PODs Put Profits Above Patients – The Result is Bankrupting our Integrity
By Scott Lederhaus, M.D.
Association for Medical Ethics President
November 5, 2015
As a neurosurgeon, spine surgeon and President of the Association for Medical Ethics, I have spent the last several years speaking out about the pervasive effect Physician Owned Distributorships, also known as PODs, on the medical community to my colleagues, patients and the media.
A POD is an entity whereby a physician owns the medical devices or implants he/she puts in their patients. It has been found that a physician is more apt to implant excessive hardware for the sake of enhancing income when using implants the surgeon owns and then sells to the hospital. Today, anyone with a backache and a degenerative disc is a surgical candidate, at least according to these surgeons. The corruption surrounding physician-owned distributors and the idea that every patient with any level of low back pain is a surgical candidate is nothing short of unbelievable. It was estimated by the Office of Inspector General based on data from 2011 that 20% of all spinal fusion operations were done using POD implants. I suspect that number is under-reported.
Think twice about belonging to a POD. Despite what the healthcare attorneys who set up these distributorships are telling us, a POD is NOT a legal entity. They do not satisfy the Safe Harbor protection and thus are always suspect of violating the anti-kickback statute. All physician members of a POD can all be individually investigated, even if only one of the surgeons is in gross violation of the anti-kickback law. Thus, all members could be investigated for their participation in the POD. Also, all POD members are potentially liable for product failure with requirements to report these failures to the FDA, since the POD owners are now owners of the implants.
I find it repulsive that physicians could act in such egregious and heinous ways towards their patients. Physicians have a higher calling, and we are entrusted by our patients to have their best interests in mind. It never ceases to amaze me how the administration and medical staff at some hospitals enable these "caregivers" to permit such activity. It's all about money and not about proper patient care or quality. Gone are the days of quality care since the insurance industry has largely done away with considering contracting with quality physicians. The insurance companies currently select physicians based on who will contract for the lowest reimbursement.
As a consequence, patients are considered a commodity and these “caregivers” can needlessly operate and implant non-indicated hardware in their patients. The implant surgeon and hospitals are the only ones who benefits in this scenario. Forget what the patient needs.
Patients are unaware this even occurs. However, spine surgeons around the country are very familiar with this level of corruption and deceit. Unfortunately, the ethical spine surgeons and our surgical societies have not taken a stance or voiced their opinions publicly due to fear of retaliation from defamation and libel lawsuits. This has to change, and the good doctors of this country have to stand up for their patients and do what is right.
The spine industry needs a thorough cleaning. Guidelines need to be followed. Patients cannot be subjected to unnecessary or excessive surgeries that the surgeons themselves would not undergo. As Dr. Gerald Rodts stated in his 2010 Congress of Neurological Surgeons presidential address, "It can no longer be the 800-pound gorilla in the room that everyone is ignoring. We all need to make it a personal mission to call out those outliers who are threatening our ability to care for our patients in the future with treatments that are supported by medical evidence."
Dr. Rodts is right. In the five years since his presidential address not much has been done to change the unethical approach to the spine. It's up to the spine surgeons to monitor and report these unethical and dangerous surgeons. What will you do?