This isn't discussed much, but the healthcare provider industry has traditionally been a major sector of interest for private equity. Hospital companies like HCA, dental clinics, ambulatory surgery centers, etc.
Healthcare providers are attractive to private equity 1) because of stable, non-cyclical cash flow, 2) benefits to scale (ie better negotiating leverage with payers), 3) ability to easily increase revenue at small clinics by "optimizing" billing (ie use more lucrative codes for the same procedure) and practice management (optimizing procedure mix and scheduling) and 4) regulatory protection -- local monopolies enjoy durable economic advantages and often are politically entrenched as healthcare providers are major employers
These factors aren't limited to private equity backed healthcare, though. Even non-profits take advantage of these things (sutter health in the bay area is an example). If you're looking for why US healthcare is so expensive, this isn't a bad place to start
There was an NPR (I think it was NPR) story about how medical helicopter rides have skyrocketed in cost.
The issue was a lot of private equity folks realized that you could just get in the market and if you didn't get enough rides... you just cranked up the price and went after individuals who where hardly in a position to shop around when they needed the ride.
Now there is an excess of medical helicopters, solution? Crank up the price...
In ancient Rome, Crassus owned the fire department. When there was a home on fire, Crassus would negotiate the price for extinguishing the fire with the owners or tenants.
I mean, this is close to being right, but it's wrong in every one of the details.
Crassus didn't own the fire department. Crassus owned a bunch of slaves who he had trained to put out fires.
Crassus didn't charge for extinguishing fires. If your house was on fire, Crassus took his team and negotiated to buy your house. If you sold it to him, he'd put out the fire. There was no flow of money from you to Crassus under any circumstances. (But he could get a low price, because the value of your house was constantly dropping while it burned.)
In imperial times, private firefighting groups were illegal since they were viewed as a potential source of rebellion. (Using your own slaves to put out fires on your own property was of course fully legal.) It's in my mind that Crassus benefited from similar laws, but he was active during the Republic. Maybe someone else knows more about the precise timings.
A fire department is a service that will put out fires for the public.
Crassus only put out fires on his own property. Rome didn't have a fire department. Firefighting was expected to occur on a volunteer, as-needed basis.
Crassus would also negotiate deals with neighboring houses that were in danger if the fire spread. In densely-packed Rome a fire two or three houses down could suddenly make continuing to own your little piece of property a risky venture.
People often wonder what the point of tenure is. Well this is it. Those authors need to not back down, and call attention to this. If they're tenured researchers or professors, they should be able to make publications like this without fear or retaliation from the school or industry.
All tenure does is largely protect you from getting fired. They can still do a fair amount of damage though you still have employment. Lab space can be reduced, it can get harder to get approvals for research, decreased funding etc.
It's not a deflector shield, but "Protects you from getting fired" is, itself, a powerful tool. Especially at public universities with potentially hostile legislatures/boards of regents.
In Sweden you cannot fire people on permanent contracts (that you need to give after 2 years) if you still require their work, i.e., you cannot fire someone without cause and then hire someone else to their exact job. In the Netherlands it is also extremely difficult to get rid of an employee with a permanent contract that you need to eventually give to them. In all cases I personally know of, permanent contract employees were basically paid by the company to agree to leave.
Tenure doesn't prevent you from being fired ever; it just requires a process to determine that you are being fired for cause. That is already the case for all workers in countries without US-style at-will employment.
In Bolivia, there’s a right to “job stability” in the constitution written in 2008. Supreme Court here interpreted it as “right not to be fired”. There is precedent of people complaining to the ministry of labour asking to be hired again after getting fired and getting away with it. It’s stupid, but it’s a counter example.
For example german academics suffer from the fact that they have to change state after some years. Short term contracts can only be prolonged so long. After that you get a permanent position which university rarely wants. Therefore they tell you good bye. And that is because it’s almost impossible to fire someone with a permanent position. (Not the best source: https://www.timeshighereducation.com/unijobs/article/academi...)
In what country can you not fire your own employees?
In Germany, you need strong reasons to fire an employee: intentionally causing accidents/damage, theft and other felonies related to your work (so, no firing your employee for drunk driving off the job) or failure to improve performance. The other thing is due to closing of the department or the location or the company going bankrupt, but these cases are often enough fought over in court and especially if the company is not bankrupt it's difficult to get someone fired.
Very interesting, honestly I prefer the American system where you can be fired at any time but if fired without cause you are entitled to continue receiving some portion of your paycheck from unemployment insurance.
In many (most?) European countries you cannot legally fire an employee at will. There needs to be a process, and the employer has to be able to show that the employee cannot or will not perform even adequately (or actively harms the employer eg. by stealing), cannot be trained or reassigned to a more suitable position.
Let’s not engage in Whataboutism. We’re talking about the US, specifically. In the US, specifically, being tenured and having protection against being fired is a powerful tool.
