Tag Archives: SB 1096

Commoditization of pharmaceutical records blocked in Assembly

The Assembly Health Committee has unanimously declined to forward SB 1096 to the floor of the Assembly. I’ve written quite a bit about this privacy invasion, and it’s heartening to see this one disappear for a while.

As a reminder, SB 1096 would allow pharmacies to sell prescription data so that patients could receive “reminder letters” from third parties. As the law currently stands, pharmacies and doctors could do so themselves, but could not sell the data to others. Other states allow this privacy invasion, but fortunately California will remain the lone holdout against PhARMA’s plans to commoditize our health records. Despite the $20,000+ that health care interests invested in Sen Calderon, they were unable to succeed in passing this poorly conceived legislation.

Thank you to Asm. Health Cmte Chair Dymally and the entirety of the Committee for rejecting this.

LA Times’ Lazarus blasts SB 1096

I admit it. I'm really up in arms about SB 1096. See, I really value my privacy, and want to ensure the privacy of my fellow Californians. particularly Californians with the following conditions: Diabetes, Osteoporosis, Asthma, Chronic obstructive pulmonary disease, Cancer, Gastric disorder, Hypertension, Thyroid disorder, Organ transplantation, Chronic eye disorder, Rheumatoid arthritis and osteoarthritis, Renal disorders, Parkinson's disease, Seizures, Multiple sclerosis, Depression, Schizophrenia, Bipolar disorder, Anxiety disorders, Attention deficit disorder. Phew, that was a mouthful!

But David Lazarus, the consumer reporter at the LA Times (for now), notes another drawback of this bill that I neglected to mention:

The reality, critics say, is that this is an effort by pharmaceutical companies to help ensure that patients stick with expensive name-brand drugs and not stray toward cheaper generic alternatives. (LAT 6/11/08)

 There is a clear financial stake in this for name-brand manufacturers. They want you to keep buying ProzacTM or ZoloftTM, not the generic knock-offs that cost the system, and the patient, substantially less money.

I highly recommend the Lazarus article for its other insights.

Calderon's bill appears to anticipate that mailings may be paid for by drug makers or companies such as Adheris and not just by drugstores. It says disclosure is required “if the written communication is paid for, in whole or in part, by a manufacturer, distributor or provider of a healthcare product or service.”

I pointed this out to Calderon.

“I'm not familiar with that,” he replied. “I've never seen that part of the bill.”
He said his sole reason for introducing the legislation was to improve the health of Californians by getting more people with chronic conditions to take their medication.

Since 2002, Calderon has received at least $89,000 in contributions from drug companies and pharmacy chains, according to public records.

It's clear that Sen. Calderon dearly wants this stinker to pass. So do his contributors.

Follow up on Ron Calderon and the bill to sell prescription data

Last week I wrote a post about SB 1096, a bill to allow pharmacies to sell prescription data. Apparently that post got some attention, partially for my rather crass snark, but also for the subject of the bill.  One particular response was noteworthy. I publish the following email with permission of the author; the phone number is for the main line at Calderon's Sacramento office.


You should go back to public policy school and learn how to read a bill. You apparently don’t know how to or are too lazy. If you had bothered to do that, rather than taking the word of others who haven’t read the bill either, you’d have known how inaccurate your misinformed little column is. And accuracy should be important, even for bloggers. If you would like to discuss you can reach me at (916) xxx-xxxx.

Rocky Rushing
Chief of Staff
Senator Ronald S. Calderon
30th Senate District

Perhaps I should go back to school, it was fun after all. But, I think I know how to read a bill pretty darn well. Specifically, I'm pretty comfortable with my analysis of SB 1096.  I called the number in the email and eventually spoke to Mr. Rushing. His principal concern was a quote from the Consumer Federation of California that indicated that SB 1096 would allow pharmacies to sell data to pharmaceutical manufacturers that I quoted from the Chronicle article

“This bill would be a windfall for corporations seeking to track, buy and sell a patient's private medical records,” said Zack Kaldveer, spokesman for the Consumer Federation of California. “This would represent a significant intrusion by pharmaceutical companies into the privacy of patients. By opening this Pandora's box, consumers could wind up receiving mailings designed to look as if they came from the pharmacy yet conflict with what their pharmacist or doctor has recommended. Such a scenario would be a threat to their health.” (SF Chron 5/28/08)

