Exploring the link between industry payments to doctors and prescribing habits

This article was originally published in The BMJ on November 5, 2014.

Orthopedic surgeons receive the biggest payments from industry in the US according to the Open Payments database. The next step, writes transparency pioneer Danny Carlat, is for researchers to compare payment data with disclosures of physicians’ prescribing patterns 

After substantial delays, the Open Payments website was launched on 30 September.1 The website was mandated by the Physician Payments Sunshine Act of 2010, and it is a comprehensive registry of payments made to physicians and teaching hospitals by drug and device companies. 

This first wave of reports must be interpreted in light of some data limitations and technical problems. These reports cover only the last five months of 2013, and roughly a quarter of industry payments were not published because of disputed amounts and other factors. Of the payments published, a third have been stripped of the doctors’ names because there were problems ensuring that the payments were accurately attributed to the right recipient. Therefore, only about half of all payments are both published and attributed to identified recipients. The Center for Medicare and Medicaid (CMS), the agency in charge of the database, plans to roll out the missing payments in June of 2015, along with all payments made in 2014.

Although the website is not complete, it still provides unprecedented insight into the extent and nature of financial relationships between physicians and industry. In total, companies paid $3.5bn (£2.2bn; €2.8bn) to 546 000 physicians (about 60% of all US doctors) and to 1360 teaching hospitals over the five months. The largest payments, often in the millions of dollars, went to orthopedic surgeons for royalty payments for inventing or refining surgical products. However, most payments (84%) were small and were for meals and beverages (table⇓).

Breakdown of $3.5bn payments made to US doctors in last five months of 2013
Reason for payment	Amount ($)
Research	1.5bn
Physician investors/owners	1bn
General:	1bn
Royalties and licences	302m
Promotional speaking	203m
Consulting	158m
Food	93m
Travel and lodging	74m
Education	36m
Gifts	19m

Interestingly, over 90% of the 300 physicians who were most highly paid for speaking or consulting were men, who comprise only 68% of US doctors. There is no clear explanation for this gender disparity. Women are more likely to work in lower paying specialties such as internal medicine and pediatrics and are underrepresented in specialties that are often recruited by industry for consulting. For example, only 4% of orthopedic surgeons in the US are women.

Wider moves to change behaviour

The Sunshine Act is only a transparency initiative and does not regulate what doctors can or cannot receive. However, the new website has been launched within a broader context of increasing pressure to reform industry payments. Two states, Vermont and Massachusetts, have instituted outright bans on gifts and meals, although the Massachusetts law was repealed because of concerns that local restaurants were losing income. The state’s original gift ban law of 2008 was controversial because it prohibited companies from providing any meals of any value to healthcare practitioners outside a healthcare setting. 

For several years, many of the larger companies have published their own physician payment registries, most of which were required by settlements of lawsuits alleging illegal marketing practices. As these payments have been made public, several companies have decreased their spending for promotional talks, and one company, GlaxoSmithKline, is eliminating such payments altogether.

Like industry, the medical profession is regulating itself. In 2008, the Association of American Medical Colleges published strict conflict of interest recommendations for academic medical centers, which have responded by strengthening their policies. From 2008 to 2014, the percentage of medical schools that ban their faculty from giving promotional talks has increased from 4% to 49%; the percentage of schools banning gifts and meals has also risen sharply. Since 2007, the American Medical Students Association has tracked such conflict of interest metrics in scorecards, which it publishes annually (www.amsascorecard.org). 

Disclosure of payments to doctors is also becoming more common in Europe. The French government, for example, is implementing a disclosure requirement that is similar, though not quite as comprehensive, as the Sunshine Act. In the UK, payment disclosure is based on a voluntary system run by the Association of the British Pharmaceutical Industry, a drug company trade group. Unlike the case in both France and the US, the UK system allows physicians to opt out of disclosure. This opt out provision may prevent meaningful disclosure, depending on the proportion of physicians who use it. Patients may complain that they cannot look up their doctors, and researchers and journalists may have difficulty comparing an individual doctor’s payment with peer averages if the database is incomplete.