It's still a powerful tool in any country regardless if it's the default or not.
"At the University of Florida, our professors do fearless research" -- title to a piece by the UoF PR department, milking an easy win for all it's worth.
I don't think it is reasonable to require research conclusions to be censored or changed just because big money is involved.
Why don't the opposition fund some independent research or independent replication study if they believe so strongly that this research needs to be shown incorrect.
Surely you can leverage your quality research to find better funding. If anything, situations like this should actually help your career—what better signal you’ve found a good vein of research?
I'm not sure that knee-jerkingly smearing him (by association) as a racist eugenicist quite disproves the point that tenure is not protection from misguided attacks.
Tenure protects the professor from the school, not the school from industry lawsuits. Only a sane legal system and consequences for frivolous lawsuits (if this is in fact frivolous) would be relevant here, as the school isn't (yet) trying to punish the professor for this.
Thanks for the correction. However, many doctors that are in mainly clinical practice but publish occasionally under the university umbrella do not generally on a tenure track. So their title may be associate professor, but they are not generally tenured. However, if they spend a significant amount of time in research they may still have tenure track.
Can someone link to the paper? The best thing we can do to combat this sort of thuggery is to shine light on it and try to go full-on Streisand effect.
It sounds to me that what is being monetized is the authority of doctors. There's a lot of medical conditions where you rely on the doctor to tell you what to do. After all, you don't have a degree in that.
Now I can buy a clinic and pressure all the doctors through an incentive scheme that they are not used to, and get them all to nudge the borderline cases into must-act cases. And chances are each individual case is somewhat defensible, and the doctor is still an authority. It's perfect, the doctors are not even going to admit their bias. But as a whole, a lot of people will be on treatments that they wouldn't have been on.
That's one thing I noticed at my dentist years ago. It used to be a family practice but then they sold to a larger company. From then on every time I was there they tried to push another expensive treatment in addition to regular teeth cleaning. I am not an expert so how could I judge this recommendation? Maybe it's in my best interest or maybe they just want to make more money. Eventually I just stopped going there because I had a bad feeling. You should be able to trust your doctor but it's really hard to do so knowing that they are after profit mainly.
Yup same here, they had a rotating team of dentists who swapped seats every week and often times tried to upsell me on procedures and one had the audacity to joke I was costing them money cause I had no cavities or work needed "it's good for you, not good for me" said with a chuckle, while I rolled my eyes and got the hell out of there eventually finding a family practice I could trust.
It sounds to me that what is being monetized is the authority of doctors.
I think what you've described is really the US healthcare system as a whole.
I really don't understand why this isn't more of a focus of discussion. The US healthcare system is so monopolized, and so lacking in competition and transparency, it's obvious why healthcare costs are skyrocketing.
I understand the outrage over this story, but I don't understand why it might be surprising to some. So much of the US healthcare system is driven by similar incentives, especially at private, for-profit hospitals (and even at nonprofit public hospitals).
Think about it this way. Take some fundamental human need. Now legislate and structure society so only a relatively tiny number of people with a specific certificate, based on program completion, not skills demonstration per se, can supply that need. Go even further and structure the regulation of that certification by people who already have the certificate, under the argument that they are the only ones who are in a position to judge it. Now reinforce the whole thing by FUD arguments that any other approach will lead to catastrophe, illness, and death.
What do you think is going to happen?
Almost everything about the US healthcare system is characterized by rent-seeking, monopolies, or power structures and lack of transparency. It's begging for corruption. If you wanted to design an economic sector so as to drive up costs, you'd end up with something that looks basically like US healthcare.
A salaried person still has room for perverse incentives. The wine-ing and dining by drug companies is famous, and not counted on any salary form. It makes no difference.
Yes, the situation described by the OP is ultimately due to those incentives not being kept in check by the customer, as there is little incentive for them to research the care.
A socialized healthcare system is actually truer to a functioning free market than what we currently have. By negotiating prices and treatment ahead of time (albeit collectively), both sides of the transaction have the ability to make informed decisions. Whereas in our current system prices are (at best!) negotiated by a sick person while they're over a barrel, and in most cases not even negotiated just let ride on the roulette wheel of health "insurance".
An open market (transparent, competitive, and payer-indifferent prices) could be even better, especially for more elective less time sensitive procedures like dermatology. But that's a long ways away from how things currently are, and in the opposite direction of how they're moving.
Bloomberg has still not retracted its story about the Chinese spyware despite heavy pressure from Apple and Amazon. So I guess that shows that at least some journalist can cope with it.
What is the value that private equity and/or VC are adding to dermatology? I guess what I'm asking is, why would the physicians be interested in sharing some portion of their income with these non-physicians?
Medicine, like other guild professions like law, dentistry, and accounting, is an enterprise which seems to naturally fit the partnership model instead.
