The cost of surgical implants is increasing by over 7% annually; and even more in workers comp spinal cases. In audits my firm has performed we have seen costs ranging up to $27,000 for the hardware and related bits and pieces used (or allegedly used) in a neurosurgery case.
It looks like one of the contributors to those high costs is that old reliable – fraud. Blackstone Medical, a spinal implant manufacturer, is in deep legal trouble, facing allegations that it paid doctors kickbacks to use the company’s devices.
And as I’ve noted before, surgeons select the specific devices used in surgeries, with little or no apparent concern about the cost.
Blackstone allegedly paid physicians for bogus research and consulting services, gave them gifts and funded trips, all in an effort to get surgeons to use their devices. This news is not likely to raise any eyebrows; perhaps we’ve all become inured to new revelations of fraud and abuse in health care, with this latest just another warning that the present ‘system’ is corrupt, inefficient, and desperately in need of reform.
Stryker, one of the larger manufacturers, projects the spinal implant market to grow by 16% per year, and estimates the worldwide market at over $4 billion. If the allegations about Blackstone are true, a big chunk of that cost may be eliminated if we can just cut out the fraud.
What does this mean for you?
Implant costs are going to continue to increase; what’s your plan?
thanks to FierceHealthcare for the Blackstone info.
I am the president of Des Moines Orthopaedic Surgeons, P.C., a 20-doctor orthopaedic surgical practice in Iowa. You have alleged that orthopaedic surgeons have little or no concern about cost of implants. Let me assure you that each of our doctors is fully aware of the cost of implants. We actively participate in all negotiations with vendors regarding price, we negotiate with all insurers regarding reimbursement for implants, and we work together as a group to select appropriate choices according to medical necessity. None of our surgeons receives any form of compensation for use of orthopaedic implants.
I am the president of Des Moines Orthopaedic Surgeons, P.C., a 20-doctor orthopaedic surgical practice in Iowa. You have alleged that orthopaedic surgeons have little or no concern about cost of implants. Let me assure you that each of our doctors is fully aware of the cost of implants. We actively participate in all negotiations with vendors regarding price, we negotiate with all insurers regarding reimbursement for implants, and we work together as a group to select appropriate choices according to medical necessity. None of our surgeons receives any form of compensation for use of orthopaedic implants.
I am one of the attorneys with pending litigation against Blackstone Medical premised on its relationship with Dr. Patrick Chan, a neurosurgeon who pled guilty to accepting kickbacks from an Orthofix sales representative in violation of Medicare anti-kickback statutes. Orthofix later acquired Blackstone Medical — a month before Dr. Chan was arrested in 2006 for his dealings with an Orthofix representative and while he had ongoing “consulting” contracts with Blackstone Medical. Under those agreements, Chan received reimbursements, cash fees, royalties, at least one study grant, honoraria for speaking on behalf of the company, and stock options that he ultimately converted to 120,000 shares of stock in Blackstone for a purchase price of $275,000. The stock itself may have been worth millions. At the time of arrest, Chan reported a net worth of about $10 Million. He is now a convicted felon, and Blackstone is under federal investigation for its physician-consulting arrangements. While I realize this thread is devoted to the higher cost of hardware used in spinal surgery, I don’t think that we should lose sight of the broad underlying and pernicious implications of the Chan-Blackstone matter: The devastating effect of such fraudulent and profiteering arrangements on patients who may be subject to unnecessary procedures for purposes of fattening the corporate bottom line of spine device makers in collaboration with their physician conspirators. Assuredly, Arkansas is not the only jurisdiction where this has occurred. Blackstone Medical is an international company, after all, likely with “consulting” agreements with physicians around the United States and perhaps even abroad. The scope of the problem, considering these factors, is staggering. We as individuals who are patients and at risk of “cutting for cash” procedures can only hope that many more physicians will follow Dr. Quenzer’s model. Sadly, there are apparently many who do not.
Hello,
Could you please tell me the cost of mentor memory gel implants to the surgeon. I want to know approximately how much profit the surgeon makes charging 1,000 per implant in Australia. What price does Mentor sell their implants to ausytarlian surgeons for?
Thank you