Big Door Keep Revolving - Our Latest Roundup About the Blurred Lines Between the Health Care Industry and the Government Bodies that are Supposed to Regulate and Make Policy Affecting It

The revolving door continues to turn connecting US government bodies that make health policy or regulate health care and the health care industry.  Sometimes these transitions are obvious, sometimes they are obscure.  The press sometimes makes the revolving door the subject, but more often it is just an aside.

The latest roundup of transitions through the door includes, in chronological order of media attention...

Former White House Press Secretary to Consultancy Serving Health Care Corporations

As reported by the Washington Post in April, 2014, Robert Gibbs was White House Press Secretary until he departed for the private sector,

Since departing the White House in 2011, Gibbs has taken a path familiar to other former White House officials who use their ties to a president to enrich themselves and establish a new career. 

In particular, he

co-founded The Incite Agency, a consulting and media relations firm that advises Fortune 500 companies, including health-care firms.

The story was apparently generated after the Democratic House Minority Leader openly criticized someone who served in the Democratic President's White House, so the thrust of the story was about how Mr Gibbs has apparently changed his ideas on Obamacare since his White House days,

House Minority Leader Nancy Pelosi (D-Calif.) suggested Sunday that former top Obama aide Robert Gibbs's comment that the employer mandate portion of the Affordable Care Act won't survive might be related to Gibbs's business interests.

'I don't know who his clients are or what his perspective is,' Pelosi told CNN's 'State of the Union.' 'But we are celebrating the fact that we have over seven million who have signed up.'

The Post also noted,

The speech Gibbs gave this past week in Colorado is consistent with how the Harry Walker Agency bills Gibbs as a potential paid speaker. On its Web site, pitches Gibbs by noting that he 'played a major role in the daily White House policy debates over the shape of healthcare reform.' It suggests that during such speeches, Gibbs 'articulates the future for the Patient Protection and Affordable Care Act.'

The pitch concludes by stating that 'The future of Obamacare -- and how it will affect your business -- is yet to be seen, and few are better prepared than Gibbs to guide you through that conversation.'

Again, note that this article seemed to be inspired by Rep Pelosi's direct criticism of a fellow Democrat, not by the revolving door transition per se.  

President of Global Government and Scientific Affairs at Natural Products Association to Director of the Division of Dietary Supplements at the FDA then Back to Natural Products Association as CEO

This round trip through the door was noted rather obliquely in a New York Times article in late April, 2014, focused on how slowly the FDA has reacted to apparently dangerous "dietary supplements,"

Before joining the F.D.A. in 2011, Dr. [Daniel] Fabricant was a top executive at an industry trade group, the Natural Products Association.

The article had previously identified Dr Fabricant as

the director of the division of dietary supplement programs in the agency’s Center for Food Safety and Applied Nutrition.

But,

The F.D.A. recently announced that Dr. Fabricant is leaving the agency this month to return to the trade group as its chief executive.

While the NY Times article thus mentioned as an aside that a government official with major responsibility for regulating dietary supplements had these relationships with the dietary supplement industry, it did not question whether that relationship had anything to do with slow responses by the FDA to reports of toxic dietary supplements. 

Spokesman for the Speaker of the House of Representatives to Spokesman for America's Health Insurance Plans

USA Today briefly but directly noted this in mid-May, 2014,

House Speaker John Boehner’s spokesman, Brendan Buck, has spent a lot of time over the years helping his boss and congressional Republicans criticize President Obama’s health care law.

Now Buck is leaving Capitol Hill to be spokesman for America’s Health Insurance Plans, the trade association that represents thousands of health insurance companies.

'Brendan’s experience and skill set will allow him to hit the ground running on Day One,' said Karen Ignagni, president and CEO of AHIP. 'He’s an effective communicator who knows how to tackle complex policy issues and skillfully navigate an ever-changing health care and media environment.'