Medicine is a market for lemons, so reputation/brand is important. Many good doctors are full up on patients, but if they can convince you that an unknown doctor in their practice is just as good/under their supervision, they can pocket some of those gains.
This doesn't really require private equity, but PE is providing a way to get a lump sum for this to doctors, and milking that cash cow.
There is also a growing remote/virtual dermatology sector which can see gains from technology, but I doubt PE is involved.
There is a strange bit about being a doctor or lawyer -- you aren't allowed to for a C corp for your own practice. However, if someone else forms the corp and you work for them, then you get all the protections of a C corp, as long as you don't own the majority share.
> There is a strange bit about being a doctor or lawyer -- you aren't allowed to for a C corp for your own practice.
1. In at least some U.S. jurisdictions (and possibly all), lawyers' practices can indeed be set up as corporations; my former firm was an example. The individual lawyers in the firm are still personally liable for their own malpractice and for that of any junior attorneys and/or staff whom they supervise. The corporate form does protect them from personal liability for the office lease, etc., unless they've personally guaranteed the lease, which is not uncommon. (Don't know how it works for doctors but I assume it's similar.)
2. "C corp" is an income-tax classification; AFAIK it has nothing to do with non-tax liability.
C Corp is a legal entity classification, along the lines of S Corp, LLC, partnership, and sole proprietorship. What might be confusing is that S corps can use pass-through taxation or retained earnings (C Corp) depending on what the owners choose. There are various forms of partnerships with different levels of liabilities to the partners: general partnership, limited partnership (LP), limited liability partnership (LLP), etc. Partnerships generally provide much less protection than a C Corp.
The same thing they add to any other business: Better management, efficiency, etc..
I don't think any profession 'naturally fits the partnership model'. Some professions have simply managed to enshrine protectionism for themselves into law. There's precious little evidence that this is in any way beneficial for consumers and serves to do anything other than enrich the members of the professional guild at the expense of the public.
The value add is an enthusiastic pursuit of profit. Ownership by a collection of doctors drives lower margins/profits than ownership by a private equity firm. Economies of scale can also help, but that’s not the driving reason behind PE acquisitions. There’s a degree of good faith/naïveté when medical providers and pharmacies bill insurance providers. PE firms can leverage this expectation and push for increased costs with little, if any, additional overhead.
When you've got 10+ doctors sharing the same building & infrastructure etc then it starts looking more like a classic business. Accounts receivable department etc
Simple economics of scale. centralizing a highly effective management and financial instruments create a lot of value, often called a roll-up strategy. a company worth 1 merged with a company worth 1 is typically worth more than 2.
I am a general surgeon employed by a hospital system in the southeast.
PE / VC don't add anything other than trying to skim a profit off the top of medicine, like any other capitalist. Dermatology is a lucrative practice. They don't have to work in hospitals, so they set their own hours. VC/PE's are doing the long game - purchase a practice (dermatology / anesthesiology, orthopedics ) and reward the current partners who basically get to receive compensation for their future earnings. In return, the current partners accept a lower salary going forward. Lucrative with guaranteed $$$ for senior partners with a few years left to practice. For new partners not so much. And definitely not for new hires. The problem is that the cost of establishing a new practice is overwhelming. You can plant a stake as a new physician in a town, but then you have to rent an office / furnish it / equip it / and employ people without any guarantee that you will get patients.
Or, when you graduate with $300k debt, you take the job that pays you $200k / year guaranteed with no risk, but accept the fact that you will be earning less than you generate. And I'm sure there's a non compete clause (I have one).
What will happen, over time, however, is that less and less people will choose that subspecialty, just like what happened to pilots.
Of course, then the VC/PE will just close shop and walk away.
In general surgery, our reimbursements have been lower than any other surgical subspecialties for years, but our saving grace is that you really can't have a hospital without a surgeon. Here in SC, there are ZERO self employed general surgeons. 30% of what we do are urgent/emergent interventions, and tons of people here in SC have either medicaid or no insurance. When I became a hospital employee, my salary tripled. Before that, if I made > $150k that was a good year. And that's 80 hour work weeks.
Because that was typical around the nation, general surgery went from being one of the most competitive residencies to one of the least. My senior partner (10 years older) was top 5% of his class. I was top 25%. For about 5-10 years, all you needed to get a residency spot was to graduate from medical school. It's recently become more competitive, probably bc most of us are employed, boosting our salaries.
Hospitals make their money from the facility fees. I do all my surgeries in my hospital system's hospitals, not the competitor's hospital.
Dermatology is one of, if not the hardest, medical professions to match in, because for whatever reason, their reimbursements are high.
For example, if I do a laparoscopic appendectomy on an 80 year old, I get $623 (CPT 44970). They'll spend a couple of days in the hospital which is not chargeable by me bc 90 days of post op care is included in the fee.
