The hidden role of cost: Medicare decisions, transparency and public trust

University of Cincinnati Law Review

Volumn 79, Issue 1, 2010, Pages 1-51

  Fox, Jacqueline ^a  

^a UNIVERSITY OF SOUTH CAROLINA   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 79953775949     PISSN: 00096881     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (263)

1. Pub. L. No. 111-148, 124 Stat. 119 (2010).
2. According to the United States Census Bureau, 15% of Americans did not have health insurance in 2008, more than 46 million people. Press Release, U.S. Census Bureau, Income, Poverty and Health Insurance Coverage in the United States: 2008 (Sept. 10, 2009), available at http://www.census.gov/newsroom/ releases/archives/income-wealth/cb09-141.html.
3. See also CARMEN DENAVAS-WALT ET AL., U.S. CENSUS BUREAU, INCOME, POVERTY, AND HEALTH INSURANCE COVERAGE IN THE UNITED STATES: 2008, 57-67 (2009), available at http://www.census.gov/prod/2009pubs/p60-236.pdf.
4. CTRS. FOR MEDICARE & MEDICAID SERVS., U.S. DEP'T OF HEALTH & HUMAN SERVS., NATIONAL HEALTH EXPENDITURE PROJECTIONS 2009-2019 (2009), available at https://www.cms.gov/NationalHealthExpendData/downloads/proj2009.pdf [hereinafter NHEP].
5. Id. In 2008, healthcare expenditures were 16.2% of gross domestic products (GDP).
6. Id. This 1.1% increase in percentage of GDP spent on health care is the greatest single year increase in U.S. history.
7. Id.
8. Id. tbl.3.
9. Id.
10. Press Release, World Health Org., World Health Organization Assesses the World's Health Systems (2010), http://www.who.int/whr/2000/media-centre/press- release/en/index.html.
11. See also WORLD HEALTH ORG., THE WORLD HEALTH REPORT 2000: HEALTH SYSTEMS: IMPROVING PERFORMANCE 155 (2000), available at http://www.who.int/whr/2000/en/ whr00-en.pdf (ranking the United States first in spending per capita among 191 countries) [hereinafter WHO REPORT]. As one can easily imagine, the WHO 2000 ranking is subject to criticism.
12. See Carl Bialik, Ill-Conceived Ranking Makes for Unhealthy Debate: In the Wrangle Over Health Care, a Low Rating for the U.S. System Keeps Emerging Despite Evident Shortcomings in Study, WALL ST. J., Oct. 21, 2009, at A19, available at http://online.wsj.com/article/SB 125608054324397621 .html.
13. The Institute of Medicine, in a report from 2002, found that lack of health insurance caused at least 18,000 deaths each year. INST. OF MED., INSURING AMERICA'S HEALTH: PRINCIPLES AND RECOMMENDATIONS 8 (2004). While this study was based on data collected in 1993, an academic study from 2009 found that "lack of health insurance is associated with as many as 44,789 deaths per year in the United States."
14. Andrew P. Wilper et al., Health Insurance and Mortality in US Adults, 99 AM. J. PUB. HEALTH 2289, 2295 (2009).
15. The Henry J. Kaiser Family Found., U.S. Health Care Costs, http://www.kaiseredu.org/IssueModules/US-Health-Care-Costs/Background-Brief. aspx (last visited Aug. 26, 2010) (citing Growth in Health Care Costs: Before the Comm. on the Budget U.S. Senate (2008) (statement of Peter R. Orszag, Dir., Cong. Budget Office)).
16. See also id. ("[S]pending on prescription drugs has decelerated. Some analysts state that the availability of more expensive, state-of-the-art technological services and new drugs fuel healthcare spending not only because the development costs of these products must be recouped by industry but also because they generate consumer demand for more intense, costly services even if they are not necessarily cost-effective."
17. citing CONG. BUDGET OFFICE, TECHNOLOGICAL CHANGE AND THE GROWTH OF HEALTH CARE SPENDING (2008))
18. Medicare is the federal program that provides medical benefits to people over the age of sixty-five and to the disabled. Health Insurance for the Aged Act (Medicare Act), Pub. L No 89-97 79 Stat. 286 (1965).
19. See NHEP, supra note 3, at 1.
20. THE HENRY J. KAISER FAMILY FOUND., MEDICARE: MEDICARE AT A GLANCE 1 (2010), http://www.kff.org/medicare/upload/1066-12.pdf.
21. JOHN HOLAHAN & ALLISON COOK, THE HENRY J. KAISER FAMILY FOUND., CHANGES IN HEALTH INSURANCE COVERAGE, 2007-2008: EARLY IMPACT OF THE RECESSION 2 fig.1 (2009), available at http://www.kff.org/uninsured/upload/8004.pdf.
22. Id. fig. 2. Medicaid is the combined federal and state program that provides health benefits for those with low incomes.
23. See Medicaid Act of 1965, Pub. L. No. 89-97, § 121(a) 79 Stat 343 (2008).
24. "[T]he cost of a particular technology is not relevant in the determination of whether the technology improves health outcomes or should be covered for the Medicare population through an NCD." CTRS. FOR MEDICARE & MEDICAID, DEP'T OF HEALTH & HUMAN SERVS., GUIDANCE FOR THE PUBLIC, INDUSTRY AND CMS STAFF: FACTORS CMS CONSIDERS IN OPENING A NATIONAL COVERAGE DETERMINATION (2006), available at http://www.cms.hhs.gov/mcd/ncpc-view- document.asp?id=6.