What made this interesting seems to be how it represented a change of tune on Mr Buck's part.  Note that many people believe that commercial health insurers will benefit from all the new policy holders that Obamacare sends them, so

As the health insurance  industry’s trade group, AHIP supports the law’s mandate that individuals obtain health insurance. The trade group has praised the Affordable Care Act’s ability to expand insurance coverage.

But never mind that the man in the government for whom Mr Buck previously worked,

Boehner likes to call Obamacare a 'train wreck.'

FDA Director of the Office of Medical Policy for the Center for Drug Evaluation and Research to Greenleaf Health Consultancy

This so far has appeared only in a mid-May, 2014,  press release.   It describe Dr Sherman's career at the FDA,

During her FDA tenure, Sherman was a driving force for innovation, new programs and policy. Sherman was responsible for spearheading and implementing the Sentinel Initiative, the Critical Path Initiative, biosimilars policy and the new Breakthrough Therapy Designation.

As Director of CDER’s Office of Medical Policy and Associate Center Director for Medical Policy Sherman was responsible for developing, coordinating, and implementing medical policy programs and strategic initiatives as well as establishing and chairing CDER's Medical Policy Counsel [sic]. This included overseeing the regulation of prescription drug promotion and advertising.

Sherman began her career with FDA in the Division of Antiviral Drug Products at CDER in 1989—first as a medical reviewer and then as a clinical team leader. In 1998, she was appointed Deputy Office Director for the Office of Drug Evaluation I. In 1999, she assumed the duties of Deputy Office Director for the newly established Office of Medical Policy in CDER. 

But now she will be "Principal, Drug and Biological Drug Products" for Greenleaf, described as,

Greenleaf Health is a full service regulatory consulting firm that provides strategic guidance to companies regulated by the FDA and those developing innovative solutions to pressing public health challenges around the globe

Note that Greenleaf was already well populated with FDA officials who had previously transited the big revolving door,

Patrick Ronan, former FDA Chief of Staff and currently president of Greenleaf; Dr. Daniel Schultz, former Director of the Center for Devices ('CDRH') and Radiological Health and currently Greenleaf's Principal for Medical Devices and Combination Products; Michael Chappell, former Associate Commissioner for Regulatory Affairs, and currently Greenleaf's Principal for Regulatory Compliance; Heather Rosecrans, former Director of CDRH's 510(k) staff and currently Senior Vice President for Medical Devices and Combination Products; Linda Carter, formerly Associate Director of CDER's Office of Evaluation I and currently Vice President of Drug and Biological Drugs; and Taryn Fritz Walpole, former FDA Deputy Chief of Staff, and currently Chief Operating Officer and Senior Vice President for Regulatory Affairs

So maybe it has become so routine for middle and upper level FDA managers to go to work for consultancies that help industry to deal with the FDA that no journalist found this revolving door transition interesting.

Summary

Again, there appears to be constant traffic among health care corporations and the government bodies that regulate them and make policy that affects them.  The traffic may be so heavy and routine that it no longer appears to be news, unless accompanied by an ironic detail or two.

However, as we have said many times before, the constant interchange of health care insiders among government, large health care corporations, and the consultancies, marketing, public relations, lobbying and legal firms which represent them certainly suggests that health care, like many other sectors, seems to be run by an amorphous group of insiders who owe allegiance neither to government nor industry.

However, those who work in government are supposed to be working for the people, and those who work on health care within government are supposed to be working for patients' and the public health.  If they are constantly looking over their shoulders at potential private employers who might offer big checks, who indeed are they working for?

Attempts to turn government toward private gain and away from being of the people, by the people, and for the people have no doubt been going on since the beginning of government (and since the Constitution was signed, in the case of the US).  However, true health care reform  would require curtailing the severe sorts of conflicts of interest created by the revolving door.

Real heath care reform would require multi-year cooling off periods before someone who worked in the commercial world can get a job in a government whose work has direct effect on his or her previous employer or industry sector, and before someone who worked in government whose work had direct effect on a particular economic sector can accept a job for a company in that sector.   

