Tuesday, June 14, 2011

The New Paradigm in Selling

http://finance.senate.gov/newsroom/ranking/download/?id=274abe2e-ee0d-489e-9498-6542c0476cf5

No fellow bloggers, TSB is not singling out Paradigm Spine, TSB is talking about the ongoing metamorphosis of selling medical devices in the good ol' U.S. of A healthcare system.  Upon reading the pro's and con's in response to POD's, again, TSB believes that the investigation into POD's by the OIG and the U.S. Senate's eventual ruling will determine the future of all U.S. spine companies business model.  As someone so aptly described, the focus on this topic has made us look foolish and divided.  That's what usually happens when things begin to spin out of control. It is apparent that there has been a paradigm shift in what has been describe as our industry's revenue model. Questions abound regarding the longevity of what was, and what could truly be the future.  If one believes in unfettered markets, well look no further, the spine industry is the perfect model.  No rules or boundaries, minimize regulations, avoid accountability, erode science while emphasizing marketing.  Hocus Pocus, we have resurrected our own three witches. Some of you will agree, while others will dissent, while some of you cry out  to PLEAAAASE STOP THE INSANITY!

So what lies in store for the industry?  How do we compete in an environment where the system is gamed, by our customers, and, our own peers?  Will the strongest survive, while the weak perish?  Has competition and free markets as once defined in America reared its ugly head?  As Linda Richmond use to say, "can we talk, gather around."  While we debate whether POD's are legal or illegal, surgeons attempt to paint themselves as altruistic by claiming that there only concern is to save the hospital money as the industry's "new gatekeepers," Rome burns.  If profits are not the motivation behind their actions, then what is?  The love of medicine, LOL!

But what about hospitals?  What about these bastions of modern day healthcare?  Have they helped the current environment, or, are they the culprits behind perpetuating this chaos?   Explain the rationale for taking away a surgeon's ability to use whatever product he or she desire, if we truly believe in free markets?  Isn't the surgeon the one that has spent endless hours and hundreds of thousands of dollars to be the gatekeeper?  As hospitals BS surgeons that they must work together, they manipulate the environment to only benefit themselves.  If the hospital is footing the bill for implants, isn't it their responsibility to negotiate a fair and equitable price, and not the surgeons?  Or is this just another ploy to keep the surgeon's focus off of the eye of the tiger.  Slowly but surely, they are becoming the hospitals slave.  As Michael Corleone once said, "every time I try to get out, they pull me back in."   How many times have you sat across from a hospital administrator that has informed you that regardless what Dr. Famous would like to use, you are not a preferred vendor?  WTF does that mean?  TSB wants to know what MBA, CPA, JD, or MD came up with that BS description? How many times have you been told that in order to get your product into the facility, you will have to meet with the Product Evaluation Committee (PEC), only to find out that the next meeting will take place in four weeks, if you are lucky?  How about the facility that informs you that you will have to wait until the end of the year to submit an application for preferred vendor status. WTF is that all about?   If there is one thing that we have learned is that PEC's only exist to stonewall a potential vendor from getting into the facility. What happens if you really had something that was truly innovative or clinically advantageous to the patient's care, would any of us want to wait if it was our health at question?  What happens if you can offer comparable technology with added cost savings to the facility? If price containment is the impetus behind POD's, and surgeons are willing to use a product that saves the hospital money, does it really matter what product one uses, as long as they are comparable?  How many times have we heard that a screw is a screw, a cervical plate is a cervical plate, etc., etc., and so on?  A bit of a paradox. The apathy that exists at hospitals is a study unto itself.  Can anyone make a simple decision? Brain surgery isn't this complex. Are we experiencing the death of common sense?

As hospitals squeeze us on pricing, they continue to reap the benefits.  Ever sell a pedicle screw for $800 dollars, only to find out that the hospital billed the carrier $ 8,000 per screw.  What other industry can do that?  Ever sell BMP for $5,000 -7,500 only to find out that the facility billed the carrier $22,000 and an additional $8,000 for some TCP sponge?  Let's face facts, medicine is no longer based on care, it is based on profits. And that my friends is why whether one believes it or not, or agrees with it or not, the system will eventually evolve into a one payor system. The current system cannot sustain itself, and the faster we come to grips with reality, the faster we can move on.  It won't be called socialism, it won't be Obamacare, it will be called survival.  As healthcare delivery consumes 25% of the GDP, does anyone truly believe that it happened in the last two years?  As Arnold use to say, "listen to me now, or hear me lader."

Global consolidation has changed the rules of engagement.  Commentators that have eulogized those bloggers that have objected to POD's are only adding fuel to the Senate inquiry or an OIG investigation into the legality of this model.  Exhibiting one's hubris has been known to come back and bite you in the ass, if you don't believe it, ask Anthony Weiner.  So in closing, what will the new model evolve into?  Will forecasts be realigned to meet the markets structure, or will we continue to live in the past?  How does one continue to grow in a stagflated market?  As a commentator to our blog love's to espouse, "you sales people are living in the past," maybe, that individual is only half right. Maybe its the executive management teams at these companies that are living in the past, creating the illusion that all one has to do is keep the status quo and things will be alright.  But then again, maybe its the same people that have created this monster, that are now attempting to figure out how to survive.  Two years, three years and its on to the next scam.  You can throw all the marketing studies and procedural databases out the window, there's a new paradigm shift in selling, and if don't believe it, you won't survive.