25. See also Ruth Faden & Sean Tunis, Virtual Colonoscopy: A Window Into the Challenges of Health Care Reform, HEALTH CARE COST MONITOR, Aug. 6, 2009, available at http://healthcarecostmonitor. thehastingscenter.org/ruthfaden/ virtual-colonoscopy-a-window-into-the-challenges-of-health-carereform/ ("Medicare also addressed the question of whether the higher cost... factored into its decision; it said that the costs were considered but emphasized that its decision was based on uncertainty about the clinical benefits."). The cost effectiveness of the colonoscopy at issue in this case was discussed extensively by people outside of CMS in response to the CMS decision, making CMS's denial particularly interesting. One is left wondering whether CMS was ignoring important cost implications or refusing to admit it had done so.
26. See infra notes 125-127 and accompanying text.
27. See, e.g., Philip R. Alper, Commentary, Kids' Shoes and Death Panels: Deciding Between Needs and Wants is Health Care's Impossible Task, WASH. TIMES, Feb. 10, 2010, at B04, available at http://www.washingtontimes.com/news/2010/ feb/10/kids-shoes-and-death-panels/ ("It is an open secret, however, that the more costly the claim, the more intense the scrutiny.").
28. NHEP, supra note 3, at tbl.3 (predicting $978 billion by 2019).
29. Public participation takes place during the public comment period in the Medicare coverage process, described in Part V.B, infra.
30. See Allan S. Brett, "American Values" - A Smoke Screen in the Debate on Health Care Reform, 361 NEW ENG. J. MED. 5, 440 (2009) (an excellent discussion on both the constant use of the concept of "American Values" in healthcare debates and how little we truly know of what these values are).
31. BARBARA S. KLEES ET AL., DEP'T OF HEALTH & HUMAN SERVS., BRIEF SUMMARIES OF MEDICARE & MEDICAID 7 (2009), available at http://www.cms.gov/ MedicareMedicaidStatSupp/downloads/2009BriefSummaries.pdf.
32. THE HENRY J. KAISER FAMILY FOUND., MEDICARE: A PRIMER 13 (2009), available at http://www.kff.org/medicare/upload/7615-02.pdf [hereinafter PRIMER] (citing OFFICE OF MGMT. & BUDGET, EXECUTIVE OFFICE OF THE PRESIDENT, FISCAL YEAR 2009 MID-SESSION REVIEW: BUDGET OF THE U.S. GOVERNMENT (2008)).
33. See Medicare Program: Criteria for Making Coverage Decisions, 65 Fed. Reg. 31,124 (May 16, 2000).
34. See generally STEFAN TIMMERMANS & MARC BERG, THE GOLD STANDARD: THE CHALLENGE OF EVIDENCE-BASED MEDICINE AND STANDARDIZATION IN HEALTH CARE (2003).
35. CTRS. FOR MEDICARE & MEDICAID SERVS., U.S. DEP'T OF HEALTH & HUMAN SERVS., MEDICARE COVERAGE ADVISORY COMMITTEE OPERATIONS AND METHODOLOGY SUBCOMMITTEE; PROCESS FOR EVALUATION OF EFFECTIVENESS AND COMMITTEE OPERATIONS 3-6 (2006), available at http://www.cms.hhs.gov/FACA/Downloads/recommendations. pdf.
36. NHEP, supra note 3, at 1 (indicating that the average rate of healthcare spending is expected to increase by 6.1% a year into the foreseeable future, while growth in the overall economy is expected to be 4.4% per year).
37. See The Henry J. Kaiser Family Found., supra note 9.
38. An excellent comparison of different countries' systems can be found in HEALTH CARE COVERAGE DETERMINATIONS: AN INTERNATIONAL COMPARATIVE STUDY (Timothy Jost ed., 2004).
39. See also The Henry J. Kaiser Family Found., supra note 9.
40. Medicare Act, 42 U.S.C. §§ 1395 et seq. (2006) (providing coverage for those over 65 and the disabled);
41. Medicaid Act, 42 U.S.C. §§ 1396 et seq. (2006) (providing coverage for the poor);
42. Emergency Medical Treatment & Active Labor Act (EMTALA), 42 U.S.C. § 1395dd (2006) (requiring emergency departments to stabilize patients in emergency situations, though the patients bear financial responsibility for the care provided).
43. PRIMER, supra note 22, at 1 ("Prior to 1965, roughly half of all seniors lacked medical insurance.").
44. See Press Release, Patrick Leahy, Statement of Senator Patrick Leahy on the Motion to Proceed to H.R. 3590, The "Patient Protection and Affordable Care Act" (November 21, 2009), available at http://leahy.senate.gov/press/ press-releases/release/?id=62ef39d7-76f2-4621-b7b8-f1d959433ef3 (stating that more than one in three elderly people lived in poverty prior to the passage of Medicare).
45. James W. Mold et al., Who Are the Uninsured Elderly in the United States, 52 J. AM. GERIATRICS SOC'Y 601, 601-06 (2004) (publishing the results of a 2000 study which found 350,000 uninsured people over the age of sixty-five).
46. DENAVAS-WALT ET AL., supra note 2, at 50 tbl.B-2.
47. See Jacqueline Fox, Medicare Should, but Cannot, Consider Cost: Legal Impediments to a Sound Policy, 53 BUFF. L. REV. 577, 586-96 (2005);
48. see also THEODORE R. MARMOR, THE POLITICS OF MEDICARE (2d ed. 2000).
49. Fox, supra note 34, at 595.
50. Ctrs. for Medicare & Medicaid Servs., National Health Expenditures Historical and Projections 1965-2019, available at http://www.cms.hhs.gov/ nationalhealthexpenddata/03-nationalhealthaccountsprojected.asp (follow "NHE Historical and projections, 1965-2019 (ZIP, 32 KB)" hyperlink) (last visited Aug. 29, 2010).