First, he should think about taking this up with the Consumer Fed, but I'll address it as well.  I described the purchasers of this data as “pharmaceutical marketers.” The accuracy of that description is incontrovertible; clearly the people buying this data can be fairly described as marketers. Mr. Rushing was quite keen on saying that the data wasn't going to the manufacturers but rather to these third party data brokers. Now, that might be true in practice, but there is no limitation in the bill as written which would stop the manufacturers from attaining this data to send these letters themselves. 

The nitty gritty and some more details of the conversation over the flip.

Here's the newly crafted language of the relevant law:

Except to the extent expressly authorized by the patient or enrollee or subscriber or as provided by subdivisions (b) and (c), no provider of health care, health care service plan, contractor, or corporation and its subsidiaries and affiliates shall intentionally share, sell, use for marketing, or otherwise use any medical information for any purpose not necessary to provide health care services to the patient. For purposes of this section, a written communication mailed to a patient by a pharmacy shall be deemed to be necessary to provide health care services to the patient and shall not require prior authorization, if all of the following conditions are met:(emphasis added)

There are a bunch of limitations to this broad general exception to the California Confidentiality of Medical Information Act that you can see if you check out the bill. There's a requirement that the letters stop when there's no refills remaining or the prescription is canceled and a requirement that only the drug prescribed can be referenced in the reminder letter. There are strict confidentiality provisions in proposed Civil Code 56.10(d)(9). But nowhere does the bill stop manufacturers from purchasing the data from pharmacies. In fact, the bill explicitly contemplates that “manufacturers and distributors” will be paying for these letters by requiring a disclosure on the letter. 

Furthermore, I'm not sure having 3rd party data brokers like Adheris (aka Elansys ) having the data is really that much more comforting than having Merck or Eli Lilly having it. In effect, this bill would moot a court case brought against Adheris for doing this already. Retroactive immunity is in vogue these days I suppose. (Note: It's not clear that this would moot the court case, that would have to be resolved by the courts.)

But to the greater issue, that of privacy. Mr. Rushing makes the argument that 49 other states have this rule to allow sales of pharmaceutical records, and why is California the outlier? There is a simple response to this: Californians value their privacy. We have the toughest privacy laws in the nation, thank you, Representative Speier, precisely because we feel that data warehousers shouldn't have access to every morsel of information about us. As my mother always said, just because everybody else is doing it doesn't mean that we should too.  We needn't join that race to the privacy floor that HIPAA provides.  Our privacy laws are, and should be, a model for other states.

That being said, there are health benefits of reminder communications for chronic conditions. However, they do not need to be sponsored. The pharmacy can send out these mailings now as could the prescribing doctor.  In fact, despite whatever arguments the National Association of Chain Drug Stores and the California Retailers Association makes on the policy arguments that this is substantially better for public health (Rushing gave me a $150bn figure for nationwide savings if everybody took their meds on schedule), the fact is that the risk involved in the sales of these records outweighs the benefits. We can already provide reminders without sales of medical records financed by manufacturers or distributors. Even the California Medical Association agrees that we needn't travel this risky ground in the name of possible results.
I had a very enlightening conversation with Mr. Rushing on other issues as well, whereupon he told me that “Ivory Tower/Ivy League” elites just don't get the district. I will point out that I have been entirely educated by public schools, from kindergarten through both graduate degrees.  Nonetheless, it was all the “elites”(like me, I suppose) fault because everybody loves the Calderons in the district.  Well, at least 300 people more than those who liked Rudy Bermudez in the 2006 primary election. (PDF Results here ) Oh, Mr. Rushing also believes that they deserve their success because of their record of service.  I think that really there is too much there to even parse.

