Doctors Get Meals And Money From… Insurers
21 CommentsBy Ed Silverman // October 30th, 2008 // 12:56 pm
All the doctors had to do was show up, enjoy a free dinner at an elegant Rochester, New York, restaurant specializing in steaks and expensive wines, and pocket $100 on the way out the door. No, this wasn’t a big drugmaker showing largesse. Health insurers invited the docs to hear a pitch about the benefits of prescribing generics instead of pricier brand-name meds, the Associated Press writes.
Meet the flip side of a concern about corporate influence in the doctor’s office that’s been criticized - often stridently - when big pharma entices doc to prescribe brand-name drugs. Under pressure, that industry has since reined in its promotional efforts. But insurers are allowed to push docs toward cheaper drugs, frequently by offering a cut from the savings insurers get when docs prescribe generics.
“On either side you’ve got corporate bottom-line interests putting pressure on physicians who should be putting patients first,” Jean Silver-Isenstadt, executive director of the National Physicians Alliance, an industry organization that prioritizes patient interests, tells the AP.
Independent Health offers docs who prescribe 70 percent or more generics in a month a bonus of 50 cents per patient per month. A doc seeing 500 patients a month and meets the minimum gets $3,000 a year. John Rodgers, Independent’s executive vp and chief marketing officer, says the program doesn’t punish doc for not prescribing generics. “Our plan doesn’t agree to force people off of a drug if a person makes a personal choice they can continue that drug with a higher copay,” he tells the AP.
Some states want to more closely monitor the relationship between insurance reps and docs. In Massachusetts, a pending bill would regulate incentive plans between insurance carriers and providers. A Michigan proposal would ban financial incentives in exchange for prescribing a generic, although insurers would be allowed to compensate docs for time taken to evaluate whether a switch was best.
In New York, State Senator Jeffrey Klein introduced legislation that would prevent insurance companies from offering incentives to docs A grandfather clause would require HMOs to continue providing brand-name drugs to patients already benefiting from it. But none of these bills have gotten serious traction in state legislatures.
Last year, the American Medical Association warned that it considered the bonuses kickbacks and said doctors who accept payment from an insurer for switching a patient from a brand name to a generic drug could potentially face criminal and civil liability under federal statutes.
And caught in the middle, docs warn that when a medical decision is taken out of a doctor’s hands, it can hurt patients, such as 77-year-old Emmett Curran of Lynn, Massachusetts.
After 10 years of taking the cholesterol medicine Lipitor, which has no low-cost generic equivalent, Curran’s new insurer under Medicare refused to cover it. They insisted he take the generic equivalent of a completely different drug and he was scared. “I’m not 25 or 30,” he said. “There’s something that’s working for me with no side effects, why do you want me to experiment?”
His physician, Mario Motta, gave him free samples of Lipitor provided by drug salesmen. He also wrote to the insurance company to explain Curran had tried generic drugs, but in this case the brand-name drug was essential.
Still the company refused to cover it. Curran started spacing out his med out of fear he would run out. He wound up in the hospital and had a fifth stent put in to help keep his blood vessels open. The insurer didn’t relent until Motta got the American Medical Association to make a call. Curran was covered by Anthem Blue Cross and Blue Shield, a subsidiary of WellPoint - the nation’s largest insurer.
WellPoint couldn’t comment on Curran’s specific case because it would violate patient privacy laws, spokeswoman Lori McLaughlin tells the AP.
“If a member needs an exception to our formulary benefits, they or their provider have the ability to ask for an exception to our formulary benefits,” she said in a written statement. “We also look at prior records we have access to and based upon those we can, in certain circumstances, approve an exception to the formulary benefits. While on average, 75 percent of those patient appeals are approved for coverage, appeals are handled in accordance with guidance from the Centers for Medicare and Medicaid Services.”
Insurers say they encourage generics because it keeps consumer costs down when health care expenses are spiking. Companies argue that patients sometimes won’t stick to their expensive prescription to try to save money, and a generic alternative could keep their regimen consistent.
“Health plans are not mandating to physicians what to prescribe to patients,” Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, a national trade association, tells the AP. “They are providing incentives to encourage greater use of generic drugs.”
Drugmakers were criticized for encouraging docs with incentives for years. As a result, pharma has imposed its own regs in recent years, allowing only “modest” meals and inexpensive gifts with a medical purpose. “Insurers paying physicians to switch patients from one treatment to another raises question about whether individual patient needs are being put first,” Ken Johnson, senior vp president at PhRMA, writes to the AP.
The Rochester dinner for physicians was indefinitely delayed after the AP called with questions. It was organized by a local chamber of commerce, and the stipend was paid for by various businesses, including several insurers. It is unclear how often these events occur, because they aren’t advertised. Instead invitations are sent directly to doctors.
Most docs enthusiastically support using generics - if they are exact versions of the brand-name med. “There are drug classes that you can switch from one drug to another, and there are some that you can’t - and the person deciding that should have a medical degree,” Marc Siegel, an associate professor of medicine at New York University Medicine, tells the AP.
Source: The Associated Press
Dan A.
This situation has been going on for at least over a year.