A dermatologist that cuts off a 1.5 cm skin cancer in his office gets $251 to cut it off (CPT 11602) and $307 to close the wound (12032). No nights / weekends / and pretty stressless procedure (to me).
So is it usually the case that whenever you see a group run medical practice, in comparison to a solo practice, that the facilities are managed by some sort of larger VC/PE group, assuming they are a private,for-profit organization rather than a hospital owned by the city or local university?
The business side of healthcare is fascinating and somewhat terrifying once you follow the money and see how this correlates to positive patient outcomes. I hope more researchers are willing to study this phenomenon without fear of losing career prospects.
no. Some are a conglomeration of private practices that joined to better negotiate with insurance companies, some are owned by other entities, some are independent. My group was self employed up until 5 years ago, but no insurance company would talk to us to give us a raise because they said we were so small (and wouldn't drop from being a provider). They didn't look to see that we didn't own a lab, a CT scanner, a surgery center, etc... They just knew we had no leverage. Now, my colleagues that remain independent say that insurance companies ask them what can we do to keep you independent? b/c when a hospital owns all the physicians in a county, they pretty much get the upper hand in the negotiations.
Basically, it's a bunch of business people making maneuvers to try and extract as much money from the system as possible, which is why it's >$30k / year to insure a family in the USA. This makes small businesses unable to compete against companies located in socialized medicine countries, in my opinion. It also makes it impossible to compete against a business that does not offer insurance to their employees.
Eventually, we'll go single payer, bc it cannot continue at this rate.
PS - Any non profit organization has to publish their tax returns. Search Form 990 and the non profit name to pull it up. All non profits have to publish the top 20 earners - some will be administrators and others will be physicians.
you should write a more extensive article on this, you explain it extremely clearly and the public's respect for your profession will mean that people will listen.
Thanks for sharing this. It was a great appendum to the article and useful to understand the practicalities of how some surgeries/appointments in the USA medical system are funded (and how some medical practices/clinics are private equitied).
I have no proof they are involved, but my wife and I both had a visit to a dermatologist last year. Both of us were then recommended for excisions. She was 29, I was 28.
Everything came back pretty much normal.
We were sent to this fern after a friend went there. He also had an excision. Also under 30.
Now, we feel pretty much like we were played. Maybe this is relevant to this issue.
This summer I made the mistake of going to a large dermatology practice with several locations because a dermatologist I had seen a few times before was unavailable. I had what turned out to be essentially contact dermatitis. The large corporate practice ended up billing almost $900 for this including an unnecessary biopsy. I assumed that this was simply a rogue practice, but this news story makes me see this in a new light. Apparently the field of dermatology has been identified as a lucrative profit center by P/E firms and these sort of dermatology practices are being built up to strip mine the out of control medical-insurance complex here in the US. The logical next step is for these equity-backed firms to use their capital to acquire the majority of dermatology practices in a region and be able to dictate pricing.
I'm sure that this area of medicine has been selected by equity firms because of the prevalence of cosmetic-related procedures that are inherently high-margin in this field. But there is so much money being sucked into this sector of the economy that this will encompass other types of medicine. The other area that seems to be active now is hospice care - the large insurer Anthem just bought a large palliative care provider this year. How this is not playing both sides of the trade kind of escapes me.
The whole health care sector is starting to resemble the payday loan market on a vast scale and with even less regulation. And with 2 profit-seeking players interested in shaking down the consumer in every transaction, not just one. Or, one player pretending to be two players for maximum profit.
Vertical integration is happening everywhere, especially due to advances in technology allowing for much greater economies of scale. Insurers have to combine with each other to get bigger to negotiate with providers and pharmacies, providers have to combine with each other to get bigger to negotiate with insurers, pharmacies have to combine with each other to negotiate with drug manufacturers and PBMs, drug manufacturers combine with each other to negotiate with insurance, and finally, insurance combines with pharmacy and PBM (Aetna/cvs) to negotiate with drug manufacturer and providers.
Telecoms, computers, retailing, everything is trending towards a handful of big players with enough vertical integration to be able to survive. Initially, this is could be good for consumers as the cost savings of economies of scale might be passed on to them, but we will pay for it at the end when there is only 2 vendors to choose from and they dictate the price.
That's why we should discourage company growth beyond a certain size. They grow because they are better than the competition but at some point they can just overpower any competition or just buy them out.
When the companies are the same type of business, it is called horizontal consolidation, not vertical integration. Vertical integration is a company buying its supplier or its customer.
Yes, I started off my comment referring to Anthem purchasing Aspire Health the previous commenter referred to which is vertical, but then I abruptly transitioned to talking about horizontal integration. I was trying to convey that because of the horizontal integration, the next step is to go vertical like insurance is doing with providers and PBMs and pharmacies.
I've re-excised melanoma's in young people and excised moles that I didn't think looked like melanomas that came back as being them. Metastatic melanoma kills. The recovery room of one of our local hospitals is named after a nurse who died at age 32 of metastatic melanoma.
