Thursday, March 28, 2013

Here Comes The Rain Again!

Here comes the rain again, falling on my head like a memory, falling on my head like a new emotion
I want to walk in the open wind, I want to talk like lovers do, I want to dive into your ocean, Is it raining with you?

Yes fellow bloggers, here comes the rain again, it's the time of the season when love runs high at the OIG. That acronym stands for the Office of Inspector General. On March 26th, 2013 the OIG issued a special fraud alert for physician owned entities. Wah! Wah! Could the Federalis have finally come to their senses? I mean they have gone after Julian Assange, Pvt. Bradley Manning, internet wiz kid Aaron Swartz, while giving Wall Street a pass, claiming that they are TBTF but also too big too prosecute. Oh, who said crime doesn't pay?  Where's Vanilla Ice when you need him? As POD's and POC's continue to proliferate the medical device sector, while dividing companies against physicians, physicians against salespeople, the OIG's concerns focus on the strong potential for improper inducements between and among physician investors, the entities that they are involved with, device vendors, and device purchasers.

Essentially, the penultimate question remains; "do POD's and POC's violate anti-kickback statutes?" For years, this issue has been debated. Does this type of business model affect a surgeons decision making process? The last five years in spine has tarnished an industry that was once respectable. From the Wall Street Journal to the NY Times, from Long Beach, California (can I hear casino backed medicine?), to Tennessee, Mississippi, and Alabama (the birthplace of POD's?), to Florida, to The Spine Blogger, POD's and POC's have been subject to scrutiny. As TSB claims ever since private equity and orthopedic investment banks took hold of the opportunities to capitalize and profit in a healthcare market that had very little oversight provided by the government, everybody has partied like its 1999.  The foxes have been guarding the hen house. Yet, slow but surely all things must pass. As Glenn Frey once sang, "the heat is on!"

Systemic abuse in healthcare is rampant. From the hospital CEO's and facilities hiding behind "non-profit" tax exemptions, to the physician consultants, to the insurance industry, to device companies, to the hospital staff, to RapeTrax and VendorRape (that's the next scam that needs to be investigated), to salespeople, to investors, everyone needs to take responsibility for their actions and how those actions have contributed to the rise and fall of the American healthcare system. From patients who cannot control their vices, to greedy investors who cry about FDA oversight because time and money drive their thoughts, to greedy surgeons who probably hate their medical careers only to moonlight as fictitious entrepreneurs, to those whom complain about entitlements only to use their Medicare at every chance they get, everyone gets some blame. Anyone who denies that their personal and professional judgement is not tainted by having a vested financial interest in a POD or POC is higher that Hunter Thompson leaving Las Vegas.  

If a group of slimy surgeons start a POC and are the only customers using the product, or, are enticing other physicians to use their product by providing them with an inducement, isn't that illegal? The definition of inducement is something that motivates, stimulates, or creates an incentive, and what better way to incentivize a surgeon? The only way you make more money as a surgeon is by performing more surgeries. Let's take some examples. Say a start-up company that has plenty of cash decides to hand out equity in return for sales volume, is that an inducement? Wouldn't having a vested interest in the success or failure of a medical device company be construed as a inducement? Especially, if the surgeon had the ability to drive up the valuation of the company by implanting more product?  Let's try another example, let's say a company created a platform whereby they subsidized a Fellows or residents start-up practice in exchange for their loyalty meaning only using their product, could that be construed as an inducement?  Say ten surgeons invest one hundred thousand dollars each in a company and only use that specific company's products, regardless whether those products have the same quality or meet the safety standards of a competing product, is that good medical judgement? Let's say the implants break, or the rod reducer malfunctions every time the surgeon uses it, resulting in a fracture of the patient's pedicle, and the surgeon investors fail to report it to the FDA because they have a vested interest in the company, is that good medical judgement? Let say you have a pedicle screw head that splays in-vivo, you change the design without notifying the FDA, and the surgeons that are getting paid to use the product never report it to the FDA, is that legal?  Let alone do they have the incentive not to report it? These are the types of scenarios that patients and the government are not privy to until some individual risks his or her career and files a whistleblower complaint or a patient gets hurt or killed. There is no oversight.

Isn't it interesting that the states where activity has been rampant include, California (there's gold in 'em hills), Utah, Alabama, Texas, Mississippi, Florida, and Tennessee, just to name a few.  I mean, even Nuvasive has complained about POD's affecting their business. If you prey on the elderly (Medicare patients), the uneducated, the misinformed, the helpless, PODs and POCs have torn down a once respected profession and industry. As my granddaddy use to say; "if you hate your career, do something different." There will be complaints about big brother imposing more rules and restrictions. About tort reform, about Obamacare. That will be construed as nothing more than an irrational projection on who is to fault for the state of the U.S. healthcare system. There will be complaints and arguments made about how much it cost to get a medical education in the United States. Here's a clue, don't go to medical school. Yet, this isn't really about free markets, it's about patient safety, it's about the publics safety, it's about abusing the Medicare system whether our readers believe it or not. There have been more than one Dr. Makker's in the industry. Unfortunately, he was not only greedy but a terrible surgeon.  Where was the oversight?  When your own peers are not willing to condemn you and exile you until there is public outcry, what type of society have we become?  Just read some of our readers experiences while working in spine. We have become a society that the end (making a lot of money) justifies the means. Money obfuscates reality.