First I was afraid I was petrified, thinking I could never live without you by my side
But I spent so many nights thinking how you did me wrong, I grew strong, I learned how to carry on
And so you're back from outer space, I just walked in to find you here, with that sad look on your face
I should have changed that stupid lock, I should have made you leave your key
If I'd known for just one second that you would be back to bother me......  I will survive.

88 comments:

  1. Who do you think the so-called "Quality Implant Coalition" is? This "coalition" only seems to exist within in letters of Medtronic's law firm. As the established revenue leader in spine, who has the most to lose financially from PODs? Medtronic, of course.

    Yes folks, whatever side of the POD issue you are on, you can be assured that we have the best Senate that money can buy.

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  2. Signs of changes to come:

    "Blue Shield of California, a large nonprofit health insurer that has come under sharp criticism in recent months for its double-digit rate increases, said on Tuesday that it planned to cap its earning and refund the bulk of any excess income to its policyholders.

    The insurer said it would limit its profit to no more than 2 percent of its revenue and said it already planned to return $180 million, the profit the company says it made above its 2010 target."

    NYT June 8.

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  3. There is no doubt Medtronic is behind much of the legislation/Coalition, etc in Washington as they do have the most to lose. BUT- they are fighting the good fight for all reputable companies and we should all endorse the demise of POD's. This business needs a thorough house-cleaning and until there are restrictions on physician ownership or delivery of implants, ownership of hospitals, etc. nothing will change. Remember the days of surgeon - owned free standing imaging centers? It's gotten a lot more restrictive today and spine needs to follow. There should also be limits on the sales volume any company can derive from consultants. If there were a limit of say, 10% of sales- almost ALL of the companies under 50MM in sales would go away.

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  4. But no one is answering the gist of the post, are we really heading in the direction of a new business model, and if so who will survive and who will perish?

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  5. My father worked in the device industry for 45 years. I'm on year # 17. He told me when I first got started: "Never forget, it's about the $. If somebody gets healthy again, that's nice, too". That observation might make him sound callous, but, does your sales manager feel any differently? Not much has changed over the years as far as I can tell. Maybe just that people / organizations don't worry as much about concealing their greed.

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  6. It is ironic that Medtronic has appointed itself policeman of the industry when they theselves have settled millions with the DOJ in kickback cases.

    It's about money pure and simple. If Medtronic was profiting from PODs, their lackey Senator Hatch would be pushing in the other direction.

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  7. The guidance from the OIG/DOJ will provide the new framework for all companies (and surgeons) to operate under. The companies who currently do not sell to PODs would freely do so if they felt it made financial sense and they were not jeopardizing their company's future. The DOJ has shown it has no problem going after the big guys and they have made it known that the next time the "Deferred" in DPA will not be offered. If the DOJ provides guidance on how to legally structure a POD, or similar entity, then you will see an immediate shift in the business model for selling spinal implants with participation from some (if not all) of the big companies. If the DOJ rules that PODs are illegal and can't be structured in a legal manner, look for the assets of many small companies to be available for purchase at bargin basement prices. The companies who have not sold to PODs are going to be sitting back watching and waiting for their opportunity to respond to results of this inquiry while Alphatec, the other POD suppliers, and surgeons who participate in PODs are sweating it out hoping to survive and stay out the pen.

    I expect we'll see the DOJ prosecute some of the sham PODs, their suppliers, and the hospitals that were using them. The DOJ will also likely provide an example of what would be required to structure a POD in a manner to comply with the intent of the AKS.

    Personally, I'm going to sit back and enjoy a few drinks on the beach while watching the fireworks unfold this summer. Then, I'm going to make sure my future business model is set up to take advantage of the new landscape. Darwinism will be on display over the next couple of years as both the stupid and those refusing to adapt will die off.

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  8. TSB, The post-POD model will go something like this:

    1. Form a spine company WITHOUT physican owners and private label products from various other companies/suppliers. Do some design work on the instruments.

    2. Pay docs fat royaties for designing a unique screwdriver handle, but not on their own procedures. Pay other docs fat royalties for designing a unique screwdriver shaft, but not not on their own procedures.

    3. PROFIT!!

    There you go, a fully vetted physician payment system. The big guys do it everyday by the millions.

    Be careful what you wish for - the PRC (physician royalty company) may be a lot worse than the POD! And it will be a lot tougher for Medtronic to attack without shooting itself in the foot.

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  9. 8:33

    You're dad is right, although the concealment or transparency of greed is irrelevant. It is the actions that result from greed that matter:

    "A study published last April in the Journal of the American Medical Association cited a 15 fold increase in the number of spinal fusion surgeries for Medicare patients from 2002 to 2007. This same study went on to say that “it is unclear why more complex operations are increasing. It seems implausible that the number of patients with the most complex spinal pathology increased 15 fold in just six years. There is, however, a significant financial incentive to both hospitals and surgeons to perform the complex fusions and that may play a role.” - Senate POD Review

    Sure'd be nice if some of those people got healthy.

    I'll make a wild, and admittedly, forward assumption that your dad's 'follow-the-dollar' philosophy might look on an unrelated industry in duress and deduce, 'poor suckers, weren't smart enough to see it coming!'

    Well we're in that industry right now. Hospitals and insurers are probably thinking, remember, it's all about the money, if there are sales reps left over, that'd be nice.

