Why Implantable Defibrillators Have To Be Rationed

November 6th, 2007 by DrRich

Before leaving medical practice eight years ago to become a writer and consultant, DrRich spent nearly 20 years as a cardiac electrophysiologist - a cardiologist specializing in the treatment of heart rhythm problems. And from 1982 until he left practice, his major research focus was to help advance the safety, usability and effectiveness of the implantable defibrillator (known as the ICD).

The ICD is an implantable pacemaker-like device that monitors the heart rhythm, and if a fatal heart arrhythmia occurs (an event known as a cardiac arrest), it automatically shocks the heart back into a normal rhythm. Almost from the moment of its first use in patients in 1982, the ICD has been the only method ever developed that substantially reduces the risk of sudden death in high-risk patients. If a person with an ICD has a cardiac arrest, there is roughly a 99% chance that the ICD will save them.

The ICD has become the poster child of covert healthcare rationing, and in his writings on this space DrRich has not been shy about pointing that out, for instance, here, here and here. DrRich believes that covertly rationing the ICD, like all covert rationing, is harmful to individuals and to society. In this particular case, the large majority of high-risk patients who have clear indications for ICDs - supported by clinical science, by professional guidelines, and even sanctioned by HMOs and Medicare - are not receiving them. And as a result, it appears that thousands of patients who could have received ICDs are dying suddenly. (Over 300,000 Americans die suddenly from cardiac arrest each year.) But the problem goes even deeper than that.

There are three features about ICDs that make them compelling targets for rationing. The first two render them attractive targets for covert rationing. ICD companies and the electrophysiology community are well aware of these two features, and in their own ways are working to counteract them. But the third feature will require limiting (or even eliminating) the use of ICDs even if we were to move to a system of fair, equitable, open rationing. And here, both ICD companies and electrophysiologists are in a state of continued and obstinate denial.

Feature 1) Preventing sudden death is hugely expensive.

ICDs themselves and the medical procedures necessary for their implantation are very expensive, generally $30,000 or higher, and estimates are that upwards of 500,000 “new” candidates for ICDs are created each year. (These new candidates come from the pool of patients who survive heart attacks or develop heart failure annually.)

The finances look even worse if you’re a Medicare administrator or an HMO executive. To you it looks like this: Today, sudden death removes hundreds of thousands of high-consumers from the rolls each year. If these patients were instead to receive ICDs, then not only would you have to pay for the ICDs, but you would also have to continue paying their long-term healthcare costs (which are substantial since most have chronic, underlying heart disease), not to mention their Social Security. Today these people are conveniently and efficiently dropping dead, and preventing their sudden deaths would create a huge problem for you - even if the ICDs themselves were free. You can only conclude that preventing sudden death is simply bad public policy.

Feature 2) There is no constituency for sudden death.

Under a system of covert rationing, the rationing decisions are not based on issues of efficiency, effectiveness, or fairness - they’re based (and MUST be based) on what you can get away with. And it is particularly easy to get away with covertly rationing ICDs.

This is because sudden death has no constituency. Breast cancer has a constituency; AIDS has a constituency; cerebral palsy has a constituency. But Jerry Lewis never held a telethon for sudden death.

The large majority of people who are at high risk for sudden death don’t realize it. After a sudden death has occurred, the surviving family is often told that their loved one died of “a massive heart attack,” or some other purely unpredictable and unavoidable “act of God.” Patients and loved ones do not have, and doctors do not choose to impart, any sense of the predictability, preventability, or survivability of such a thing. So there is precious little demand for ICDs; what little there is can easy be ignored or pandered to.

The bottom line: Under a covert rationing paradigm, preventing sudden death is something payers (whether the government or insurance companies) will naturally and desperately want to avoid. At the same time, since sudden death has no constituency and there is no great hue and cry about it, it will be relatively easy for them to get away with rationing ICDs. Clearly then, if there’s any medical therapy that’s ripe for covert rationing, the ICD is it.

But even if we were able to eliminate covert rationing today, ICDs would still require rationing. This is because:

Feature 3) The ICD industry and their chief customers - electrophysiologists - embrace a completely dysfunctional and counterproductive business model.

Building and selling ICDs is an enterprise whose continued success utterly depends on maintaining very high price points. While the unit cost for building an ICD may be a few thousand dollars, to make ends meet most of these devices must be sold for over $20,000. This is because ICD companies get paid only once for an ICD - on the day of implant - but they continue incurring expenses as long as the device remains in service. These “lifetime” expenditures include monitoring of device function; maintaining expensive, rigorous quality and reliability processes; and backing up every implanted device with a large force of highly-trained and expensive field clinical engineers who are available to electrophysiologists 24/7, anywhere and everywhere, for “troubleshooting” and even for routine follow-up. All this “extra” stuff must be fully accounted for in the initial cost of the device. High price points therefore are essential to this business model.

Maintaining high prices in a competitive environment is not easy. It requires that ICD companies release “new” models every year or so. Occasionally these new models have useful improvements, such as smaller size or longer lasting batteries. But frequently they are simply “fancier” in some way that is designed to achieve a marketing advantage with their customers - high-end electrophysiologists.

