Cancer Care’s Rationers-Will Obamacare Lead To Cuts in Cancer Treatments?

A new report is a warning of treatment limits to come.

The Lancet last week published the findings of its international 37-expert commission on “Delivering Affordable Cancer Care in High-Income Countries.” The prestigious British medical journal’s broadside against oncology’s “culture of excess” is drawing notice in medical circles and especially fevered attention in the land of the National Health Service. But readers interested in the medical options—or lack thereof—that ObamaCare will soon deliver should take note as well.

The report does observe recent advances in the fight against cancer, including one estimate that since 1980 “anticancer medicines increased life expectancy in the average patient with cancer by nearly 1 year, at a mean cost in the USA of $6,500.” If that sounds like good news, the report’s authors are less sanguine. Instead, their findings are long on laments that the “rapid development of new technologies” and other innovations are helping drive the world’s $895 billion-and-growing “cancer burden.”

The report does confront a vexing moral issue, and it makes nuanced concessions—about the tradeoffs between cost and innovation, for instance—that are unusual from the likes of the Lancet. By way of example, take the case of sipuleucel-T, one of a class of “molecularly targeted therapies” that “are revolutionizing the treatment of cancer.” Sipuleucel-T has been shown to improve survival by several months for patients with metastatic prostate cancer.

The authors lament that the therapy costs roughly $100,000 a head. “The treatment is proven to be effective,” muses the report, “but how shall we determine its value?” The report’s royal “we” returns again and again to such questions, claiming that “we overdiagnose, overtreat and overpromise.” And the main cure the report proposes lies not necessarily in more or better medicine, but in more allegedly enlightened forms of rationing and price controls.

The obvious answer is that “we” ought to have no business determining value, since the choice properly belongs to the patient, his family and care givers. But a government that puts itself, as Britain’s has, in the role of providing—and withholding—medical care must make such choices in the patient’s stead.

“Countries seeking to provide universal access to health care for all its citizens,” wrote the U.K.’s rationing body NICE in a statement accompanying the Lancet report, must consider the “opportunity costs often incurred by use of some expensive new anticancer drugs that offer modest benefits.”

Those choices are especially stark in Britain, which maintains one of the most comprehensive publicly funded health-care systems in the world. But the United States may not be far behind. The authors hope that ObamaCare’s various commissions will “lead to a wider application of cost-effectiveness based criteria for determining treatment entitlements in America.” They even recommend integrating cost-effectiveness with the Food and Drug Administration’s clinical approvals, along with tighter regulation of off-label drug use, which would be a disaster for terminally ill patients.

The reality is that cancer care accounts for merely 5% of total U.S. health spending, and making progress against one of the world’s leading causes of death is a leadership role that the world’s rich countries should be playing. Costs will come down and benefits will improve as genomic science allows doctors to better target therapies to subsets of patients.

One of the report’s co-authors, Karol Sikora of CancerPartnersUK, tendered an opposing view in a Daily Telegraph op-ed, writing that “society has to decide how much to put on the price of life.” A telling word that “society.” The tragedy of Britain’s socialized medical system, and perhaps soon of America’s, is that “society”—government—is now burdened by moral dilemmas that properly belong in the realm of individual choice.

Alaska Pipeline Faces Shutdown Unless Drilling Increases!!

FAIRBANKS, Alaska — When the famed Trans Alaska Pipeline carried two million barrels of oil a day, the naturally warm crude surged 800 miles to the Port of Valdez in three days and arrived at a temperature of about 100 degrees.

Now, dwindling oil production along Alaska’s northern edge means the pipeline carries less than one-third the volume it once did — and the crude takes five times as long to get to its destination.

That leisurely flow means the oil is above ground longer and more exposed to Alaska’s frigid weather; the crude sometimes arrives chilled to 40 degrees. As the flow and temperature continue to drop, experts say the risks of a clog or corrosion increase, as do the odds of ruptures and spills.

Unless a technological solution can be found, the arcane physics of crude flow may force the multibillion dollar, 48-inch-wide steel pipeline to shut down — and determine the fate of the largest oil field ever found in the U.S.