As the Door Turns - The Ongoing Interchange of Leaders Among Large Health Care Corporations, Those who Represent Them, and Government

The revolving door is the two-way conduit between leadership positions in government and industry that helps to enable health care, and maybe all of society, to be run by a group of insiders who can move easily between large or influential health care organizations and the government bodies that are supposed to regulate, oversee, and enforce laws relevant to them.

It has been three months since our last update on the revolving door as it applies to health care, so here is our latest effort, according to the chronological order of the initial media coverage. 

Foundation Leader with Ties to Eli Lilly and to Former Synthes CEO to the White House

As reported by the New York Times in December, 2013, new White House senior adviser John D Podesta, who founded and ran the nominally non-profit organization Center for American Progress, had multiple ties to health care corporations and their leaders, e.g., to pharmaceutical maker Eli Lilly,

The pharmaceutical giant Eli Lilly was also a donor because of what it said was the Center for American Progress’s advocacy for patients’ rights — and just as the debate heated up in Washington over potential cuts to the Medicare program that covers Lilly’s most profitable drugs.

Although, for the record,

Neera Tanden, the president of the Center for American Progress, said in an interview that the group frequently takes positions that conflict with the corporate agendas of its donors, including companies like Eli Lilly. 

Also an important but somewhat less obvious linkage was described thus by the Times, 

 In addition, he earned $90,000 as a consultant to the HJW Foundation of West Chester, Pa, according to an aide working with him on the disclosure report he is preparing. HJW is a nonprofit group run by Hansjörg Wyss, a billionaire businessman and major contributor to the Center for American Progress.

What the Times did not say about Mr Wyss was that he is the former CEO of Synthes, a Swiss based medical device company, since merged into Johnson and Johnson   As we wrote in 2011,

 Synthes USA, the American branch of a Swiss based device company, first settled charges that it had been paying surgeons with company stock to use its products in its clinical trials in 2009 (see this post).  Then prosecutors alleged that these were not really rigorous trials. Instead, for marketing purposes, executives of Synthes subsidiary Norian persuaded surgeons to use its Norian XR product in a case series of spine surgery patients and then publish the results.  Three patients who received the product for this 'off-label' use died.  This scheme was alleged to have been directed by "person no. 7," whom journalists identified as the company CEO, Hansjorg Wyss (see post here.)   In an unusual move, the prosecutors indicted four company executives, who then pleaded guilty.  They did not take any further action against Wyss, who turns out to be one of the world's richest men (see post here).

However, at the time the former executives were sentenced, one of the executive's attorney's claimed,

Wyss was the undisputed leader of the company. 'He made some of the very critical decisions that put the trials on the ultimate pathway,' Gurney said. 'The culture of an organization is set at the top.'

Former Deputy White House Press Secretary to Global Strategy Group, Whose Clients Include Pfizer, Purdue Pharma, and WellPoint

As reported by the National Journal in December, 2013,

Bill Burton
Old gig: Deputy White House press secretary
New gig: Formed and ran Priorities USA Action, a super PAC that raked in more than $75 million during the 2012 campaign; recently joined the public affairs firm Global Strategy Group as a managing director. Clients include GE, Cisco, American Express, Comcast, and Pfizer.

Other health care clients include health insurance company Empire BCBS, pharmaceutical company Purdue Pharma, and for-profit health insurance company WellPoint

Former National Health Information Technology Coordinator to Get Real Health

As reported by Government HealthIT in February, 2014,

Three months after leaving the federal government, [former National Coordinator for Health Information Technology] Farzad Mostashari, MD, is joining the board of directors at the patient engagement company Get Real Health.

The big-thinking, bow-tied public health veteran is currently studying accountable care policies full-time at the Brookings Institution, and said he’s joining the Get Real Health board to help it '‘stay’ real as it innovates and serves patients and providers.'