    To TSB's question? Yes.

    Win, lose or draw I see only change. I think when you start directly competing against customers, especially as small of a group as spine docs, that is the definition of a paradigm change.

    Senate inquiry will bring sunshine (perhaps not disinfectant) to the sordid mess we've created.

    Follow the dollar...but don't lose site of the customer's needs!

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  10. 9:25 again...I'm with ya 9:11!

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  11. TSB, dude sometimes you just ramble and go on and on. Maybe a little more story and less quoting "remember what so and so always says" or quote some lame ass song.

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  12. My crystal ball sees the continuation of consolidation leaving several mega giants. The shift will come as these giants compete for a direct to end user non-specialized mega bundled contract.

    This change will be the end of all current distribution models. A web based ordering model will be utilized. Hospital personel will be required to do their jobs and learn the systems that they utilize.

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  13. One of my favorites- "Anybody can make this stuff but there is an art to getting rid of it."

    Certainly this applies in spine, but the POD model may alter the "art" significantly. I believe that even if PODS are the future, there will be plenty of opportunities for the best to work with surgeons to maximize the potential of this distribution model. Then again, I have really hard time seeing PODS getting the thumbs up from OIG. Stay tuned.

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  14. One doctor's perspective

    http://www.seacoastonline.com/articles/20110209-OPINION-102090351?cid=sitesearch

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  15. This article nailed it on the head. The US cannot sustain a free market, for profit, healthcare model.

    "Why markets can’t cure healthcare"

    Judging both from comments on this blog and from some of my mail, a significant number of Americans believe that the answer to our health care problems — indeed, the only answer — is to rely on the free market. Quite a few seem to believe that this view reflects the lessons of economic theory.

    Not so. One of the most influential economic papers of the postwar era was Kenneth Arrow’s Uncertainty and the welfare economics of health care, which demonstrated — decisively, I and many others believe — that health care can’t be marketed like bread or TVs. Let me offer my own version of Arrow’s argument.

    There are two strongly distinctive aspects of health care. One is that you don’t know when or whether you’ll need care — but if you do, the care can be extremely expensive. The big bucks are in triple coronary bypass surgery, not routine visits to the doctor’s office; and very, very few people can afford to pay major medical costs out of pocket.

    This tells you right away that health care can’t be sold like bread. It must be largely paid for by some kind of insurance. And this in turn means that someone other than the patient ends up making decisions about what to buy. Consumer choice is nonsense when it comes to health care. And you can’t just trust insurance companies either — they’re not in business for their health, or yours.

    This problem is made worse by the fact that actually paying for your health care is a loss from an insurers’ point of view — they actually refer to it as “medical costs.” This means both that insurers try to deny as many claims as possible, and that they try to avoid covering people who are actually likely to need care. Both of these strategies use a lot of resources, which is why private insurance has much higher administrative costs than single-payer systems. And since there’s a widespread sense that our fellow citizens should get the care we need — not everyone agrees, but most do — this means that private insurance basically spends a lot of money on socially destructive activities.

    The second thing about health care is that it’s complicated, and you can’t rely on experience or comparison shopping. (“I hear they’ve got a real deal on stents over at St. Mary’s!”) That’s why doctors are supposed to follow an ethical code, why we expect more from them than from bakers or grocery store owners.

    You could rely on a health maintenance organization to make the hard choices and do the cost management, and to some extent we do. But HMOs have been highly limited in their ability to achieve cost-effectiveness because people don’t trust them — they’re profit-making institutions, and your treatment is their cost.

    Between those two factors, health care just doesn’t work as a standard market story.

    All of this doesn’t necessarily mean that socialized medicine, or even single-payer, is the only way to go. There are a number of successful health-care systems, at least as measured by pretty good care much cheaper than here, and they are quite different from each other. There are, however, no examples of successful health care based on the principles of the free market, for one simple reason: in health care, the free market just doesn’t work. And people who say that the market is the answer are flying in the face of both theory and overwhelming evidence.

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  16. Cluster F*** for sure. Have fun spine guys!

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  17. Who really cares about PODs?

    The REAL question is:

    When will Globus go public?

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  18. New business model? A combination of pharma and joints. Further consolidation of companies so you will have half a dozen or so in the market. Biggest cost is at the sales/marketing level and the one way to do that is lower salaries and/or commissions. Salary with bonus will be one of the new norms and topping the biggest and best sales people under 175k.

    Most wouldn't know, but pharma was a pure commission model along time ago. Guys sold drugs under the table to a pharmacist, did his/her shopping at the local store and made solid cash. Industry changed to solely have direct sales forces with capped compensation.

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  19. What about all the eye doctors who both prescribe and sell glasses? Are they all unethical criminals too?

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  20. Why aren't we selling to insurance companies directly and eliminate the 300-400% markups? They would just bring their stuff in to hospital and hospital charges a sterilization fee. Is that too simplistic? Am I missing something?

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  21. Why is it okay for Depuy/Medtronic to pay consultants and have those same consultants insist on using Depuy/Medronic exclusively in their hospitals. If those hospitals except medicare isn't there some type of law being broken? Should the DOJ Investigate the distributors who get these deals done. Are distributors next in line for prosecution?

