approach (within the corridors of defined eligibility) of universality, access, health planning, portability, and integration with other social service programming. 18 of the 31 participating governors were Republican and liked the fact that the Obama expansion program was well funded, that the benefit package was broad (not a sham like the HSA induced high deductible/ empty benefit products proliferating everywhere), and that they preserved the flexibility within bounds to set the priorities on spending and defined how best to advance the overall health of their state populations. Add to this CHIP, a federal offering likely be extended, that provides coverage to economically needy children who find themselves slightly above poverty levels. In the wake of failed Repeal and Replace efforts, the remaining 19 hold-out Republican governors must now reconsider their ideologically driven stances. Some at least will reverse their stands.

The governors who have participated already have learned that centralized administration of a universally available health insurance offering carries distinct cost savings. Specifically, governor guided single payer health delivery under Medicaid came in 22% less costly than privately insured comparators. Governors like John Kasich of Ohio were left to wonder what might be the economic impact on Warren Buffett’s belief that health care was a “tapeworm on the American economy”. Analysts evaluation of single payer back office administration combined with state controlled and planned integrated health delivery shows a potential immediate 15% savings on our 4 trillion plus annual bill simply by consolidating management of coverage and payment systems.

Governors also could see that the human resource implications of such a move. Our purposefully complex program, which now threatens to break the American economy in much the same manner as reckless military spending collapsed the Soviet Union, has spawned 16 non-clinical jobs in health care for every one clinical role. A shift toward availability of single payer, if poorly planned and transitioned, could carry with it massive unemployment. But if you look at innovators like Kasich, what you see is the potential to reassign jobs by skill in a manner that could advance the strength of the social service network in areas like housing, nutrition, education, transportation and the environment.

Today’s Medicaid Numbers? 74 million or 20% of Americans currently covered; 11 million added under ACA; 40% of children covered; 50% of all births covered; 10 million disabled covered; 2/3rds of nursing home patients covered; 16% of health care spending nationwide; only 13% of citizens oppose Medicaid expansion.

Sen. Schatz recognizes a fundamental and permanent shift at work. He notes, “One of the unintended consequences of the Republicans trying to cut Medicaid is they made Medicaid really popular. This conversation has shifted. There was a time where Medicare was really popular and Medicaid was slightly less popular. What this ACA battle did was make both of them almost equally popular.”

The Code Blue Campaign endorses five core principles:

1. Universality: Health coverage and quality accessible health services are a right of citizenship in the United States.

2. Public Administration: Administration of basic health coverage is organized in the most cost-efficient manner possible with central oversight by the government. Incremental steps allowing the option of public sponsored plans to those already insured should be encouraged.

3. Local Control of Delivery: The actual delivery of services to ensure quality and cost effectiveness is provided by health professionals and hospitals at the local and state levels.

4. Health Planning is a Priority: Creating healthy populations is a high priority for each state governor. Working to establish health budgets and priorities, leaders must integrate health services with other social services, advance prevention planning and manage vulnerable populations.

5. Transparency: Providers submit bills. Government ensures payment of bills. Patients focus on wellness or recovery. Not all services will be covered. For uncovered services, those with the means to pay will be encouraged to purchase private supplemental insurance.