There’s one other, seemingly simple fix: Add more oil.

“If I could ask for one thing, it is to figure out how to get more oil into this pipe,” says Tom Barrett, president of the pipeline’s owner, Alyeska Pipeline Service Co.

But production from Alaska’s giant oil fields has been falling for years. Turning that around would require drilling in new areas, some of them environmentally sensitive and most controlled by the federal government.

Saving the pipeline has become a political issue in Alaska. The pipeline, which employs 2,000 people, still delivers more than 11% of the oil produced in the U.S. Almost all of it ends up in refineries in Washington, California and Hawaii. The end of the pipeline would likely translate into higher gasoline prices, which hit an average of $3.98 a gallon last week, the highest in nearly three years.

Oil companies and many Alaskan officials argue more lands should be opened to drilling so that the pipeline can get the crude it needs to flow fast and safely. Royal Dutch Shell PLC, which wants to drill off the state’s coast, recently met with senior White House officials to press its case.

Some environmentalists and federal officials say the oil companies are using the pipeline to bully the government into pushing through drilling permits or allowing access to areas that should remain protected, such as the waters off Alaska’s northern coast. So far, oil companies have expressed little interest in the controversial Arctic National Wildlife Refuge.

“We have a lot of overblown rhetoric that the sky is falling and that we need to open the federal lands and waters because of low flow in the pipeline,” says Lois Epstein, Arctic program director for the Wilderness Society, who prefers to find ways to coax more oil out of state lands in and around existing drilling sites.

The time available for arguing about the matter is dwindling.

Exploring for oil and then building the connector pipes and pump stations needed to start up a new oil field can take from five to fifteen years in Alaska. With each passing year, the pipeline is getting colder and its operation more precarious. If the pipeline is shut down, by law it must then be dismantled.

Shutting the pipeline would force refineries to find new and more expensive supplies of crude oil. And President Barack Obama’s efforts to decrease oil imports would suffer a major setback.

The pipeline “is a strategic national asset,” says Peter Slaiby, Shell’s top executive in Alaska.

Oil was first discovered at the northern edge of Alaska in 1968, when the Prudhoe Bay State No. 1 well drilled through a section of oil-bearing sands the depth of a 50-story building.

The well’s owners, Atlantic Richfield and Humble Oil, now parts of BP PLC and Exxon Mobil Corp., respectively, had found a giant. It turned out to be the largest oil field ever discovered in the U.S. and one of the largest in the world. But all that crude was underneath frozen tundra, 250 miles north of the Arctic Circle.

The oil was worthless unless it could be taken to global markets. That required an engineering marvel: the first pipeline to operate in Arctic conditions, an 800-mile-long tube from the oil fields to the port of Valdez.

Environmental opposition was fierce. An act of Congress was required to break a stalemate and secure the right-of-way. Seventy thousand workers took more than three years to build the conduit, commonly known as TAPS, which ended up costing nearly $8 billion, plus interest, in 1970s dollars.

In June 1977, after months of testing, the pipeline was ready. “Gentlemen, start your engines,” a pipeline operator called out on the radio, according to a petroleum engineer who was listening. And the crude began to flow.

For years, the Alaskan North Slope, as the area is called, boomed as companies tapped the giant reservoirs, feeding raw crude to refineries that turned it into the gasoline that Americans pumped into their cars. The operation generated profits for the pipeline’s owner, Alyeska, a company now owned by several of the world’s most powerful energy companies: BP, Exxon Mobil, ConocoPhillips, Chevron Corp. and Koch Industries Inc.

The volume of crude increased each year for the first 11 years as more and more wells were turned on. At its peak, in 1988, the pipeline carried more than two million barrels a day, about 3% of global crude.

When first tapped, the oil reservoir was pressurized from millennia of being compacted by the weight of the earth. Wells flowed without any coaxing. By 1988, oil companies had removed so many barrels that the pressure had begun falling, and so had the amount of oil that flowed to the surface.

