BLOGSCAN - Why Problems at Local Marquee Hospitals May be Anechoic

We have often discussed how the shortcomings of leadership of big health care organizations may be anechoic.  (See this post for a recent example.) 

Now, on the HealthBeat blog, Maggie Mahar discussed how journalists often fail to look closely at the actions of large, well-known local hospitals.  She noted some possible causes:
- "Hospitals, after all, are major advertisers."
- "the marquee hospital’s patrons tend to be powerful local figures."
- " most readers really don’t want to hear that their local academic medical center is having problems...."
She also summarized just how unhealthy relationships among the news media and marquee hospitals can become, but also provided some examples of incisive investigative reporting.  As they say, read the whole thing.

Post Title → BLOGSCAN - Why Problems at Local Marquee Hospitals May be Anechoic

Who Undermined "These Wonderful Philanthropic Organizations?" - Evil External Swindlers or Their Own Leadership

The rise and fall of yet another esteemed health care institution provides another cautionary tale about health care dysfunction. 

The Tragic Fall of the Picower Foundation

Two years ago, a highly-regarded charitable foundation had to close its doors, apparently one of the biggest victims of the Bernard Madoff Ponzi scheme.  Here is the Boston Globe version of the story:

The unfolding scandal surrounding the alleged Ponzi scheme run by Bernard L. Madoff yesterday claimed as a victim one of the largest foundations in the country, which has funded groundbreaking brain research at the Massachusetts Institute of Technology and diabetes research at Harvard Medical School.

The Picower Foundation of Palm Beach sent an e-mail to 'colleagues and friends' late yesterday saying that it was a victim of Madoff's alleged scheme and that it would soon shut down. With assets of more than a half-billion dollars, it is believed to be the largest charity to have been forced to close by the unfolding scandal.

'It is with great sadness that I write to inform you that the Picower Foundation has ceased all grant-making, effective immediately, and will close its doors in the coming months,' wrote Barbara Picower, the foundation's president, who added that its money was managed by Madoff.

Similarly, the New York Times reported without question:

One of the nation’s leading philanthropies, the Picower Foundation, announced on Friday that it was shutting down.

Also,

Listed previously at $1 billion, the foundation’s assets were managed by Bernard L. Madoff, Mrs. Picower said in a statement, and his 'act of fraud has had a devastating impact on tens of thousands of lives as well as numerous philanthropic foundations and nonprofit organizations.'

A Blow to Medical Research and Academic Medicine

This appeared to be a major blow to philanthropy, and to medical research and academic medicine.  Per the Boston Globe:

[No charities that had suffered from the Madoff scheme] were near the size of the Picower Foundation. In its 2007 tax return, it said the market value of its investment portfolio was $955 million. The Foundation Center, a nonprofit that tracks philanthropy, ranks the Picower philanthropy as the 71st largest in the United States by assets. It finances medical research at many leading institutions, human rights and child advocacy programs, and arts and cultural operations.

In particular,

A portrait of the Picowers hangs in the Picower Institute for Learning and Memory at MIT. They gave the center $50 million in 2002, which was, at the time, the largest grant from a single foundation the university had ever received. The foundation gave MIT another $4 million in May to launch a fund for faculty to conduct high-risk neuroscience research activities.

'I am deeply saddened by the terrible news,' Susumu Tonegawa, the Nobel laureate for medicine who founded the center in 1994, said in an e-mail.

It is unclear from the foundation's statement whether it lost all its money or just enough to force it to cease operations.

The Picower Foundation also gives MIT $200,000 a year to fund scholarships for graduate students, in the name of Norman Leventhal, the famed Boston developer and philanthropist. Leventhal was a director of Picower Foundation until this year.

The Picower Foundation also awarded $1.5 million for diabetes and metabolism research to Dr. Jeffrey Flier, dean of Harvard Medical School.

In addition,

[Dean Flier's] research funded by the foundation 'is over,' he said, unless he finds another funder.

