“We performed a retrospective, population-based cohort study of US allopathic and osteopathic physicians practicing in 2014 per the National Plan and Provider Enumeration System, excluding other clinicians (eg, nurses, dentists) and physicians activating or deactivating their records between 2014 and 2018. Specialties were grouped by Medicare Data on Provider Practice and Specialty taxonomy classifications: primary care, medical specialty, surgical specialty, obstetrics/gynecology, hospital-based specialty, and psychiatry.
[..] Payments were aggregated per physician annually, then categorized by cumulative aggregate value (≤$10,000; $10,001-$25,000; $25,001-$50,000; $50,001-$100,000; $100,001-$500,000; and >$500,000). Values were adjusted to the 2018 Consumer Price Index.
[..] Of the 2014 cohort of 878,308 physicians, 458,269 (52.2%) received at least 1 payment in 2014, declining to 394,991 (45.0%) in 2018, representing a relative overall decrease of −13.8% and relative annual decrease of −3.5% (95% CI, −3.5% to −3.4%). From 2014 to 2018, these physicians received 49.8 million payments totaling $9.3 billion. The total value was highest in medical and surgical specialties ($3.4 and $3.9 billion in aggregate, respectively). The annual proportion of physicians receiving payments decreased over time across all specialties. However, total and annual payment values remained stable across specialties except for primary care, for which total value decreased.
In 2014-2018, 90.1% of physicians who accepted payments received less than $10,000. Among physicians receiving lesser aggregate payments, annual values decreased over time (yearly change: for ≤$10,000, −$11 [95% CI, −$12 to −$11]; for $10,001-$25,000, −$100 [95% CI, −$117 to −$84]; and for $25,001-$50,000, −$135 [95% CI, −$199 to −$71]; P < .001). Those receiving more than $50,000 accounted for 3.4% of physicians receiving payments but 82% of the total value [emphasis mine]. For these physicians, annual payment values increased or remained stable over time (yearly change: for $50,001-$100,000, $42 [95% CI, −$96 to $179]; for $100,001-$500,000, $866 [95% CI, $567 to $1165]; and for >$500,000, −$8487 [95% CI, −$21 316 to $4342]).”
Full research letter, Marshall DC, Tarras ES, Rosenzweig K et al. JAMA 2020.11.3
“Not all inducements aimed at affecting the utilization of medical services, however, are ill-intentioned. At a time when medical spending is stressing the US health care system, financial inducements aimed at encouraging cost controls or improving outcomes should be supported. To more accurately distinguish between public-minded vs detrimental financial inducements, the time has come to revisit the health care fraud and abuse laws that regulate these inducements.
[..] The Anti-Kickback Statute prohibits offering, soliciting, or receiving anything of value to induce or reward referrals or generate federal health care program business, whereas the Stark Law prohibits a physician from referring Medicare or Medicaid beneficiaries to an entity or practitioner with which the physician has a financial relationship. (The Stark Law does not apply to private insurers.) A third statute, the Physicians Payments Sunshine Act, by contrast, attempts to influence inducements through transparency rather than prohibition. It requires medical products manufacturers to publicly report any payments made to physicians or teaching hospitals.
[..] Current fraud and abuse laws lack sufficient specificity. For instance, value-based health care is an example of a positive inducement in health care. The purpose of value-based health care is to maximize patient health outcomes for the dollars spent, and this goal cannot be achieved without encouraging physicians to rethink their approach to care and pursue value. One of the ways to achieve that shift is to provide financial incentives, which are inducements to value. The Centers for Medicare & Medicaid Services adopted these inducements in its Merit-Based Incentive Payment System, which adjusts physician reimbursement based on quality, cost, clinical practice improvement, and implementation of electronic health records.
Outside the public payor system, physicians and health care organizations have been unable to capitalize on value-based health care in part because of the regulatory barriers blocking innovative uses of inducements. For example, a hospital may want to establish a care coordination program for patients discharged to a skilled nursing facility. However, any support or incentives to the facility could be considered remuneration that might induce the facility to refer patients back to that specific hospital, representing a violation of Anti-Kickback Statute. The Department of Health and Human Services has recognized these roadblocks and is attempting to modernize some of the regulations governing inducements.