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  22. 6:27 are the eye drs selling prescription glasses to people who have 20/20 eyesight? Is there an increase in glasses being sold vs. when a dr writes a script and sends you off to buy the glasses somewhere else? It is the conflict in surgical cases that is in question. If there are people driving around your neighborhood with prescription lenses on who do not need them I would stick to walking

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  23. The distributor sales model has attributed to the domino effect that is now PODs. So many of these rinky dink distributors in my area carrying custom spine and other Lego systems have been playing dirty since day 1...was only a matter of time before the surgeons realized what they are missing. Direct sales forces are monitored much more closely, with a lot more to lose.

    in terms of pricing, these hospitals are so dumb. they negotiate terrible contracts with the health insurers, and we feel the brunt of it. And yes, when will hospitals realize that the more we charge for implants, the more they bill the carrier?

    This industry has become a joke

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  24. Actually, there is indeed the potential for abuse in physician-owned eye centers. If you have glasses, an unethical doc can slightly increase or change your prescription every year, or recommend more expensive bifocals when you don't really need them, or anti-glare lenses etc.

    People outside the medical profession just don't get it. There is ALWAYS the potential for abuse - every minute of every day. Every patient encounter, every diagnosis, every recommendation for treatment is an opportunity to abuse the patient and the system. PODs don't change that fact one way or the other.

    PODs won't affect the ethics of a physician. If he was ethical before the POD, he will still be ethical. If he was unethical and did unnecessary surgery before the POD, he will still do that too.

    At some point, the government needs to either place trust in physicians to do the right thing or eliminate all profit-basis in the system.

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  25. "the government as evidenced by the "one purpose rule" has made clear
    that a physician's decision as to whether to use one product over another cannot in any way be based on the physician receiving payment for using a particular product. (Example, the allegations in the Blackstone Case where surgeons were paid as consultants for their "Volume.") Therefore, if the POD structure did lower healthcare cost such an arrangement should not trump or justify violation of the anti-kickback statute or other Federal fraud and abuse laws."

    The government must address and clarify the "broad scope" of the terms "payments" and "should not trump or justify violation" as they pertain to PODS, if not, they will never resolve the legality of this model. But let's paint a few scenarios;

    Scenario #1: The Hospital(s) that Dr. Steinamann's POD operates at identify the products that are utilized by his POD, who is to say that the hospital can cut a better deal with those specific companies and eliminate his POD as part of the supply chain between the hospital and the vendor? Does that make fiscal sense, considering that it would be an additional savings to the hospital by cutting Steinmann's POD out as another unnecessary layer in the supply chain? Does Dr. Steinmann and his POD cohorts then threaten to move their business to operate at another facility? As stated, the hospital wins, Steinmann loses, because it eliminates another layer in the supply chain, that he argues is increasing the cost of delivering healthcare. If he opts to move his business down the street, it becomes apparent that the reason the POD was developed, was to profit from it. If Steinmann's argument is that having another layer or "middleman" adds to the cost, isn't this a contradiction considering he is acting as just another "middleman?"

    Scenario #2: Want to test the waters, identify other products and present them to Steinmann at a cheaper price and see if he agrees to use your product. If he does, then he is truly interested in saving the hospital money while potentially increasing his own POD's profit margins.

    Before everyone starts shouting and screaming, remember, watch the video and decide for yourself. He's the expert, but then how many surgeons that are owners in a POD or POH brag that they run their facilities profitably, while never informing the public that they only bring patients to their respective facilities that have excellent insurance plans while the bring the "riff raff" to the local city hospital on the other side of town? You be judge.

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  26. The name of this site should be "The POD Blogger"

    Anyone know when Globus will go public?

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  27. I think TSB, like Senator Hatch, is a paid memeber of Medtronic's anti-POD task force.

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  28. Whatever happened with Judge Davis' Synthes' decision to possibly incarcerate several former Synthes' employees? Did I miss something?

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  29. TSB.....who says that Steinmann wouldn't say thank you and offer the hospital even better deal than you say these specific companies can offer? Whose relationship wins here? Do you think the competitive supplier wants to get in this risky game of price fighting? Only to be told thank you, and Steinmann will match or better the savings. Remember it's the Steinmann surgeons who started the strategy, nurtured the relationship, and will be vested to help the hospitals continue in their savings strategy over the likes of the BIG companies wish to maintain the status quo.

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  30. 9:18 a consumer sitting across the counter making a decision on bifocals or not is quite a different matter than a surgeon putting in implants.

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  31. The Stryker OP-1 Gents will be the next ones to step up to the plate. Coming soon this November.

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  32. The Bruins are wicked pissah!!!

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  33. ok guys, enough POD talk. Shit move on will ya! Damm!
    I am interested in more important shit.
    Whats up with Globus these days? Looking for feedback.
    Thanks

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  34. im taking my implants and selling them directly to the patient. That way we cut eveyone out. Some of these patients are more knowledgeable then half you reps on this BLOG.

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  35. Watch the Kaiser model take over the entire country.. One health care plan ...All physicians will be employees with no other types of payment... medical innovation will be develop in Europe and Asia (thank you FDA).. med reps will become hospital staff members(hey you can scrub in!)..implants and other products from companies will be required to be priced at a percentage above costs with one or at most two product choices....Hospital committees will make decisions for levels and types of care...malpractice claims go away.. No middlemen just a few government approved manufacturers - hospitals- and the government.. Obama's ticket to re-election and his dream legacy.. How does this paradigm shift happen? Put the surgeons in a compromising position and give them a deal they can't refuse.