Corruption of medical judgement? Overuse to increase the cost of Federal healthcare programs? Unfair competition? Not in spine. No siree! When you control whose product you will use, how many times you use it, and where you will operate because you have a financial interest in an entity, is that a free market? After twenty-five years in the device industry, something is amiss. Those who are involved in POD's or POC's will wrap themselves in an outcry of "free markets." They will say that we are becoming a socialist society, but even free markets must have rules. That is why you can't drive at 120 miles an hour in a 55 speed zone, or yell "fire" in a crowded movie theater. Without rules we become a lawless society with no boundaries.  Just look at where we are today?  As Yogi Berra use to say, "when you come to the fork in the road, take it." TSB wants to know what our readers think?

159 comments:

  1. Can't believe I am first to comment on this thread...I won't even sign as Suck It..., out of respect for this post. For the first time in my adult life, I am proud of the action of a big government. I hope there is no over-reach, but I also hope that there is swift, significant follow-through.

    I think it will still be a while before the industry regains it's moral compass. Good luck you Spine-iacs, especially the good guys.

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  2. This rant said nothing, means nothing.
    One post per month from TBS.....Spine is dead.

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  3. 3:43 if anything your English needs some work, keep on selling, America is a great country even for illiterates

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  4. I don't think the recent fraud alert represents "big government" or interfering with free markets. This is, as you say, about patient safety and enforcing laws that are already on the books. I'm as conservative as they come and I am glad about this recent fraud alert. As insiders, we know the nuances of product quality as well as surgeon behavior that the public and OIG don't know. It seems the OIG has learned a bit about those nuances based on the fraud alert. Of course, the good Dr. Steinmann has already announced his approval of the alert and pronounced that his model isn't guilty of any of the sins outlined by the OIG. My guess is that he's more nervous than he lets on

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  5. Hang 'em high for all to see.

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  6. This could be huge, if OIG vies POD/POCs views PODs as inherently suspect under the anti-kickback statute, then this would cut short these entitites from a legal standpoint, correct? I'm curious to know what happens next.

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  7. Even if PODs go away, half of you still can't sell a thing, so what does it matter?

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  8. John C. Steinmann, DO – President and CEO
    Renovis
    1901 West Lugonia Ave., Suite 340
    Redlands, CA 92374

    JOHN STEINMANN, D.O.- Spine Surgery
    Arrowhead Orthopaedics
    1901 West Lugonia Ave., Suite 120
    Redlands, CA 92374

    ReplyDelete
    Replies
    1. He's a Renaissance man!

      Delete
  9. Great post. The next step for the government is to make examples of a few offenders. The FBI has been poking around my area for the last 2 years interviewing people and collecting information. The wheel has spun and now we wait to see where it lands.

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    Replies
    1. Where is your area?

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    2. TN and Alabama. Ground zero!

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  10. I'm interested to know how ownership in a POD and the "single purpose rule" don't automatically indict the surgeon. Why would they own a share of the company unless they intended to make money on it. If they intend to make money, then profit is a purpose of the ownership. Can one of you wannabe lawyers edify me?

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  11. News to all you Medtronic/Synpuy/etc. reps. The business you lost to PODs is NEVER coming back, even when PODs ago away. The model will just change, likely with no-rep deals involving the hospital directly, and will further erode prices. PODs will go away, but the cure will be much worse than the disease.

    PODs have proven that reps in the room aren't necessary and the hospitals have gotten the message. The genie is out of the bottle, and there is no going back.

    ReplyDelete
    Replies
    1. Do not read the above comment, you will be dumber as a result.

      This has been a public service announcement.

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    2. 9:02 - you are sooo wrong. My acts locked out the POD a surgeon was using for legal reasons, one of them being having a rep around. IF something was to happen intra op who's there for you from your POD... NOBODY,,, that puts the hospital at a HUGE legal disadvantage in a courtroom. The surgeon does use MDT/Synthes for his cases now. With this news I don't think many hospitals will want them in, at least in my area. I am the genie, the walrus and the lizard king.

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    3. It will be short term until the next deal comes around, or he moves to another hospital. Just wait Genie boy, these things take time.

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    4. Genie is back,,, he has no other options amigo (or amiga). The last two hospitals he was at are an hour away and they also put the stop to the POD after the OIG came in last year and did audits, met with legal from the hospital, contracting and other vendors too. Perfect example of why they will not make it in our area.

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  12. Nothing will change

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  13. In the next move to cut costs, hospitals will begin to buy implants directly from vendors, then hire "direct support staff" to work the rooms for cases. It will be the equivalent of a scrub tech, but just someone working the other side of the table.

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    Replies
    1. Too many legal issues here. Companies will not train/insure outside staff. Attorneys would eat this up in court if hospital legal would even allow it.

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    2. Not true. Companies in and out of spine do it all the time. As long as training is documented, there should be zero increase in liability. In fact, trained scrub techs and RNs are usually better qualified than reps who have no state certfication process at all.

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    3. I have nurses in my area that are good nurses but after a decade working spine cases still know the difference in a PLIF and TLIF and have no concept about reading films. Maybe they could learn, but reps who earn their business are way more knowledgeable than the nurses about their specific area of expertise. If you think docs can operate without a rep, ask any doc doing deformity or MIS fusions if they would trust their scrub tech to be the only resource in the room. Not many would.