Research possibilities

How will the Open Payments database be helpful in the future? Although the Sunshine Act was ostensibly passed to allow consumers to make more informed healthcare choices, it is likely that the site will have even more value to researchers and policy makers. The degree to which industry payments actually influence medical care has not been resolved because until now there were scant data with which to properly investigate the issue. But researchers will now be able to compare a trove of industry payment data with other databases recently released by CMS, such as detailed disclosures of physicians’ prescribing patterns.

Even before Open Payments, one research group merged the prescribing database with industry payment data aggregated by the investigative journalism organization ProPublica. They found that payments were strongly correlated with increased prescriptions of companies’ products. Such results, if replicated on a larger scale, may well lead to stricter government regulation of financial relations between companies and physicians. Such regulations, in turn, would hopefully lead to more evidence based healthcare and improved patient outcomes. If so, Open Payments will turn out to be an enterprise well worth the effort.

Notes

Cite this as: BMJ 2014;349:g6651

Footnotes

• Competing interests: I have read and understood BMJ policy on declaration of interests and have no relevant interests to declare.
• Provenance and peer review: Commissioned; not externally peer reviewed.

References

1. ↵
   Jarvies D, Coombes R, Stahl-Timmins. Open Payments goes live with pharma to doctor fee data: first analysis. BMJ 2014;349:g6003,

   
   

Payments to Doctors: The Bottom Line

There's a scene in Ghostbusters in which the characters are discussing gun safety.    

"Don't cross the streams."

"Why?"

"It would be bad."

"I'm fuzzy on the whole good/bad thing. What do you mean, 'bad'?" 

"Try to imagine all life as you know it stopping instantaneously and every molecule in your body exploding at the speed of light. Total protonic reversal."

"Right. That's bad. Okay. All right. Important safety tip. Thanks, Egon."

When it comes to the Sunshine Act and the massive database of payments just released, it's fair to say that we're all a little fuzzy on the "good/bad thing." 

 

Part of the problem is that there's too much data and too many categories, all wrapped up in a website that is tough to navigate. It's easy to lose the forest for the trees, but if we climb above the canopy we can begin to some patterns in Open Payments.  

First, let's do an overview of the large categories. CMS recently released this fact sheet explaining what has and has not been published in this first version of the website. (By the way, my sources for most of the figures in this article are ProPublica and the Open Payments website.)

• The total amount of money that companies paid out to doctors and teaching hospitals from August-December 2013: $4.6 billion.
• The amount of money that was actually published on the website: $3.5 billion
• The unpublished money: $1.1 billion. This includes both disputed payments and payments that companies are allowed by law to delay disclosing (mostly payments related to products not yet approved by the FDA). This unpublished money is a lot, but it represents a relatively small number of payments--only 199,000, as opposed to the 4.4 million payments that have been published.

Now let's play a game that I call "good payments/bad payments".

 

A "good" payment is money invested in medical innovation.  

 

A "bad" payment is money paid to doctors to join the marketing team. To be clear, there's nothing wrong with marketing per se, nor is there anything wrong with a company hiring doctors as employees to market products. Once a doctor becomes a company employee, he or she is transparently part of the company's team, and once you're a member of the team, everybody knows you can no longer be objective when you talk about your company's products.

By "bad" payments, I'm talking about money (and meals, gifts etc....) going to doctors who are apparently independent but actually are not. Their day jobs are to treat patients, but they freelance as speakers, consultants, and consumers of catered lunches. They portray themselves as objective arbiters of information, but in fact they are being paid in such a way that they are de facto members of a ghost marketing team. This is why they are such effective marketers. Ads that don't look like ads are the most persuasive ads.

 

If you're willing to accept this moral yardstick, let's start judging payments.  