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  36. The sky is not falling.

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  37. Wait ! who's investigating the Stryker distributors?? and oh my, my ,my ....the credit card statements from those reps have to tell a crazy story. Leepin' Lizards there's some juice there

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  38. Just for kicks- Medical Management programs catered to physicians will decline once POD’s go away:

    http://www.marshall.usc.edu/mmm/over

    http://classic.marshall.usc.edu/assets/134/22662.pdf

    Educate the public about POD's and the Leviathans will prevail.

    #StickToPracticingMedicine
    ~Tweet-Tweet

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  39. POD's ? The real issue is DOP's Can anyone name a Distributor Owned Physician in their area?
    ?
    ?

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  40. When is the bundling of products going to come under fire? Medtronic gives a hospital a free o-arm and in return they are guaranteed 90% of the hospitals hardware business. While the physician may not directly profit, they are still selecting hardware and implants based on a contractual agreement rather than what is best for the patient. Are all the companies implementing this type of thing?

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  41. 12:35, there is some truth to what you wrote. Most people don't know that Obamacare used Kaiser as a template model for healthcare. That is EXACTLY what Obama was shooting for. Fortunately, he was blocked and forced to adjust his model... with no real target as he digresses from his initial intention.

    Why not just expand Kaiser and keep private healthcare as an additional option? Those that are supports of socialized health can knock themselves out and get Kaiser Healthcare. Interestingly enough, most people living in a State with Kaiser opt for private healthcare given the option. Heck, even the Indigents head to private healthcare facilities for care!

    On that note, how does Kaiser handle indigents? Do they accept them or defer them to another system? Ex: an illegal immigrant in labor, or a homeless man hit by car. I don't know. Thats why I am asking.

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  42. 134: I like your style and I like your moves. Whats wrong with listing all POD's and DOP's together?

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  43. All these arguments become old news by just changing the reimbursment process for the hospitals and surgeons.

    This year, we found that the ACDF code is now a bundled code. The fusion, and the discectomy is covered by one code.

    In the future, I can see that the lumbar fusion code may also be streamlined. Posterior fusion will be one fee, regardless of instrumentation or TLIF. If that goes through, watch the resurgence of Posterior insitu fusions without screws or TLIF cages. Surgeons will only add the instrumentation on grossly unstable patients, as they will rationally make the decision that potential bad outcomes will negatively impact their reputation.

    For a short time the TLIF technique did not generate reimbursement, until the docs protested. I think the next go around, the protest will fall on deaf ears.

    Hospitals already are being paid a flat rate, regardless of how much hardware is utilized by government healthcare. That model will continue to expand. Doc's will be "economically credentialed" by hospitals. Expensive, high cost doc's will not be given the usual courtesies by the Hospitals.

    The usual defense of "I am the only one qualified to do these high risk, multi-level cases, so I do not cherry-pick" will not fly.

    Manufacturers, Sales reps, Pod's, Dop's, Doc's we are all in for a change.

    Adapt and survive. Innovations that save costs will thrive.

    Compete well everyone.

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  44. @2:45...I've seen many times where Kaiser stabilizes then transfers the pt and you and I foot the bill.

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  45. Old spine doc said:

    "watch the resurgence of Posterior insitu fusions without screws or TLIF cages."

    What are you, a chiropractor? If you were a real surgeon, you would know that fusion without internal fixation, other than in extraordinary cases like infection, hasn't been the standard of care in 20 years. There is no way non-instrumented fusions will make a comeback, despite what happens with the coding.

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  46. 2:45

    They turn them into Soylent Green Crackers:)

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  47. Globus?... your not going to like this, but Globus is actually worth to much money, they are not affordable, i know this because im the head of the technology division. for instance if you invested 1 dollar, it's actually worth 8 dollars, but the problem is globus won't release any of there technology to anyone. So stop asking about Globus every freaking hour of every freaking day, there ceo is screwing yu just like mine is, were all fu-k-d, go to work save your money, and in the end give it to a nursing home like the rest of us broke asses!

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  48. 5:47

    In the late 1980's and early 1990's, in situ fusions were the standard and it worked quite well. We also supplemented the fusions with syntheses cortical screws into the facet for added stability.

    You do not need the $2k "modern" facet screws to achieve these same results. $50 syntheses cortical screws worked just as well. Somehow, we could not get industry to support our study into the efficacy of these fusions (I wonder why?). But we all know there is data supporting this very cost effective technique.

    I know this does not sit well with the business community. But there is also data to support in situ fusions for indications such as recurrent HNP's, and fusion after aggressive facetectomy in stenosis patients. Those indications are probably at least 50% of the current fusions.

    In those situations, if there is no gross instability, and there is no remuneration for the extra efforts, you will exactly see the resurgence as I stated.

    And yes you are right, there are some who would abuse this situation, and not use instrumentation for the grossly unstable. But, over time, life is fair. The abusers will be discovered and their practices will suffer.

    How do I know this? Because I have been in practice long enough to see trends, sales reps, and "rain maker" surgeons come and go.

    Yes, pile on me, but at least in my local area, most of the sales guys, and distributors come to me for their families treatments, and I am sworn to secrecy about this as I do not use their products (and they do not want their surgeons to find out). They also know that I will not operate unless absolutely indicated. And then, usually with standard decompressions or discectomies, rarely hardware.

    Compete well.