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    4. -correction- still DON'T know the difference in PLIF and TLIF

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    5. I agree that specialty procedures like complex deformity, and mis as well as new technologies, will require a rep, but it is ridiculous that a rep supports the can-of-corn cases. It will actually provide a cleansing of the rep pool. I think this is all good. You doofus reps that provide no clinical benefit, are done. Surgeons that were around when spine was respectable, even the ones that have sold-out over the last decade, should be ecstatic over this. Everyone knows which reps know their craft.

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    6. Why would the surgeon be ecstatic? Especially the ones that "sold out"? Because they won't have a rep to make sure their sets are ready and stocked properly? Because they won't have access to loaner sets without a rep to order, deliver and process and then bill and send the sets back? Because no one will be showing him any newer technology and arranging for him to get trained? Because no one will be around to sort out billing issues and the hospitals end up not getting any new inventory shipped because the hospital is on credit hold? Because when he has difficulty with a case, some "implant specialist" hired by the hospital to cover everything from breast implants to heart valves can't provide any experienced insight or advice? Yeah, the docs will be jumping for joy!

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  14. Probably cynical, but my expectations are the following:

    1) the Hospital CEO's will act like three monkey's (hear no/speak no/see no) including those that should have read about it in WSJ and laugh all the way to the bank.
    2) the local papers (hear no/speak no/ see no) won't inform the public in (hear no/speak no/see no) community.
    3) The OIG is on sequestration, and they will wait for (hear no/speak no/see no) CEO to self-report so they can collect some fines and on the days they work, they will outsource someone to write the press release that (hear no/speak no/see no) local paper doesn't print. (Remember kyphon)
    4) And (hear no/speak no/see no) CEO increases "on call" pay for referring physician or employs them at twice the market value to keep the referral's coming.
    5) And John Q. Public pays the price, again.

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  15. Stable Spine..they are coming for you!

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    Replies
    1. Alan Brown & friends..the end is near!

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  16. https://oig.hhs.gov/fraud/docs/alertsandbulletins/2013/POD_Special_Fraud_Alert.pdf

    blah blah blah.

    Nothing new, folks. Just a little press release to reassure us that they're not sleeping on the job. Y'all just keep on waiting on FBI and OIG to ride in on a white horse and restore your territories back to the good old days of the '90s.

    Good luck with that. The market has moved on. You are now permanently working 2x as hard for 1/2 the pay. Just like your customers.

    Just milk it 'til the vending machine obsoletes you completely. Then move on to selling used cars or timeshares. Better hours. Same pay soon.

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  17. www.nytimes.com/2013/03/26/health/salesmen-in-the-surgical-suite.html?ref=health&_r=0

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  18. No changes until there are hand-cuffed perp walks with sports jackets over the criminals' heads. Here in Florida it's a wasteland of PODs, PIP/LOP, hospital collusion, and brilliant "surgeon-inventors". I wish I would have gotten into another field, but I guess I'll wallow in the mud a while longer. Spine used to be an adventure, now it just pays the bills...

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  19. Scorching Lawsuit Against Surgeon & Medtronic

    "Unnecessary procedures are criminal acts,"

    http://www.courthousenews.com/2013/03/26/56056.htm

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  20. "Nothing is illegal if a hundred businessmen decide to do it, and that's true anywhere in the world." -Andrew Young

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  21. When a POD surgeon decides to add a cross link or fuse 3 levels instead of 1, they are making decision that will give them money back into their pocket. Why wouldn't they want to throw the kitchen sink into somebody's back? This is a start, and I predict the POD's will be obsolete within 24 months. For those of you not familiar with what the orthopedic industry wen through 4 years ago, ask a Zimmer rep what they can do for their surgeons...nothing! Hell, they had John Ashcroft in their Corporate Office...and now they Can't even buy a guy dinner. Good luck POD's, your days are numbered.

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  22. Thats why Zimmer Spine could be a contender if they got some decent product. Unfortunately the management is being starved to death by the pencil pushers in Warsaw. Did anyone see the tiny pathetic Zimmer Spine table hidden behind their massive display at AAOS? Truly comical.

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  23. Million Dollar ZimmerMarch 31, 2013 at 12:00 AM

    Please...Zimmer Spine has underwhelmed for 10 years. As if they're any indicator of the market at large. It's a company built on a bunch of rejects from the growth spine companies. Their current excuse for sucking is that there are PODs out there. Gee...get used to it. They are here to stay.

    The excuse before that was Dynesis...a product that grew like mad in Europe, got bought by Zimmer, showed positive IDE data, then and struggled to sell tens of units per month in the US.

    Zimmer Spine will suck in the next 10 years like they did in the last 10.

    They're still counting on trabecular metal to save them. The product portfolio is a reflection of management's ability to discern bad product from good.

    Hardworking geniuses, all of them. I *swear*.

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  24. I've been in spine for four short years and I find it funny and sad that many of you rip on your competitors constantly. Reps, no doubt, add value, but we are all selling the same things for the most part and to to bust on a company only shows your ignorance and insecurity. It's a relationship business, which sales has always been, so get out and build one. Do you really think anyone's plates or screws are that much better than the next guys? Ask a surgeon that you actually have a relationship with.