Added his colleague, Dr. Barbara B. Kahn, chief of the division of endocrinology, diabetes, and metabolism at Beth Israel Deaconess Medical Center, 'I think it's tragic for the Picower Foundation and for the public that a single individual could undermine these wonderful philanthropic organizations that support excellent causes such as biomedical research.'

So that was the story in 2008. By then, we all knew that the scope of Bernard Madoff's fraud was audacious, and that all sorts of people were victimized, but it seemed a particularly low blow that he could "undermine these wonderful philanthropic organizations that support excellent causes such as biomedical research."  The narrative was one in which a prestigious, well-intentioned charity was laid low by an evil act perpetrated by a wily criminal.

Should Madoff be Blamed?

Or not. Today the Wall Street Journal reported the latest update on this story, on that seems quite dissonant with the version above:

A federal judge signed off Thursday on a settlement in which the widow of a longtime investor with convicted Ponzi scheme operator Bernard Madoff will return $7.2 billion to the victims of Mr. Madoff's fraud.


The settlement by Barbara Picower, the widow of Jeffry Picower, brings to nearly $10 billion the amount that Irving Picard, the court-appointed trustee for Mr. Madoff's firm, has recovered for people cheated in the scheme.

Recall that Barbara Picower was the President of the Picower Foundation.

Anechoic Stories About the Conflicted Leadership of the Picower Foundation

In fact, the glowing description of that foundation in the Boston Globe did not square with stories that ought to have raised serious questions about this apparent bastion of health care philanthropy, but instead were quite anechoic.

In 2001, the St Petersburg Times had published an expose of the Picower Foundation which suggested that its Jeffrey Picower used it in a complex scheme involving self-dealing for the purposes of personal enrichment.  The story is a bit complicated, but I provide details below to underscore its verisimilitude.

A Foundation that Appeared Virtuous

On one hand, it acknowledged how the foundation was set up to appear virtuous. One of the largest recipients of its apparent charity was the Picower Institute.

Picower's wife, Barbara, was active in determining the charities that received Picower Foundation grants. In 1999, the foundation gave $250,000 to the National Abortion and Reproductive Rights Action League, $700,000 to public television station WNET-Ch. 13 in New York, $120,000 to the Children's Aid Society and $107,000 to the Boys and Girls Clubs of Palm Beach County.

By far, though, its largest grant was to the Picower Institute. The foundation's $5.5-million donation was 41 percent of the $13.3-million in grants it made in 1999.

The Institute's leader was a famous medical academic:

Dr. Anthony Cerami was at the peak of his career in 1991 when he dined with Picower to celebrate his new job as president of the Picower Institute for Medical Research.

A dean at New York's Rockefeller University, Cerami had just been elected to the elite National Academy of Sciences, about the highest honor for a scientist short of a Nobel Prize.

'Dr. Cerami is what we call a giant in the scientific community, and he's also very well liked personally,' said Michael Kent, a biotechnology investor.

A Focus on  Drug Development

But it appeared that the main purpose of the Institute was actually to develop drugs, through a vehicle called Cytokine Networks:

Cytokine Networks held the rights to certain discoveries of the Picower Institute. In an arrangement common for non-profit medical research charities, it was set up in 1993 to commercialize science discovered at the Picower Institute.

'To bring science more quickly to the bedside -- that was their avowed mission,' Massey said of the institute.

Cytokine Network's largest shareholders were the New York-based Picower Foundation and the Picower Institute, which had each invested $2.5-million in the venture and held a combined ownership stake of 62.5 percent.

[Jeffrey Picower] owned no shares of the company.

Cytokine Networks held the rights to a drug labelled CNI-1493:

CNI-1493 has shown great promise in reversing Crohn's disease, a devastating inflammation of the intestine that is treated, though not always effectively, by injections. A small molecule can be taken in pill form and is cheaper to manufacture.