When I asked Mr. Rushing if he happened to know how many individual contributions Sen. Calderon took in last year, or at least a general comparison to how much money he had received from interests opposed to consumer privacy. He was unable to answer, but I am. Sen. Calderon over $20K  from corporations and PACs that would be benefitted by SB 1096. As to the other side of the equation, let's just say that last year Senator Ron Calderon took in no personal contributions, no contributions from privacy groups, etc. But, I suppose that's all chump change compared to what Ron Calderon took in for his “Legal Defense Fund” that he used on his recount in the 2006 election.

I'll agree that the 30th Senate District isn't a bastion of wealth, and that it needs legislators that put in effort and facetime.  It's great that people know the Calderons. But it would be even better if elections were determined not by family relationships, but by the issues and accomplishments that each candidate brings to the table. Mr. Calderon eeked out his election against Rudy Bermudez, a former Assemblyman who fought for ethics reform, and he next faces voters in 2010. I'm sure Senator Calderon will use the opportunity to discuss his achievements. We'll see if allowing pharmacies to sell prescription data is in the stump speech.

Oh, and if Mr. Rushing is interested in a policy school, I highly recommend Berkeley's Goldman School.

Ron Calderon: The Anti-Speier

Ignore the physical differences between Jackie Speier and Ronald Calderon, the jokes are too easy to make.  These two legislators are basically examples of where the California Democratic Party is coming from and where it is headed. Calderon is the past, Speier is the future.

Current Representative (and 20-year state legislator) Speier is a leader who stands up to corporations. The privacy bill that she passed is the toughest in the nation. And she passed that despite the fierce opposition of financial institutions that the bill regulated, save for the CEO of e-Loan.  Oh, and she pissed off the Republicans in the House. While the privacy bill is her hallmark legislation, she has a record that anybody would be proud of.

Calderon, on the other hand, is part of the “Mod Squad” intent on nuzzling up to the corporate trough. He is fond of the all money is good money philosophy, no matter how many strings are attached. And perhaps he knows something about which Rep. Speier speaks. In this session, he has been pushing SB1096, a bill to allow pharmacies to sell medical records to pharmaceutical marketers. The privacy implications are astounding, and unacceptable.


The legislation would allow pharmaceutical firms to send mailings directly to patients. Supporters of the proposal say the intent is to remind patients to take their medicine and order refills. But consumer privacy advocates are outraged.

“This bill would be a windfall for corporations seeking to track, buy and sell a patient’s private medical records,” said Zack Kaldveer, spokesman for the Consumer Federation of California. “This would represent a significant intrusion by pharmaceutical companies into the privacy of patients.

“By opening this Pandora’s box, consumers could wind up receiving mailings designed to look as if they came from the pharmacy yet conflict with what their pharmacist or doctor has recommended. Such a scenario would be a threat to their health.”

The California Medical Association opposes the legislation, contending that it could jeopardize patient safety and hurt doctor-patient relationships. The mailings are particularly problematic for patients with sensitive medical issues such as mental illnesses, says the association. (SF Chron 5/28/08)

The bill originally failed by a vote of 17-17, with an interesting coalition of Republicans and Democrats opposing the bill. Eventually, Calderon was able to pass the bill out of the Senate last week by adding an opt-out provision. The final Senate vote was 21-16, with the Noes including progressives like Kuehl and Migden and conservatives like McClintock and Battin.

However, opt-out is not strong enough. Heck, even e-mail marketers for retail stores like the gap have the common courtesy to ask before they send us spam. The least California can do is require that pharmacies get affirmative opt-ins to this practice. The privacy of medical records is just too important to monkey around with opt-out rules.

But opt-out wouldn’t really work for the drug marketers, would it? The data would be too sporadic to have any great value.  This bill was essentially written by Adheris, the self-described leader in “prescription drug patient behavior modification.” In other words, they’re trying to sell more drugs. By the way, they don’t have such a great record on these issues:

A primary backer of the bill is Adheris Inc, a subsidiary of a drug marketing company that was sued several years ago under its former name for privacy violations. Adheris is involved in a pending class-action lawsuit in San Diego involving the same issues in the Calderon bill. (SF Chron 5/28/08)

The California Senate made the mistake of letting this stinker slip through. The Assembly cannot do the same. Contact your Assemblymember and tell them to vote NO on SB 1096. I know I’ll be contacting mine.