51. See also Christopher Chantrill, Total Budgeted Government Spending Expenditure, http://www.usgovernmentspending.com/year1965-0.html (last visited Aug. 26, 2009) (showing that the entire federal budget for 1965 was $118 billion and thus suggesting that the cost of health care was not as worrisome then as it is now).
52. Fox, supra note 34, at 595.
53. Id. at 596-97.
54. Medicare Act, 42 U.S.C. §§ 1395 et seq. (2006).
55. 42 U.S.C. § 1395y(a)(1)(A) (2006) ("Exclusions from coverage").
56. Fox, supra note 34, at 591-93.
57. Id. at 594.
58. Id.
59. Id. at 594-95.
60. Id.
61. Id.
62. Id.
63. Id at 596.
64. Id.
65. S. REP. NO. 89-404, at 36 (1965), as reprinted in 1965 U.S.C.C.A.N. 1943, 1977. In an effort to garner political support from hospitals, the Medicare Act included generous hospital reimbursement rates that were meant to include infrastructure costs.
66. S. REP. NO. 91-1431, at 138 (1970).
67. Id.
68. The federal government enacted the Health Maintenance Organization (HMO) Act in 1973, which encouraged the creation of these new forms of health insurance. Health Maintenance Organization Act of 1973, 42 U.S.C. §§ 300e et seq. (2006).
69. Gail A. Jensen et al., The New Dominance of Managed Care: Insurance Trends in the 1990s, 16 HEALTH AFF. 125 (1997).
70. Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001 et seq. (2006).
71. 29 U.S.C. § 1144(a) (2006).
72. § 1001.
73. See THE HENRY J. KAISER FAMILY FOUND. & HEALTH RES. & EDUC. TRUST, EMPLOYER HEALTH BENEFITS: 2009 SUMMARY OF FINDINGS 1 (2009), available at http://ehbs.kff.org/pdf/2009/7937.pdf (reporting that 159 million people are covered by employer-sponsored plans as of 2009).
74. Jacqueline R. Fox, Will Health Care Reform Increase Litigation Over Denied Claims?, HEALTH CARE COST MONITOR, Oct. 29, 2009, available at http://healthcarecostmonitor. thehastingscenter.org/jacquelinefox/will-health- care-reform-increase-litigation-over-denied-claims/.
75. Glen P. Mays et al., Market Watch: Managed Care Rebound? Recent Changes in Health Plans' Cost Containment Strategies, HEALTH AFFAIRS, Aug. 2004, available at http://content. healthaffairs.org/cgi/content/full/hlthaff.w4.427/ DC1.
76. Jerry L. Mashaw, Small Things Like Reason Are Put in a Jar: Reason and Legitimacy in the Administrative State, 70 FORDHAM L. REV. 17, 35 (2001).
77. PRIMER, supra note 22, at 1, 13.
78. Id.
79. Id. at 16.
80. See discussion infra Part IV.
81. See 21 C.F.R. §§ 814.1 et seq. (2010) (premarket approval of medical devices).
82. See PAUL N. VAN DE WATER, CTR. ON BUDGET & POLICY PRIORITIES, MEDICARE CHANGES CAN COMPLEMENT HEALTH REFORM (2008), available at http://www.cbpp.org/files/7-31-08health.pdf (discussing the dynamics in the healthcare industry that lead to Medicare having such a dominant role in coverage decisions).
83. See Medicare Program; Revised Process for Making Medicare National Coverage Decisions, 68 Fed. Reg. 55,634, 55,634-55,641 (Sept. 26, 2003).
84. Id. at 55,638.
85. 42 U.S.C.A. § 1395x(v)(1) (West 2010).
86. Id.
87. Id.
88. 68 Fed. Reg. at 55,635.
89. 42 U.S.C. § 1395y(a)(1) (West 2010).
90. The Secretary of HHS determines payment amounts under § 1395(g)(a) for benefits provided under Part A of Medicare, and under § 13951(a) for benefits provided under Part B of Medicare.
91. 68 Fed. Reg. at 55,636.
92. Id.
93. Id.
94. Id.
95. Id.
96. Id.
97. 21 U.S.C.A. § 321(P)(1), (v)(1) (West 2010) (defining "safe & effective").
98. Id.
99. This, too, may be changing, though it is too soon to know what role the FDA will eventually have in assessing the comparative quality of new drugs and devices.
100. Off-label usage means that drugs or devices are free to be used by healthcare practitioners however they see fit once a single reason for use has been approved of by the FDA. When such drugs or devices are used in any way besides what the FDA has approved, it is referred to as off-label.
101. Bruce Patsner, CMS Review Could Act as a Check on FDA Shortcomings, HEALTH L. PERSPECTIVES, at 1-3, Sept. 24, 2008, available at http://www.law.uh.edu/Healthlaw/perspectives/2008/(BP)%20cms2.pdf.
102. JACOB S. HACKER, INST. FOR AM. FUTURE, THE CASE FOR PUBLIC PLAN CHOICE IN NATIONAL HEALTH REFORM: KEY TO COST CONTROL AND QUALITY COVERAGE 14 (2009), available at http://institute.ourfuture.org/files/Jacob-Hacker-Public-Plan- Choice.pdf.
103. HOLAHAN & COOK, supra note 13, at 2 fig. 1.
104. See Medicare Program; Criteria and Procedures for Making Medical Services Coverage Decisions That Relate to Health Care Technology, 54 Fed. Reg. 4302, 4302-4318 (Jan. 30, 1989);
105. Medicare Program; Procedures for Making National Coverage Decisions, 64 Fed. Reg. 22,619 (Apr. 27, 1999);
106. Medicare Program; Criteria for Making Coverage Decisions, 65 Fed. Reg. 31,124 (May 16, 2000).
107. See Administrative Procedures Act, 5 U.S.C § 553(b)(3)(A) (2006).
108. Medicare Program; Revised Process for Making Medicare National Coverage Decisions, 68 Fed. Reg. 55,634, 55,634 (Sept. 26, 2003).