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  49. Old Spine Doc.............

    You are dead on it about non-instrumented fusions. All one has to do is read the study by Pateder and Benzel (who many refer to as the 'authority' in spine biomechanics) from 2010 about non-instrumented fusions in patients undergoing laminectomy / decompression. It doesn't take hardware to achieve an acceptable level of clinical success.........just some good hands, autograft and a lumbar brace.

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  50. As much as I hate to say it, Old Spine Doc has a point. NIF's were have been shown to be very effective over the years when done correctly, even recently in a European study there were great results. I sell Metal and this trend would not benefit me financially but he does have a point.

    Another looming challenge for physicians is if outcomes based reimbursement hits the streets in full force. Imagine how many surgeons would be broke if reimbursement depended on the outcomes of their patients. This is trickling in slowly and insurance companies are giddy about it! I have a feeling that guys like Old Spine Doc would fare just fine in this atmosphere but many others would not.
    For us reps/managers, we too will face a value based system. If you provide no value, you are not in the system!

    Competing well!

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  51. All this talk of noninstrumented fusions. The nursing home must have left the computer on. The benefits of fixation have been proven. Yes you may get a noninstrumented case to fuse in a healthy compliant patient, but that's a rare patient. Why risk dislodging the graft because you don't want to take 30 minutes to put some screws in? It makes no sense other than laziness or inability.

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  52. Don't buy into all this marxist propaganda. The marxists hate innovation/technology because in their pseudo intellectual minds, it takes away jobs (they think jobs are a right) (Obama just complained about ATM's taking teller jobs away).

    All this bs about one payer, and two companies relies on zero innovation and therefore things becoming commodities. They are forgetting one thing, we are f&@king Americans! We will innovate, create, and outthink you Marxist bastards. Our passion is in our blood, and as long as I can breathe I will be free to make my own go&amn healthcare decisions.

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  53. Stryker? anyone? Stryker? advamed? Stryker?

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  54. 9:55

    I agree with you regarding the point that innovators will always come out ahead.

    But your last line makes me laugh. Are you paying cash for all your healthcare needs? If not, then you are not making all your "go&amn healthcare decisions".

    If you are, then you are being subject to the $20k physician fee for spinal fusion, and the $4k price of a pedicle screw.

    Then, if you are paying for the whole procedure, you will shop around to see if you really need the fusion as well as the decompression. Maybe, you only need the laminectomy. Costs only $4k for the doc, and much less to the hospital. Or maybe, if I need the fusion, maybe, I will be fine with a brace and no screws. Just maybe, I need to find that old spine guy, you know, the one everyone thinks in over the hill.

    Compete well, innovate well.

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  55. This string of comments has turned into evidence of the common phrase, "...youth is wasted on the young..." For all you peach-fuzz-face sales reps, the surgeries are not done for the purpose of instrumentation. But in the meantime keep giving your $6 figure advice: "righty tighty, lefty loosey" -SpineSeller

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  56. 5:59

    "For all you peach-fuzz-face sales reps, the surgeries are not done for the purpose of instrumentation."

    You forgot to add: "unless you are a surgeon in a POD."

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  57. 6:50

    Wrote: "It doesn't take hardware to achieve an acceptable level of clinical success.........just some good hands, autograft and a lumbar brace."

    Well we know braces are a dime a dozen and allograft is just a phone call away. but the Good Hands part of the equation is why Infuse became so popular. When spine surgeries were only performed by a handful of surgeons it might have been a different story. Money drove the average ortho/neuro surgeons to try their hand at spine surgery. Many of these surgeons who were mediocre anyway, needed even more help in spine cases. Hence specialized instrumentation was born, initially by these very early spine surgeons.

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  58. 7:31

    The most important criterion is proper indications. Everything else is secondary.

    I chuckle about the comments on use of hardware and BMP on non-compliant patients, or people with high risk for failure.

    Most spine surgery (especial fusion) is elective. Of course there is the fracture patients, and tumor patients, and the occasional true cauda equina, but most do not fit in this criterion.

    Elective surgery is selected to decrease pain. But, the prudent doc will assess the risks versus the benefits, based on indications, and medical co-morbidities. There of course is the secondary gain potentials in WC and PIP.

    Sometimes, less is more. But that is not what metal companies, hospitals, and some of my more aggressive collegues want to believe.

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  59. Old Spine Doc has a point. I don't think we'll see a complete abandonment of hardware in the future, but new payment structures will certainly create incentives for (surgeons?) hospitals to minimize their hardware usage...whether the surgeon goes along will depend on the relationship between the hospital and the surgeon. Many will likely try to save money for their hospitals...but where will the lines be drawn when saving the hospital money imperils patient outcomes? Will the new trend in malpractice suits be to focus on under-utilization of hardware? Hmm..

    This will be an interesting battle to watch as more and more physicians become employees of hospitals.

    Who will be the gatekeepers for how many screws, cages, and biologics are appropriate for surgery?

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  60. June 15, 2011 12:35 PM --- you made me spit up my fruit loops, that was the best post in months...

    Old Spine Doc --- I like the dose of reality, it is all about patient care.

