Move Along, People, Move Along: There’s No Health Care Corruption to See Here

By Roy M. Poses, MD, Clinical Associate Professor of Medicine at Brown Univerity. Originally posted in Health Care Renewal.

Health care corruption, remains a largely taboo topic, especially when it occurs in developed countries like the US. Searching PubMed or major medical and health care journals at best will reveal a few articles on health care corruption, nearly all about corruption somewhere else than the authors’ countries, usually in someplace much poorer. While the media may publish stories about issues related to health care corruption, they are almost never so labelled.

Yet Transparency International’s report on global health care corruption suggested it occurs in all countries. A recent TI survey showed that 43% of US citizens believe the country has a health care corruption problem (look here).

In the last few weeks, there have been two major US news stories that seem to clearly involve allegations of health care corruption, but not in so many words. Both were big because the indicted were sitting governors of big US states.

Governor Rick Perry (Republican – Texas) Indicted for Abuse of Power

The biggest story seems to be the indictment of Rick Perry, the Republican Governor of Texas. Here is a summary from the Washington Post,

A grand jury indicted Texas Gov. Rick Perry (R) on two felony counts Friday, alleging that he abused his office and used a veto threat to coerce an elected district attorney to resign.

The grand jury began considering charges against Perry earlier this year following an ethics complaint alleging that he abused his veto power when he cut funding for the state’s anti-corruption unit, which is part of the Travis County district attorney’s office.

He had called on Rosemary Lehmberg (D), the district attorney for Travis County, which includes Austin, the state capital, to step down after she was arrested in April 2013 for drunken driving. Lehmberg pleaded guilty to driving while intoxicated — an open bottle of vodka was found in her car — and was sentenced to 45 days in jail.

Perry threatened to veto $7.5 million in state funding for her office unless Lehmberg resigned. She refused, and Perry followed through on his veto threat, saying that he could not provide the money ‘when the person charged with ultimate responsibility of that unit has lost the public’s confidence.’

There has been a big kerfuffle over this indictment, with the majority seeming to think it is some sort of political stunt that will have little effect on Mr Perry. For example, the Washington Post later ran an editorial calling the indictment “wrong-headed.”

However, articles in some less prominent outlets suggested that the indictment actually raised questions about possible corruption, actually health care corruption. For example, James Moore writing in the Huffington Post,

Some of the media appear to have adopted the Perry narrative that he wanted to get rid of an irresponsible Travis County District Attorney Rosemary Lehmberg because she had been arrested for driving under the influence of alcohol.


The PIU had been investigating the Cancer Research and Prevention Institute (CPRIT), a $3 billion dollar taxpayer funded project that awarded research and investment grants to startups targeting cancer cures. The entire scientific review team, including Nobel Laureate scientists, resigned because they said millions were handed out through political favoritism. Investigations by Texas newspapers indicated much of the money was ending up in projects proposed by campaign donors and supporters of Governor Perry. In fact, one of the executives of CPRIT was indicted in the PIU investigation for awarding an $11 million dollar grant to a company without the proposal undergoing any type of review.

As documented by the Cancer Letter, the scientific reviewers at CRPIT quit because of perceptions that the scientific review process was being manipulated, possibly for private gain,

The scientists submitted blistering letters explaining their decisions to leave.
‘This past spring, the peer review system of CPRIT was dishonored by actions of CPRIT’s administration when a set of grants were delayed in funding because of suspicion of favoritism,‘ writes Phillip Sharp, chair of the council. ‘Further, a proposal based on science similar to that previously reviewed by the CPRIT council was selected for funding using other criteria. These events ultimately led to the resignation of Dr. Gilman. The same events motivate my decision to resign now.’
Both Gilman and Sharp are Nobel laureates.
The walkout—and, perhaps more so, the letters—send a powerful signal that CPRIT is now outside mainstream cancer science. The controversy—and the instance of ‘favoritism’ alleged by Sharp—began when the state agency funded an $18 million project spearheaded by Lynda Chin, an MD Anderson scientist and the wife of that institution’s president.

Also see stories in the Nature news blog, and in the Science news blog. Similar connections to the Public Integrity Unit’s response to the CRPIT scandal and its indictment of a CPRIT official appeared in the Texas Observer.