109. Fox, supra note 34, at 612.
110. 5 U.S.C. § 557(b) (2006) (clarifying that when an agency does not adopt a rule, there is no requirement that a reason be given.).
111. Medicare Program; Criteria and Procedures for Making Medical Services Coverage Decisions That Relate to Health Care Technology, 54 Fed. Reg. 4302, 4302-4318 (Jan. 30, 1989).
112. Paul E. Kalb, Controlling Health Care Costs by Controlling Technology: A Private Contractual Approach, 99 YALE L.J. 1109, 1112 (1990).
113. An example of this type of study is the recent work that comparing the use of medicated with non-medicated coronary artery stents for risks, benefits, cost and outcomes of each. See Patrick W. Serruys et al., Percutaneous Coronary Intervention versus Coronary-Artery Bypass Grafting for Severe Coronary Artery Disease, 360 NEW ENG. J. MED. 961, 961-72 (2009);
114. see also Kathy Hardy, Angioplasty vs. CABG - A Look at Comparative Effectiveness Research, RADIOLOGY TODAY, June 15, 2009, at 10 (article discussing the results of the study).
115. Medicare Program; Procedures for Making National Coverage Decisions, 64 Fed. Reg. 22,619, 22,619-22,625 (Apr. 27, 1999).
116. Id.
117. Fox, supra note 34, at 580-82 (discussing the cost-benefit analysis process in the context of Heart Transplantation).
118. Id.
119. See generally D.J. Hunter, Rationing Health Care: The Political Perspective, 51 BR. MED. BULL. 876, 876-84 (1995).
120. Medicare Program; Revised Process for Making Medicare National Coverage Decisions, 68 Fed. Reg. 55,634, 55,634-55,641 (Sept. 26, 2003).
121. Id. at 55,634.
122. Id.
123. Id.
124. Id.
125. MEDICARE COVERAGE ADVISORY COMM. OPERATIONS & METHODOLOGY SUBCOMM., CTRS. FOR MEDICARE & MEDICAID SERVS. PROCESS FOR EVALUATION OF EFFECTIVENESS AND COMMITTEE OPERATIONS (2006), available at http://www.cms.hhs.gov/FACA/ Downloads/recommendations.pdf.
126. Id. at 6.
127. FED. COORDINATING COUNCIL FOR COMPARATIVE EFFECTIVENESS RES., DEP'T OF HEALTH & HUMAN SERVS., REPORT TO THE PRESIDENT AND THE CONGRESS 4 (2009) [hereinafter CER REPORT].
128. Medicare Program; Revised Process for Making Medicare National Coverage Decisions, 68 Fed. Reg. 55,634, 55,637 (Sept. 26, 2003).
129. Id. at 55,636.
130. Peter J. Neumann & Sean R. Tunis, Medicare and Medical Technology - The Growing Demand for Relevant Outcomes, 362 NEW ENG. J. MED. 377 (2010).
131. See 21 C.F.R. § 314.126 (2010) (describing the acceptable study designs for FDA submissions).
132. Peter J. Neumann et al., Medicare's National Coverage Decisions, 1999-2003: Quality of Evidence and Review Times, 24 HEALTH AFF. 243, 243-54 (2005).
133. Id. at 243.
134. Id. at 246, 252-53.
135. MOSBY'S MEDICAL DICTIONARY (8th ed. 2009) ("[I]mplantable cardioverter-defibrillator (ICD), a surgically implanted electric device that automatically terminates lethal ventricular arrhythmias by delivering low-energy shocks to the heart, restoring proper rhythm when the heart begins beating rapidly or erratically. About the size of an audiotape cassette, the device can be implanted without thoracotomy in many cases. It is attached to the abdomen or chest wall with a wire link to the heart.").
136. Abigail Trafford, Second Opinion: Implantable Defibrillators, WASH. POST, July 31, 2001, available at http://www.washingtonpost.com/wp-srv/liveonline/01/ health/health0731 .htm.
137. This was an accepted treatment for these patients, particularly after 1997, when the New England Journal of Medicine published a study showing that ICDs worked better than the drugs available at that time.
138. See AVID Clinical Trial Ctr., A Comparison of Antiarrhythmic-Drug Therapy with Implantable Defibrillators in Patients Resuscitated from Near-Fatal Ventricular Arrhythmias: The Antiarrhythmics Versus Implantable Defibrillators (AVID) Investigators, 337 NEW ENG. J. MED. 1576, 1576-83 (1997) (a comparison of antiarrhythmic drug therapy with implantable defibrillators in patients resuscitated from near-fatal ventricular arrhythmias).
139. Stephen C. Hammill, Influence of the Medicare Reimbursement System on ICD Implantation, 5 CARDIAC ELECTROPHYSIOLOGY REV. 133, 135 (2001).
140. Medscape CRM, Medicare Panel Recommends Expanded Coverage for ICDs, MEDSCAPE TODAY, Mar. 21, 2003, http://www.medscape.com/viewarticle/451046 (explaining in detail the structure of the Second Multicenter Automated Defibrillator Implantation Trial).
141. Arthur J. Moss et al., Prophylactic Implantation on a Defibrillator in Patients with Myocardial Infarction and Reduced Ejection Fraction, 346 NEW ENG. J. MED. 877, 877, 882 (2002) (for the Multicenter Automatic Defibrillator Implantation Trial II Investigators).
142. Medscape CRM, CMS Draws Heat as Coverage of MADIT II ICD Decision Draws Near, MEDSCAPE TODAY, May 23, 2003, http://www.medscape.com/viewarticle/456391 [hereinafter Medscape Heat].