Declining pressure and falling oil production are the norm for oil fields, and the North Slope is no exception. Today, the amount of oil being pumped is dropping by about 6% a year.

The lower the volume of oil flowing through the pipe, the slower it moves. It’s like a garden hose: Open up the spigot only slightly and the water will move slowly; turn the spigot to wide open and the water will move quickly through the hose to the other end.

In the case of the pipeline, the slow flow means the crude spends more time above ground in the cold Alaskan winters; the average January temperature is -10 Fahrenheit at one point in the route.

According to Alyeska, if the current trend continues, the winter temperature of crude in the pipeline could drop to 32 degrees by 2013 and ice crystals will begin to form inside it, putting it at higher risk of a rupture.

The problems facing the pipeline were made very clear in January, when a leak on the North Slope forced two back-to-back winter shutdowns for a total of 148 hours. Temperatures inside the pipeline dropped by almost two degrees a day. Much longer, says E.G. “Betsy” Haines, Alyeska’s oil movement director, and wax in the crude would have begun congealing, potentially turning TAPS into the world’s largest tube of ChapStick.

After the January leak, a federal oversight agency found that the low volume of oil flowing through the pipeline “has resulted in numerous integrity challenges that have not been fully addressed.” Among its concerns: ice can create plugs that damage valves and sensors; wax buildup can cause corrosion. Either can leave the pipeline vulnerable to ruptures and spills.

Alyeska engineers are brainstorming fixes to raise the temperature in the pipeline, such as adding more insulation. Another possibility involves a refinery along the route owned by Koch Industries’ Flint Hills Resources unit. Already, the refinery takes 100,000 barrels a day off the pipeline, uses some to make jet fuel, diesel and other petroleum products, and then puts 60,000 barrels of crude warmed by the refinery back into the pipeline. On a recent March day, this operation warmed the crude in the pipeline by 12 degrees.

Koch has been doing this at no cost to Alyeska, and the pipeline owner would like to draw even more heat from the refinery. But Koch says it has plans to start charging for the winter-heating service.

Mr. Barrett, the head of Alyeska, says any changes or upgrades that would warm the crude are expected to run into the hundreds of millions of dollars.

This may end up being too expensive for Alyeska owners to justify. BP, which owns 46.9% of Alyeska, says as long as the pipeline is running, it will make required investments to insure system safety.

John Miller, a former chairman of Alyeska, who is now a consultant in Anchorage, says unless more oil is added, “costs are going to go up incredibly.” Companies are charged a fee for each barrel of crude they move through the pipeline. This revenue pays for the pipeline’s operation and upkeep. As the cost of maintaining the pipeline increases and there are fewer barrels transported, the per-barrel fee will rise rapidly.

Since the January incident, anxiety in Alaska over the pipeline has soared. Oil revenues from taxes and royalties make up 85% of the state’s general revenues and provide an annual check for all residents.

Without a simple or cost-effective engineering solution, stakeholders have pushed for a political fix. Gov. Sean Parnell recently proposed cutting taxes on oil producers who drill on state land near existing wells — where federal permits aren’t required — in order to encourage more drilling. But that died in the Legislature.

A generation of production from the North Slope has taken 16.2 billion barrels from the frozen earth, according to the state. But a lot remains to be tapped under the tundra, perhaps more than 10 billion barrels. Most of this oil is more challenging to extract, and likely poses greater risks to the pipeline itself since it’s more abrasive.

Oil companies are having a hard time getting permits for new exploration from the federal government.

Shell earlier this year canceled plans to drill in the Beaufort Sea this summer because, after five years, it couldn’t get a federal air-emission permit for an offshore drilling rig. Its plans for drilling in the Chukchi Sea on Alaska’s northwest coast are also held up by a legal dispute. Exxon Mobil is also waiting for federal environmental approval, and in February, the federal government denied ConocoPhillips a permit the company had been working on for five years.

Even if permits are approved and the lawsuit is resolved quickly, Shell’s Mr. Slaiby says it would take 15 years to produce oil from the remote Chukchi Sea. He says he believes the pipeline would still be operational.