No physician wants to be the one who says - don't worry about that -
having said that, if a dr recommends excision, and you're hesitant, get a second opinion.
but I also think that dermatologists see and biopsy so many lesions, that after a while, they should be able to be very selective in what they biopsy.
So I wonder if there is an opportunity to create a service that let's you look up the center you are visiting, and seeing who the investors/ owners are. Then you can filter away any that has gotten bad stars/reviews based on bad practices.
You'll have a huge problem with uninformed reviewers. It usually doesn't become apparent you've been receiving substandard care (or over care) for quite a while, if ever. Maybe you could contact this by taking reviews only from patient advocates?
I would use this initially, until it got enough traction that paid/incentivized reviews destroyed it. I can think of at least one clinic I’d have avoided.
The core underlying issue is fee-for-service [1] which inherently incentivize overutilization of services.
We have been and should continue pushing for better alternatives. ACOs [2] and integrated managed care [3] are promising possibilities and there are assuredly others.
Young dermatologist here - its an interesting time for my and my derm friends. We frequently discuss if the introduction of a PE profit motive will shunt care away from the complex, comprehensive patient exam to a more 'problem-focused' model.
The proposed changes to Medicare reimbursement - which essentially pays the same for an office visit regardless of complexity - seems to be also pushing that way.
Speaking only from personal perspective, helping complex patients is incredibly rewarding and I would absolutely hate for the system to steer the specialty away from that.
> Starter comment: NYTimes discusses an article that details Venture Capital buying dermatology practices that do an unusually high proportion of high dollar procedures. The article made it through peer review and was posted as an article in press. It was suddenly pulled. The AAD’s incoming president works for an VC Owners clinic and sits on their board. Lawyers for one firm called lead authors institution to demand changes. This is a huge assault on academic freedom. More so than any nonsense from Washington. Coming on the heels of AAD telling multiple people incorrectly that they failed the board exam over the past few years, this is another major scandal that could result huge changes. Or retaliation.
From another comment there that is a tl;dr of some the problem:
> VC involvement in derm practices is a huge, huge issue. One of the bigger practices in town recently was bought by a VC firm, and, lo and behold, all their borderline melanomas now, after being read by their "new" pathologist, need re-resections to get more ti$$ue. I no longer refer to them. Don't even get me started on electronic brachytherapy.
After just finishing "Bad Blood", the book by John Carreyrou on the Theranos fraud, this particular passage in the article had me incensed:
> This week a lawyer for Advanced Dermatology and Cosmetic Surgery, which is backed by private equity and is the largest dermatology practice in the United States, called the general counsel at the University of Florida, where two of the authors are employed, demanding specific changes to the paper.
I'm disgusted by these high-powered law firms using thuggish tactics to try to silence critics. I have no problem with these lawyers responding to the article, in public, after it is published, but using the threat of expensive litigation to shut people up is just gross and morally bankrupt.
Agree. Related thought: the influence of lawyers in tech firms - witness the draconian EULAs users are 'forced' to accept with a false binary choice of accept or not - and the role that corporate law staff have had in software development, by effectively limiting the rights of users.
It seems to me that many technology firms copy-and-paste the soul of EULAs to protect themselves (against the worse cases that may arise) with little thought about the effect these long list of restrictions cause. It often seems it cascaded from Microsoft's use of EULAs from Windows 95, Office 95 and onwards, because it was the norm to consumers in that 'monopoly' environment.
The role of lawyers in suppressing ideas, choices and debate - be it in healthcare (the USA dermatology sector as per the OP article) or in technology - the Hacker News set - warrants further debate.
Especially if ethics are to play a greater role in the future of technology - as seems to be the general consensus of forward-thinking governments and progressive technologists.
I think this legal arms race is a consequence of America's overly-litigious and profitable legal system.
These EULAs are the equivalent of warning labels on soda bottles that loosely read "Warning: Contents under pressure, don't point at your eyes"... who is that written for? We laugh and call it unnecessary, but that warning exists because there is precedent that must now be defended against.
When those ludicrous cases are widely used as a means of attack or personal enrichment, of course corporations will respond with excessive legal restrictions. Their shareholders don't want to lose money to frivolous lawsuits or be exposed to risks competitors have covered.
Corporations (and their shareholders oh god) are not poor persecuted victims. Corporations govern our lives. They should not be free to do whatever they want. With the intentional erosion of most means to settle civil disputes, the court is the last refuge for the individual against a private group. The people behind tort reform (you know who they are) don't even care about the specific "frivolous" lawsuits themselves. They care about getting rid of environmental, consumer, and worker protections in general. Because they stand in the way of profits.
> I think this legal arms race is a consequence of America's overly-litigious and profitable legal system.