143. The full title of the guidelines is the American Heart Association/American College of Cardiology/North American Society of Pacing and Electrophysiology (AHA/ACC/NASPE) Consensus Guidelines. See Matthew R. Reynolds & Mark E. Josephson, MADITII (Second Multicenter Automated Defibrillator Implantation Trial) Debate: Risk Stratification, Costs, and Public Policy, 108 AM. HEALTH ASS'N 1779, 1780 (2003).
144. Id. at 1779.
145. Medscape Heat, supra note 122.
146. Id.
147. Id. ("At a free-wheeling CMS issues session at the North American Society of Pacing and Electrophysiology (NASPE) 24th Annual Scientific Sessions, Tunis bluntly told attendees that 'it is about the money.' There is no wiggle room in the Medicare budget, he said, so CMS has drawn a clear line in the sand.").
148. Helen S. Barold, Using the MADITII Criteria for Implantable Cardioverter Defibrillators -What is the Role of the Food and Drug Administration Approval?, 7 CARDIO ELECTROPHYSIOLOGY REV. 443, 446 (2004) ("The results of the MADIT U study have generated a great deal of controversy in the world of electrophysiology. Much of the controversy appears related to the sheer numbers of potential Implantable Cardioverter Defibrillator (ICD) implants and their potential cost to the healthcare system.").
149. Medscape Heat, supra note 122 (including those with serious coronary heart disease and advanced left ventricular dysfunction).
150. Id. (explaining the structure of this study in some detail).
151. Id.
152. Moss et al., supra note 121.
153. Medscape Heat, supra note 122.
154. Reynolds & Joscphson, supra note 123, at 1781.
155. Id. ("From the outset, there has been concern that compared with current risk-stratification strategies, less selective criteria for ICD implantation could result in many patients receiving ICDs who do not stand to benefit from them, exposing some patients to unnecessary risks and using societal resources less efficiently.").
156. Id. at 1779-80.
157. Id. at 1780.
158. Id.
159. Id.
160. Id. ("That these analyses even became necessary in our opinion simply illustrates that the most crucial clinical question to arise from MADIT U (is EP testing necessary?) was inadequately addressed by the design of the study. In retrospect, a study enrolling only noninducible patients might have generated less controversy.").
161. Michael O. Sweeny et al., Rules of Evidence: CMS and the Primary Prevention of Sudden Cardiac Death in Systolic Heart Failure, 28 PACE 81, 83 (2005).
162. Reynolds & Josephson, supra note 123, at 1783 (referencing Ctrs. for Medicare & Medicaid Services, Decision Memorandum: Implantable Cardioverter Defibrillators, # 00157N (2003)).
163. Id. at 1781 ("The result is awkward, with CMS publicly pretending that their decisions are not driven in part by financial motives, and nobody really believing them.").
164. Sweeny et al., supra note 141, at 81 (discussing CMS's continuing efforts to correctly identify appropriate ICD recipients).
165. Christopher S. Simpson, Implantable Cardioverter Defibrillators Work - So Why Aren't We Using Them?, 177 CAN. MED. ASS'N J. 49, 49 (2007) (discussing utilization).
166. See, e.g., Robert, Steinbrook, Health Care and the American Recovery and Reinvestment Act, 360 NEW ENG. J. MED. 1057, 1057 (2009) ("[C]omparativc effectiveness studies that directly compare the risks and benefits of different treatments for a particular condition arc essential for improving practice and slowing cost escalation."); THE HENRY J. KAISER FAMILY FOUND., EXPLAINING HEALTH REFORM: WHAT IS COMPARATIVE EFFECTIVENESS RESEARCH? 1 (2009), available at http://www.kff.org/healthreform/upload/7946.pdf ("Identifying the most effective and efficient interventions has the potential to reduce unnecessary treatments, which in turn, may help lower costs.").
167. For an excellent discussion of this vulnerability in the context of politics, the healthcare industry and CER, see Susan Bartlett Foote, How Comparative Effectiveness Can Save Money, HEALTH CARE COST MONITOR, July 7, 2009, available at http://healthcarecostmonitor.thehastingscenter.org/ suasanbartlettfoote/how-comparative-effectiveness-research-can-save-money/ ("Comparative effectiveness will not save money unless supporters of value-based care stand up and say - let's not just gather evidence, let's be sure we do not pay for care that is inconsistent with it.").
168. Consider, for example, the November 2009 recommendations about the frequency of mammograms by the United States Preventive Services Task Force and the public response. These recommendations called for mammograms to start at a later age and take place less frequently than had been called for by its previous recommendation from 2002. The new recommendations unleashed a public controversy, with the Secretary of Health and Human Services finally assuring voters that the federal government policies about mammograms would not change as a result of these recommendations. See Editorial, Sebelius: Mammogram Policies Unchanged, UPI.COM, Nov. 18, 2009, http://www.upi.com/Top-News/US/2009/11/18/ Sebelius-Mammogram-policies-unchanged/UPI18271258591793/ (notably failing to address whether the panel recommendations were actually correct or appropriate);
169. see also Roni Caryn Rabin, Doctor-Patient Divide on Mammograms, N.Y. TIMES, Feb. 10, 2010, at D7. According to an editorial in the Annals of Internal Medicine from February 2010, doctors are more inclined to accept the new recommendations, implying, arguably, that there is at least some scientific merit to the new recommendations.
170. Editorial, When Evidence Collides with Anecdote, Politics, and Emotion: Breast Cancer Screening, 152 ANNALS INTERNAL MED. 531 (2010).
