Michael O'Neal buys drugs for a living -- and too often these days, he's forced to do it on the "Gray Market." Like most pharmacists charged with stocking an entire hospital, O'Neal prefers to conduct his official business for Vanderbilt University Medical Center through big-name distributors. But there are days when his "back's against the wall," O'Neal said -- when official supply chains run dry for all kinds of drugs -- from the "bread-and-butter variety" used every day in hospitals to specialty medication for cancer treatment. On those days, O'Neal resorts to haggling on the little-known sector of the health care economy that's only a slight shade more legal than the black market. The gray market is an expanding world fueled by a deepening drug-shortage crisis in which secondary retailers buy up medication outside of the normal, tightly controlled pharmaceutical distribution channels and then sell their stockpiled supplies to desperate pharmacists and hospitals at exorbitant mark-ups. High blood pressure medication that normally costs $25.90, for example, can go for $1,200 -- a mark-up of 4,533%.
The number of medications on the Food and Drug Administration's shortage list keeps growing. And while calcium chloride and potassium phosphate aren't drug names the average American would recognize, they're critical to patients visiting the emergency room every day. "It seems more and more frequently that we're being alerted to some shortage of a medication that really has been a staple in the emergency department," according to Dr. Bill Frohna, the chairman of Emergency Medicine at Washington Hospital Center. The shortage hasn't yet adversely effected patients at his hospital, the largest private hospital in Washington, D.C. But, like nearly every other hospital in the United States, it's struggling to come up with workarounds for the shortage list.
At 8:30 a.m. Sunday, power went out at Johnson Memorial Medical Center. Normally this wouldn't be a problem. Power comes from two Connecticut Light & Power Co. sources -- one in Stafford, one in Somers. But Sunday, power feeds on both sides of the hill where the hospital is located failed, and the approaching Tropical Storm Irene kept utility workers from getting there to fix the problem. It was the first event in a day that would end with a full evacuation of the hospital, an unprecedented move that took 4 1/2 hours and relied on the cooperation of several area hospitals, state officials, and emergency workers in surrounding towns. Transporting all 43 patients -- a logistically and emotionally fraught process -- took the efforts of 23 ambulances, some from as far as New Haven, most making two trips each. Patients were taken to St. Francis Hospital and Medical Center in Hartford and Hartford Hospital, as well as hospitals and health centers in Manchester, Vernon, New Britain and Hebron. As at other Connecticut hospitals, officials and staff at Johnson Memorial spent much of last week preparing for Hurricane Irene. They made sure that there were enough medical supplies and food, arranged for extra staff and tested the generator. None of which was enough Sunday. Ten seconds after power went out, the hospital's generator took over, and operations continued as normal until 3:30 p.m. That's when the generator failed.
Healthcare is facing an economic bubble similar to the one the housing industry experienced a few years ago, said Nathan Kaufman, a nationally known expert on healthcare strategies. As healthcare costs continue to rise, more people, companies and the government can't afford the costs, and the impact falls on physicians and hospitals, Mr. Kaufman said. He believes the Patient Protection and Affordable Care Act will accelerate the healthcare crisis rather than solve it since it promises benefits that the government can't afford. Kaufman, managing director and founder of San Diego, CA-based Kaufman Strategic Advisors, predicts more companies will follow Verizon and propose to charge employees more for health insurance. Verizon spends $4 billion annually to cover about 800,000 employees, retirees and their families. The issue was one reason 45,000 Verizon workers throughout the East Coast picketed in a 15-day strike. "From 2001-2011, the total cost of delivering healthcare to a family of four has doubled. More and more companies can't afford the premiums and higher deductibles for their employees. Employees can't afford the deductibles," Kaufman said. "People think this problem is primarily related to the uninsured, but it isn't. In 2007, 64% of all personal bankruptcies were related to unpaid health care bills and 75% of those people had health insurance."
Partners HealthCare System Inc. reported substantially higher earnings yesterday for the three months ended June 30, crediting better investment performance, research revenue increases, and modest growth in patient discharges at its chain of Boston-area hospitals. Third-quarter net income was $51.7 million, compared to a $4.8 million loss in the same period last year, when Boston-based Partners suffered from a decline in the value of its interest-rate swaps, financial hedges it bought to lock in future rates for debt financing. This year, Partners, the region's largest hospital and doctors network, posted an operating margin -- the difference between its revenues and expenses -- of 3.8% in the April-to-June quarter, up from 2.7% in the corresponding quarter last year. But Partners' vice president of finance, Peter K. Markell, said he expects growth to slow in the fourth quarter, and Partners to register a full-year margin close to last year's 2.4%.
While we have yet to reach the holy grail of converting free text to structured data in an electronic health record, natural language processing is beginning to show real promise in healthcare. The latest indication of this is a study showing that the application of NLP to free text in an EHR identifies postsurgical complications more accurately than the analysis of discharge billing codes. The study in the Journal of the American Medical Association compared the NLP method to the use of administrative data in the Veterans Affairs Surgical Quality Improvement Program. The study population is a randomly selected sample of nearly 3,000 patients treated at six VA hospitals between 1999 and 2006. The researchers focused on six post-operative complications that the VASQIP nurse reviewers had searched for using patient safety indicators based on billing codes. These included acute renal failure requiring dialysis, sepsis, deep vein thrombosis, pulmonary embolism, myocardial infarction, and pneumonia. The results showed that NLP was more sensitive in detecting all but one of the complications. On the other hand, NLP had somewhat lower specificity when compared to using administrative codes. (The more specific an assessment tool is, the better able it is to rule out the existence of a complication that doesn't really exist.)