However, Jeffrey Picower, the husband of Barbara Picower, seemed to indirectly control Cytokine Networks:

he ran the board meetings, which were held at the New York offices of the JMP Group, Picower's investment holding company, said [Dr Glenn] Rice, the former Cytokine Networks executive.

'He was involved with every major decision,' Rice said. 'He'd get into minutia -- the capitalization of the company, screening potential new investors, personally reviewing the clinical trials. Virtually everything a chairman of the board would do, he did.'

Picower Foundation Sells Cytokine Networks to Picower (the Person)

And here comes the trick. Observe closely:

In 1999, [Cytokine Networks] ... merged with another private pharmaceutical company, PharmaSciences Inc., in which Picower was the majority shareholder.

So

When the merger was completed in 1999, Picower's non-profit organizations' equity stakes were diminished from a combined 62.5 percent of the old company to 24.5 percent of the new company.

Picower owned nearly 47 percent -- making him the largest shareholder in the company that had obtained the rights to CNI-1493.

An evaluation by Merrill Lynch put the merged company's fair-market value at $15 to $25 a share, making Picower's stake worth an estimated $40- to $67-million.

This is a pretty good trick:

Rice contends that by wearing all the hats in the merger, Picower had a conflict of interest.

In any business negotiation, each side tries to get the best deal. Yet in this merger, the interests of Picower's non-profit organizations were pitted directly against Picower's personal interests.

On one side were shareholders of Cytokine Networks, mainly the Picower institute and foundation. On the other side were the shareholders of PharmaSciences, primarily Picower.

Picower called the shots at the institute and foundation. So, Rice said, the question is this: On whose behalf was Picower working? His own? Or his non-profit organizations?

'The valuation here would be crucial,' said George Cowperthwaite Jr., a certified public accountant who specializes in preparing private foundation returns and has no connection to Picower.

By that, Cowperthwaite means the relative values assigned to each company for purposes of the merger. The shareholders of Cytokine Networks would be expected to push for the highest value possible assigned to their company. A higher value would give them more ownership in the new, merged company.

Yet Rice, who also was a shareholder in Cytokine Networks, questioned whether Picower had any incentive to push for a higher valuation of Cytokine Networks because it would mean that he would end up owning less of the merged company.

Indeed, a 1997 valuation by Lehman Brothers concluded that Cytokine Networks shareholders should own 47 percent of the combined company. They ended up with 36 percent.

In 2009, ProPublica published a report on the Picower Foundation which summarized this transaction thus:

Picower used both his foundations and a private corporation called PharmaSciences, of which he was the majority shareholder, to gain control of a potentially lucrative medical discovery. In 1999, Picower merged PharmaSciences with a for-profit spinoff of his institute called Cytokine Networks, essentially negotiating with himself. The merged company called Cytokine PharmaSciences had the rights to develop a new drug that could help minimize such illnesses as arthritis and multiple sclerosis. The newspaper raised the question of whether Picower had shortchanged his nonprofit in the deal.

So it appeared the Jeffrey Picower used the Picower Foundation, which was lead by his wife, and the Picower Institute, which was ostensibly an independent not-for-profit organization funded by the the Foundation, to set up a deal which could have markedly enriched Jeffrey Picower.

Picower's Previous Anechoic Financial Peccadilloes

In fact, it appeared that Jeffrey Picower had a long history of questionable business deals.  In 2002, Forbes ran a profile of Jeffrey Picower that asserted:

has been battle-hardened from years of legal disputes over his dealings. In the 1980s he sold to clients of his old accounting firm Laventhol & Horwath shaky tax shelters involving computer leases. When the Internal Revenue Service realized the computers were virtually worthless, it challenged the deductions. That spelled trouble for longtime client Peter Davidson of Brooklyn, N.Y.'s Davidson Pipe, who had put at least $30 million in Picower's leases after an introduction by Laventhol accountant William W. Schneck, who happens to be a former boss of Picower. Davidson sued Laventhol and Picower for $90 million. He claimed that Picower had bribed Schneck to betray him. Picower denied that, and his lawyer says he testified that the $50,000 he'd given Schneck was a loan. After hearing the opening arguments, he and Laventhol paid Davidson to drop the case on condition that Davidson keep his mouth shut about the settlement. Davidson later settled with the IRS.

