The Bottom Feeders Are Out In Force: Physician-Owned Device Distributorships

John Carreyrou in the Wall Street Journal online--
http://online.wsj.com/article/SB10001424052702304778304576373592455703056.html

--tells us that 5 senators, including our old acquaintance Chuck Grassley of Iowa, have asked the Inspector General of DHHS to investigate physician-owned distributorships. These PODs are owned by physicians and act as middlemen, buying medical devices such as spinal surgery implants from the manufacturer and selling them to hospitals. They apparently are sometimes able to offer the device at a slight discount, which the owners claim makes them a good thing.

The senators are prompted by press coverage of a Portland, OR case in which a neurosurgeon was charged with doing a lot of unnecessary surgery, which could have been motivated by his being an investor in a POD and making more money the more devices the POD sold (to the tune in that case of a cool half million a year). He denies thart he did any unnecessary surgery but he has lost his privileges and is being investigated by the state medical board. A telling point is that once the POD had the media spotlight shown on it, device manufacturers stopped doing business with it and it had to shut down.

The senators' concern is also prompted by the apparent near-exponential growth in PODs, even though they exist in a "legal gray area" according to Carryrou. (Besides the PODs themselves, another growth industry seems to be law firms promising that they'll help you set up your POD in a way that protects you from the legal system coming down on your head.)

Does anyone recall the olden days, when it was sometimes necessary to explain to physicians why they should not own a drug store on the side, and then send their patients to that drug store with their prescriptions? Maybe time for a refresher course...