Lisa Van S
I prefer the real thing over a generic,.. I also enjoyed fine dining at Shula’s Restaurant, great steaks, excellent wine, and a whopper of a bill!!!
Christopher
You know what they say Lisa, “No Bill, No Pill”
Dan A.
Christopher, that was good.
PaulGGG
It’s all about accountability. As the pharma industry pulls back and tightens things, the bad actors will finally become exposed: insurance companies, generics companies pharmacy chains, and doctors themselves.
Compliance Analyst
I work for one of these, “bad actor” generic companies. I am wondering how we became the bad guys in the industry? It certainly is not our sales reps….at least our company only has 5 and I seriously doubt they can cause that much trouble.
I do have to say that generics horning in on drugs still on patent and constantly challenging those patents is one part that leaves a bad taste in my mouth.
PaulGGG
Generic company practices:
- Pure $$ incentives and bribes to PBMs, wholesalers and pharmacy chains to carry their version of the generic and not another
- Very lavish junkets to pharmacists at association meetigs (I know, been there)
- Deep in the pockets of politicians who want more generics at a lower price but look the other way when generic prices go up much faster than brand name prices
- I could go on and on
Nathan
Compliance Analyst writes: “I do have to say that generics horning in on drugs still on patent and constantly challenging those patents is one part that leaves a bad taste in my mouth.”
I’m glad to hear that from someone inside a generics company. The challenges we (in big pharma) are facing from generics goes way beyond the intention of the current law… We are being faced with challenges from generics before our composition-of-matter patents even expire! (think Protonix) Among other things, this is causing pharma to more agressively seriously pursue biologic medicines which (currently) cannot be challenged by generics.
Stephanie
I do not feel comfortable taking generics (sorry to lump all together, but….). We work with pharma and many generics are cutting corners so they can have low prices. Anyone remember Able?
Compliance Analyst
Paul - We are not one of the huge generics companies but we do quite a bit of business. I know our marketing group pretty well as I get brought into debates with them all the time. Our sales rep spend their times at the distributors…..not the pharmacists.
Nathan - Our parent company is also a part of “big pharma” but I think one of the most ethical…at least they get voted that way each year. I see some of their big drugs constantly get challenged when the patent does not expire for years. I am sure it gets bothersome.
Stephanie - I agree to a point, Able labs was falsifying data in a gross manner, as was Leiner (and some others). In late 2007, we actually had a month long audit of data integrity and passed with flying colors, I know 19 other companies went through the same thing. I can’t speak for the rest of the industry, but can tell you that the FDA has a lot more focus on data manipulation during inspections. We have even seen it in our most recent inspections. I would be more worried about the brand and generic behaving differently when ingested, which happens due to small manufacturing differences.
atlex
To all of those critics out there (LVS, Truthman30, Jaynesday, Dan A.)…where’s the outrage? You should be all over this. Or is it really that you have an anti-pharma bias and these actions only bother you if pharma is involved? I guess you think health plans are good guys, right?
Pharma Newbie
Who do you think they work for? My guess is your question is the answer.
Nathan
That’s a good question atlex — I’m waiting eagerly for a response!
I am Spartacus
Just as we eagerly await your responses on those posts that show pharma to be clearly and egregiously in the wrong. But no matter.
Although unasked, I will respond and say I think insurance companies are the reason healthcare is screwed in this country (not pharma). I can see no reason whatsoever that insurance should be allowed to be a for-profit industry (unlike pharma). I sincerely hope that someone in Congress - Mr. Waxman, Mr. Grassley, are you listening? - should definitely take them to task for their misdeeds and rake them over the coals (as they have pharma).
But you two are quite disingenuous to intimate that you are not critics. You also do your fair share of criticizing. Does the fact that you have a pro-pharma bias keep you from criticizing health plans, atlex? Or would it just kill you to be on the same side of an issue with those you despise? Or do you simply not feel up to the task? Perhaps you think your insulting manner will win you some friends, yes? Meh.
I am Spartacus
Well, actually I’m harpy. Changed the name for another post.
atlex
Harpy/IAS,
I’m not interested in winning friends on this site. And, I don’t think that I am at all disingenuous. I am not supportive of pharma paying physicians for activities that are clearly not in the best interest of a patient’s health–for example, financial incentives to prescribe certain drugs. I have no problems with paying physicians fair compensation for consulting services, speaking services, etc. I am also in favor of health plans being held to the same standards as pharma.
Atlex
Anne PME
Good to see that the exhorbitant premiums that I pay are spent on kickbacks!
Do you think that Anthem Wellpoint and other health insurer executives and board members will bring these payments up if they become eligible for the bail out money?
Anne PME
Compliance Analyst:
Can you name the generic co. that you work for?
Lisa Van S
Atlex,
Health Plans are good guys,.. Absolutely not. Many Health Plans refuse antibiotic treatments for Lyme Disease Patients. Children and adolescents dont receive CBT therapy because health providers deem it too expensive, I could go on and on.
Compliance Analyst
Lets just say that we are one of two pharma companies in Columbus, OH.
harpy
“I am also in favor of health plans being held to the same standards as pharma.”
So where’s your outrage?