Picower also had a run-in with the Securities & Exchange Commission. In 1983 the SEC rebuked him for being months late disclosing that he had exceeded a 5% position in Fidata, a financial services firm that he later merged into what is now Alaris, a medical device maker. Shades of the Cytokine Pharma merger: Picower was on both sides of the table.

Two years ago Picower had to put up $21 million from another one of his pet companies--Physician Computer Network in Morris Plains, N.J.--to appease other shareholders who'd lost everything when it went bankrupt after it came out that his executives had cooked the books. It is hard to imagine how a smart guy like Picower could have been oblivious to all of that while chairing the board and controlling 45% of the stock, but he was never charged with a thing.

There have been other trips to the courthouse. Fourteen years ago he refused to pay the final bill for renovations on his New York offices. When the interior design firm sued to collect, he sued them for $17 million, taking the stand at trial in an effort to convince the jury that sloppy work had left him in squalor. The judge made a surprise visit to the office with the jury in tow. The place turned out to be sumptuous, and the judge decided not to let it go to the jury at all, rendered a directed verdict and ordered Picower to fork over $178,000, including legal fees.

So by 2002, there were plenty of reasons to worry about the integrity of any organization lead by Picower.  Yet when the Picower Foundation went bankrupt in 2008, the public narrative was of a noble pillar or health care philanthropy done in by an evil confidence man.

One year later, the story was very different

Picower as a Beneficiary of Madoff
So maybe it should have been no surprise when ProPublica chronicled how the Picower Foundation seemed to have made huge profits from the Madoff Ponzi scheme that had victimized so many others.

It now appears that the biggest winner in Madoff's scheme may not have been Madoff at all, but a secretive businessman named Jeffry Picower.

Between December 1995 and December 2008, Picower and his family withdrew from their various Madoff accounts $5.1 billion more than they invested with the self-confessed swindler, according to a lawsuit filed by the trustee who is trying to recover money for those Madoff defrauded.

Jeffrey Picower died in October, 2010.  As noted above, just today, the settlement that would return $7.2 billion from Picower's operations to the Madoff  trustee.

Summary

The big question is why people can be so easily fooled? 

Why were a Chief of Endocrinology, the Dean of one of the country's most prestigious medical schools, and a Nobel Prize winner not the least bit skeptical of a foundation whose leadership was accused of conflicts of interest and self-dealing, and had been involved in a series of questionable business deals over the previous 20 years?  All this was public by six years before the collapse of the foundation.  Why was the media so eager to spin a narrative that labelled the apparent perpetrators as victims?  A simple Google search on "Picower" would have suggested other explanations.

Certain health care institutions seem to held in such high esteem that almost no one thinks to question what goes on behind their walls.  This makes it possible for unscrupulous leaders to subvert the missions of such institutions for personal gain.  It even makes it possible for scam artists to create institutions that appear as if they ought to be held in high esteem as vehicles for chicanery.

We have now seen so much ill-informed, incompetent, mission-hostile, conflicted, and criminal leadership of health care organizations that no one should accept the word of someone just because he or she is in the leadership of an institution with a fancy name.

Just because a health care organization has an impressive name, or even an impressive history does not mean that its current leaders should be immune to questions, inquiry, skepticism, or even investigation.  In fact, in this day and age, the leaders of large health care organizations with historically good names should be scrutinized especially carefully. 

If not, expect so see more collapses of "wonderful" organizations.