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    Replies
    1. This business is a relationship business right up until the new guy or company offers the surgeon something you can't.

      Delete
    2. That's the problem. It should be a product quality and not who can blow sunshine up some surgeon's ass to inflate his insatiable ego. It's simple, "We're better and here's why. Now do you get it doc? Since we are better the there is no medical reason to with anyone else." That's how it should work.

      What will it take to get your business better products, service and support or bullshit and kickbacks?

      Delete
  25. Anyone hear about a group in California offering large pay days to docs for a drug dispensing business and then in return the doc uses lanx implants on his spine cases to return the pay out? I'm hearing 50k per month per surgeon?

    ReplyDelete
    Replies
    1. Could dar be Luxmed?

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    2. What is mister wheeler and dealer Kyle Webb up to? Who would want to deal with this guy?
      Maybe the DOJ needs to pay him a visit.

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  26. So what companies are selling in a big way to PODs???

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    Replies
    1. It's the same 4-5 in every POD. Although many are now looking at the model. See Baxano earnings call last month.
      If your using some of these implants you are either a POD or have a vested interest- Alphatec, Spinal USA, SeaSpine, US Spine, Phygen, Amendia, Lifespine.

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    2. You left out Xspine

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    3. 6:05, thats not entirely true. Spinal USA, Phygen, Amendia are owned by surgeons and sell almost exclusively to their owners. I'm not sure about Seaspine, although I know they have some shady dealings. Alphatec definitely sells to PODs, but they also have an independent distributor network and those distributors are not part of any PODs, (the surgeons in PODs that buy ATEC products are excluded from the distributor territory).

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    4. And ATEC bought Phygen, so those surgeon owners no longer own either company.

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    5. Correct, they are now in a POD with higher returns. Don't think the sale to ATEC brought the revenue they all hoped for 7 years ago.

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  27. If you ask any hockey player why there is so much fighting in hockey you will get the same answer, "Because it's allowed". The medical industry is a lot like hockey. You break the rules in a way that can seriously injury a player and you get 2 minutes in the penalty box. You might get 5 minutes for fighting and if you crack someone in the head with your stick you could get a game misconduct and if the guy you hit is a star player you might get a 3 game suspension and a fine.

    If you take a poke at somebody on the basketball court you get tossed from the game.

    Hockey is a sport and it is an honorable game but the lax rules are enforced.

    Basketball is an honorable sport played by gentlemen and ladies with strict rules that are strictly enforced.

    American football is a game played by gentlemen and watched by animals.

    Rugby is a game played by animals and watched by gentlemen.

    Spine and the medical industry in general is not like any of the aforementioned sports because it's more like pro wrestling. When it comes to honor or governance spine __________________________________________________.

    There really is no debate here. PODs are just one of the many wrongs. Surgeons should do what it best for their patients but they don't. The only real question is are surgeons naturally thugs or does the industry make them that way? From what I have seen, most of them are naturally thugs. They are the reason this industry is the cesspool that it is. They could say no to the dirty dealings and stay true to their profession but they don't and know look what we have now.



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  28. "Money obfuscates reality."

    That just about says it all.

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  29. What if a POD purchases implants from China, or India, etc., for $35 for a pedicle screw, get them FDA approved via a like device, start a POD and sell them for $1000 a piece. What happens if that screw breaks and the patient sues the doc. Where is the product liability? I bet the doc and the hospital then assume the liability of the implanted device, not the manufacturer of the implant from China. What would happen to the guys putting in a 10 level fusion in a 85 year old to treat back pain when the OIG finds out about it? Will that guy go to jail? I'm betting the doc treating titaniopenia will go to jail and this who POD thing will collapse. Remember, money corrupts and more money corrupts more.

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    Replies
    1. Most of the screws already come from China and they can be had for 2 bucks a piece.

      Money talks and it buys inspectors and regulators.

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    2. Idiot. You have no idea what you are talking about.

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    3. Globus manufactures India, and companies are moving production to China.

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    4. There are many high quality companies who only manufacture product in the USA. If you sell critical products used in surgery that are manufactured in China and India, your competitors will use that against you.

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    5. AnonymousApril 1, 2013 at 11:16 AM

      Globus manufactures India, and companies are moving production to China.

      AnonymousApril 1, 2013 at 1:14 PM

      There are many high quality companies who only manufacture product in the USA. If you sell critical products used in surgery that are manufactured in China and India, your competitors will use that against you.

      ''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''

      That trend has been going on for a along time. There are over 200 drug manufacturing plants in China and only 2 FDA inspectors.

      There really is no way to tell there products are manufactured. If the devices are sold to Chinese surgeons then they are probably of high quality but if they are for export only watch out.

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    6. It costs a machine shop less than a penny to produce a screw. It may cost them a nickel to produce a pedicle screw. Here's how they are made. http://www.youtube.com/watch?NR=1&v=kidWBeyOMA0&feature=endscreen

      Since only a few companies actually make screw machines there is no way to tell where a screw is manufactured. Surgeons are implanting Chinese screws whether they know it or not.

      $20k will get you a brand new screw machine http://machinery.alibaba.com/screw-making-machine-prices.html You can buy a used one for less than 1/2.