In addition, the New Republic published an article suggesting the involvement of Mr Perry and his administration in other cases of alleged health care corruption. These included trying to use state government to mandate a vaccine made by a company for who his former chief of staff was a lobbyist,

His attempt to mandate that Texas girls receive a vaccine for HPV, seemingly at odds with Perry’s social conservatism, looked more explicable when one considered that his former chief of staff was lobbying for Merck, the vaccine’s manufacturer. And yes, Merck contributed $30,000 to Perry over his first decade as governor.

Also, he put appointed to the state board of health top employees of a medical supply company owned by a big campaign contributor, and in which Mr Perry himself also invested,

Perry expressed his gratitude to James Leininger, a staunch conservative whose last-minute loan to Perry helped him narrowly win his 1998 race for lieutenant governor and who gave him $239,000 more over the next decade, by appointing former top employees of Leininger’s hospital-bed companyin which Perry’s personal investment during the ’90s resulted in a $38,000 gainto the Texas Board of Health,…

Finally, the state Emerging Technology Fund gave considerable money to another friend of and big campaign donor to Mr Perry,

A year earlier, the A&M system had entered into an agreement to develop vaccines with a therapeutics manufacturing firm called Introgen; this put the firm in a position to benefit from the new center. Introgen’s founder, David Nance, is a close friend of Perry’s. He contributed $100,000 to Perry over the decade, he had previously served on the advisory committee of the tech fund awarding the $50 million, and Perry’s son, Griffin, owned Introgen stock between 2001 and 2004.


Introgen had its main drug rejected by the FDA and declared bankruptcy shortly before the $50 million award, but Nance continued to do well by the state. In 2010, the tech fund awarded $4.5 million to his next venture, Convergen, even after a review panel rejected the application. The fund paid Nance’s daughter $70,000 for promotional work, and several fund employees went to work with Nance. Perry also provided $1.9 million in federal funds to a separate Nance venture, Innovate Texas, founded in 2008 as a sort of clearinghouse for Texas tech firms. The outfit paid Nance a six-figure salary. It is now defunct.

Corruption as defined by Transparency International is abuse of entrusted power for private gain. Thus TI does not limit the term to cases involving politicians or government. But surely the indictment of Governor Perry raises multiple questions about political and government corruption by this definition, and this corruption involving health care. The definition used by TI is ethical, not legal, and it is impossible to predict whether Governor Perry will be convicted.

Still, while Texas Governor Rick Perry’s indictment was big news, and fodder for a lot of discussion about politicization of the criminal justice system, the multiple issues the case raises about possible health care corruption have been ignored by most major news outlets, and no one so far has labeled the case as having anything to do with “health care corruption,” or words to that effect.

Former Governor Robert F McDonnell (Republican – Virginia) on Trial for Bribery and Corruption

Meanwhile, the press has been fascinated with testimony in the bribery and corruption trial of former Virginia Governor Robert McDonnell. In 2013, the Washington Post published a long investigative report about how the Governor and his wife seemed to be promoting a dietary supplement called Anatabloc as an anti-inflammatory agent while accepting various favors from the CEO of the company that made it. The background on the company is

[Johnnie R] Williams’s company, Star Scientific, was introducing a dietary supplement called Anatabloc, whose key ingredient is found in tobacco and other plants.

Anatabloc was crucial to the future of the company, which has been losing money for years. But the science behind the product — an anti-inflammatory the company hopes might be helpful to people with such ailments as Alzheimer’s and multiple sclerosis — was unproven.

The article described how Mr Williams paid $15,000 for the food at the Governor’s daughter’s wedding, and provided “rides on Williams’ corporate jet, personal gifts for the first family….” In fact,

Over eight months during the 2009 gubernatorial election, Star Scientific donated more than $28,500 worth of air travel to McDonnell’s campaign. That commitment increased after McDonnell took office; Star reported donating nearly $80,000 in flights to Opportunity Virginia, the governor’s PAC.

Apparently in return,

Three days before her daughter’s June wedding, Maureen McDonnell flew to Florida, where she spoke at a seminar for scientists and investors interested in anatabine, the key chemical in Anatabloc, according to people who attended the conference.