[..] Patient assistance programs are another complicated form of inducement. Patient assistance programs provide financial assistance to patients who cannot afford their medications. At first glance, these programs seem publicly minded, but they are in fact funded completely by pharmaceutical companies. By covering patients’ out-of-pocket costs for a manufacturer’s drug, patient assistance programs allow manufacturers to keep prices high and capture market share from competing brand or generic formulations. Such programs may help individual patients, but by driving up spending on expensive drugs, they are problematic on a societal level.
Currently, these payments are not required to be reported under the Sunshine Act. Other fraud and abuse laws do not adequately regulate this area either. For example, the Anti-Kickback Statute forbids pharmaceutical manufacturers from running their own patient assistance programs for Medicare beneficiaries but has allowed for some charitable assistance programs. As a result, these programs are often administered by nonprofit entities, which receive large donations from pharmaceutical manufacturers. In October 2019, two patient assistance programs entered into a $6 million settlement with the US government under the theory that they were operating as pass-through entities for pharmaceutical companies to pay kickbacks to Medicare beneficiaries in violation of Anti-Kickback Statute. Patient assistance programs again illustrate that the current regulatory approach falls short in addressing the complexities of inducements present in the health care system.
Similar concerns are raised by the inducements that Annapureddy et al describe in this issue of JAMA [not the article excerpted above]. The investigators studied 145,900 patients who received implantable cardioverter-defibrillators (ICDs) by 4435 physicians using devices from 4 device manufacturers. Data from Open Payments disclosed that nearly all these physicians (94%) received personal payments from device manufacturers. Patients were more likely to receive devices made by the manufacturer that provided the highest total payment to the physician who performed the implant procedure. The absolute difference in proportional use ranged from 14.5 to 30.6. The consistent correlation between the payments to physicians and the selection of the devices is striking. Nevertheless, these payments often avoid triggering Anti-Kickback Statute liability because they may be nominally intended to cover speakers’ fees or travel costs.
[..] Marshall et al demonstrate that the Sunshine Act’s push for transparency does not necessarily reduce such payments. Marshall et al tracked general payments from industry received by 878,308 physicians for the first 5 years of the Sunshine Act, 71.5% of whom received at least 1 payment in 2014. The requirement that such payments be publicly disclosed affected physicians who received low-value payments (defined as ≤$50,000) and was associated with reductions in the value of these payments. [..] However, increased transparency had no effect on the physicians who received the largest payments (defined as >$50,000). Thus, the total value of the payments remained stable from 2014 to 2018. [..] This finding raises questions as to the actual effect of transparency in deterring problematic financial inducements.
The effect of these payments on the quality of care for patients receiving ICDs is unclear from the study by Annapureddy et al. Some may argue that if there is no difference in quality of care and no real price differential among the various options, payments to influence physicians do not violate any public policy goals and should be allowed. But inducements should also be considered in the context of the high health care costs in the United States. The payments to physicians in the report by Annapureddy et al were funded by ICD sales, and these devices would be less expensive without these payments. Furthermore, these payments may undermine the reputation and trust of the medical profession, potentially damaging the complex relationship between patients and physicians. Therefore, it is problematic that the Anti-Kickback Statute does not explicitly address these payments.
Clearly, there is a need to revisit current fraud and abuse laws to be able to more appropriately respond to the range of inducements, both positive and negative, that influence medical decision-making. Current and future approaches should move away from policing all inducements to considering the specific purposes for these inducements as the triggers for regulation and oversight. Using financial incentives to induce medical decisions is not inherently suspect. In fact, harnessing the power of inducements to address issues of cost and outcomes would help improve the value of health care. For positive inducements, such as value-based health care, a very broad exception to the current, outdated fraud and abuse laws should be created. Nevertheless, because the purposes of some inducements run counter to health care goals, current fraud and abuse laws should be revised to better address payments that drive up health care spending, such as those documented by Annapureddy et al. Legal regulatory approaches as well as professional self-regulatory approaches to address health care fraud and abuse also should be reassessed, considering that transparency may not have its intended effect.”
Reconsidering Health Care Fraud and Abuse Laws, Shachar C and Curfman G. JAMA 2020.11.3