      Delete
    7. This is a joke, right? That is not how they are made. You can't make them for a nickel and yes you can know where they are made. Please, either let us know you're joking. If not, then you are the joke

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    8. And what planet does 121 live on?? A penny a screw???? A 20k swiss, brand new? Reality check time, moron. The titanium costs more than a penny, a GOOD new swiss capable of whirling the thread costs 185k minimum. Add overhead, iso13485 certification etc.... You're just some dumb schmuck sales slime that can do nothing except leech off of intelligent, productive members of society

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    9. I'll tell you what 1:21, if you buy the machine and get the screw ready for sale, I'll buy a million of them for $5 each, grossing a whopping 100 fold profit margin for you and your $.05 screw. Go to work and get rich since you know how it's done.

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    10. I can stamp car doors for $5 a door and buy a used cheap stamping machine. Should I start doing that in my garage? Oh wait, I have to design, engineer, prototype, test, and get government approval for a car first! Bally.......you are such a dumbass and your simple mind cannot get past all the hate you have for the world. Your constant misinformation fools no one, rather exposes exactly who you are.

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  30. http://www.prnewswire.com/news-releases/pdp-holdings-llc-announces-support-for-health-and-human-services-office-of-inspector-general-guidance-200630731.html

    How about this one? PDP Holdings. Anyone deal with these guys? I hear it's a POD wrapped in a veil....

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  31. The PDP press release is a smokescreen. The management and surgeons involved in PDP are in serious legal peril. The "PDP Model" is just a POD that pays surgeons to use the products, the rest of their statements are immaterial.
    Here is the bottom line of the OIG alert: If the surgeons are encouraged to use the product (and because they are paid to use the product, they are encouraged) then they are going to be prosecuted. If only one purpose is financial remuneration then the POD executives, surgeons, and the hospital executives who buy POD implants will likely face criminal prosecution. PDP is merely fooling themselves by making such a statement. The OIG will not hesitate to prosecute the surgeons, PDP officers, and hospitals involved despite this ridiculous, self-serving press release. If PDP or any POD did not provide “remuneration” for their surgeon investors/customers to use the products, then the POD would not be viable. PDP CEO Tom Gallagher could end up cutting a deal with an OIG prosecutor that puts his surgeon customers into immediate legal jeopardy.
    Once the sunshine act hits in August, anyone involved in a POD including its officers, surgeons, and hospitals are in grave danger of prosecution. Surgeons that are convicted or plead guilty to charges associated with Anti-kickback or Start law violations will loose their medical license in most states. Why would a surgeon with any intelligence take such a risk? Might as well play Russian roulette.

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    Replies
    1. Read the Sunshine Act. PODs will only have to report if they are a Group Purchasing Organization. If a POD is designed to serve a single physician or practice, they will not have to report under the Sunshine Act. This was one of the big differences between the draft and the final document. Grassley wanted to cover PODs but the law that was passed only covered GPOs. Thus, the OIG/DOJ issued the Fraud Alert because many PODs were believing the government was condoning their existance by excluding them from the Sunshine Act.

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    2. Great call. The best reason I've heard for the timing of the alert. Makes perfect sense. It may be a stretch to call a POD a GPO, however. PODs will likely claim the distributor exclusion and not report.

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    3. The safest PODs are the ones who take ownership of the inventory as well the billing with the hospitals. Per the Sunshine Act, if you take title of the inventory you are not exempt from reporting. Therefore, any distributor who takes title of the implants must report under the Sunshine Act. Therefore, the safest PODs would have to report and the slimiest ones wouldn't have to report under the Sunshine Act but may have to report to the nearest penitentiary.

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    4. If they don't take title, then they can't claim the safe harbor requiring a risk proportionate to the profit so the setup of the POD would run afoul of AKS from the get go. But as we all know, there is no risk when the owners constitute the entire customer base and they control the sales volume.

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  32. How long will it be before Malpractice attorneys start filling lawsuits against surgeons that are involved in these illegal businesses?

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  33. From PDP's website, under the "Surgeon Benefits" tab:

    "Benefit from economic incentives based upon savings derived from utilization of cost-effective preference items"

    Economic incentives? If a single purpose is an "economic incentive", the arrangement is illegal. That statement could only be true if PDP pays the doctors based on the difference in cost of another implant and a lower cost PDP offering. It could also be read into that that if a surgeon chose a non-PDP product that costs less than the PDP offering, he would be incentivized to do so, unless "cost-effective preference item" is defined by PDP as a product they sell.

    I know for a fact this is a line of BS, because I distribute for a manufacturer that they purchase from and I offered to sell it at a lower price to the hospital and was told "No thanks"

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  34. The Integra Spine distributor in California is still actively recruiting and staring PODs. He just had a recruiting trip over bottle service in Vegas mid March. I randomly ran into a surgeon I knew and he drunkenly spilled his guts. I called the OIG hotline and was told they had several calls about the same individual.

    Shame on you Integra Spine, you are better than this.

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    Replies
    1. Why would you think that Integra Spine is involved or even aware of this? I'm no fan of Integra Spine, but it would seem that this is the action of a spine distributor rather than a manufacturer. In fact, I would think that Integra Spine would not be pleased.

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    2. If they bury their heads in the sand then it's no big deal......until their name is in the WSJ and the stock price drops.

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  35. Who is the Integra distributor on the West Coast. We would like to interview him

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    Replies
    1. I know the distributor in LA is West Coast Spine and Ortho.