The governor’s wife told the group that she supported the product and touted the pill, which is not regulated by the Food and Drug Administration, as a way to lower health-care costs in Virginia, the attendees said.

About three months after the wedding, the McDonnells and Star Scientific were together again, this time at the governor’s mansion for the official launch party for Anatabloc.

Although much of the interaction appeared to be between CEO Williams and Mr McDonnell’s wife, the Post reported later in 2013,

A prominent political donor purchased a Rolex watch for Virginia Gov. Robert F. McDonnell, according to two people with knowledge of the gift, and the governor did not disclose it in his annual financial filings.

The $6,500 luxury watch was provided by wealthy businessman Jonnie R. Williams Sr., the people said. He is the chief executive of dietary supplement manufacturer Star Scientific

Also, now that the trial is ongoing, there was sworn testimony that Governor McDonnell seemed to be helping to market Anatabloc, as per Reuters,

Virginia Governor Robert McDonnell gave a personal pitch to a state healthcare official for the dietary supplement at the heart of the former governor’s trial on corruption and bribery charges, the official testified on Monday.

Sara Wilson, director of the Virginia Department of Human Resource Management, said McDonnell pulled out a bottle of the product, Anatabloc, at a meeting she and her boss had with him in March 2012 to discuss healthcare. McDonnell, a Republican, ‘said how much it had helped him and his wife,’ Wilson said under prosecution questioning on the 11th day of the federal trial.

There was also testimony that Mrs McDonnell tried to market the supplement to 2012 Republican presidential candidate Mitt Romney, as stated in a Washington Post article,

After Virginia Gov. Robert F. McDonnell (R) endorsed Mitt Romney for president in 2012, McDonnell’s wife sought out the candidate to promote the dietary supplement now at the heart of the former first couple’s corruption trial, a onetime aide testified Monday.

Maureen McDonnell and then-Star Scientific chief executive Jonnie R. Williams Sr. showed up together at a news media session in South Carolina hoping to pitch Anatabloc to the prominent Republican, said Phil Cox, Robert McDonnell’s chief political adviser at the time.

Cox, also executive director of the Republican Governors Association, said that he put a stop to that plan but that Maureen McDonnell went on to talk up the supplement to Romney’s wife on a campaign bus. He said she told Ann Romney that the anti-­inflammatory supplement, Anatabloc, could ‘potentially cure MS.’

Now this case is clearly all about allegations of health care corruption. The allegations are that the CEO of a health supplement company provided extensive favors to a politician and his wife, who then made several attempts to market one of his products as treating and possibly curing disease. Yet while these allegations are pretty clear, no one so far has called this a case of possible health care corruption.

By the way, in the last few weeks I also found rela\n tively obscure mentions of two other cases involving allegations of health care corruption. One was a case in which an Ohio state representative took actions on behalf of a health care real estate investment trust that he, his family members own in part, and whose board includes one major political donor (see the AP story via the Providence Journal). The other was a case in which the West Virginia Attorney General had inherited a case from the former office holder involving a drug and medical supply company for which his wife is a lobbyist (see the Charleston Gazette story).


As we have said before, when health care corruption is actually discussed in polite circles, including the scholarly literature about medicine and health care, the discussion usually refers to corruption elsewhere. In particular, in developed countries, discussion of health care corruption usually focuses on less developed countries.

Now we see that when the issue clearly is the possibility of health care corruption, even the news media will avoid using such a term. Articles may describe what amount to health care corruption. They may refer to it as corruption. But they will not pair that term with health care (or medicine, or anything similar). The subject of health care corruption remains taboo. As long as we do not discuss it, some can preserve the illusion that it does not exist. Thus the anechoic effect continues.

So to repeat an ending to one of my previous posts on health care corruption…. if we really want to reform health care, in the little time we may have before our health care bubble bursts, we will need to take strong action against health care corruption. Such action will really disturb the insiders within large health care organizations who have gotten rich from their organizations’ misbehavior, and thus taking such action will require some courage.

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. Banger

    There are individual cases of corruption within the system that the system itself would probably like to eradicate. Then there is systemic corruption which is far deeper and far more important than politicians helping cronies–that is not addressed in the article. Certainly both need to be addressed and Dr. Poses should be commended for bringing attention to these problems.