The Rockville, Maryland-based company was founded in 2000, starting out as a connected health consulting outfit and then, after working with Microsoft’s HealthVault in 2007, launching its own health technology in 2012, the InstantPHR patient engagement platform.

From CareScience Inc to National Coordinator for Health Information Technology to Health Evolution Partners

The article about Dr Mostashari also mentioned in passing a more complicated set of transitions involving an earlier national coordinator for health care information technology.   

Mostashari is not the only former national coordinators to step into the health IT private sector after federal service. David Brailer, MD, the first appointee to the role of the national coordinator for health IT, is now running the San Francisco private equity firm Health Evolution Partners.

But in fact, according to his rather glowing Wikipedia entry, Dr Brailer also came from the commercial health care IT industry,

 In 1992, Brailer left academia and founded a company spun out of his Ph.D. thesis, inventing ways to measure health-care quality. This became CareScience Inc., a Philadelphia software firm that helped hospitals improve efficiency and prevent errors. Under Brailer, CareScience established the nation's first health care Application Service Provider (ASP). Brailer led the company through several financings, strategic partnerships, an initial public offering in 2000, and sale to global software firm Quovadx in 2003.

Then, in 2004,

Brailer was appointed as the first National Health Information Technology Coordinator, pursuant to an executive order by President George W. Bush on April 27, 2004, which called for widespread deployment of health information technology within 10 years.

According to his Health Evolution Partners biography, Dr Brailer is also now a member of the boards of directors of American Optical Services, CenseoHealth, Optimal Radiology, and Walgreen Co.

From Aide to Congressman Young to a Lobbying Firm with Health Care Clients Then to Congress

According to the Tampa Bay Times, yesterday Republican David Jolly won a special election to a congressional seat for Florida.  The article noted that Mr Jolly was "once an obscure aide to the late Republican U.S. Rep. C.W. Bill Young and then a Washington lobbyist,..."

His past work was described in more detail in a post on the Republic Report blog,

David Jolly, the Republican congressional candidate vying for the special election in Florida next week, has not only made a career out of lobbying. Records reviewed by Republic Report show that Jolly’s clients won millions of dollars in taxpayer earmarks from his old boss, the late Rep. C.W. 'Bill' Young (R-FL), an appropriator known for his lavish use of the earmarking process. 

Futhermore,

Two of the firms that hired Jolly as a lobbyist - BayCare Health Systems and Alakai Defense Systmes - won lucrative earmarks from Young while paying Jolly to influence the committee where Young was a senior member.

In 2009, BayCare Health Sytems retained Jolly and another former Young staffer named Douglas Gregory.  Later that year, Young secured a $1 million earmark for BayCare Health Systems for 'facilities and improvements.'

Summary

Note that the revolving door does not seem to discriminate according to political party or ideology.  The cases above involved both Republicans and Democrats. But the revolving door does discriminate against the not well connected, because it seems to provided preferred posts in the upper echelons of government for industry insiders, and preferred posts in the upper echelons of industry for government insiders. 

As we have said many times before, the constant interchange of health care insiders among government, large health care corporations, and the lobbying and legal firms which represent them certainly suggests that health care, like many other sectors, seems to be run by an amorphous group of insiders who owe allegiance neither to government nor industry.

However, those who work in government are supposed to be working for the people, and those who work on health care within government are supposed to be working for patients' and the public health.  If they are constantly looking over their shoulders at potential private employers who might offer big checks, who indeed are they working for?

Attempts to turn government toward private gain and away from being of the people, by the people, and for the people have no doubt been going on since the beginning of government (and since the Constitution was signed, in the case of the US).  However, true health care reform  would require curtailing the severe sorts of conflicts of interest created by the revolving door.

Real heath care reform would require  multiyear cooling off periods before someone who worked in the commercial world can get a job in a government whose work has direct effect on his or her previous employer or industry sector, and before someone who worked in government whose work had direct effect on a particular economic sector can accept a job for a company in that sector.   