I would concur with this. From the software firm's perspective, there is less risk in being overly cautious (i.e. EULAs) than to have less restrictive and open rights.
Maybe there is a need for a standard common-law contract that provides a set of 8-10 basics and then any companies have to specifically spell out what is different in their personal EULA - and the user can either accept or reject those additional terms? A true accept or reject, that is, and not just two buttons ;)
But then why are EULAs allowed in countries that are far less litigious?
Are other countries compelled to adopt the EULA for their citizens (convenient!), lobbied or pressured via free- or other trade agreements with the USA (soft/smart lobbying!), or are we, as users to blame for pressing 'accept' without any lobbying efforts of our own?
Considering the many YouTube videos of exploding bottles, the warning is for the 10000 people a day learning something for the first time. What's wrong with using literacy to help people learn from the miatskes of others?
Users don't read. We have warnings in my state next to elevators that read "Ensure elevator is at this floor before entering". This is literally accurate but practically ludicrous.
The solution to problems of this nature is almost always redesign.
That's due to allergen labelling regulations. Since a lot of stuff can contain artificial almond extract or other substitutes when labeled as almond-based or flavored, the regulations don't carve out any exceptions, even when the allergen literally is the product.
Allergen labelling is a huge blessing to anyone with serious allergies. Yes, labeling A Package of Allergens with 'Contains Allergen' might feel weird, but it's critical for non-obvious ingredients and contaminants.
So for consistency's sake it's better to just always list allergens, rather than have the regulations say "except when it's bizarre and nonsensical." Otherwise, someone has to decide where that boundary is.
I don’t think it’s really that hard to draw the line. You can still err heavily on the side of safety while not requiring a bag of nuts to warn about the nuts it contains. But our legal system doesn’t go for that sort of nuance.
The US law on allergen labeling does actually have this nuance, but sellers probably chose to err on the side of caution. See section 203 (a) of the Food Allergen Labeling and Consumer Protection Act of 2004:
> If it is not a raw agricultural commodity...
> ...except that the name of the food source is not required when ... the common or usual name of the ingredient uses the name of the food source from which the major food allergen is derived
Why not have a warning label? It's, what, perhaps 4 words extra?
How do you draw the line? Is the exception "if the item is exactly X and labeled exactly X then it doesn't need to contain an allergen notice for X"?
Or is it any broader? What specific knowledge should we assume that everyone knows?
If someone sees the name "milk", should they assume the product contains dairy? What about soy milk? What about peanut butter or coconut cream - do they contain dairy? Does Grape-Nuts contain grapes or nuts?
You might say that all of those should be obvious. But why make that assumption at all?
Isn't it easier to say that all products containing one or more of a given set of allergens must list those allergens? Because that's a really easy line to draw. It's clear to the producer, clear to the consumer, and clear to the legal system.
No, I think it's a bit humorous because coffee is and always has been widely known and accepted to be served piping hot, often near boiling. Same with tea and mate. If you order a pot of tea from any decent shop or restaurant, it will be served full of freshly boiled water. The closer to boiling the better. Do you think all teapots should have big warnings enameled on their sides as well? Should all knives have "WARNING: SHARP" engraved on the blades?
That woman burned the skin off her genatalia when McDonald's served a far too hot coffee. After they refused to pay a small amount to cure her injuries (remember, no socialized health care in USA), she sued. She offered to settle, again for a small amount to cover expenses, and McDonald's refused again
McDonald's launched a massive PR campaign to mock her in order to pollute public sentiment in favor of corporations over victims, so thejury awarded $2.7 millions in punitive damages to defend the public against McDonald's brazen attack on himan society. The Judge lowered the award to $640K; and McDonald's appealed, refusing for the third time. They eventually settled for a confidential amount.
To add context, the original awarded amount was calculated to be the revenue of a single day of coffee sales for McDonald's. Stella Liebeck had originally sued for ~$50,000, to cover the cost of her medical bills, which McDonald's refused to do. Additionally, the award was calculated at that amount as a punitive measure, because McDonald's had received hundreds of complaints from customers of the coffee being too hot, which it summarily ignored. The coffee had been a problem; McDonald's just didn't care.
Unfortunately, the lawsuit, and the seemingly 'ridiculous-at-first-glance' nature of the headlines surrounding it, was used by several companies to push for specific tort reforms, which were mostly to the detriment of the average public.
There's more to this than "Dumbass sues company because hot coffee was hot".
McDonalds had received a few hundred complaints out of 10 billion cups of coffee served. The temperature of the coffee was not a problem; it was, and still is, the temperature at which all good coffee shops and restaurants serve coffee, including McDonalds. If you go get coffee at McDonalds (or Starbucks or pretty much anywhere else) it will be served to you at around 80 deg C, and sometimes even higher. This temperature is recommended by professional coffee associations [1], and it's the temperature at which any decent coffee machines holds your coffee.