171. NAT'L PUBLIC RADIO ET AL., THE PUBLIC AND THE HEALTH CARE DELIVERY SYSTEM 2 (2009), http://www.npr.org/documents/2009/apr/nprpoll-charts.pdf (reporting poll results showing 72% of Americans think there is insufficient scientific research to show what will work best for patients, and only 55% would trust an independent panel of experts to help make these determinations, with the percentage trusting this panel dropping to 41% if the federal government plays a role in appointing these experts and, even in the face of evidence that a treatment is not as effective as another, 56% think private insurers should be compelled to pay for the less effective treatment).
172. Rush Limbaugh, Transcript, The March to Socialized Medicine Starts in Obama's Porkulus Bill, Feb. 9, 2009, http://www.rushlimbaugh.com/home/daily/ site-020909/content/01125111.guest.html (consistently expressing the idea that the purpose of CER is to ration health care).
173. Patient Protection and Affordable Care Act, Pub. L. No. 111-148, § 6302, 124 Stat. 119 (2010).
174. § 6301(e)(1), (e)(2), (f).
175. See 1 CCH, CCH's LAW, EXPLANATION AND ANALYSIS OF THE PATIENT PROTECTION AND AFFORDABLE CARE ACT 850 (2010).
176. American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5, 123 Stat. 115.
177. See also CER REPORT, supra note 108, at 11.
178. 42 U.S.C.A. § 299b-8 (West 2010).
179. See Colin Hanna, Rationing Wolves in Public Servants' Clothing, ROLL CALL, July 6, 2009, available at http://www.rollcall.com/news/36488-1.html;
180. see also Peter Singer, Why We Must Ration Health Care, N.Y. TIMES, July 15, 2009, at MM38, available at http://www.nytimes.com/2009/07/19/magazine/ 19healthcare-t.html?-r=2.
181. CER REPORT, supra note 108, at 16 (CER has been defined by the Coordinating Council as "the conduct and synthesis of research comparing the benefits and harms of different interventions and strategies to prevent, diagnose, treat and monitor health conditions in 'real world' settings. The purpose of this research is to improve health outcomes by developing and disseminating evidence-based information to patients, clinicians, and other decision-makers, responding to their expressed needs, about which interventions are most effective for which patients under specific circumstances.").
182. Id. at 3 (containing part of a longer definition of the purpose of the Council's work).
183. Id.
184. Limbaugh, supra note 150 (quoting Betsy McCaughey, former Lt. Governor of N.Y.).
185. Id. See also Kurt Nimmo, Barney Frank, Eugenics Death Panels, and a Dining Room Table, FREE REPUBLIC, Aug. 19, 2009, http://www.freerepublic.com/ focus/news/2320327/posts (The Council's "purpose is to empower an unelected bureaucracy to make decisions about healthcare rationing that elected politicians are politically unable to make.");
186. Rich Lowery & Robert Costa, The Rogue, on the Record, NAT'L REV. ONLINE, Nov. 17, 2009, http://article.nationalreview.com/414954/the-rogue-on- the-record/rich-lowry-and-robert-costa?page=3 (Sarah Palin describing why she referred to the Council as a "death panel": "While reading that section of the bill, it became so evident that there would be a panel of bureaucrats who would decide on levels of health care, decide on those who are worthy or not worthy of receiving some government-controlled coverage," which would, in turn "lead to harm.").
187. CER REPORT, supra note 108, at 59. In its response to the negative public outcries, an interesting notation appears in the minutes of the Coordinating Council's second meeting: "Council members also noted that they had heard, loud and clear, that the Council's governance and processes must be transparent, and that the Council must incorporate input from all stakeholders to gain credibility and build trust." Id. This comment makes it clear that trust and credibility are problems here.
188. Opinion Res. Corp., CNN Opinion Research Poll, at 7, Sept. 13, 2009, available at http://i2.cdn.turner.com/cnn/2009/images/09/14/rel14b2.pdf. Typical of the incoherency within this debate, the argument has been that the Council, as created in February 2009, would lead to death panels whereas the Poll, given in September 2009, was asking about people's concerns with proposals for future healthcare reform, specifically: "If Obama's plan became law, do you think senior citizens or seriously-ill patients would die because government panels would prevent them from getting the medical treatment they needed?" Id. One could argue, then, that it is unclear what, exactly, these fears are even peripherally related to.
189. Posting of DrRich to Better Health, http://www.getbetterhealth.com/who's- against-comparative-effectiveness-research/2009.05.15 (May 15, 2009).
190. See Patrick W. Serruys et al., Percutaneous Coronary Intervention versus Coronary-Artery Bypass Grafting for Severe Coronary Artery Disease, 360 NEW ENG. J. MED. 961, 961-72 (2009).
191. Id. (specifically, an increased risk of needing " revascularization").
192. Id.
193. Id.
194. Roni Caryn Rabin, Heart Stents Found as Effective as Bypass for Many Patients, N.Y. TIMES, Feb. 19, 2009, available at http://www.nytimes.com/2009/ 02/20/health/20heart.html?-r=1&ref=health ('"What they're telling us is that these procedures are similar in many respects,' he added. 'For individual patients, one is often better than the other. For a patient who can have either one, there are pluses or minuses to each one.'" (quoting Dr. L. David Hillis, Chairman of the Dep't of Med. at the Univ. of Tex. Med. Sch. in San Antonio)).
195. See News Release, Harris Interactive, Large Numbers of People Do Not Trust the Institutions They Identify as Most Responsible for Drug Safety (Apr. 25, 2007), http://www.harrisinteractive.com/news/allnewsbydate.asp?NewsID=1216. The poll data on this issue shows, repeatedly, that this distrust is quite strong. A Harris Interactive poll of United States adults, for example, found that only 45 percent of people somewhat trust or very strongly trust the U.S. FDA. Only 27 percent of people somewhat or very strongly trust pharmaceutical companies. Only 20 percent of people somewhat or very strongly trust Congress. However, many more people, a 58 percent majority, somewhat or very strongly trust doctors or other professionals who prescribe drugs. Id. The same poll found that most people do not believe that drug companies will ever release any data about adverse reactions to their drugs.
