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Stanford’s 'Freebies' Ban Doesn't Advance Medicine


Stanford’s 'Freebies' Ban Doesn't Advance Medicine

Paul Howard, Paul Howard October 18, 2006
Health PolicyOther

Pharmaceutical and health-care equipment firms have come under fire for exerting an unseemly influence on medical practice by promoting newer and pricier products to doctors and patients. Get “commercialism” out of medicine, the critics thunder. But they actually have it backward. More consumer information and marketing, not less, is what healthcare needs.

Unfortunately, the critics have persuaded several prominent academic medical centers—most recently, Stanford University’s—to ban all industry-sponsored activities and “freebies”: free lunches, drug samples, or any other promotional materials. “The academic medical center is a place medicine looks for leadership,” Arthur Caplan, director of Penn’s Center for Bioethics, tells the Los Angeles Times, “They are just places . . . where you try to keep the commercial aspect absent.”

Everyone agrees that direct financial conflicts of interest should be routinely disclosed. But Stanford’s policy seems more about protecting the moral authority of doctors and administrators than advancing patient health.

Before demonizing companies’ marketing efforts, let alone banning them, the nation needs to have a real debate, with hard evidence, about the proper role of market incentives in health care. Unlike other sectors of the American economy, where consumer choice and information technology drive productivity gains, health-care providers—in part because of doctors’ ingrained reluctance to discuss costs with patients—tend to offer consumers very little information about the quality and pricing of services.

As a result, there’s little consumer demand for improved services, so quality suffers across the health-care system, even as prices spiral ever higher. In a 2002 study, for instance, Dartmouth University researchers found enormous variations in Medicare spending across geographic regions—spending on patients in Miami was more than twice that of patients in Minneapolis, with no link to improved health. The study also found a “systematic underuse” of cost-effective services like colon cancer screening or routinely prescribing proven drugs to heart-attack patients. A more recent RAND study found that Americans received “agreed upon standards of care” (based on national guidelines and other metrics) only about 50 percent of the time. The study concluded that better care depended on the “routine availability” of health-care info and patients becoming better advocates for their own treatment.

Marketing helps achieve both these ends, not only keeping doctors up to speed on the latest advances in medical devices and prescription drugs, but also educating consumers to seek treatment for un- or under-treated conditions. David Cutler, a noted health economist at Harvard, has observed that direct-to-consumer advertising for new drugs during the 1990s helped revolutionize the treatment of depression. “Many people approach doctors because of the ads,” he notes, “and doctors are more receptive to patients with the condition as a result of pharmaceutical companies’ efforts.” Prohibiting drug marketing to doctors and direct-to-consumer advertising for new treatments would only reduce the ability of physicians and consumers to make better health-care decisions.

Through their own marketing efforts, moreover, pharmaceutical and medical-device companies expose themselves to constant criticism and debate—exactly as it should be in a vibrant marketplace. Doctors can sort through medical studies to reach their own conclusions and consumers can use intermediaries from Consumer Reports and Web MD to do the same.

Ultimately, patients and doctors benefit far more from the heated competition of profit-driven medical research than from the isolation of an academic ivory tower.