Wall Street Journal publishes new exposé on PODs; hospitals continue to adopt anti-POD policies
The latest investigative piece by health-beat reporter John Carreyrou, ‘Surgeons Eyed over Deals with Medical-Device Makers’, published on 25 July in the Wall Street Journal, describes the potential patient harms that can result when surgeons have a financial interest in the implantable medical devices that they order for their own patients via ownership in a physician-owned distributor (POD).
The article correctly points out that the Office of Inspector General of the US Department of Health and Human Services (OIG) has written in a recent ‘Special Fraud Alert on Physician-Owned Entities’ (SFA) that PODs are ‘inherently suspect’ under the federal healthcare programmes (FHCP) anti-kick-back law (AKL). While the article correctly highlights the potential patient harms associated with PODs, it contains mis-statements of the law regarding whether PODs can be legally structured and the importance of the size of a physician’s return on investment in an AKL inquiry.
The article’s statement that such entities can be structured so that they are ‘legal’ under the AKL is misleading. Among other things, the AKL makes it illegal for physicians to receive (or hospitals or device sellers to offer) any remuneration, including a return on investment, if even one purpose of the arrangement is to induce the physician to refer patients for products or services covered under Medicare or another FHCP (such as Medicaid). The supply chain for implantable medical devices in the US almost uniformly involves direct sale from the product manufacturer to the hospital where the surgery is performed, and the hospital equally uniformly orders the implant that the operating surgeon dictates…
If you are registered and logged in to the site, click on the link below to read the rest of the Hogan Lovells briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Hogan Lovells
News from The Lawyer
Briefings from Hogan Lovells
The decision of the US Court of Appeals has raised questions about how issuers should present their disclosures on conflict minerals under Exchange Act Rule 13p-1 and Form SD.
An interesting judgment was delivered by the Honourable J Majiki on 19 November 2013 in the Eastern Cape High Court, Port Elizabeth.
Analysis from The Lawyer
As international firms question their future in these small, closely linked markets, local lawyers too are eyeing the business environment with caution
Beyond the headline infrastructure projects, UK construction work is still recovering from the clobbering it took during the slump