    Medical spending in the U.S. is nearing 20% of GDP yet people are in pain (47% of adult Americans experience chronic pain each year) depression, anxiety and so on now common ailments treated with a host of drugs. Yet, at the same time we know stress is responsible for 80% of all HC problems–are we spending 80% of our health-care budget on relieving stress? No. The point is that the U.S. medical industry like all the other major institutions in the U.S. exists to benefit itself and, somewhere down the line, to help the public. This is the essence of the malaise we face–intsitutions whether police, the military, the finance industry and so on have gone into the phase of systemic corruption–these institutions are no unreformable because their basic values and ethics are contrary to what most of us would recognize as humanitarian ethics.

    This was predictable long ago–as long as money is the chief moral arbiter all competing moralities will eventually die of or be subject to money–this is what is happened to Christianity. In case you don’t know, many if not most Evangelical Christian cults believe that once you “give” your life to Jesus Christ, you are “saved” forever and need not act morally (justification by Faith)–few people have gone into the implications of this idea–but think about it and then wonder why the “red” areas of the country seem so anti-humanist and, frankly, anti moral from the perspective of the Gospels at least.

    1. Ed

      On the first part of the comment, the medical industry in this country is a major cause of stress, since its gotten so complicated to navigate. I wonder if it now does more harm than good to public health outcomes. Then why are Americans so healthy compared to elsewhere? Well actually life expectancy started dropping recently so the answer is probably that we aren’t.

      The second part should be another comment. I’ve also noted that the red state version of Christianity tends to be big on justification on faith instead of on works (a theological position I tend to agree with). So where do the moralistic attitudes on (other) people’s personal behavior comes from. If you actually attend a low protestant church, there is also a good deal of emphasis on personal redemption and forgiveness, and that we are all ultimately sinners, etc. I have a hard time reconciling all this. The two theories I have is that red state culture is really tribalistic, and excluding outsiders outweighs what they hear in church, and/ or that blue state culture is really more intolerant in its way towards wayward personal behavior. All this really belongs on another thread.

      1. Don Levit

        Thanks for your posting.
        It belongs on this particular article, for corruption and abuse of power starts in the heart, and moves outward by speech and action.
        Going to heaven, according to my understandingh of Christianity is a gift of grace, and something one cannot earn.
        Doing good deeds (from a Jewish persopective) makes Jews holy as God is holy.
        Good works is stressed over faith, in that Tikkun Olam – repair the world – is the main mantra of Judaism.
        The afterlife is an after thought.
        On the little that Judaism touches on heaven, all people go to heaven.
        We do not believe in hell, although we do believe in the devil (which is the opposite of G-d).
        The soul must go thru a cleansing process, the maximum time being 11 months.
        If our collective hearts were not so corrupted, much of these shenanigans would not be occurring.
        By having G-d, Jesus, etc. in one’s life, one thinks twice and maybe 3 times, before cooperating in corruption.
        Don Levit

    2. Crazy Horse

      Want further evidence that the Medical Insecurity industry is second only to the Warfare State as the defining American institution?

      The second most expensive “health care” system in the world is that of Holland. If the US spent the same amount per capita it would reduce its annual expenditures by one trillion (1,000,000,000)* dollars per year. That is a good gross measure of the extent of corruption in the system.
      * sorry if I didn’t put enough zeros on that figure– I have trouble counting once the stack of dollar bills gets higher than Mt. Everest.

      1. Mark P.

        ‘That is a good gross measure of the extent of corruption in the system.’

        You are correct, sir.

  2. human

    It’s wonderful to see the light of day being shown on these 1%ers flitting around the edges trying to get into the club of the .01%ers, however, this is still striking at the branches, not the roots. The MOTU remain opaque, insulated and powerful.

  3. Dana

    As an Ohioan, I wondered how I’d missed the story about the state representative … until I clicked through and saw it’s actually an Indiana state rep. We have enough corruption here, thank you, don’t smear us with our neighbors’ too.

  4. impermanence

    There is nothing that exists in this country right now that is not horribly corrupt. All of these institutions work in concert.

