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Teaching Hospital Update October 4-8, 2010

By Todd Wojtowicz and Leah Voigt*

Cash-Strapped States Target Residency Programs for Cuts

Maricopa Integrated Health System (MIHS) in Phoenix needs to grow its residency program. Arizona has a shortage of physicians, and more young doctors are seeking training opportunities with the expansion of area medical schools. But like other states across the United States, Arizona is facing tough economic times. Legislators cut more than fourteen million dollars in graduate medical education (GME) funding statewide, meaning a loss of nearly sixty-five million dollars with federal matching funds. That forced MIHS to come up with the two million dollars usually paid by the state to maintain its $2-to-$1 federal match for Medicaid GME funding.

Arizona is one of many states targeting GME as a place to trim their budgets. As a result, academic health centers nationwide are scrambling to cut costs or find new funding sources to maintain their residency programs at a time when, they say, they need to be expanding them instead. "It's very hard to deal with the needs that academic centers and residency programs see out there, needs that they want to address but that they cannot," said the president-elect of the American Academy of Family Physicians (AAFP).

Medical school enrollment has climbed 2% annually during the past five years due to new medical schools and expansion of existing medical schools. But the number of residency slots funded by Medicare has been capped at 100,000 since 1997. "The cap was put in place because at the time we thought we would have too many physicians. Obviously that hasn't proven to be true," the president-elect of AAFP said.

GME funding varies nationwide. In addition to Medicare, states may provide direct payments for residency programs or get a federal match through Medicaid, the second-largest funding source for GME. Some states cut Medicaid GME funds before the economy went sour, said the director of federal affairs for the Association of American Medical Colleges (AAMC). Forty-one states and the District of Columbia provided some Medicaid support for GME in 2009, down from forty-seven states in 2005, according to an AAMC survey released this year. Five states, Massachusetts, Montana, Rhode Island, Vermont, and Wyoming, have stopped Medicaid GME funding within the past five years, costing academic medical centers millions.

Carolyne Krupa, Cash-strapped States Target Residency Programs for Cuts,, Am. Med. News (Oct. 4, 2010).

Two Vaccines Equal Lower Risk of Death, Disease

In older people with chronic disease, giving vaccines against both pneumococcal disease and influenza can markedly reduce their risk of death, as well as other adverse events, researchers said. In a prospective cohort study, outpatients sixty-five and older who got both vaccines saw their risk of death within the study period fall 35% compared with those who got neither, according to a physician at the University of Hong Kong and colleagues.

The researchers also saw reductions in pneumonia, ischemic stroke, and acute myocardial infarction (AMI), as reported online in Clinical Infectious Diseases. There is good evidence that the annual trivalent flu vaccine prevents influenza and pneumonia among those sixty-five and older, the researchers noted, although the evidence that the twenty-three-valent pneumococcal vaccine reduces the risk of pneumonia and death is "less robust."

To test the issue, the researchers offered the two vaccines to all outpatients with a chronic illness (ranging from asthma to malignancy) in one of Hong Kong's health regions from December 3, 2007, through June 30, 2008. Those who refused both were recruited into one of three control groups, those getting just the flu vaccine, those who took just the pneumococcal vaccine, and those who refused any vaccination. 7,292 volunteers received both immunizations, 2,076 got just a flu shot, 1,875 got only the pneumococcal vaccine, and 25,393 were unvaccinated, the researchers reported.

At week sixty-four, they found that, compared with the unvaccinated group, those getting both vaccines had a 35% reduction in the risk of death following the outcome diagnosis and those who got the flu vaccine had a 22% reduction. They also found that those getting both vaccines had fewer hospital admissions for pneumonia, ischemic stroke, and AMI.

Michael Smith, Two Vaccines Equal Lower Risk of Death, Disease, MedPage Today (Oct. 7, 2010).

FDA Plans to Collaborate with Outside Researchers to Improve Food and Drug Science

The Food and Drug Administration (FDA) must update its scientific tools for reviewing prescription drugs, medical devices, and tracking food safety, according to a research plan laid out Wednesday by agency leadership. FDA Commissioner Margaret Hamburg said the agency will spend twenty-five million dollars in the coming year on collaborations with outside scientists from academia, government, and industry. In a speech at the National Press Club, Hamburg said that improved scientific standards will help speed up the approval of important new products and spot safety problems sooner.

FDA is looking to collaborate on a host of projects, including efforts to predict the side effects of drugs based on the genetic code of individual patients, to reduce or eliminate drug testing on animals and to prevent the spread of salmonella and other bacteria in the food supply. Modernization is a perennial theme for FDA leadership as the agency struggles to keep up with the evolving science behind the latest drugs, devices, and even foods. Last month the agency held a three-day meeting on the safety of a genetically modified salmon that grows twice as fast as the naturally bred fish.

But federal funding for the agency traditionally has lagged behind the agency's budget requests, giving rise to a series of user fee programs in which drugmakers and medical device makers help pay for the agency's review of their products. The twenty-five million dollars investment cited by Hamburg is part of the administration's proposed four billion dollar budget for fiscal year 2011, which began October 1.

