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OIG Monitors Links Between Physician-Owned Hospitals and Physician-Owned Spine Distributors

A report released by the U.S. Office of Inspector General (OIG) found limited transparency with regard to ownership information of physician-owned distributors (PODs) and physician-owned hospitals.
The OIG used publicly available information (websites) and data from the Centers for Medicare & Medicaid Services (CMS) to attempt to determine whether a physician had an ownership interest in both a hospital and a POD that sold spinal devices to that hospital. The research focused on the ownership of 12 PODs from which 12 physician-owned hospitals reported purchasing spinal devices. 
The OIG was able to identify one physician who owned a POD that supplied devices to a hospital in which the physician had ownership interest. The report noted the possibility of additional physicians with identical relationships that could not be detected using the outlined information. 
The report stated that the limited information raises transparency concerns because:
  1. Ownership information may have implications for patient safety and quality of care
  2. PODs face criticism that physician owners could make clinical decisions that lead to unnecessary surgery in order to boost financial gain
The OIG made no future recommendations, but said that it will continue to monitor POD activity through CMS’ Sunshine Act database.
The report follows an October 2013 report on the prevalence and use of spinal devices supplied by PODs.