Post Title → Who Undermined "These Wonderful Philanthropic Organizations?" - Evil External Swindlers or Their Own Leadership

What, The RUC? - A Prominent Health Care Policy Blog Leaves Some Important Things Out

A new US President, health care costs that continue to rise despite declining access and questionable quality, even during an unprecedented global economic crisis all have made health care reform a hot topic once again in the US. This has even lead to discussion of some topics that formerly rarely merited polite discussion, sort of.

Last week, writing in the New York Times Economix blog, Professor Uwe Reinhardt, a noted health care economist at Princeton University, took on the topic of payments to physicians. His main point was:

America’s health care spending issues might have something to do with our fee-for-service payment system.

Studies have shown that physicians are not impervious to the financial incentives inherent in fee-for-service payments. For example, on average, physicians who have a direct financial interest in the use of imaging services, like CAT scans or M.R.I. scans, recommend far more such services for their patients than do physicians without such financial interest....

He noted some possible solutions:

In recognition of the conflict of interest inherent in fee-for-service payment, there is now a worldwide movement to replace the system with so-called 'evidence-based case reimbursement'. Under this approach, one single payment would cover all of the supplies and services that are needed, under best, evidence-based clinical practices, to respond adequately to well-defined medical conditions.

Not all health care, of course, can be categorized into neat, episodic bundles for this purpose. For chronic conditions, for example, payment may shift from fee-for-service to annual or monthly fees per patient, and care for such patients might be organized by clinically integrated health systems or by managed care companies procuring health care from different systems on an integrated basis. And for some patients with very complicated conditions, fee-for-service would still persist. One would think, however, that a move toward these alternative payment systems would not only reduce the geographic variations in per-capita health spending, but help control the annual growth of health spending over all.

What is missing from this picture?

Positive Incentives for Procedures, Negative Incentives for "Cognitive" Services, Especially Primary Care

First, Reinhardt suggested that the major problem with the current way the US pays for physicians is that it gives excess incentives for physicians to order diagnostic tests provided by facilities in which they have financial interests. This is, in my humble opinion, a real problem. But it is hardly the biggest problem with our current system of physician payments.

I submit that the biggest problem with our current system is that it provides big and increasing incentives to do procedures. This may lead to the over-use of some procedures in some instances. Moreover, it promotes high prices for the devices, drugs and support services required by the physicians to do these services. Thus, the current system pays many people well, and makes some people very rich. However, its enormous costs come out of other peoples' wallets, decreasing access and quality. Furthermore, the current system has provided disincentives to provide "cognitive care," especially primary care. Payments to physicians who do primary care do not cover all that they do on behalf of patients. Payments have not even kept up with inflation, nor with the increasing overhead costs of providing primary care, most of which are produced by the demands of government and insurance company bureaucracies. Thus, primary care in the US is dying. It is increasingly difficult for patients to find physicians who will take care them as whole patients, not as a set of different organs.

The Shadowy RUC

These biased incentives that lead to so much mischief are not the product of divine intervention or the laws of physics. They are the result of the actions of people, a few people operating in the shadows.

As we have discussed, the US Medicare system determines what it pays physicians using the Resource Based Relative Value System (RBRVS). This system determines the pay for every kind of medical encounter according to a complex formula that is supposed to account for physicians' time and effort, physicians' practice expense, and the cost of malpractice insurance. The components of physicians' effort assessed are, in turn, technical skill and physical effort; the required mental effort and judgment; and stress due to the potential risk to the patient.

To keep the system, which was started in 1990, current, requires addition of new kinds of encounters, which means encounters involving new kinds of procedures, and updating of the estimates of various components, including physicians' time and effort. To do so, the Center for Medicare and Medicaid Services (CMS) relies almost exclusively on the advice of the RBRVS Update Committee (RUC). The RUC is a private committee of the AMA, touted as an "expert panel" that takes advantage of the organization's First Amendment rights to petition the government. Membership on the RUC is allotted to represent specialty societies, so that the vast majority of the members represent specialties that do procedures and focus on expensive, high-technology tests and treatments. However, the identities of RUC members are secret, as are the proceedings of the group.

