Oregon DOJ Demands More Transparency of Device Payments to Docs

Nick Budnick of The Oregonian reports:
http://www.oregonlive.com/health/index.ssf/2013/08/oregon_case_suggests_patients.html
--that the state Department of Justice has gone out ahead of national trends in demanding that physicians reveal to patients the payments they receive from device manufacturers, that could provide a financial incentive for them to implant more devices.
Two Salem cardiologists were fined $25,000 each in settlements in which they admitted no wrongdoing, for failing to inform their patients of fees they received from Biotronik regarding that company's defibrillators and pacemakers. The physicians were being paid fees of $400 to $1250 per implant when a company trainee was present at the procedure.
Let's look at this practice in more detail. First thing to note is that these extra "training" fees effectively doubled the payments the docs received from insurers for performing these procedures. The two physicians made a total of $97,000 and $131,000 over a several-year period, respectively, from these payments. So it's reasonable to conclude that these amounts were large enough to sway the doc's judgments about when and how many devices to implant. (Court documents revealed that one of the docs once complained to the company that he had to do an implant and there was no trainee available on that day.)
Second point--the official reason for these payments was that the company wanted its employees to know all there was to know about the device and its adjustment and placement, so that they could in turn properly instruct new physicians on their proper use. These experienced physicians were merely serving the company in this legitimate function and thereby earning all the dollars paid to them on the up and up. The problem with this is the long history of device companies pulling every trick in the book to disguise paybacks and bribes to docs, in exchange for greater volume of use of the company's product, as if it was payment for some fully legitimate service. Just how many procedures did employees need to see in order to be "trained"? Just what sort of "training" actually occurred at these sessions ("Okay, I am going to implant this device, you can come and watch")?
There is a third point that is a bit more speculative, but relates to an earlier post on this topic:
http://brodyhooked.blogspot.com/2011/10/more-on-device-industry-from-aslme-coi.html
I noted previously how, according to an insider who knows the device-implant scene much better than I do, it is not the case that these company employees are being "trained" so that they can help physicians do their jobs better. At least in some instances the company employees are being provided to the docs as free labor. They do the technical adjustments of the device which the physicians are too "busy" to learn how to do, and unwilling to pay their own technician to do for them. Having this free labor provided is of course a huge financial incentive to use that particular company's device.
Reasons to suspect that all is not on the up and up include the report, by Budnick, that Biotronik started off as a relatively small German firm and has rapidly gained U.S. market share in recent years. Reportedly its marketing practices are also under Federal investigation.
It's important to note that Biotronik was not directly a party to the Oregon DOJ action, which focused solely on the physicians' behavior. However, Biotronik did come to the defense of its docs, saying it was unfair to single them out when other drug and device companies have paid so much to so many other Oregon doctors. Somehow that does not strike this "ethicist" as a solid defense.
Another ethicist, however, was more pliant. Budnick quotes an affidavit that Biotronik also helpfully submitted to the Oregon DOJ, from my esteemed colleague Jonathan Moreno of Penn. He argued that there was no legal or ethical basis for a claim that the physicians should have informed patients of the company payments. An obvious question--unanswered in Budnick's coverage--is how much payment Prof. Moreno received for this service to Biotronik. (Another esteemed bioethics colleague, Carl Elliott of Minnesota, who's been quoted here many times before, was cited by Budnick as disagreeing with Prof. Moreno--as I would.)