It sucks that Stella Liebeck was injured. Nobody deserves that. But she was burned because she squeezed a cup of hot coffee between her legs while she messed with the lid. This is, by any reasonable criteria, an abuse of the product, and protecting a few people from such foolish choices would mean depriving everyone else of decent coffee. Fortunately that hasn't happened yet.
No, the coffee was not far too hot. It was served within the temperature range that was, and still is, recommended by professional coffee associations like the NCA [1]. Most good coffee establishments serve coffee in the range of 160 degrees F (71.1 degrees C) and 185 degrees F (85 degrees C). Yes, all temperatures in that range present a burn hazard. I have trouble believing that a reasonable person would assume it's safe to put a newly-served cup of hot coffee between their legs and take the lid off, which is what poor Stella did.
Nobody like to remember that folks went there because the coffee was extra hot.
She didn't get burned because McD's served hot coffee - she'd been drinking that for years? She got burned because just as she took the top off to put in sugar, her grandson gunned the motor and spilled it.
So who's 'fault' is all this? In law you can sue for money from anybody even remotely connected with an injury. So she chose McD's instead of her grandson - no surprise. But was it right?
Uh, it was McDonald's fault, as proven by the several legal battles this woman won. This continuous questioning of settled arguments is absurd. They served the woman boiling hot coffee - it's simply not drinkable or safe to handle at that temperature (and shouldn't even have been brewed over 180...)
You're not a coffee drinker are you? :) The optimum brewing temperature for coffee is 200 deg F (94 deg C), plus or minus a few degrees. This is the range recommended by professional coffee associations such as NCA and SCAA [1], and is the range used by pretty everyone, from Starbucks to your local diner. The NCA recommends that coffee be served at around 80 deg C (which is what burned Stella Liebeck); this is a perfectly reasonable service temperature, widely used by most good coffee shops and restaurants, including McDonalds to this day.
The "settled arguments", as you say, were questionable to begin with, and businesses continue to struggle with how to balance decent coffee service and protection from frivolous lawsuits. But the only thing that's really changed since Stella's lawsuit is the addition of warnings on coffee cups, just in case anyone else decides it's a good idea to squeeze a cup of hot coffee between their legs while they fiddle with the top.
Yet she had handled it before, as had millions of other people. No, this was a case of 'who can I sue to get paid for my injury', which is an epidemic these days. That's also well known, and its disengenous (and massively naieve) to assume that winning a legal battle means you are in the right
I believe if you are recieved dangerously hot beverages(that could melt your skin) where there is no context to expect the beverage could harm you, and are injured from it, then it shouldn’t be your fault. If I ask for a glass of water from a restaurant, should I handle the glass of water as if it could give me frostbite? What if they handed me super cooled water that damaged my hand as I accidentally touched the surface as I ate food? How can it be my fault when there is no reasonable danger to be aware of?
Again, not the case in this particular instance. And further, the cup was very hot, and the lid secure. Those straw men are irrelevant - it wasn't by touching the cup that the litigant was injured. It was willfully removing the top.
How would she be at fault if there is no indication that willfully removing the top would expose liquids so hot that it would melt her skin? There is no reasonable expectation to be served coffee that will melt your skin when exposed to it.
I understand where you're coming from, but I don't think you understand the temperatures involved here. Stella was burned by 80 deg C coffee. Guess who else serves coffee this hot? Everybody. ALL good coffee shops and restaurants serve coffee in the range of 160 degrees F (71.1 degrees C) and 185 degrees F (85 degrees C). The National Coffee Association informally recommends the higher end of this range, around 80-85 deg C, and McDonalds still serves at this temperature or higher.
Anyone who drinks coffee at shops or restaurants, or makes coffee in a decent coffee maker, has experience with 80+ deg C coffee, and any reasonable person should know not to squeeze a cup of it between their legs while they take the top off, which is what Stella did.
> Agree. Related thought: the influence of lawyers in tech firms - witness the draconian EULAs users are 'forced' to accept with a false binary choice of accept or not
The comedy option is to print it out, cross out and initial each clause you disagree with, sign it, and mail it to them certified with a letter saying you agree under these terms please write back if they don't agree.
This actually works with all contracts of adhesion, but you will get a lot of confused looks from the flunkies.
Would be of interest to note how many users have submitted such requests/letters, since GDPR took effect in May of this year.
If lawyers, and by extension, the management/C-level teams of software firms - who either direct, endorse or approve what the lawyers put in the EULAs to begin with - can stick it to users, why shouldn't users be able to stick it back to them?
These aren't critics. These are scientists. Changing their results to suit corporate interests is a fire-able offense, and they are honor-bound to not retract unless the truth of their results are in question.
Giving overly generous Yelp reviews is fine, who cares? Publishing "generous" science as fact is morally wrong.
I'm disgusted by these high-powered law firms using thuggish tactics to try to silence critics.