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    2. Brandon Davis

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    3. Integra hmmm wouldn't want to be a surgeon caught using this crap!!!

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    4. He is involved with Spine 360 and DeRoyal now

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    5. I hear Christine his wife is deeply involved in the company as well.

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    6. I wonder if he will wear those sunglasses when he get interrogated....what a DB

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    7. He is the Abe Froman of setting up PODs. I have very little doubt that jail is in his future.

      Delete
    8. This company is full of crooks, Greg Hairston is another snake in this company. The paper trail is long it's only a matter of time.

      Delete
  36. Speaking of the WSJ, how is Spinal USA doing these days?

    The OIG may want to investigate the surgeons listed on the SEC's site (obviously excluding Pastena). They should inquire about the landowners of AL MS GROUP LLC as well. I have a feeling they will discover some familiar surgeon names associated with the company.

    http://www.sec.gov/Archives/edgar/data/1462841/000146284112000001/xslFormDX01/primary_doc.xml

    ReplyDelete
  37. This may be a far greater threat to the spine industry bad guys than the government. http://www.youtube.com/watch?v=qFsPIAMLSjU

    ReplyDelete
  38. Prosecute all these idiots and the suppliers, Medicare fraudsters, and take away nonprofit hospitals, maybe with penalties and taxes paid we can afford to call American operators…

    ReplyDelete
  39. The name of the company that "dispenses" Lanx to it's surgeons for about $45-50K per month is Industrial Pharmacy Management out of Newport Beach. http://www.ipmrx.com/

    ReplyDelete
    Replies
    1. That's drobot mike Jr.

      Delete
    2. Didn't they just get raided

      Delete
  40. There's always Tucson Orthopedic Institute in Tucson. A group of eight spine surgeons very blatantly operating under a POD. The hospital, Tucson Medical Center, MUST know what they do, and they are looking the other way.

    Then, of course, there's Steve Hanks, MD in Tucson. He's got some form of business with a real slime ball rep by the name of Wade Groenwald. The hospital these two are at, Northwest Medical Center knows whats going on there as well. Blindness must be in the hospital's DNA nowadays.

    ReplyDelete
    Replies
    1. What products do they use?

      Delete
    2. Medysses Spine, Life spine, Spine 360, you name it and there are a plethora of products being used in that "business".

      Delete
  41. As usual these criminals will gt the usual slap on the wrist as the news media continues the phony left vs right debate.

    ReplyDelete
  42. "penultimate". This word does not mean what you think it means.

    ReplyDelete
  43. Hey MSM why not start a POD hall of shame and name names and post addresses or have your readers do it?

    http://vitals.nbcnews.com/_news/2013/03/27/17487962-fraud-alert-doctor-owned-medical-devices-come-with-risks-report-finds?lite

    Let consumers know which surgeons and hospitals are on the take. Keep the bastards looking over their shoulders.

    Some manufactures are boycotting PODs

    Manufactures are pushing product out the door at 40¢ on the dollar. Many are waiting to hear the thoughts of the Office of the Inspector General on the matter before committing to selling to the entities. Others refuse dealing business with PODs.
    Example:
    POD (doctors) buys a $100 widget for $40.
    A doctor sells it to the hospital (to put in his patient) at $70 or $80 = profit to POD of $30–40.

    Note: the PODs are claiming that it's "smart medicine" as the hospital is getting these implants at a better price than the group purchasing organizations they belong to.

    It's a conundrum. At the end of the day, the ones that lose are the manufactures as they have to dilute their technology and bastardize the market if they want to participate. Couple this with the device tax and you have single-handedly stifled technology, innovation, and forward thinking … in one fell swoop.

    ReplyDelete
    Replies
    1. You can't do that- that would be slander to these surgeons. Plus then they would never come back to using your gear. Newsflash they aren't ever going to use your gear. So who cares then- if they are commiting a kickback violation expose their asses and perhaps they leave and the hospital will bring in surgeons who in the future you will have a shot at.

      I kind of like the idea. Please put in a nice format so the Regional OIG Special Agents can easily choose their targets.

      Surgeon:
      POD:
      % of business to POD:
      Purchasing Director at Hospital:
      Spine Coordinator at Facility:
      CFO at Facility:
      Compliance/Risk Manager at Facility:
      Sales Rep from POD:
      Distributor of POD:

      You'd be very surprised at the amount of this data the OIG already has. Good idea 4:59- I'd like to see 50 posts by tomorrow.

      Delete
    2. I like the format of this information. This is information that should be made available at every hospital so that there are no hidden conflicts of interest. Unfortunately it is often difficult just to know who are the PODs in the area. It's a kept secret. A list of all PODs should be made on a searchable website. Why hide if it's a legal entity? If no one is worried about the fall out from the OIG, why not be public. What do you have to hide from? Would the docs be embarrassed to have known publicly that they use a POD who's implants may be made in China? Doesn't the public have a right to know? Wouldn't the public be interested if they knew their implants were made in a foreign country, without any ability to go after a foreign company for product liability? The public spends more time and effort buying a new car then researching the doc, hospital and implants to be used. The public assumes the docs would only do whats best for the patient. The public is wrong!!!

      Delete
    3. Starting August 1, all physician payments by PODs must be reported and will be made public. The fine for failure to disclose payments is up to $1MM annually. I am sure that hospitals that have not had a policy preventing purchases from PODs will have one shortly since they are at risk. I think we should call out known POD surgeons right now. Hopefully this will cause them to drop the POD for their own reputation.