As oil prices have risen, congressional pressure on the Obama administration to expand access to domestic oil and natural gas has increased. Last week, the White House hosted a meeting with Shell on its proposed Alaska projects, to “facilitate the conversation” between the company and the multiple federal agencies whose approval Shell needs, a senior administration official said.

Interior Department Deputy Secretary David Hayes says he recognizes the seriousness of the problems facing the pipeline, but disagrees that the answer is to speed through permits in the environmentally sensitive Arctic region.

“You can’t look to the federal government as the problem here,” he says.

Some environmentalists think the more reasonable answer is to let the pipeline die a natural death.

“We have a pipeline well past its expiration date and there is an obsession with keeping the pipe full and flowing in perpetuity,” says Brendan Cummings, an attorney with the Center for Biological Diversity, which has sued to block Shell’s exploration plans. “It may be nearing the end of its useful life anyway.”

Credit: By Russell Gold

Forced into Medicare–the Social Security Trap

To Claim Your Social Security Benefits, You Must Enroll in Medicare

This week marks the first anniversary of ObamaCare, and if you are wondering where that coercive law is headed, we’d point to a case in federal court. That’s where Judge Rosemary Collyer has ruled that Americans have a legal obligation to accept subpar government health benefits.

It remains a remarkable fact that America obliges most citizens over the age of 65 to take that rickety government health plan known as Medicare. Judging by today’s growing number of health-savings options (HSAs, medical FSAs), some Americans would prefer to maintain private coverage upon retirement, rather than be compelled into second-rate Medicare. Yet the idea of patient choice offends many in government, and in 1993 the Clinton Administration promulgated so-called POMS rules that say seniors who withdraw from Medicare Part A (which covers hospital and outpatient services) must forfeit their Social Security benefits.

Several senior citizens in 2008 challenged the government, suing to be allowed to opt out of Medicare without losing Social Security. The plaintiffs paid their Medicare taxes through their working lives and are not asking for that money back. They simply want to use their private savings to contract for health services they believe to be superior to a government program that imposes price controls and rations care. They also dutifully contributed to Social Security and — fair enough — prefer to keep those benefits.

As recently as the fall of 2009, Judge Collyer provided support for the plaintiffs. She rejected the Obama Administration’s argument that the plaintiffs were lucky to get Medicare and therefore had suffered no “injury” and lacked standing. She noted the Clinton POMS are simply part of a government handbook and never went through a formal rule-making. She also refused the Administration’s request to dismiss the suit, noting that “neither the statute nor the regulation specifies that Plaintiffs must withdraw from Social Security and repay retirement benefits in order to withdraw from Medicare.”

Yet in a stunning reversal, Judge Collyer last week revisited her decision and dismissed the case. In direct contravention to her prior ruling, the judge said the Medicare statute does — with a little creative reading — contain a requirement that Social Security recipients take government health care. The Medicare statute provides that only individuals who are “entitled” to Social Security are “entitled” to Medicare. Therefore, argues the judge, “The only way to avoid entitlement to Medicare Part A at age 65 is to forego the source of that entitlement, i.e., Social Security Retirement benefits.”

This is convoluted enough, but Judge Collyer’s truly novel finding comes with her implicit argument that to be “entitled” to a government benefit is to be obligated to accept it. This is a startling break with existing legal understandings and raises profound questions as to whether Americans have a duty to accept other “entitlements,” say, food stamps or public housing. Or, as the plaintiffs attorney, Kent Masterson Brown, warns: “Anyone concerned with what will happen when the bureaucrats start writing the thousands of pages of rules that will govern” ObamaCare need only look at this ruling. “Nothing will be optional.”

That might explain why the Obama Administration fought this suit so vehemently. The government fisc — and taxpayers — would benefit if some seniors pay for their own health care. But for many liberals, the goal isn’t saving money or providing choices. The goal is to force all Americans into the same programs to fulfill their egalitarian dreams. The plaintiffs appealed this week to the D.C. Circuit Court of Appeals, and we hope for freedom’s sake they prevail.