Another Revolving Door Variant: From Academia with Millions in Medtronic Royalties, to the White House, to the Health Care Service Corp

The revolving door spins, and where it will stop, nobody knows...

In October, 2010, we noted questions about how Dr Stephen Ondra got to be a Senior Policy Adviser for the US Department of Veterans Affairs. A veteran who was a neurosurgery professor at Northwestern University, Dr Ondra had received millions of dollars in royalties from device manufacturer Medtronic, whose CEO supported his appointment to the government position  (see this post).  As soon as he was appointed, he publicly opposed a nominee for US Surgeon General who had been critical of the medical device industry, and its financial ties to doctors.

After going to Washington, Dr Ondra apparently also served in the Executive Office of the President, in the White House, but returned to Northwestern University in 2012.  However, he did not stay there for long.

This month, a post on Forbes indicated he is moving on again, and back to the corporate side of health care.

the nation’s fourth-largest health insurance company is naming a key former health advisor to President Obama as its top doctor.

Dr. Stephen Ondra, will become senior vice president and chief medical officer at Health Care Service Corp., the Chicago-based parent company of Blue Cross plans in Illinois, Texas, Oklahoma and New Mexico. The plan has more than 13 million health plan members and is looking to grow even more, announcing last year a proposed partnership with the Blue Cross plan in Montana.

Health Care Service Corp is a mutual insurance company, that is, a company owned by its policy-holders rather than stock holders.  However, that does apparently not make it any more ascetic than a typical for-profit insurance company, at least in terms of generosity towards its top hired executives.  As Crain's Chicago Business reported in 2012,

New federal regulations intended to force health insurers to spend less on administration didn't keep the parent of Blue Cross & Blue Shield of Illinois from paying CEO Patricia Hemingway Hall more than $12.9 million in 2011, a 61 percent raise.

The Health Care Service Corp. chief executive's total compensation last year dwarfed the $8 million she received in 2010, according to a filing with the Illinois Department of Insurance. The 2011 increase was fueled by an $11.8 million bonus, which was 69 percent above her 2010 bonus of $7 million.

Ms. Hall wasn't alone in getting a big raise at Health Care Service, whose insurance business booked net income of more than $1 billion in 2011, for the second straight year.

The 10 highest-paid executives at the Chicago-based mutual company — which operates Blue Cross plans in Illinois and three other states — earned a collective $41.7 million, 65 percent more than the $25.3 million they were paid in 2010.

 If Dr Ondra's new position puts him among the latter group of executives, he too stands to make millions a year. 

So to recap Dr Ondra's career so far, in 2010 he was a medical school professor who had earned millions in royalties from Medtronic.  He then went to top leadership positions in the US Veterans Department and Executive Office of the President.  He returned briefly to Northwestern University, only to leave again for a top executive position in for-profit insurance company Health Care Service Corp, where he is likely to make millions more.

Thus Dr Ondra is our latest interesting example of the "revolving door" phenomenon in health care.  He started as an erstwhile academic physician but with a very major financial relationship with a medical device company.  He then went through the door the first time into the US government, and then a second time from the government to a for-profit insurance company, with just a brief stop-over in academia.

By the way, it appears that all of this is quite legal.  It does again raise questions about whether health care leaders in government with previous relationships with industry might still feel undue sympathy to the interests of industry, as might government leaders who can expect future jobs in industry.

Moreover, this case, like previous cases we have discussed,  indicates how leadership in academic health care, corporate health care, and the government tend to blend together.  Leaders of one type of organization have more and more in common with leaders of the other types of organizations than they do with their lesser ranked colleagues, and certainly than with other health care constituencies.  So the more the revolving door revolves, the more we wonder about the corporatism of health care, about how health care seems to be increasingly run by an amorphous group of academic/ corporate/ government leaders whose loyalties may be more to each other than to academic and professional values, patients' and the public's health, and government of, by and for the people.