196. MARCIA ANGELL, THE TRUTH ABOUT THE DRUG COMPANIES: HOW THEY DECEIVE US AND WHAT TO DO ABOUT IT (2005), available at http://www.nybooks.com/articles/ archives/2004/jul/15/the-truth-about-the-drug-companies/.
197. Harlan M. Krumholz & Joseph S. Ross, Relationships with the Drug Industry: More Regulation, Greater Transparency, 338 BMJ b211 (2009), available at http://www.bmj.com/cgi/content/full/338/feb03-2/b211 (analyzing Harris Interactive poll, supra note 170, and other studies showing both the distrust and vulnerability of consumers and patients).
198. Barry Meier & Duff Wilson, Medical School Says Former Army Surgeon Hid Ties to Medtronic, N.Y. TIMES, July 15, 2009, at B3, available at http://www.nytimes.com/2009/07/15/business/15device.html.
199. Id.
200. See also Timothy Kuklo, Recombinant Human Bone Morphogenetic Protein-2 for Grade III Open Segmental Tibial Fractures from Combat Injuries in Iraq, 90-B J. BONE & JOINT SURG. 1068 (2008) (withdrawn by: J. Scott, Withdrawal of a Paper, 91-B J. BONE & JOINT SURG. 285, 286 (2009)).
201. Meier & Wilson, supra note 173.
202. Alaska Elec. Pension Fund v. Pharmacia Corp., 554 F.3d 342, 344 (3d Cir. 2009), cert. denied, 130 S. Ct. 2401 (2010).
203. Id. at 345.
204. Id. (discussing at length the data manipulation surrounding Celebrex).
205. Joseph S. Ross et al., Guest Authorship and Ghostwriting in Publications Related to Rofecoxib: A Case Study of Industry Documents From Rofecoxib Litigation, 299 JAMA 1800 (2008), available at http://jama.ama-assn.org/cgi/ content/abstract/299/15/1800 (examining documents that were produced during discovery for a products liability case concerning rofecoxiband that showed the prevalence of ghost writing along with a pattern of keeping this hidden).
206. See MERRILL GOOZNER, CTR. FOR SCI. IN THE PUB. INTEREST, UNREVEALED: NONDISCLOSURE OF CONFLICTS OF INTEREST IN FOUR LEADING MEDICAL AND SCIENTIFIC JOURNALS 2 (2004), available at http://www.cspinet.org/new/pdf/unrevealed-final. pdf.
207. In support of this belief, a national poll from October 2009 found that nearly 80% of people polled said they oppose restrictions on access to health care if treatments will not be covered because they are too costly, not essential or have too little chance of success.
208. See Gary Langer, Growing Health Care Concerns Fuel Cautious Support for Change, ABCNEWS, Oct. 29, 2003, http://abcnews.go.com/images/pdf/ 935a3HealthCare.pdf.
209. In support of this assertion, a recent poll found that 93% of Americans polled said it was extremely or very important that their healthcare plan cover tests and treatments that they or their doctor thought were necessary. Jeffrey M. Jones, Majority in U.S. Favors Healthcare Reform This Year, GALLUP, July 14, 2009, http://www.gallup.com/poll/121664/majority-favors-healthcare-reform-this- year.aspx.
210. Id. In this same poll, 52% of Americans polled said that controlling cost was the most important goal of healthcare reform. Id.
211. See discussion infra notes 186-187 and accompanying text.
212. See infra notes 200-205 and accompanying text.
213. PAUL J. FELDSTEIN, THE POLITICS OF HEALTH LEGISLATION: AN ECONOMIC PERSPECTIVE (3d ed. 2006).
214. Id. at 10.
215. Id.
216. Id. at 11. For example, the elderly seek the financial benefit from Medicare. Id.
217. Id.
218. Id. Cost is a broad term that includes financial contributions, volunteer efforts, protests, etc. The term is used to encompass all of the things one can do to influence the process that requires expending one's resources: time, money, influence, energy, etc.
219. Id.
220. Id. Funding allocations to one program that require taking money from another program can also risk creating a concentrated interest in the group that is losing the benefit of financing. This happens "[w]hen the financial commitments imposed on it [or demanded from it] require cutbacks in other politically popular programs or necessitate a tax increase." Id. at 154.
221. Id. at 11. The preference for creating diffuse burdens would explain why legislators would rather borrow to fund a program than tax current constituents. The cost is shifted to the distant future.
222. Before Medicare was enacted, people over sixty-five were mostly shut out of the private market for health insurance. Fox, supra note 34, at 585.
223. FELDSTEIN, supra note 186, at 3.
224. Id.
225. Soc. SEC. ADMIN., SOCIAL SECURITY: UNDERSTANDING THE BENEFITS 4 (2010), available at http://ssa.gov/pubs/10024.html.
226. FELDSTEIN, supra note 186, at 154.
227. Jerry L. Mashaw, Public Law and Public Choice: Critique and Rapprochement, in RESEARCH HANDBOOK ON PUBLIC CHOICE AND PUBLIC LAW 19 (Daniel A. Farber eds. et al., 2010) (fully discussing political self-interest and its flaws). Repeating here the arguments against the narrow view of Congressional self-interest would be outside the scope of this Article, yet the topic, in all detail, is of great importance to the debate about how to ration health care in the United States system.