      Delete
    4. POD payments and ownership will only be required to be reported if the POD is considered a GPO or if it takes title to the inventory. This excludes many of the PODs which are in the clearest violation of the Anti-Kickback Statute. Thus, the DOJ's Fraud Alert and its statement that "We do not believe that disclosure to a patient of the physician's financial interest in a POD is sufficient to address these concerns."

      Delete
    5. Telling the truth is not slander or libel. Truth is an absolute defense. A surgeon shit list would do a lot do clean up this industry.

      Delete
    6. All PODs are to be included in the Sunshine Act. Has nothing to do with just GPO's.

      Delete
  44. Spine Surgery India offers info on Spine Surgery India,Spine Surgeon,Spinal Surgery India,Back Pain,Spine Implant,Cost Spine Surgery Hospital India.If you are thinking to go INDIA for surgery, then you must search for Spine surgery India, Laser spine surgery India, Best spine surgeon India, Spine surgery best hospital India & spine surgery cost india

    ReplyDelete
    Replies
    1. Hey Towel head.....Do I get a free Slurpee and guaranteed infection with every surgery???

      Pimp your crap in your homeland - get the fuck out of the USA!!!!!

      Delete
    2. See. We are not ready to even think of having foreign implants. Patients need to know what they are getting for their hard earned cash. Health insurance is not cheap. What would the public think if they knew? Having said that, the big implant companies need to reduce the costs of their implants. After all, a pedicle screw has been around forever and there is no need to think the public is still paying for R&D on those same implants. Give us a break on the price, already.

      Delete
    3. The public is not paying for R&D costs, they're paying for the worthless 20 senior vp's salaries. Manufacturers are being SQUEEZED to produce pedicle screws for around $30.00 right now. I know, I'm quoting, & making them. The mark ups are astronomical. Manufacturers in this country literally making cents on the dollar while hospitals, & the big boys are raking it in. The health industry is CORRUPT! It will not change unless something radical happens

      Delete
    4. The guy who controls the sale makes the profits. Your problem is that there are 500+ companies in the US alone qualified to make a pedicle screw. Yet only about 20 companies that can sell them in major volume.

      Delete
    5. What's the cost when you add in instrument sets, shipping, storage, sales commissions etc? The cost to manufacture something is not always the actual cost.

      Delete
    6. Let's add insurance, marketing costs, training, regulatory affairs, design control, testing, royalties, consultants, medical device tax, etc. I always laugh when I hear people complain that a pedicle screw only costs $50 to make and it's sold for many multiples of that.

      Cutting the metal is the easiest and cheapest part of the whole business. That's why contract manufacturers always fail when they try to market their own products. They have no concept of how the business really works once the screws leave their dock.

      Delete
    7. Are all companies still paying a license fee for poly screws to Biomet or Depuy? When do those patents expire? I have heard that license fee is upwards of $100 per screw sold, can anyone verify that?

      Delete
    8. Well 11:43, I always laugh when some suit, or ex physical therapist with a worthless 2, or 4 year degree says that cutting metal is the "easiest and cheapest part of the whole business." You are the one who has no concept. Rising tooling, & material costs, a shrinking work force are all factors that you obviously have no clue about. If it's so easy, & cheap, why aren't you doing it? Because you have no idea of the mathematics, & physics involved in producing components that are becoming exponentially more complex as designers are pushed to improve on technology without infringing on patents.

      While there is some truth in your first paragraph, the real truth is that the vast majority, if not all device companies are incredibly top heavy. Why do medical device companies need senior vp's, vp's directors, & managers of the same department? In fact, they don't. As management teams are recycled, without fail the new one comes in, & bring their pals with them to skim as much as they can. Don't tell me I have no idea of how the business works. I've been watching it for over 25 years. You try to make it sound like hospitals, & reps aren't reaping the majority of the profits from this game. They are, for now. It's changing, & you're all going to have to deal with it.



      Delete
    9. Indian surgeon beat Americans hands down.

      Delete
  45. "I'd like to see 50 posts by tomorrow"

    You're still at zero three days later. Nice call to arms, zero.

    ReplyDelete
    Replies
    1. nobody wants to be the one to list this... even though its posted anonymously it can be traced back if needed. I have two docs I would like to post but will not.

      Delete
    2. Dont post it here, it won't do anything but start a new thread of trash talkers who do nothing but complain. Call the local OIG agent. Most of what you can give is circumstantial since you and I dont have the books or the documents of incorporation for the POD, but you can alert them to all of the things outlined in the Fraud alert that just came out. Changes in practice patterns, leveraging inpatient referrals to pressure hospitals to buy from POD, increased hardware per case, increased explant volume, switching from bone graft to PEEK sold by POD, son in law rep for POD, no non-owners buying from POD, no non-implanters investing in POD, etc.

      Delete
    3. Everyone selling in this business, and I mean everyone, is potentially guilty of something given the wide open interpretations of kickback and Stark. Buying lunch for the office? Taking a doc to dinner? Order wine? What if his wife shows up, does she pay? Mentioning an off-label use? A few too many consultants in your region?