    The corruption in health care is now very deeply ingrained. As the corporations began to take over around 1980, the purchased the leadership of the health professions and it was all downhill from there.

    1. Dirk77

      It seems that there is really only one issue: getting money out of poltics through public funding of elections. All other problems, national and global, appear derivative and thus secondary. If someone has a good idea how to bring this about, I’d like to hear it.

      1. OpenThePodBayDoorsHAL

        Obomba Takes Single Payer Off The Table So Insurance Execs Can Continue To Feed At The Trough.
        I mean do you need any better headline example than that?
        They could have done what The Netherlands did, leave the insurers in place but regulate the products they must offer and the prices. But oh, no, 3 insurance CEO’s hadn’t been able to buy a second private island yet, plus have you seen how much it costs today to maintain a Gulfstream for Suzy and the kids?

  5. McMike

    This might be a good time to ask someone to explain how the vaccine paradigm can plausibly remain infallible, and exempt from the malfeasance and pathology – exempt from the rot, the corruption, the profiteering, the lies, and the deliberate pathological disregard for human lives – that permeates every other aspect of public policy and corporate behavior, particularly in the realms of health care, pharmaceuticals, and chemicals, not to mention the authoritarian impulses of the National Compliance State.

      1. McMike

        Are you capable of a substantive reply to the actual question?

        Perhaps you might cite the impervious structural firewalls at drug companies and private research labs, the enlightened and empowered regulators at the FDA, the extraordinarily punitive enforcement mechanisms of the Justice Department and vibrant tort system, the effective systemic safeguards that prohibit conflicts of interest and perverse financial incentives, the stringent campaign contribution regulations…. something, anything that separates the vaccine industry from the corruption and crimes that permeates every single other facet of health care public policy and corporate behavior.

        1. Vatch

          I’m not anti-vaccine; I’m glad I was protected against polio and smallpox as a child. In a few months, I expect to get a DPT booster, and I may get a flu shot, too. However, I’m glad that the vaccines I will get no longer use the mercury containing compound thiomersal. Toxic organic mercury is not something I want in my body. It reminds me of the horrible Minimata disease. Despite the controversy, I’m glad that activists got mercury removed from vaccines in the U.S. and Europe.

          I think people need to be skeptical about Big Pharma’s vaccine marketing. There are huge amounts of money at stake, and a few dead bodies along the way are just a cost of doing business for some of these corporations.

          1. McMike

            Yes, there is very little scrutiny on the system from the outside or mechanisms for accountability – the tort system having been taking largely out of the equation with blanket preemptive liability waivers, the CDC have cloaked themselves in the mantle of the Government Savior of Children, and the FDA/research conflicts of interest rampant – the industry enjoys government-mandated and enforced captive monopoly markets for their drugs. What could go wrong with that?

            The attention on thimerosal helped get this issue into the open, the HPV scandal in Texas as well. Alas, there are still a variety of preservatives, adjuncts, GMOs and nanotech in vaccines.

            I am fully confident that we will one day realize that the massive repeat dosing of newborns with a variety of drugs and chemicals was a Bad Idea in terms of their long term health (much like tobacco, it will be finally be admitted by the PTB decades after it is obvious and widely known).

            It baffles me how people who are skeptical of the drug industry and health care system, who eat organic despite government/industry promises that pesticides are good for you, who avoid GMOs despite the same assurances, who don’t believe that fracking is safe and harmless, etc. are willing to abdicate their skepticism to the vaccine industry.

            1. Marcie

              I totally agree with you McMike you make excellent points. Another thing, if you ask pro vacs what causes autism they don’t know but it surely can’t be vaccines because any hint that it is vaccines will reduce the revenue of Big Pharma that could care less about anything but its profits from vaccines.

              Another instructive example is what is happening with gadolinium based contrasting agents. These have the toxic metal gadolinium in them and every single gadolinium based contrasting agent leaves behind gadolinium from 1% to 25%. GE’s product Omniscan is the worst of all of them and it even came out at trial that its product leaves behind 25% of the gadolinium. All the GBCAs have been black boxed but it is still being injected into people to the tune of millions of bolus injections a year. So what did GE do to preserve its sales of MRI machines? It purchased Amerisham back in 2004 when rumors were swirling that Omniscan was going to cost the company billions in liability because of its toxicity and the death of several people that received its’ product.