This opaque and unaccountable process has resulted in increases outstripping inflation in fees paid for procedures, while fees paid for "cognitive"medicine, i.e., for primary care, and for services that involve diagnosis, management of acute and chronic disease, counseling, coordination of care, etc, but not procedures, have lagged inflation. The effects of the RUC have been amplified by the unexplained tendency of commercial managed care and health insurance to track the RBRVS system when making their own payments to physicians.For further details about the RUC, see these posts on Health Care Renewal (here, here, here, here, and here) and important articles by Bodenheimer et al,(1) and Goodson.(2)

By the way, why the US Center for Medicare and Medicaid Services (CMS) relies de facto exclusively on the RUC to control the RBRVS system, and why the AMA made the RUC into a secret organization apparently beholden only to the organization's proceduralist members are unanswered questions.

What Reinhardt Left Out, and Why?

Professor Reinhardt, one of our most distinguished health care economists, barely touched on the biggest problems with how the US fee-for-service payment system works, and why these problems occurred. Thus, it is not surprising that the few solutions he recommended seem irrelevant to these problems.

As an aside, his discussion is not atypical of what is seen in most writings about health care policy that have to do with costs. It appears that it is politically incorrect to say that incentives are skewed, that this skewing appears to have resulted from the acts of a few individuals, and that these acts occurred with little outside attention or accountability. Why do health care policy experts follow these dictates of political correctness?

I don't know, but one possible explanation is that they are themselves biased by their own incentives. So let us further consider the case of Professor Reinhardt.

Professor Reinhardt's Conflicts of Interest

Not listed in the NY Times official bio of Professor Reinhardt are the following relationships:

- Professor Reinhardt is a member of the board of directors of Amerigroup, a health insurance company specializing in providing Medicaid and Medicare managed care. The company's 2008 proxy statement said that Professor Reinhardt owns the equivalent of 134,482 shares of stock, current value, $3,859,633 (at its current price, $28.70 per Google Financial), and got $221,422 total compensation in 2007.

- Professor Reinhardt is a member of the board of directors of Boston Scientific, a medical device company. The company's 2008 proxy statement said that Professor Reinhardt owns the equivalent of 51, 533 shares of stock, current value, $396,288 (at its current price, $7.69 per Google Financial) and got $118,885 total compensation in 2007.

In addition, per the above proxy statements, Professor Reinhardt is on the board of two funds from H&Q Healthcare Investors, and is a Trustee of Duke University and the Duke University Health System.

Boston Scientific, a device manufacturer, benefits from increased demand for its products due to physicians' pay incentives that favor the procedures for which they are used. As a director of the company, Professor Reinhardt has a duty to advance the financial interests of the company and its shareholders. Amerigroup may benefit from the current status quo in how physicians are paid. As a director the company, again Professor Reinhardt has a duty to advance the financial interests of the company and its shareholders. Thus, it seems that Professor Reinhardt's legal responsibilities to these companies might tend to bias him against actively questioning how physicians are currently paid, or proposing solutions that might upset the status quo.

Professor Reinhardt's leadership roles in US publicly traded corporations are public, but not easily found unless one knows where to look. (A previous post on Health Care Renewal did discuss Professor Reinhardt's previous failure to review relationships relevant at the time to a riposte Reinhardt wrote in response to an op-ed in the New York Times by a physician who decried the increasing commercialization of health care.)

However, the New York Times did not choose to make public these conflicts of interest. I should note that biographies of Professor Reinhardt on the Princeton web-site, and furnished by the Princeton Bioethics Forum, the Commonwealth Fund, and the Henry J Kaiser Foundation did not note these relationships. A transcript of an interview on the Public Broadcasting System Frontline show also did not reveal these relationships.

Without the knowledge of these financial relationships, one might suppose Professor Reinhardt's opinions are only based on his disinterested expertise as a well-known economic scholar. Without knowledge of these financial relationships, one might think that a secretive, opaque process skewing physicians' payments toward procedures is not an important problem for our health care system.