    MM --- there's some hubris in your commentary on reimbursement. Do Hospitals charge $800 per screw, only to bill $8000 for that same screw? It's a definite possibility; but keep in mind, the big payors typically pay a percentage of cost (hey, where have I seen that before!?!?). That brings that net revenue down significantly and even at that, hospitals are lucky if they end up getting pad at all on certain cases. Even if Hospitals get pre-auth'd, they can still be denied payment. The point is hospital reimbursement is a massive shell game and just because someone sees a screw billed out at $8000, it doesn't mean that's what is actually paid.

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  61. Stryker reps BLOW!!!

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  62. Old Spine Doc

    I don't know how, but I would like to get your email address (contact info, etc). My company has developed a new technique / instruments that might be right up your alley for those 'old school' non-instrumented fusions. The surgeons that have used it have really been impressed so far. Starting August 1st, we're going to make it disposable.

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  63. 11:35. What about all the non instrumented cases a surgeon does that the hospital banks on??

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  64. 12:21 i would like to jump on the pile . Stryker reps talk the clean cut advamed talk, but the stories I here about them are a whole other matter

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  65. Pods will not exist if companies stop to partner with them ! Very simple

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  66. http://www.ncbi.nlm.nih.gov/pubmed/9431617 Spine (Phila Pa 1976). 1997 Dec 15;22(24):2813-22.
    1997 Volvo Award winner in clinical studies. The effect of pedicle screw instrumentation on functional outcome and fusion rates in posterolateral lumbar spinal fusion: a prospective, randomized clinical study.
    Thomsen K, Christensen FB, Eiskjaer SP, Hansen ES, Fruensgaard S, Bünger CE.
    Source

    Department of Orthopedic Surgery, University Hospital of Aarhus, Denmark.

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  67. 6:23

    Earlier, someone posted about the inability to feed their family secondary to the POD's. Do You think that guy would pass up the chance to make a few bucks, even if it means supplying a POD? What are you going to do, slash his tires if he does? Stop sounding like a Wisconsin Union.

    It is a business decision, just like the one you made when you went into the spine industry. I do believe some of you went into the trade as a noble cause. But most of you went into it, just like most people try to go into investment banking. It is for the bucks.

    Competition, costs, disclosure and outcomes will ultimately determine which parts of the Spine Industry will survive. That includes each and every player in this sector.

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  68. As a non-US based rep who has attended many meetings in the US with non-US surgeons it is clear that in general there is way too much metal being put in patients stateside.

    At an AO course they put a slide up of an L4/5 disc herniation + symptons etc and 90% of the room opted for 360 fusion. They then put the slide up again and said you are the patient. 50% opted for conservative treatment...

    Similarly I can remember being at a J&J sales meeting (in a former life as a hip and knee rep, please dont judge) where they put up an X-ray of a hip and knee and asked what was wrong with the patient.

    Many erudite comments were suggested - ostephyte here, displasic there. WRONG! The answer from management was - THERE IS NO METAL IN THE PATIENT! (At least now with ASR most of their patients have heaps of metal in them).

    So much for the Credo...

    Old Spine Doc I think you are spot on and the patients need more of your kind.

    PODs I feel clearly add a financial incentive to the surgeon to instrument more and for my money that is the main driver behind their adoption.

    If so many surgeons were so concerned about price in their lives they would all be driving second hand Toyotas.

    Pay the docs a fixed salary rather than reimbursement by procedure and see what gets instrumented...

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  69. 7:14

    You are correct. Pay the docs a fixed salary and no one will get intrumented. No one will be operated, no one will be seen in the office, no one will be treated. Like all government workers, they will do the absolute minimum needed to keep their salary.

    Go back to Soviet Russia please.

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  70. TSB, I would pay real money for you to post a non-POD topic. If I read another POD thread I am going to kick the dog. Hell, I'd be willing to read ten paragraphs about the pros and cons of Globus going public than endure this torture any longer.

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  71. When is Paradigm Spine going public?

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  72. Old Spine Doc,

    How do you think your indications for instrumentation would compare to those of the surgeons working in a Kaiser facility? Or to a country with centralized health care?

    Given the Benzel study you referenced, do you believe there is merit to the high-cost minimally invasive approaches?

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  73. 2:07

    Now, I use instrumentation for most of my fusions except for situations with significant osteoporosis.

    I love MIS technique and truly believe it accelerates recovery time.

    But in the future, I cannot see any insurance or government plan incentivising the doc's to use these techniques.

    But we live in America. We have a relatively wealthy populous. Like in all of medicine, there will be a two tiered system. Standard medical care will probably include basic spine care, emergent surgery (cauda equina, fracture care, infection, etc). Doc's will be paid at the soviet price.

    Then, there will be the cash paying elite, who will line up to see the doc's with good outcomes. These elites will do their homework, and select from a small group of surgeons who do will perform the more innovative, less pain, and less recovery time surgeries.

    I suspect the marketers will thrive, and there will be a new industry of "match making" services for high priced medical care. Poor outcomes will be exposed (everyone knows about the Bloomberg article by now).

    Of course, the danger then becomes all these lower cost, high quality overseas centers.

    It will come down to outcomes, and costs.

    True intersection of medicine and capitalism. Not this dependence on socialized medicine, that we all protest against, yet benefited from.

    What do I mean? Boys and girls, we the medical industry (that includes doc's), have thrived under the largesse of the Federal government via Medicare, and mandates for health coverage for employee's (Union driven as well). Medicare, my friends, is a socialist program. The intent was noble, but now, the expanding benefits, are bankrupting this great nation. It will be unwound, and services will be limited by a "Soviet" compensation model.

