Conflicts of Interest James G. Anderson, Ph.D. Department of Sociology & Anthropology

Questions What situations represent a Professional Conflict of Interest? How extensive are conflicts of interest? What challenges do they pose for the traditional physician commitment to act on behalf of the patient? What has been the medical profession’s response? How do professional groups deal with this problem? What steps should the medical profession take to cope with conflicts of interest?

Definition Conflict of interest refers to any situation in which an individual with responsibilities to others (including professional responsibilities) might be, consciously or unconsciously influenced by financial, or other factors that involve self interest (JAMA, 1994)

The Problem Current practices provide doctors with financial incentives that may conflict with patient’ interests Doctors’ financial well-being are tied to medical care providers, suppliers, pharmaceutical companies, third-party payers These arrangements may predispose physicians to provide too many or too few services or to make inappropriate referrals Patients may receive poor quality care or be harmed Patients and society pay for wasteful services

Types of Conflicts of Interest Conflicts between the physician’s interest (usually financial) and the patient’s interest Conflicts that divide a physician’s loyalty between a patient and a third-party

The Changing Context of Medicine Monetarization of medicine Third-party payment Increased supply of physicians/hospital beds Changes in hospital payment Technology Loss of physician autonomy The federal government

Incentives to Increase Services Fee-for-service practice Kickbacks for referrals Self-referral to medical facilities in which the physician invests Income from dispensing drugs, medical products, ancillary services Hospital purchase of physician practices Payments made by hospitals to recruit and bond physicians Gifts to physicians by medical suppliers

Audiologists Receive commissions/gifts from hearing aid manufacturers Dispense hearing aids

Physicians Physicians receiving kickbacks for prescribing drugs. Physicians dispensing drugs/products Physicians referring patients to a hospital that provides them with office space, directorships, etc.

Dentists Visits to 50 dentists in 28 states and DC Examination plus 1 crown cost $500 Dentists ask what were his insurance limits Estimates range from $460/1 crown to $29,850/21 crowns

Optometrists Accept fees, gifts from manufacturers of lens, optical appliances, etc.

Physicians and Third Parties Physician referral for ancillary services in which they have a financial interest British pharmaceutical companies owns eleven cancer centers that provide care.

Columbia/HCA Rewards to MDs for referring patients Purchase of physician practices Discharged hospital patients sent to home health care agencies owned by Columbia Staff MDs provided profit incentive to reduce care

Financial/Commercial Relationships University faculty consultants for 90% biotechnology companies 50% of faculty researchers serve as consultants for biotechnology companies Physicians have a financial stake in 25-80% of ancillary medical facilities

Incentives to Decrease Services HMO financial incentives Control of access to physicians Gatekeepers Management of care by physicians Payment incentives

Physician Incentives in HMOs Percentage of Payment Withheld from primary Care Physicians

Reward for Surpluses in the Specialist Referral Fund

Other Financial Penalties for Primary Care Physicians Increases in the 5 payment withheld the following year Liens on future earnings Decreases in the amount of capitation payment the following year Exclusion from the program Reductions in distributions from fund surpluses Require physician to pay amount of deficit

What Can Be Done? Disclosure Informed consent Regulation Consumer protection laws Professional groups

Limitations of the Medical Profession AMA guidelines are voluntary Today's principals contain no statement regarding most conflicts of interest Antitrust laws prevent the AMA from restricting advertising and many commercial practices The AMA has no procedures for monitoring compliance Enforcement is left to state medical societies and professional licensing boards