We have come to a critical time in the history of attempts to reform the US health care system. Whether reform occurs, and whether it does any good will depend on the quality of the debate that precedes it. Such a debate should be robust, but those involved ought to make clear where their biases and interests may lie.

Unfortunately, it may be that some of the most prominent voices in the debate are those of people with strong personal financial interests in having health care reform go in certain directions, not others. Furthermore, people with particular interests may not want certain issues to be even brought up. If these interests are not revealed, the debate becomes deceptive.

I fear that much of the debate up to now has been deceptive, and will not lead to good outcomes.

References

1. Bodenheimer T, Berenson RA, Rudolf P. The primary care-specialty income gap: why it matters. Ann Intern Med 2007; 146: 301-306. Link here.
2. Goodson JD. Unintended consequences of Resource-Based Relative Value Scale reimbursement. JAMA 2007; 298(19):2308-2310. Link here.

Post Title → What, The RUC? - A Prominent Health Care Policy Blog Leaves Some Important Things Out

BLOGSCAN -PharmaLot Bows Out

Say it ain't so, Ed. PharmaLot, one of the best health care blogs, in my humble opinion, and the premiere news blog about the pharmaceutical industry, is ending its run. Its author, Ed Silverman, took a buyout from the Newark Star-Ledger, the blog's parent organization. I hope somehow, somewhere, a replacement spring up, and that Ed Silverman goes on to bigger and better things. So long, Ed, we'll miss you.

Post Title → BLOGSCAN -PharmaLot Bows Out

Newspaper Publisher Joins Board of Medical Center - Just a Potential Conflict of Interest?

The Cleveland Plain Dealer just reported (although right now the web-link is not working correctly) a story that may help explain why stories about questionable management of health care organizations often are anechoic,

Plain Dealer President and Publisher Terrence C. Z. Egger was named Monday a Cleveland Clinic board trustee, an appointment he said will not compromise the newspaper's duty to cover the Clinic impartially.

Egger said in an interview that trustee Chairman Mal Mixon asked him to serve on the 60-member board. He accepted to be involved with the growth engine of the area economy, he said.

The Plain Dealer did at least allow that this new appointment might be controversial.

The newspaper should take steps to assure the public that Egger's role as trustee has no influence on news coverage or editorials related to the hospital, said Bob Steele, a journalism values scholar at the Poynter Institute, a newspaper think tank in St. Petersburg, Fla.

'It's dicey territory,' said Steele. 'You have competing loyalties. And competing loyalties, if not properly recognized and professionally and ethically addressed, can create conflicts of interest [that] can corrode the credibility of either organization.'

It's interesting how the paper chose to quote someone who could not bring himself to say that the newspaper publisher's new position created a conflict of interest, only the potential for one.

News reporters are usually very careful about not having any financial relationships with people or organizations about which they may report (to the point of refusing a cup of coffee from someone who someday might be in a story they would report). Yet when the boss of the newspaper, to whom ultimately all those reporters report, is now also the boss of a major hospital system, that's only a potential conflict of interest.

In fact, the wishy-washy way in which this story was reported suggests just why this sort of conflict is important and troubling. It would take a courageous reporter to write a story critical of the Cleveland Clinic, when he or she knows the newspaper's boss is a leader of the Clinic.

This story does illustrate another mechanism for the propagation of the anechoic effect.

Post Title → Newspaper Publisher Joins Board of Medical Center - Just a Potential Conflict of Interest?

BLOGSCAN - Media Hype of the Vagus Nerve Stimulator for Depression

A post on the Schwitzer Health News blog contrasted how Medicare decided that Cyberonics' vagus nerve stimulator did not have sufficient evidence supporting its use for depression versus how much hype the device has recently received from the news media.

Post Title → BLOGSCAN - Media Hype of the Vagus Nerve Stimulator for Depression