Questions grow about billions flowing to specialists over medical hardware
Patients, regulators, hospitals, and doctors themselves need to open their eyes and ask tougher questions about the eyebrow-raising trend occurring among a specialized set of “sawboneses” — orthopedists and neurosurgeons.
Hundreds of them are profiting handsomely, not on their medical skills but rather their investments in and relationships with surgical hardware. The specialists also are increasingly reliant, in dubious fashion, on medical device salespeople.
Fred Schulte, an investigative reporter with the independent, nonpartisan Kaiser Health News service, has written a pair of detailed news articles raising yet more questions about medical devices, specifically the $3 billion that floods a peculiar pipeline between those who operate on patients’ backs, knees, hips, and shoulders and the companies that provide the surgical hardware for the procedures.
This is far beyond a nuts-and-bolts business for the medical specialists, who typically earn $500,000 annually for their toil in surgical suites alone. It’s no longer the chief income source, though, for rising numbers of orthopedists and neurosurgeons, Schulte found, reporting:
“Hundreds of orthopedists and neurosurgeons have cashed in on stakes in companies that design, manufacture or distribute orthopedic implants — sometimes after investing little or no money — and despite ongoing ethical and legal concerns … KHN found that surgeons had stakes in more than 200 privately owned device companies from 2013 through 2019. At the end of 2019, their holdings topped $300 million in value. Doctors can dispute the payments but rarely do so. Device makers often reach out to orthopedic surgeons for help designing or evaluating new implants, a practice they say spurs innovation and leads to safer, more durable devices. Offering feedback can land surgeons lucrative royalty and consulting deals or stock holdings that escalate in value when startup device companies are sold. In other cases, surgeons have owned a piece of distributorships that buy implants from manufacturers and resell them at a profit.
“Whistleblowers and government fraud fighters have argued for years that money passing from industry to doctors can corrupt medical judgment, inflate costs and lead to unnecessary operations or otherwise harm patients. Some of the harshest criticism has been directed at surgeons who profit from the sale of orthopedic devices — from spinal implants and screws and other hardware to artificial knees and hips that typically cost thousands of dollars. Federal officials warned as far back as 2013 that these sales could violate federal anti-kickback laws.”
Specialists, of course, must work within legal-ethical boundaries with their medical-related enterprises, KHN reported:
“It is legal for doctors to work for, or own a piece of, a medical business as long as their compensation is not tied to the volume of its products they use and provided that medical decisions are made in the best interests of patients. Several surgeons’ organizations encourage members to keep detailed records of the services they provide, accept only ‘fair market’ compensation from device makers, and fully disclose industry ties to patients and their peers in scientific journal articles and professional meetings.”
At the same time, it has become blurrier, Schulte reported, when big name specialists — especially those with reputations built on their care and treatment of famous athletes or with ties to major sports organizations — receive stock grants, or other investment incentives in device-making companies or specialized hardware.
The orthopedists and neurosurgeons insist they work hard for their money. They defend their outside businesses, including hardware distributorships that would make auto parts dealerships blush, arguing that practitioners in their specialties are noted for designing, tinkering, and improving materials they work with daily — often to their patients’ benefit.
But federal regulators have expressed growing worry about doctors’ outside businesses interfering with the safety, effectives, and cost of patient care, Schulte reported. Officials say the set-up is ethically fraught, with high potential for practitioners to experience excessive pressure to use certain, more expensive gear more often, particularly if colleagues do so and profit from this. It also adds to costs for patients and institutions if they must stock what effectively become warehouses of hardware, depending on specialists’ wishes — and without demonstrable differences between types of gear.
Who’s behind that mask in the OR? It may be a device salesperson
Schulte, separately, draws on lawsuits and other documents to detail how the spiking choice, complexity, uncertainty, and novelty of medical hardware has led to doctors’ dubious reliance on salespeople for the gear.