Electrophysiologists have a clear agenda here as well. Their “demands” on ICD companies, expressed in rigorously conducted marketing surveys and focus groups, inexorably lead to ever more complex devices. This complexity allows electrophysiologists (a small community whose growth is tightly controlled) to maintain a professional stranglehold over the implantation and management of ICDs. It’s a matter of turf protection. Since ICDs are already exceedingly complex devices, and grow more complex with each succeeding generation, then “obviously” one must be a high-end specialist to understand and manage all their nuances. (In real life, they are so complex that not even many electrophysiologists can keep up with them, thus necessitating the need for armies of field clinical engineers in the employ of ICD companies.)

Clearly, this business model - as manifested by the synergy between ICD companies and cardiac electrophysiologists - is fundamentally dysfunctional. It utterly precludes ICDs ever becoming as widely used as both ICD companies and many electrophysiologists think they ought to be, that is, in hundreds of thousands of new patients each year.

Under a system of healthcare rationing - whether overt or covert - this business model is simply a non-starter. Even observers like DrRich, who devoted his career to the problem of sudden death, can begin to sympathize with Medicare and the HMOs in their attempts to stifle the use of ICDs under such a model.

Unfortunately, covert rationing fosters a perpetual continuation of this dysfunctional business model. Open rationing, on the other hand, would immediately reveal this model as being entirely obsolete and unworkable, and might (at last) goad the ICD industry into the direction it ought to go - toward developing implantable defibrillators that are simple, reliable, effective, easy to implant and manage, long-lasting and cheap.

ICDs are not only the poster child of covert rationing, they are also a particularly compelling example of how covert rationing inherently fosters waste, profligacy, inefficiency, and tangled and counterproductive incentives, throughout the healthcare system - even in the private sector, whose proponents invariably extol its natural efficiency.

Posted in General Rationing Issues | 2 Comments »

Former CMS Official “Admits” to Covert Rationing

July 16th, 2007 by DrRich

In his forthcoming book, Fixing American Healthcare - Wonkonians, Gekkonians and the Grand Unification Theory of Healthcare, DrRich demonstrates how the imperative to covertly ration healthcare causes payers to bastardize evidence-based medicine. In a recent interview in Health Affairs, Sean Tunis MD, formerly Medical Director for the Centers for Medicare & Medicaid Services (CMS), goes a long way toward admitting this to be the case.

The case in point was a CMS coverage decision that was made in 2003 regarding the expanded usage of the implantable cardioverter defibrillator (ICD). The need for a coverage decision arose because a major randomized clinical trial (MADIT II) had been published demonstrating beyond reasonable doubt that patients with prior heart attacks and compromised cardiac function had significantly better survival if they received ICDs.

To make a long story short, despite incontrovertible scientific evidence that these patients would benefit from ICDs, despite the endorsement of the MADIT II results by professional organizations, despite the fact that most private insurers in the US had already expanded coverage to this new patient group, and despite the fact that CMS’ own advisory panel (hand picked by CMS) voted 7 -0 to expand coverage, CMS declined to do so. (Actually, they expanded coverage to some extent, but not to the extent supported by the evidence.) In making their non-coverage decision, CMS resorted to a particularly “interesting” form of statistical analysis that more objective observers recognized right away as statistical legerdemain.

In the recent Health Affairs interview, Dr. Tunis at last sheds some light into this decision. Cost, and not just scientific evidence, must be taken into account. He says,

“It was well understood by me and others at CMS that ICDs were expensive and that there were a lot of additional people who might be eligible for an ICD, and that added up to a large amount of money. So what does that cause us to do differently than for decisions with less potential financial impact? It causes us to look extremely carefully at data on safety and effectiveness. You might think of this as an upside-down or inside-out variation of a cost-effectiveness analysis in which the evidence threshold for coverage is implicitly adjusted based on a qualitative judgment about the economic impact of the decision.”

“In fact, explicit statements have been repeatedly made by Medicare that cost is not factor in coverage decision making. But my guess is that for anyone who works for a large payer in a policy environment that is increasingly panicked about the cost of health care, it’s easy to imagine how economic impacts could still have subtle and perhaps even unconscious effects on some of the scientific and value judgments that we have been talking about, whether or not these folks are told to ignore costs.”

Allow DrRich to interpret: Because CMS had to take cost into consideration, but at the same time because it is the explicit policy of CMS not to take cost into consideration, their only choice was to twist the science in such a way as to make the coverage decision they had to make because of cost considerations, while “blaming” the decision on the science.

To his credit, in the Health Affairs article Dr. Tunis explicitly decries this sort of covert healthcare rationing as obviously damaging and inefficient, and goes on to endorse a public discussion of rationing, with the aim of making it explicit and therefore less destructive. One suspects, on reading his comments, that a reason Dr. Tunis is no longer with CMS may be to avoid being repeatedly placed in the position of being an agent of covert rationing.

In any case, we see again in the ICD example an instance of the Fourth Corollary of the Grand Unification Theory of Healthcare: Covert rationing corrupts everything it touches. In this case, it corrupts the interpretation of medical science, and renders evidence-based medicine illigitimate. It is very difficult to trust evidence-based policy decisions when the “evidence” is being arbitrated by the payers - those who society has deputized to covertly ration our healthcare.

Posted in Wonkonian Rationing | 2 Comments »