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  74. Globus going public will fix all of this.

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  75. Ole Spine Doc, can you please send a link to the referenced Bloomberg article?

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  76. Hey,, Anyone have any thoughts on the new Globus lateral stand-alone cage which they're pricing around $24K??

    THAT is exactly what's wrong w/ this industry,,

    $24K for an implant? Ridiculous.

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  77. 7:16

    here's the link:
    http://www.bloomberg.com/news/2011-05-04/laser-spine-surgery-more-profitable-than-google-sees-surge-in-complaints.html

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  78. Old Spine Doc,

    You're right about almost everything. Except the slam on Wisconsin Unions. Way to kick a teacher when she's down, dude.

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  79. Rhymes with Biker is going to buy Globus. Perfect fit. From the quality of reps to the copycat products and the "special" expense accounts.
    giggity

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  80. I love the physician comments that PODs are akin or equal to eyeglasses or boobs after all Plastics and Ophthalmologists buy and resell their products. Einstein, last time I checked the patients pay cash for these products and get to choose which ones they want. At the very least they have gone out and purchased a separate vision plan at their expense. I don't think Medicaid comes with a vision or big tits plan and if it does we need to get my wife signed up. Some how I talked her into marrying me and she could use a little in the chest department. The physicians say all reps are dumb! Surely, hopefully that was POD owner/distributor and not a physician making that ridiculous argument the last few threads.

    We are talking about receiving illegal inducements while being reimbursed by the government, which all of us pay in taxes. It also happens to be a significant portion of most spine surgeons practice (remember degenerative disc disease). Which makes it even funnier when all the reps and doctors whine about the government and government healthcare. If it weren’t for good old USA none of us would be making the money we are. I want to see the spine doctor in the next ten years that turns away Medicare and Medicaid patients. When you go all cash you can sell the patients whatever implant you want.

    Till then I would be careful about breaking the law. Because if it is all about the benjamins I am going to a one year law school and hang billboards all across the country. I will have three ways to make money, illegal competition, malpractice and Medicare/Medicaid fraud. Hmmm, sounds like a pretty profitable undertaking; only I have a little integrity left, which unfortunately is more than most the reps or physicians in this racket. That is my bet what cleans this industry up one day and we can thank the trial attorneys, which we all like to vilify as what is wrong with this country. Just my opinion but I think what is wrong with this country is surgeons, reps and companies breaking the law to make money, which is compromising patient care. Sounds a little like banks, only worse as your operating on people. Good luck on the stand.

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  81. As many have posted before, the legal nightmare will begin when any type of mistake is made by a surgeon while implanting their own screws or plates. You will already face scrutiny from a jury but there will be a completely different spin put on things by the prosecution because of your involvement in a POD. The attorneys who don’t know anything about medicine are going to portray you as a money grubbing slime ball. They will say the only reason poor Mrs. Smith had any instrumentation put in was so you could make an extra buck. Then the local news reports doctor implants patients with unnecessary implants to make extra profits. Then all of the marketing and reputation building that you have spent the past 10 years on is down the toilet because you let someone convince you that the POD model is completely legal which it may be, but there are lots of other things to think about.

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  82. 2:30

    Let's say tomorrow, POD's are ruled illegal. Are you going to then suck up to the former POD doctor's? The same guys you just trashed and vilified? After all, you are who you do business with. What a moral dilemma.

    I guess you california guys are in a pickle.

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  83. Old Spine Doc,

    You have more time to blog than most reps who barely work!

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  84. It will end up where if you want a cheaper price for the implant you will have to sacrifice there...its done over in Europe all the time....the USA is slow to adapt as we are spoiled..

    As for the comment on getting something preauth'd and then denied on the backend...fire your GED employee and find one that can google insurance laws by state..if its a fully insured plan there are preauth laws that can overturn a denial on the backend....if it's a self insured plan..the patient just needs to involve their hr department....

    You could give the hospital an implant for $1 but if they don't know how to bill, or appeal denials they will lose no matter what guaranteed every time....just my 2 cents... Again not worth much

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  85. Hate iPad correcting my sh@t! Any way new way of implants and selling will be for a cheaper price you can buy the implant but have no rep during the case! Test of the physicians true skill.... This is how it's done in Europe and the cost of implants is cheaper than here in the diva states

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  86. all you reps hate on Globus because your jealous of there technology. Copy?? who? synthes sucks, stryker sucks....zimmer sucks...nuva has a nice Lateral, (and nothing else!!!))but not as good as Globus retractor and new interbody devices...Med hasn't come out with anything that can wow in years...Who the hell are they copying???? space aliens...Give them some props for having really nice stuff. And I don't work for them anymore....unfortunately-easiest sells I ever made...regret

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  87. Paradigm really, there are many Gain Sharing programs that are being tested and blessed by the government for hospital/physician co-existing through an LLC formed by companies like Price Water House for example, where hospitals and physicians can work together at lowering costs in all areas, paying themselves for managing the process and incentives, which happens to offset the decreasing insurance reimbursements we are seeing today. This will allow hospitals and physicians to control or you may want to call it capitation, pricing concerns with implants, BMP, DME and any other product lines. Make your profits on volumes and not the kill. The "business" has gotten out of hand, many have had their good days. But many more are to come, we can all live on less to save some semblance of this government and restore the economy so their may be a future in healthcare for our families and many to come.

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