Medical device companies are paying select, elite sales staff big money to undergo extensive training on surgical products, telling doctors that these folks not only know the hardware but are versed, too, in its use. This has led them to be invited into operating suites, where they gown up and purportedly act as living reference guides to hardware — devices and implants — with which the medical specialists may be unfamiliar. As KHN reported, this can turn into a less than optimal situation for patients:
“Device makers train sales reps to offer surgeons technical guidance in the operating room on the use of their products. They pay prominent surgeons to tout their implants at medical conferences — and athletes to offer celebrity endorsements. The industry says these practices help ensure that patients receive the highest-quality care. But a KHN investigation found these practices also have been blamed for contributing to serious patient harm in thousands of medical malpractice, product liability, and whistleblower lawsuits filed over the past decade. Some patients allege they were injured after sales reps sold or delivered wrong-size or defective implants, while others accuse device makers of misleading doctors about the safety and durability of their products. Six multi-district federal cases have consolidated more than 28,000 suits by patients seeking compensation for injuries involving hip implants, including painful redo operations. In other court actions, patients and whistleblowers repeatedly have accused device companies of failing to report injury-causing defects to federal regulators as required — or of doling out millions of dollars in illegal kickbacks to surgeons who agreed to use their products. Device makers have denied the allegations and many such cases are settled under confidential terms.”
This is what KHN quoted Dr. James Kang, chairman of the orthopedic surgery department at Brigham and Women’s Hospital, saying about the proliferation of complex medical devices, at a Harvard Medical School roundtable discussion published in 2019:
“’In orthopedics, we are inundated with a multitude of new implants that debut each year.’ Kang said surgeons often rely on industry reps in the operating room for guidance because it is ‘usually burdensome and difficult’ for surgeons to know ‘all of the intricate details and nuances’ of so many products.”
Here’s KHN’s counterpoint to that view:
“As hospitals resume elective operations stalled by the coronavirus, some industry critics see an opportunity to rethink orthopedic surgery practices — from sales to tracking of injuries. Some want to keep industry reps out of operating rooms and place tighter restrictions on their access to hospitals. They say the current system needlessly drives up health care costs and exposes patients to risks such as infection from extra people in the operating room. Reps counter that their incomes have been dropping due to global purchasing arrangements that give hospitals greater say over prices for surgical equipment. Sales reps say their technical knowledge and skills make operations safer for patients and note that many surgeons enjoy the security of having them present in the operating room. Reps also say they perform tasks that hospitals would need to hire additional personnel to do, such as keeping track of device inventories … Dr. Adriane Fugh-Berman, a professor of pharmacology and physiology at Georgetown University, said device reps are viewed as part of the operating room team even though they are there ‘to sell products. That is pretty horrifying from a patient’s point of view.’ She said hospitals should train staff to perform these functions. ‘Relying on sales reps in the OR is appalling. We need to come up with a better system.’”
In my practice, I see not only the harm that patients suffer while seeking medical services, but also the damage that can be inflicted on them and their loved ones by defective and dangerous devices, notably those of the medical kind.
As treatments, prescription drugs, and medical devices become more complex, uncertain, and costly, patients — and doctors and hospitals, too — find themselves relying on the supposed expertise, experience, and judgment of regulators at agencies like the federal Food and Drug Administration or the Federal Trade Commission. Taxpayers will fork over huge sums this year to fund the sprawling FDA and its $6.5 billion budget.
Jeanne Lenzer, a seasoned medical investigative reporter, has found that 32 million Americans — about one in 10 of us — have at least one medical device implanted in our bodies. These include artificial joints, cardiac stents, surgical mesh, pacemakers, defibrillators, nerve stimulators, replacement lenses in eyes, heart valves and birth control devices. Most patients — indeed most of the public — may think federal regulators subject all this hardware to rigorous quality and safety testing.
That’s a wrong assumption. And though medical devices may be helping change and save many lives, Lenzer and others also warn they are harming and even killing too many patients. Under pressure from pro-business, anti-regulatory politicians and lawmakers, federal regulators have allowed a “Wild, Wild West” to flourish in the medical device business, she has argued.
We have much work to do to rein in Big Pharma and medical device makers, so the huge sums that they can inject into and extract from the U.S. health care system do not foster waste, fraud, and abuse but rather go to significantly improve patient care.