The actions of Boies law firm, as documented in the book, are particularly egregious. Worse still is that Boies himself has a track record of being super tech savvy; he’s litigated against Microsoft and Google. As he was a board member at Theranos, it stretches credulity that he wasn’t more aware of the deception. Paid in equity too, how is that not a conflict of interest? How is it even legal?
I don't think it's a conflict of interest. They got paid by Theranos for their services.
But there should be some ethics about helping clients with a lot of money bullying people with no money. Reading about the way Theranos abused whistleblowers with the help of lawyers was infuriating. The little guy simply has no chance against this unless you are willing to risk everything.
It hinges on how plausible the scenario is that you can be a board member with a history of effortlessly mastering complex technical concepts, and all around you are whistleblowers asserting that the technology is a fraud, in which case your equity is worthless, and you decide that the best course of action is to abuse the legal system to intimidate them into silence. It's documented in the book that the family of one whistleblower ran up massive debts defending themselves, and a key scientist was hounded into committing suicide. It's not mentioned in the book that any of the lawyers ever wondered if maybe there might be something in all these reports.
Anyway, read the book and draw your own conclusions about the characters involved.
It creates an environment where the attorney is incentivized to protect his/her own investment in the company, above and beyond representing the company's interest and the interest of the law.
I think it is ok to contact the authors of a paper if you think they got something wrong or omitted something important.
However, here it was not a scientist calling the authors, but a lawyer calling the general counsel. This is a clear hint that the call was not about correcting an error in the paper, but about bullying them and preventing the public from reading what the authors have to say.
This isn't really about the lawyers though. It's about industries getting so large and so centralized that it becomes economical to throw money (aka. lawyers) at quieting a dissenting paper.
It might not even be to try to get changes made, it might have its value in researchers thinking about how irritating and time consuming and possibly stressful it is to speak up next time.
There is nothing “thuggish” about demanding corrections of factual errors, and it’s not “gross and morally bankrupt” to engage to talk about those changes instead of waiting for the damage to be done after inaccurate facts are published. The law protects you from that. I suspect that you’re presupposing, without a basis, that the cited errors are not errors but rather unflattering characterizations.
In any scientists-vs-lawyers battle I would be more than happy to let the scientists publish before the lawyers get to have their say. It is possible that this is a complaint on merits but given the past performance of the legal profession in situations like these the chances are much better than even that they are protecting some commercial interest rather than that they are suddenly interested in accurate and factual reporting by scientists.
That is not an accurate description of the situation as far as I can see it. The one group of doctors is a bunch of researchers, the other group is a large corporate entity that makes gobs of money from certain products.
> Dr. Matt Leavitt heads Advanced Dermatology and Cosmetic Surgery, the largest dermatology practice in the United States, which is backed by private equity. It is one of the practices that objected to the article.
So the guy graduated a Dr. That does not presently make him a doctor other than in the legal sense. For all practical purposes in this dispute he is a businessman that sees his revenue stream endangered and moves to protect it using the law. This has absolutely nothing to do with two doctors arguing over 'who is right' or 'what is true'.
It is the head of a private equity backed business. That he also happens to be a dermatologist is not the key - unless you think he would have complained if he were only a dermatologist and not a big-business owner?
From the NY article:
> Eight days later, after an outcry from private equity executives and dermatologists associated with private equity firms
So the complained is from business people. If any of them also happens to be a dermatologist that does not seem to be the key, they don't complain about anything medical. That's because the paper was
> a research paper on its website that analyzed the effects of a business trend roiling the field of dermatology
>> I'm disgusted by these high-powered law firms...
It's not the lawyers so much as the private equity folks who hired them. Asking lawyers to forego business on [subjective] moral grounds is similar to doing so for engineers - like recent refusals to work on government projects. Some will, some won't.
This is the moral equivalent of "I was just following orders." You always have a choice whether to engage in unethical behavior, and subverting the scientific process certainly qualifies as such.
Conflict of interests on one side, sociopaths isolating a few words out of their context to have a rant on the other side; both are more dangerous than bad science, to be fair, but this is the spirit of the times.
The issue seems to come down as to wether or not the paper had factual inaccuracies. Many academic papers are withdrawn, just check out retractionwatch.com.
Healthcare providers are attractive to private equity 1) because of stable, non-cyclical cash flow, 2) benefits to scale (ie better negotiating leverage with payers), 3) ability to easily increase revenue at small clinics by "optimizing" billing (ie use more lucrative codes for the same procedure) and practice management (optimizing procedure mix and scheduling) and 4) regulatory protection -- local monopolies enjoy durable economic advantages and often are politically entrenched as healthcare providers are major employers
These factors aren't limited to private equity backed healthcare, though. Even non-profits take advantage of these things (sutter health in the bay area is an example). If you're looking for why US healthcare is so expensive, this isn't a bad place to start