              The CDC (Center for Disease Cover-up, Iatrogenic that is) quickly got involved and anointed Yale as the official registry. The official registry has fewer reported cases than GE had lawsuits so we know Yale is not being completely honest about its numbers. Then GE hires Yale’s Director of Public Relations to be its Global Director of Public Relations and refuses to settle with plaintiffs whilst waiting for them to die from the man-made disease caused by its product.

              My opinion is you take your life in your own hands when you go to a doctor. I had 12 of these injections and am totally disabled. What did Liberty Mutual do? They wrote in my file that I was not compliant because I didn’t want any more scans. Everything in this country is predatory now it has nothing to do with serving the customer or in medicine patient safety. It is what is profitable and you will get that treatment not the treatment that has efficacy.

            2. Linda Amick

              For a documented case of the Vaccine Industry which includes NIH, NCI, CDC in collaboration with DoD and Pharmaceutical Corporations when the Anthrax vaccine was being modified to become more effective in the late 80’s, read Gary Matsumoto’s excellent book, VACCINE A. It will definitely cause the inquisitive person to question vaccines and pursue more research.

          2. ex-PFC Chuck

            “Toxic organic mercury is not something I want in my body.”

            There’s mercury, like the metalic liquid in which I and others unknowingly dipped our high school class rings back in the ’50s and continued to wear, then there’s mercury in compounds like that which took a Dartmouth professor’s life 17 years ago.

            1. Vatch

              Exactly right! Plain ol’ metallic mercury is much less toxic than some of the organic compounds containing mercury. Examples of organic mercury compounds are the preservative/antiseptic thiomersal/thimerasol/merthiolate and the very nasty dimethylmercury that killed the professor. But I wouldn’t want any kind of mercury in my bloodstream.

        2. jrs

          The thing is the push toward a lot of the old vaccines (traditional childhood vaccines) originated before this stuff was so far gone.

  6. John

    The corruption lies in the fact doctors and others in the healthcare industry erect barriers to entry so customers pay outrageous fees for service.

    1. Code Name D

      I am not so sure. With ever narrowing networks, and with so much money at stake, it seems likely that examination-room level doctors can remain unaffected.

      1. McMike

        What I see is consolidation and vertical integration, with doctors selling their practices into hospital networks. We are due for a period of even less competition.

        This is a consistent theme for Dean Baker, the use of professional licensing requirements and other barriers that protect highly paid professions like doctors and lawyers from the same foreign competition that most other workers are subject to.

    2. sd

      Speaking of doctors and pharmaceuticals. Gynecologists were at one point getting incentives to use the drug Lupron for treating uterine fibroids. As a result, it was getting arbitrarily over prescribed as a one size fits all solution. One of the side effects of Lupron is that it makes fibroids much more difficult to remove surgically. It came as no surprise that in 2001, the pharmaceutical company faced fraud charges.

      Meanwhile, there are the samples that doctors get to promote medications….

  7. Gabriel

    The last I followed the health care industry, it was a $3 trillion business.
    A reputable research effort – the Dartmouth Atlas Project at Dartmouth [] – several years ago found that 30% of those expenditures were wasted. I assume the waste comes from unnecessary medical procedures, fraudulent billing, high fees, etc.
    Wiping out that $1 trillion waste means that up to a million health care jobs would also be vaporized.
    Confronting such waste means that we must also confront some unpleasant possibilities —

    1. Many entrepreneurs see health care as a growth industry and are geared up to make real money in it. This reflects a wider belief that health care is bound to be a growing industry into the future.
    2. Device manufacturers, pharmaceutical firms, and other related industries are relying on continuing and increasing healthcare purchases and support from government and other payors.
    3. Are we prepared to find other jobs for the one million workers who would be displaced?

    Given that Affordable Care was written with the help of the hospital and pharmaceutical industries, it is doubtful that we’ll have any substantial cut in healthcare waste. My further guess is that if the next president is Republican, he will have little inclination to go after this waste. A Democratic president may have a better chance, especially one not close to Wall Street.

    1. McMike

      Yup, it’s the Hold the Gun to the Puppy’s Head criminal syndicate.