228. Id at 25.
229. Id.
230. Id. (as empirical studies have shown).
231. Id. (citing Arthur Maas, CONGRESS AND THE COMMON GOOD (1983);
232. Cass R. Sunstein, Interest Groups in American Public Law, 38 STAN. L. REV. 29 (1985);
233. Cass R. Sunstein, Legal Interference with Private Preferences, U. CHI. L. REV. 1129 (1986)).
234. Id.
235. Oregon's approach to health care and cost is described in this Article only for the purpose of providing an example of sustained electorate support of a government healthcare system that directly addresses cost. Much more can, and has, been said about Oregon. For an in-depth discussion, see Leonard M. Fleck, Just Caring: Oregon, Health Care Rationing, and Informed Democratic Deliberation, 19 J. MED. & PHIL. 367 (1994);
236. Somnath Sana et al., Giving Teeth to ComparativeEffectiveness Research - The Oregon Experience, 362 NEW ENG. J. MED. e18 (2010).
237. See also RATIONING AMERICA'S MEDICAL CARE: THE OREGON PLAN AND BEYOND (Martin A. Strosberg et al. eds., 1992).
238. For a particularly critical analysis, see Jonathan Oberlander et al., Rationing Medical Care: Rhetoric and Reality in the Oregon Health Plan, 164 CAN. MED. ASS'N J. 1583 (2001).
239. OFFICE OF MED. ASSISTANCE PROGRAMS, OR. DEP'T OF HUMAN SERVS., OREGON HEALTH PLAN: A HISTORICAL OVERVIEW 1 (2006), available at http://www.oregon.gov/ DHS/healthplan/data-pubs/ohpoverview0706.pdf.
240. Id.
241. Id. at 2.
242. Id. at 4.
243. Oberlander et al., supra note 206, at 1586.
244. OR. HEALTH SERVS. COMM'N, PRIORITIZED LIST OF HEALTH SERVICES SI-I (2008), available at http://www.oregon.gov/OHPPR/HSC/docs/Jan08Plist-B.pdf.
245. Susan Donaldson James, Death Drugs Cause Uproar in Oregon: Terminally III Denied Drugs for Life, but Can Opt for Suicide, ABCNEWS, Aug. 6, 2008, http://abcnews.go.com/Health/ story?id=5517492&page=1.
246. Jeffrey Lord, The Ultimate Cost Saver, THE AM. SPECTATOR, Aug. 18, 2009, http://spectator.org/archives/2009/08/18/the-ultimate-cost-saver.
247. Rick Artig, Sensationalizing a Sad Case Cheats the Public of Sound Debate, THE OREGONIAN, Nov. 29, 2008, http://www.oregonlive.com/opinion/index. ssf/2008/11/sensationalizing-a-sad-case-ch.html.
248. Press Release, Or. Dep't of Admin. Servs., State Releases 2008 Population Survey, Feb. 23, 2009, available at http://www.oregon.gov/DAS/OPB/docs/PopSurv/ 2008OPS/OPS-2008-Press-Release.pdf.
249. See John Kitzhaber, http://www.johnkitzhaber.com/ (last visited Aug. 30, 2010).
250. 42 U.S.C. § 1395 (2006).
251. Hays v. Sebelius, 589 F.3d 1279, 1282-83 (3d Cir. 2009). This recent appellate decision in the DC Circuit analyzes the language of this section of the Medicare Act. The language of the relevant section of the Medicare Act reads: "no payment may be made... for any expenses which are incurred for items and services... which are not reasonable and necessary for the diagnosis or treatment of illness or injury." Id. at 1280 (quoting § 1395y(a)(1)(A)). The Court stated that Congress could have inserted the word "and" after "services," but chose not to, and thus did not have reasonable as a modifier of "expenses" but instead as a modifier for "items and services."
252. Id. at 1282.
253. See Michael S. Kolber, Opacity and Cost Effectiveness Analysis in Medicare Coverage Decisions: Health Policy Encounters Administrative Law, 64 FOOD & DRUG L.J. 515 (2009) (Kolber argues that the language is broad enough to encompass a cost effectiveness analysis). But see supra Part II; Hays, 589 F.3d at 1282-83 (declining to address the issue of whether CMS may consider cost in its coverage decisions, but making clear that coverage and cost are two separate steps of the coverage process).
254. Supra Part II.
255. The language of the law made this position clear. 42 U.S.C. § 1395 (2006) ("Prohibition against any Federal interference... Nothing in this subchapter [42 U.S.C. § 1395 et seq.] shall be construed to authorize any Federal officer or employee to exercise any supervision or control over the practice of medicine or the manner in which medical services are provided....").
256. In Kolber's reading of the Medicare Act, this is as broad a role for cost as he is able to find in the language. While it is debatable as to whether the modern concept of "cost effectiveness," as embodied in the CMS regulations discussed in Part II, even existed in 1965, it may be fair to read "reasonable" to include some ability to exclude wasteful procedures from coverage. The source of the Medicare language, however, is the typical health care insurance policy language of 1965, and, as described in Part II, there are no contemporaneous judicial interpretations of this contract language that support reading this power into this language. In Dynamic Statutory Interpretation, Eskridge has a theory that would allow for a changing interpretation of a durable statute like Medicare, and it is persuasive. Problems of legitimacy and transparency still need to be addressed, and that, in turn, seems to call for a more explicit statutory framework for this undertaking than somehow finding that this power has developed, organically, in the Medicare Act.
257. See 42 U.S.C. § 1395hh(aX2) (2006); 42 U.S.C. § 1395ff(f)(1)(A) (2006) (exempting the NCD process from the Administrative Procedure Act, 5 U.S.C. §553(b)(3)(A) (2006)).
258. 42 C.F.R. §§405.732, 405.860 (2010).
259. 42 U.S.C.A. § 1395y(1)(1) (West 2010).
260. § 1395y(1)(B).
261. § 1395y(1)(C).
262. § 1395y(1)(3)(C)(iii).
263. See supra Part II.D.