The majority of physicians are benefactors of meals or other goodies offered to them by drug or device manufacturers.
That’s the key takeaway from ProPublica’s analysis of 56 million payments made by drug and device makers to physicians between 2014 and 2018 released last week. It’s based on data made accessible to the public in the 2018 Open Payments Initiative authorized in Section 6002 of the Affordable Care Act.
THE OPI CATEGORIZES PAYMENTS IN 3 AREAS:
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General payments: honoraria, gifts, meals, consulting fees, and travel compensation
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Research Payments: Payments or other transfers of value made in connection with a formal research agreement or research protocol; and
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Physician Ownership Information: ownership or investment interests that physicians or their immediate family members have in the reporting entities
THE ANALYSIS FOUND:
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The total dollar value of payments by manufacturers to physicians and teaching hospitals was $9.35 billion in 2018: $3 billion in general payments, $4.93 billion for research payments, and $1.42 in “value of ownership.”
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In 2018, 627,000 physicians received gifts (general payments) reported at $2.17 billion, or $3,461 per physician. From 2014 to 2018, general payments by drug and device makers to physicians averaged $2.2 billion/year.
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In 2018, 1180 teaching hospitals received $832 million in general payments and $1.2 billion to fund their research activities.
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In the course of a year, more than half (600,000 of the nation’s 1.05 million practitioners) will receive general payments. Most of these instances (323,000) involve a meal paid for by the company promoting a new medication or device.
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2,500 physicians received at least half a million dollars each from drug makers and medical device companies in the past five years alone and 700 doctors received at least $1 million (ProPublica).
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Of the top 20 drugs with the most annual spending for physician inducement from 2014 to 2018, 6 made the list each year: Invokana (type 2 diabetes), Xarelto and Eliquis (blood thinners), Latuda (antipsychotic), the Humira (immunosuppressive) and Aubagio (multiple sclerosis). Xarelto topped the list in spending, totaling more than $123 million in payments from 2014 to 2018.
MY TAKE
Transparency about the financial relationships between drug and device manufacturers and physicians is the new normal. The correlation between inducements and the clinical judgement of physicians is certainly fertile for investigators, whistleblowers and prosecutors.
The bigger story is this: the promotion of medications and devices to clinicians and consumers is big business, prone to misinformation and potential harm to consumers. Social media enable favorable spin about products whether bona fide evidence is strong or lacking. TV ads for drugs directing patients to discuss their diagnosis with their physicians complicates matters for clinicians. And barriers to entry for for promising drugs and devices are getting tougher as providers build their own analytic capabilities to verify the efficacy and effectiveness of new drugs and devices.
I checked 2018 general payments to the three clinicians I use regularly: my internist and dermatologist received $0; my orthopedist received $365. Hardly an inducement.
Paul
PS: Last week, Luke Gregory, 63, CEO of Vanderbilt Children’s Hospital, passed away. I have known Luke for more than 30 years dating to his early career at Northeast Georgia Medical Center, Gainesville, then to Baptist Hospital and later Vanderbilt in Nashville. We’d compare notes about where healthcare was going, how leaders behave and life beyond healthcare. His sense of decency, his display of integrity and his humility were constants in a celebrated career. Luke, you will not be forgotten nor will the values you lived personally and professionally be lost on aspiring leaders. RIP my friend.
WHAT TO WATCH THIS WEEK
Ohio Opioid Settlement: In a seemingly last minute deal, 4 drug companies- Cardinal Health, AmerisourceBergen Corp, McKesson, and Teva- reached a $260 million settlement in Cleveland this morning brought by two counties (Cuyahoga, Summit) in Ohio. This deal will only serve to delay additional lawsuits throughout the country brought against the defendants. A Society of Actuaries report released last week estimates the cost of the opioid crisis will be between $174 and $214 billion this year.
Conservative Republicans Release Health Plan: Tomorrow, the Republican Study Committee (RSC) will release its health plan for the 2020 campaign as its alternative to Medicare for All. The RSC plan calls for shifting authority from the federal government to the states. FYI: Of 199 House Republicans, 144 are members of the conservative-leaning RSC.
Verma Testimony: This Wednesday, CMS Administrator Seema Verma will appear before the House Oversight and Investigations Subcommittee defending her policies relative to Medicaid work requirements, price transparency requirements and others.
Congressional Mark-up on Pelosi Drug Pricing Bill (HR3): After 10 hours of debate and a pile of rejected amendments, the drug pricing bill championed by House Speaker Nancy Pelosi advanced out of two key committees essentially unchanged last week. This week, other Senate and House committees will consider the bill with its link to an “international pricing index” a sticking point in deliberations.
Texas v. Azar Court Challenge: On July 10, the Fifth Circuit Court of Appeals heard oral arguments in the suit brought by 18 Republican state attorneys general and supported by the Trump administration. Their challenge asserts that the ACA is unconstitutional since Congress rolled back the individual penalty requiring everyone who did not carry health insurance to pay a fine. The court’s ruling is expected any day and is likely to end in the Supreme Court if the jurists concur with Judge O’Conner’s original determination.
RESOURCES
“Open Payments is a national disclosure program that promotes a more transparent and accountable health care system by making the financial relationships between applicable manufacturers and group purchasing organizations (GPOs) and health care providers (physicians and teaching hospitals) available to the public.CMS Open Payments https://openpaymentsdata.cms.gov/summary