Congressional lawmakers recently passed a resolution that will continue to fund agencies at 2010 levels, after failing to pass fiscal 2011 appropriations before returning home to campaign. If Republicans regain control of the House in November, the FDA's Obama-appointed leadership could face an even tougher time securing funding increases for the agency. But Hamburg said Wednesday FDA's mission of protecting public health should make it a priority no matter which party controls Congress.

Matthew Perrone, FDA Plans to Collaborate with Outside Researchers to Improve Food and Drug Science, L.A. Times (Oct. 6, 2010).

One in Five Adults Has Arthritis

Almost fifty million Americans, 22.2% of adults eighteen and older, have physician-diagnosed arthritis, a total that's expected to rise in the coming decades, according to the Centers for Disease Control and Prevention (CDC). Of those, one in ten report having activity limitations related to their arthritis, the agency reported in the October 8, 2010, issue of Morbidity and Mortality Weekly Report.

To estimate the prevalence of arthritis, which is on the increase because of the aging of the population and the high rates of obesity and other risk factors, CDC investigators analyzed data from the National Health Interview Survey for the years 2007 through 2009. More than 20,000 people were included for each of the three years. Respondents were classified as having arthritis if they said they had ever been told by a physician that they had arthritis or another related condition such as gout or lupus.

The CDC analysts found that women were more likely to report having a diagnosis of arthritis than men (24.3% versus 18.2%), and that the obese are more likely to have the condition than those of normal weight (29.6% versus 16.9%).

After adjustment for age, the prevalence of arthritis-related activity limitations were highest for those whose body mass index (BMI) was above forty (52.9%), those with low education levels (52%), the inactive (51.2%), smokers (47.6%), and non-Hispanic blacks (45.5%). The prevalence of arthritis rose with increasing BMI, according to the investigators, with the age-adjusted prevalence doubling in the obese (25.2% among men, 33.8% in women) compared with those who were normal or underweight (13.8% for men, 18.9% for women).

An editorial note accompanying the report emphasized the importance of obesity in the growing public health problem of arthritis. Even small amounts of weight loss, ten pounds or so, can cut the risk of knee osteoarthritis, particularly among women, so efforts to treat and prevent obesity could help ease the burden of arthritis on both individuals and the population at large, according to the editorial writers.

Nancy Walsh, One in Five Adults Has Arthritis, MedPage Today (Oct. 7, 2010)

Using CER to Set Medicare Payments Could Save Billions, Researchers Say

Using comparative effectiveness research (CER) to determine how much to pay for newly covered Medicare services could yield billions of dollars in savings without threatening patient choice, according to researchers who spoke this week during a briefing sponsored by the journal Health Affairs.

Using CER would help Medicare "shift to a more sustainable path," said one of the researchers from Harvard Medical School. Currently, Medicare reimburses providers or manufacturers for costs of care plus some profit. This "cost-plus pricing system is obsolete and even harmful," he said. The article, "How Medicare Could Use Comparative Effectiveness Research in Deciding Coverage and Reimbursement," was published in the October issue of Health Affairs.

When a new service or treatment lacked any comparative evidence, Medicare would set a tentative payment while research on the intervention's effectiveness was carried out, the article said. After three years, if there was no clear evidence that the new service had a clinical advantage over an alternative intervention, Medicare could re-evaluate what it would pay for the service. Researchers said this "dynamic pricing" model could save Medicare billions of dollars over time and would prevent the program from being "trapped" into paying more than was warranted for interventions. However, they said there are several challenges to advancing their model. It would require new legislation, and would undoubtedly be highly contested by those with a vested interest in keeping the status quo, they said.

The National Institute for Health Care Reform (NIHCR) also released this week a separate policy analysis, which says that CER can help foster beneficial medical innovation. Written by researchers at the Center for Studying Health System Change (HSC) and Mathematica Policy Research, the analysis identifies key policy considerations to help ensure that CER encourages beneficial innovation while strengthening the evidence base for medical decisions.

"A major goal of CER is to encourage the use of effective therapies and discourage ineffective therapies. By promoting effective therapies, CER stands to increase the rewards and incentives for beneficial innovations in medical care. However, CER could dampen development of new, potentially effective therapies by creating additional hurdles for innovators," according to the analysis. The analysis suggests that policymakers consider a number of priority areas when crafting an overall strategy that optimizes the influence of CER on innovation, including the role of policy in promoting societal priorities, setting consistent evidence standards, encouraging providers and patients to participate in CER studies, and supporting personalized medicine.

Bronwyn Mixter, Using CER to Set Medicare Payments Could Save Billions, BNA's Health Care Daily Report (Oct. 6, 2010) (note: registration is required to view this content).

AHLA Teaching Hospital Updates are intended to provide quick summaries of cutting-edge issues of interest to teaching hospitals and their counsel. Additional information and more in-depth coverage on these topics may be available from AHLA Health Lawyers weekly and appropriate AHLA Practice Groups.

*We would like to thank Todd Wojtowicz, Esquire (MedAssurant Inc., Bowie, MD), and Leah Voigt, Esquire (Squire Sanders & Dempsey LLP, Washington, DC), for providing this week's update.

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