      It takes too large a leap of faith to see what sort of structure would emerge if we cut off the fraud, cronyism, crime, and corporate welfare. Because in order to cut out the rot, we’d have to cut deep and wide. Incredible amounts of disruption to be sure. A giant reset button on a massive, global scale.

      What’ll happen if we press the History Eraser Button?

      That’s why straight up medieval meltdown or bloody eighteenth/nineteenth/20th century revolution are the only ways way are getting out of this.

      1. Marcie

        First off I think you are probably correct, a revolution is the only thing that is going to change the corruption paradigm in healthcare and other sectors of our economy.

        However, I see other ways we might have an impact although I’m not sure they would work. I belong to the patient harm group moderated by ProPublica and most on there are either trolls, professionals that don’t get it or the patients and family members of those of us that have been harmed. Most of the harmed patients and their families are not naïve, they know they have been harmed and that the system is corrupt. But individuals and the group 2000 + strong, passionate victims have difficulty against the powerful medical industrial complex and mistakenly these people believe if only everyone knew their story things might change. For me I think that is hogwash. Change will come only if it is forced on them. I naïvely thought that if only victims, premium payers, large self-insured employers and yes health insurance companies would realize the corruption and act on it then change would happen. However many in the general population are enamored with doctors and yes pharmaceutical companies (poor pharma needs to charge those high prices for the drugs that maim and kill to pay for R & D). Autism will cost our society trillions of dollars a year for the foreseeable future but let anyone speak against vaccines and the Democrats especially, start frothing at the mouth and go into a fit of rage against anyone that speaks out against them or even dares to question whether 69 vaccines might be too many before the age of 18. Additionally insurance companies are paying for what the FDA approves and that is very bad for patient safety because everyone knows the FDA is in bed with large multinational corporations. And the insurance companies will use any excuse they can not to pay for anything. It is a viscous cycle but what do insurance companies care; they will pass on the cost in the form of higher premiums.

        My conclusion is that people need to wake up and understand the corruption first before anything will change.

        1. Gabriel

          Marcie –
          Yes, too many powerful constituencies want the current system to continue and grow – though they may know it’s wasteful and corrupt. The sheer inertia and weight of expectations will encourage the system to persist as it is.
          Years ago in reading the WSJ about the sizable costs that employee healthcare costs imposed on the price of each vehicle made by US auto manufacturers, I thought that at some point the Big Three would throw up their hands and tell Congress, “We’ve had it. Do something.”
          Never happened. There never was a “meltdown” of the US healthcare system propelled by rebelling US auto makers.
          Maybe we need a true meltdown – so that the country and the Congress pays attention, rather than quarreling about the ACA.

          1. Marcie

            Unfortunately you are right. But your unconsciously assuming that the auto workers knew corruption and predatory healthcare was the problem. They assumed the cost was valid. Call me an optimist but I think if people start to connect the dots in healthcare (they already do for the banks) and then they understand that their loved one is sick due an iatrogenic injury, caused by corruption in healthcare, we might see change. I agree it is a stretch to think that after 30 years of swallowing propaganda and the pills that follow the citizens will all of a sudden wake up to corruption in healthcare and protest enough to force change. Then again when it so deeply impacts your finances people start caring out of survival.

  8. notjonathon

    Lambert, you didn’t even mention that the voters of the state of Florida elected as their Governor a man who had already been convicted of healthcare corruption. There is such a disconnect between the audacity of political criminals and public perception of them that I can’t see a solution.

  9. afisher

    Really late to this party – but anyone who has been following the Rick Perry saga know about his 2 funding ploys to induce companies to move to TX. It has always been dicey because although the Admin will tell everyone that is is very transparent – the terms are often changed when the stated goals are not met and the annual reports use what I believe are flaky numbers as the count not just the jobs that the companies hire but all the “ancillary” jobs – so if the company uses FedEx – that job is also included.

    Be that as it may – today ( 8/30) there was a company CEO of one of these companies that came to TX in 2006. ArthoCare (ex) CEO was sentenced to 20 years in prison for securities fraud.

    These 2 funding streams are hopefully eliminated in 2015. (fingers crossed).

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