Mostly good payments: $3 billion

• Research ($1.5 billion reported in Open Payments). Good because this is what gets us new medicines and devices. Sure, there are bogus studies meant to carve out market share for lousy drugs, but for the most part research is a good thing.
• Physician ownership ($1 billion). Good because this is money that doctors are getting in return for investing in companies, providing capital that encourages research and development. The $1 billion is a return on an investment in innovation. Do these docs have conflicts of interest? Sure. But they are not being used by companies as ghost-marketers.
• Royalties and licenses ($302 million). Good because these are rewards for doctors who have invented new medical devices or other products. Yes, companies have at times abused these payments, using them to curry favor with doctors. But on the whole these payments encourage medical innovation.  
• Consulting fees ($79 million, half of the $158 million reported). Consulting is a tough one to judge. Sometimes consultants help companies decide on what research to pursue (good); other times they are paid to look at ads and help companies market nonsense me-too products that cost the health care system money (bad). So for accounting purposes, I'm assuming a 50/50 split on the good/bad scale, and assigning half to the good bucket and half to the bad.

 

Mostly bad payments: $500 million

• Promotional speaking ($203 million). Bad because this turns doctors into drug reps. So bad, in fact, that GlaxoSmithKline decided it would end its promotional speakers' bureau program. The practice is now banned by half of all medical schools.
• Food ($93 million). The fastest way to a doc's prescription pad is through his or her stomach.
• Travel and lodging ($74 million). Join the marketers, see the world.
• Education ($27 million). Companies buying textbooks for doctors. Nuff said.
• Gifts ($19 million). Really??
• Non-accredited CME ($15 million). Companies teaching doctors=recipe for disinformation, with some exceptions, such as bona fide training on medical devices.
• Accredited CME ($4.2 million) Companies paying other companies to teach doctors. See above.
• Consulting fees ($79 million). See my comments under good payments. 

Granted, I've created a pretty simplistic moral universe here. Some of what I called "good" payments are probably sleazy, and some of the "bad" payments are probably legit. But, as a rough approximation:

--86% of companies' spending was mainly good for the public health
--14% was potentially bad for the public health, because it engendered inappropriate conflicts of interest in physicians.  

The question for companies is whether they can all get together and agree to stop throwing bad money after bad.
 

I'm Back! Now Let's Talk Sunshine.

Hi readers. Yesterday was my last day at The Pew Charitable Trusts--timed to coincide with the launch of the Open Payments website.

Before commenting on the website, here are some quick impressions about my last 2 1/2 years in Washington: fascinating, sometimes frustrating, often exhilerating, and overall just a great introduction to the arena of politics. Pew is amazing--work there if you can.

But now, let's talk Sunshine.

When I said my goodbyes to you in March of 2012, the Open Payments website was already delayed, and much of my work at Pew was aimed toward preventing that delay from stretching to infinity and beyond.  The site was finally launched yesterday, one year behind schedule--not too bad.

The website is not what most people were originally anticipating. Most of us were expecting a big search box where you could type in your doctor's name. Instead, what we have are downloadable spreadsheets of varying complexity. CMS--the agency in charge of the site--plans to make it more user-friendly within a month or so.

At this point, the best way to begin to peer through that complexity is by going to Propublica's website, where you can benefit from the wisdon of the undisputed guru of physician payment data-mining, Charles Ornstein.

The main headline is that companies have spent $3.5 billion on various "transfers of value" to physicians and teaching hospitals during the last five months of 2013. That sounds like a lot of money. It is. For fun, I did a back-of-the-envelope calculation and determined that companies spent $23 million/day, or roughly $1 million/hour over that period.

But let's not go overboard. Of that $3.5 billion, about $1.45 billion was for research, and roughly $1 billion was equity that physician-investors have in drug or device companies. That leaves about $1 billion in other payments to doctors and teaching hospitals. These are the potentially dubious payments.

So what do we make of these amounts? How do we judge them? Because ultimately, the reason the Sunshine Act was passed in 2010 was that not all drug company payments are morally equivalent. We must look at the data and judge which payments appropriate and which are not. 

Next post, we'll go through each category of business activity listed in the website and start to assign some moral valence to the payments.  

Preview: The Open Payments website makes companies look better than I would have thought. Stay tuned.