Leaders nip, tuck healthcare policy - (Boston Globe - 8/11/08)

August 11, 2008
Limits enacted on drug firm gifts

Governor Deval Patrick yesterday signed into law one of the nation's strictest limits on gifts given to medical professionals by drug salespeople, the most contentious measure contained in a broad package intended to improve healthcare safety and curb skyrocketing costs.

The new law also provides $25 million to promote electronic medical record-keeping in doctors' offices, requires the state university to graduate more primary care doctors, and gives regulators the power to hold hearings when health insurers want to raise premiums.

Critics of the pharmaceutical industry had hoped to ban gift-giving altogether, arguing that the drug company largesse interferes with doctors' judgment in deciding which drugs to prescribe. But the bill that the Legislature sent the governor bans only certain types of gifts such as sports tickets and free travel, and requires that pharmaceutical and medical device-making firms publicly disclose gifts worth more than $50.

"The good news is that it prevents some of the most abusive gift-giving," said Senator Mark Montigny, a New Bedford Democrat who has pushed for years to ban gift-giving. "If I didn't feel that it was beyond a half a loaf of victory, I would not have signed on."

The changes come amid intense focus on the cost and quality of healthcare, which consumes one in every six dollars spent in Massachusetts. Two years ago, landmark legislation required almost everyone in the Commonwealth to have insurance. But the law has been so successful - prompting an estimated 345,000 people statewide to obtain insurance - that it has been far more expensive than expected, forcing Patrick to sign a bill last week raising more than $100 million in state funds and fees on private companies to help foot the bill.

Patrick's Human Services Secretary JudyAnn Bigby said that while universal health insurance is an important goal, the current system is lacking if everyone cannot get access to quality care, or premiums and out-of-pocket costs become too costly for patients.

"We have to make sure that people have access to high quality care and that we are being efficient in the way we pay for that care and that we are paying for the right things," Bigby said in an interview. The law Patrick signed yesterday "puts the challenge to those of us who have to implement it to do more planning."

The new law, based on legislation championed by Senate President Therese Murray of Plymouth, contains several initiatives intended to increase the number of primary-care doctors, who make the initial decisions as to how patients will be cared for. Although Massachusetts has the most primary-care doctors per capita in the country, Bigby said there is evidence that there aren't enough to handle the workload, especially as the number of people covered by insurance swells.

In response, the law directs the University of Massachusetts Medical School in Worcester to increase class size so that it can graduate more primary care doctors, Bigby said. In addition, the law calls for better training of primary care doctors and aids some of them in repaying medical school loans.

The law also establishes an institute to award grants to doctors and hospitals seeking to increase their use of computer technology. Electronic medical records systems typically cost $30,000 or more, which has slowed the healthcare industry's adoption of technology that most people agree improves both safety and efficiency.

In addition, the law gives the state more oversight of health insurance rates than regulators have had in more than a decade. Now, both the Division of Insurance and an office under Bigby's control can require health insurers to publicly justify rate increases.

But the limits on drug industry gift-giving drew the most attention.

Montigny had hoped that, after failing twice, he might succeed in banning gift-giving between salespeople and healthcare professionals altogether. However, representatives of the drug and medical device industry successfully argued that the measure went too far, potentially banning money paid to doctors and hospitals to conduct medical research. Though the Senate passed the full ban, the House backed only restrictions.

Still, the limits in the law put Massachusetts at the forefront of states in cracking down on the use of financial incentives to persuade doctors to prescribe particular drugs or medical devices. In addition to banning some gifts and requiring disclosure of others, it calls for the state to develop a code of conduct for industry representatives that includes a $5,000 fine for each violation.

"I commend the governor for standing firmly on the side of the patient and the taxpayer," said Montigny.

But the pharmaceutical industry's trade group, called PhRMA, said state leaders could one day regret the limits, especially the public disclosure of gifts. The group said in a statement that researchers could be discouraged from doing important drug research if they fear their research grant will be put on a public list of gifts from industry.

"Governor Patrick's decision to sign [the limit on gift-giving] is deeply disappointing - and very likely damaging for medical partnerships, clinical research, and patients in Massachusetts," said PhRMA senior vice president Ken Johnson.

Scott Allen - Globe Staff


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