April 21, 1991

BRINGING DOWN THE GREAT WALL Writings on Science, Culture, and Democracy in China. By Fang Lizhi. Edited by James H. Williams. Translated by James H. Williams and others. Introduction by Orville Schell. 336 pp. New York: Alfred A. Knopf. $19.95.

FISHING is good on most of the Housatonic River but anglers say a nine-mile stretch between Cornwall Bridge and Lime Rock offers some of the finest trout fishing anywhere. This section of the river, where any fish caught must be thrown back alive, is rated by many sport fishermen as comparable to legendary trout streams like the Beaver Kill in New York, the Madison in Montana and the Yellowstone in Wyoming. Gary LaFontaine, who writes books and articles on fly fishing, called this part of the Housatonic "a national treasure, a world-class trout stream, offering Western-style fishing in a spectacular Eastern setting."

On a Thursday afternoon at NBC's Studio 8H in Manhattan, Angelo Moore, Fishbone's lead singer, was swinging from the rafters. Wearing a natty sharkskin suit and pointed two-tone shoes rendered incongruous by his Mohawk haircut, he climbed amplifiers, strolled on a ledge and dangled from the steel girders of the "Saturday Night Live" set.

THREE years ago, a worker at Dresser Industries in Stratford asked to be promoted but admitted he could not read. Soon after, another of the company's employees, who was unable to decipher a warning label, mixed a cleaning solution with acid and caused a co-worker to burn his hands. "We realized we had employees who could not read," said William A. Ridolfi, manager of industrial relations at Dresser, a manufacturer of pressure gauges and temperature instruments. "But we had no means by which to address the problem."

In a fundamental shift, the Federal Government will explicitly weigh cost as a factor in deciding whether Medicare should pay for new medical procedures, devices and drugs for elderly people. A confidential draft of new Medicare rules, now awaiting a final clearance that is usually a formality, says an "explosion of high-cost medical technologies" has made it necessary to consider cost in deciding whether to expand, continue or terminate coverage of specific services. Medicare decisions about the coverage of new items and procedures have an impact far beyond the Federal program, because private health insurers often follow the Government's lead in deciding whether to pay for goods and services. 'Justify the Additional Cost' Since the inception of Medicare 25 years ago, Federal officials have decided whether to cover new services and procedures, like liver transplants and magnetic resonance imaging, on the basis of their safety and effectiveness. Now the Government intends to consider another factor: whether an item or procedure costs more or less than the alternatives already approved for use by the 34 million elderly and disabled people enrolled in Medicare. Under the new rules, Medicare officials can ask the manufacturers of new devices and drugs to show whether "the added benefits justify the additional cost." Specter of Rationing Care The overall cost of Medicare tripled in the last decade and is expected to reach $104 billion this year. Medical equipment plays a central role in services provided by doctors, hospitals, nursing homes and laboratories. Some services, like kidney dialysis, have contributed to the increasing cost of Medicare but saved thousands of lives. Health-care providers say the new policy is troubling because it lays a foundation for the rationing of medical technology. Moreover, they question whether the Government has the legal authority or the expertise to evaluate "cost-effectiveness" as a factor in deciding whether Medicare should pay for particular items. Historically, it has not been a criterion. Experts in the field note that new medical devices are often very expensive when they first come on the market. Sometimes the price declines as competitors enter the market and doctors become efficient in using a device or procedure. But sometimes the price stays high. Gordon B. Schatz, a lawyer who specializes in health-care issues, said the new rule "may create barriers to technology that would have been approved for the use of Medicare patients in the past." For example, he said, the new standards could block or delay Medicare coverage of positron emission tomography, a diagnostic procedure used to measure and assess activity of the brain, heart and other organs. Mr. Schatz said the rule "may put a burden on the pocketbooks of the grandparents of America, who might have to pay for new life-saving technology themselves, in the absence of Medicare coverage." But in a preamble to the new rule, the Department of Health and Human Services says, "We do not believe Medicare beneficiaries would be disadvantaged" by the Government's new emphasis on cost-effectiveness. Cost Is Held Relevant The department proposed the rules in January 1989, solicited public comment and received many letters objecting to the use of cost-effectiveness as a factor in decisions about Medicare coverage. The final rules, signed by Gail R. Wilensky, head of the Federal Health Care Financing Administration, acknowledge those concerns, but retain cost-effectiveness as a criterion. "Considerations of cost are relevant in deciding whether to expand or continue coverage of technologies," Dr. Wilensky said in a memorandum to Dr. Louis W. Sullivan, the Secretary of Health and Human Services. If Dr. Sullivan approves the rules as expected, they will be published in the Federal Register, taking effect 30 days later. New diagnostic techniques that cost money in the short run could help save money in the long run if, for example, they reduce the need for surgery. The machinery used for positron emission tomography (PET) costs $4 million to $5 million, more than twice as much as the equipment used for magnetic resonance imaging, which records pictures of bones or organs that are far more detailed than X-rays. But doctors say the PET scan is sometimes preferable because it shows how an organ functions, not just how it looks. Under Federal law, Medicare pays only for items deemed "reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member." Medicare officials have interpreted those terms to mean that an item must be safe and effective and accepted in the medical community. The new rule says that the Government and its Medicare contractors, which review and pay claims, will use cost-effectiveness as "an additional criterion" in deciding whether to cover medical technology and procedures. Larry A. Oday, a lawyer in the Washington office of Vinson & Elkins, who represents hospitals and manufacturers of medical devices, said: "Potentially, this regulation could lay the legal foundation for rationing of new medical technology, or even for withdrawing coverage of existing technology. Technology seems to be a convenient scapegoat for the increases in health costs." Mr. Oday used to be in charge of Medicare coverage and payment policy for the Government, Current Medicare officials deny there would be any adverse effects on beneficiaries. A likely result of the new criteria is that companies conducting clinical trials of new medical devices will have to collect evidence of their cost-effectiveness in order to obtain coverage under Medicare. Thomas A. Boardman, assistant general counsel of the 3M Company, which makes a wide variety of health care products, said: "Our industry will be able to prove that high technology can be cost-effective. But the collection of additional data will impose an additional burden and may mean that it takes more time for products to become generally available to patients." More than 300 individuals and groups concerned about AIDS and cancer urged Federal officials to consider paying for experimental drugs under Medicare, which covers a relatively small number of people with AIDS. But the Bush Administration rejected the appeals and reaffirmed the Government's longstanding position that Medicare will not cover experimental items, even "treatments of last resort" for people who are desperately ill. Exceptions Are Urged Thus, while the Food and Drug Administration has allowed treatment of AIDS with an experimental drug known as DDI, or dideoxyinosine, Medicare does not pay for it. Representative Henry A. Waxman of California, chairman of the Energy and Commerce subcommittee on health, said Medicare should make exceptions to that policy. "Once there is sufficient preliminary evidence regarding the safety and potential effectiveness of a service or procedure to justify clinical research, it would be reasonable to allow Medicare coverage," subject to some restrictions, he said in a letter to Secretary Sullivan. The Food and Drug Administration also said that Medicare should cover the costs of certain experimental drugs used in treating people with AIDS or other life-threatening diseases when no alternative therapy is available. While Medicare standards are set by the Federal Government and its contractors, states have broad discretion in deciding which items should be covered under Medicaid, the health program for 27 million low-income people. Medicaid coverage of drugs and devices varies from state to state.