State's $11B tobacco settlement helps jump-start health programs, services
The Pittsburgh Life Sciences Greenhouse has been one of the most talked about recipients of the state's tobacco settlement money. It, along with two other Greenhouses â€” one in Harrisburg and one in Philadelphia â€” received $33.33 million each from the
That funding was funneled through the Department of Community and Economic Development as one component of an $11 billion settlement by Pennsylvania with the tobacco companies.
But nearly every state department has had a hand in distributing state tobacco money to the Pittsburgh area into a wide variety of programs and services, which relate directly or indirectly to health, whether they're tobacco related or not.
The Pittsburgh region has benefited from the tobacco funds in myriad ways: from the Department of Aging expanding home â€” and community-based care services for seniors to the Department of Public Welfare funding care for uninsured patients to the Insurance Department creating an adult version of the Children's Health Insurance Program plan. The Department of Health issued $500,000 grants to rural hospitals surrounding Pittsburgh to upgrade equipment, gave the Allegheny County Health Department $2.9 million to create a smoking cessation program and issued $65.5 million for medical research at hospitals statewide.
Research funding ranged from a $28,721 grant to Mercy Hospital of Pittsburgh to study how drugs could reduce brain damage after cardiac arrest to an $8.6 million grant to the University of Pittsburgh for eight research projects.
But possibly one of the bigger impacts will be on the West Penn Allegheny Health System and its research arm, the Allegheny-Singer Research Institute. When the health system's former self, the Allegheny Health Education and Research Foundation, declared bankruptcy the system's research arm was diminished.
West Penn Allegheny Health System vice president Robert Burkley said the system couldn't just apply like other hospitals and universities across the state because of the bankruptcy and the splitting of AHERF between Pittsburgh and Philadelphia offices.
"It took some effort with department of health to secure eligibility," Burkley said. "It was all predicated on the AHERF debacle."
He said health system management made its case during multiple meetings over a six-month period with the Department of Health and several House and Senate representatives to resolve the issues.
"The grant, although relatively small in the scheme of NIH funding, is big money to us," he said. "This will bring some life back into the research program."
He said the system intends to attract high-quality clinicians, some of whom were lost after the bankruptcy because of depleted morale.
"When dealing with the world-class caliber physicians we have and will continue to attract, we need to have the ability to provide research opportunities," he said.
Ultimately, West Penn Allegheny received $1 million for five research projects: one regarding cardiovascular disease, three concerning cancer and one to upgrade research facilities.
Suzie Mercadante, vice president of Allegheny-Singer Research Institute, said receiving tobacco funding for research the first year it was available was very critical in reviving its research arm.
"In addition to supporting more and different research endeavors, we also were able to do upgrades to the research core facilities to bolster that mission of getting basic research dollars," she said.
"This made it much easier to accomplish."
Mercadante said they looked at the system's assets to decide where to spend the tobacco money.
"It was time to go back and visit the research mission at Allegheny," she said. "Ultimately, we choose to invest in things that parallel the clinical strengths within the West Penn Allegheny Health System."
Allegheny-Singer also received a $3.2 million grant over four years to fund studies by Dr. Stanley Shackney, director of the Laboratory of Cancer Cell Biology and Genetics at Allegheny-Singer.
His research involves early lung cancer detection and treatment by studying molecular abnormalities in cancer cells that may be detectable well before cancer reaches a critical stage.
He said the tobacco funding was significant for the project.
"We would have found a way to do it, but this funding really makes it possible to do it in a way that it could be done well," he said. "It also expanded the scope of our work so we could make it more clinically relevant sooner."
Shackney is collaborating with Carnegie Mellon University's Robotics Institute. Researchers there who have been studying robotic vision are helping to analyze the cell images to determine growth stages.
He said the tobacco money helps West Penn Allegheny and Allegheny-Singer dig itself out of the crater left by the AHERF bankruptcy.
"I've been here for many years and lived through the AHERF crisis," he said. "Things were obviously very bad during the crisis and morale needed a boost. But at this point I'm very upbeat. The tobacco money really gives us a great boost. It makes it a very jumping place in terms of research."
Additionally, he said companies may be formed to create products that they discover during research, like a special microscope that takes multiple cell measurements and probes with light to determine cell stages.
The state funding, assuming the tobacco settlement case continues to be upheld by the courts and the state continues to receive money from big tobacco, will continue flowing to projects like West Penn Allegheny research.
But because of the breakup of AHERF and the resulting slowing of the flow of National Institutes of Health grants, which are the basis of distributing much of the tobacco research funds, West Penn Allegheny's take next year could be reduced to a third of what it received this year, Burkley said.
The jump-start the tobacco funding was able to give Allegheny-Singer this year, will assist in garnering other funding in years to come.
"The curve will turn when we acquire more grants," he said.
This year, state Department of Health ended up being fairly even in its funding distribution for research splitting the $65.5 million fairly evenly between the western and eastern side of the state. The Pittsburgh region received $30.1 million and the rest of the state received $33.3 million, which includes $7.3 million to Penn State University. The bulk of the $33.3 million went to Philadelphia-area hospitals and universities.
The Department of Health this year also distributed $41.4 million statewide to create a comprehensive program of statewide, community and school-based efforts to educate people about the dangers of tobacco products and reduce tobacco use.
The Allegheny County Health Department received the most funding in the Pittsburgh region â€” $2.9 million â€” to create its smoking cessation program.
The state's funding not only went to research ways of curing smoking-related cancers, it also went to treating people no matter their illness.
The Department of Public Welfare received $15 million from the tobacco settlement in 2001 to create a program to compensate hospitals for the care they provide to people who are unable to pay. Pennsylvania does not have a public hospital system to treat indigent and low-income people, so charity care at for-profit hospitals is the only access to health care for some people. The cost of charity care, however, has put some of Pennsylvania's hospitals in a financial crisis and threatens access to health care in many urban and poor communities.
West Penn's Burkley said this new funding is appreciated, but the reimbursements hospitals receive now do not cover the cost for health care for people who use the emergency room as their primary care physicians. "Every dollar helps, but when you're dealing with a Medicaid program that continues to be underfunded, it still doesn't come close to bridging the gap," he said.
He said hospitals are continuing to lobby the state to improve reimbursements, particularly for more outpatient care dollars.
The state's Insurance Department created "adultBasic," an insurance plan for low-income adults modeled after Pennsylvania's CHIP plan. It provides basic health care coverage to adults who earn less than 200 percent of the federal poverty level and who are ineligible for Medical Assistance or Medicaid.
More than $76 million from the National Tobacco Settlement will be spent on adultBasic in the first year alone. About 40,000 Pennsylvania residents will benefit from this program, which costs users about $30 a month.
West Penn Allegheny's Burkley said the program is still too new to determine what impact it will have on making hospitals more financially healthy.