Merrill Goozner is an award-winning journalist and author of “The $800 Million Pill: The Truth Behind the Cost of New Drugs” who writes regularly at Gooznews.com.
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The Food and Drug Administration’s decision this week to reevaluate last year’s politicized decision to approve ReGen Biologic’s knee repair device offers an important lesson about health care reform. Until special interest lobbying is removed from every level of the health care decision-making process, all schemes at controlling costs are chimerical.
At first blush the two issues seem unconnected. After all, getting a new product approved at FDA is a regulatory decision based on science. Is it safe? Is it effective? If the answer to those questions is yes, then the drug, device, imaging system, or diagnostic test will get approved by the FDA.
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However, given the “reasonable and necessary” standard for payment policy at the Centers for Medicare and Medicaid Services, FDA approval usually ensures that the new product will be reimbursed for use by the nation’s seniors. That CMS decision in turn often sets the standard for private insurance companies.
Lobbying takes place at every point along that spectrum. This quote, taken from the New York Times account, says it all:
“We did what people do all the time in Washington: we went to our congressmen, we went to our senators,” said Gerald E. Bisbee Jr., chairman and chief executive of ReGen. What he failed to add was that companies use the same approach to getting reimbursed by CMS — another agency whose decisions ought to be based on science.
Don’t think for a minute that exposure of this unseemly affair will put an end to the lobbying. Over in the Senate Finance Committee yesterday, Sens. Max Baucus and Kent Conrad joined the Republicans in beating back an effort to raise the drug industry price slowing that was announced at the White House earlier this year and incorporated into the Senate bill (I hesitate to write words like reduction or rebates when it comes to the drug pricing deal since it involves a minuscule moderation in the growth of prices over the next ten years, not a decline).
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The paper of record called the Finance Committee vote a win for the White House. When you put another $20 billion into drug firms’ coffers, is it really the politicians who are the primary beneficiaries of the vote?
There are ways to end lobbyists’ influence over health care decision making. An op-ed in the Washington Post by William Brody of the Salk Institute for Biological Studies offers one alternative: creating a Federal Reserve-like body to oversee payment decisions.
But as the FDA ReGen affair warns us, regulatory bodies — even those with the highest internal standards — can be subverted by political leaders intent on meddling in the process. “It’s what we would do for any constituent,” the New Jersey elected leaders whined when asked about their role in the ReGen affair. Until they understand that down that road lies bad science, bad medicine and bad economic policy, there’s no hope of getting health care costs under control.