      CRIME CRIME CRIME! All of it. No different than a crooked POD or anything else in the minds of the feds. If someone takes a dislike to you and decides to drop a dime, have fun with that because you are guilty until proven innocent. Don't expect your employer to defend you.

      There are way too many self-righteous idiots on here who always think the other guy is the crook, but their shit doesn't stink. You are ALL criminals in somebody's book, whether you know it or not.

      Delete
    4. No difference except violation of anti kickback statues is a felony and buying lunch for the office is not considered a crime in any court of law. Thats just a violation of Advamed, which does what again?

      Delete
    5. Actually, there have been several instances where meals have been cited as an inducement under kickback laws. If someone wanted to make an example of you, anything of value to a surgeon using your product could be considered an illegal inducement. Additionally, there are now federal reporting requirements for meals, which is another opportunity for the OIG to bust your ass if they feel like it.

      Delete
    6. I'm feeling pretty confident that I won't get sideways with the OIG over a BBQ sandwich if they haven't yet taken any action on PODs or sham royalty payments that not only induce, but virtually guarantee 100% loyalty from the receiving surgeon. But I get your point. The analogy I'll make is that while I might be going 1 mile an hour over the limit, PODs are supersonic in a residential.

      Delete
  46. The POD thing will stop when a doc or two go to prison. Then every doc will bail from the POD. Just watch. It will happen.

    ReplyDelete
  47. Or speeding vs murder. One will get you a fine, the other thrown in jail for a long time or lights out.

    ReplyDelete
  48. 4:22 Can you name the example where a meal was considered an inducement. Did it contain thousand dollar bottles of whine, lap dances and hookers? Otherwise I am calling BS on the steak and potatoes.

    ReplyDelete
  49. I worked for a Hospital CEO that went to jail.

    The only reason the OIG got involved after 10 years of complaints by the public, was because an honest CEO had tapes of a second bribery.

    The physicians got greedy and tried to get more for there admissions fron another hospital and the other CEO taped the encounter with these physicians and didn't play with the crooks.

    The cowardly physician drove his car into a MAC truck days before his prison sentence, again risking the community. The insurance company paid out a ridiculous amount in death benefits to DR. SLEEZY.

    Lots of luck waiting for the OIG. I don't know any honest Hospital CEO'S that give a flip about the community these days, so I believe the public is damned.

    ReplyDelete
    Replies
    1. Maybe multiple complaints to the OIG and certain members of congress in the districts of these thugs. Volume Volume VOLUME!

      Delete
    2. In my corrupt state - this is just a waste of #2 lead

      Delete
  50. Looks like Al Franken whored out!

    "Senator Franken is proud that Minnesota is a leader in medical device innovation. Companies in our state are responsible for the devices that people all over the country rely on to keep them healthy. The medical device industry also provides thousands of high-quality jobs in Minnesota, and Senator Franken believes that these companies should have the capital available to invest in research and development and continue to be a vital part of our state's economy."

    That Minnesota company is famous for bribes and kickbacks. How much did you cost Al? Al Franken is well aware the ciminal activity at MDT.

    http://www.franken.senate.gov/files/documents/Franken_Med_Device.pdf

    ReplyDelete
  51. Anyone know what is going on at Pacific Hospital in CA? Apparently got raided yesterday and some folks may have left in cuffs.

    ReplyDelete
  52. May have something to do with this?

    Google: In Small California Hospitals, the Marketing of Back Surgery

    ReplyDelete
  53. Pacific Hospital of Long Beach: http://www.presstelegram.com/news/ci_22962563/search-warrant-served-at-pacific-hospital-long-beach

    ReplyDelete
  54. Attended recent ISASS meeting and had to laugh looking at the Aurora booth, rolling videos, two couches and Brent sitting by himself. Dressed for success, blazer, jeans and shirt hanging out, what a bunch of goofballs! Oh, and they are going public!

    ReplyDelete
    Replies
    1. don't beat on them, they have a plan

      Delete
    2. Uhhhh was the plan to put 30 non existent products on the website and then take most of them off? Sounds like a shitty plan.

      Delete
    3. I wanna work with the Aurora guys. No "ME TOO" products there, buddy!

      Delete
  55. What's new in the world of spine?

    ReplyDelete
    Replies
    1. Depuy left a few select distributors in place? LOL!!! OIG? anything smell funny here?

      Delete
  56. Heard Life Spine is on top of a big acquisition.

    ReplyDelete
    Replies
    1. Yeah Phygen is up for sale again!

      Delete
  57. Several hospitals in California have been served with search warrants, Pacific Hospital was the first. If I was up to no good in SoCal I would be shitting my pants right now.

    ReplyDelete
    Replies
    1. Any idea which hospitals? Would like to know which spine docs are shitting their pants.

      Delete
  58. From today's WSJ and the spine industry's favorite reporter.

    By JOHN CARREYROU
    Federal agents are looking into "allegations of fraud" at companies owned by Michael D. Drobot, a hospital executive who built a Southern California business empire centered on treating spine injuries to workers' compensation patients.

    Last week, Federal Bureau of Investigation and Internal Revenue Service agents conducted searches at the companies as part of an investigation by the U.S. attorney for the Central District of California, said Laura Eimiller, a spokeswoman for the FBI's Los Angeles field office. She added that the affidavit supporting the searches was sealed, and she declined to provide specifics about the investigation.

    The agents served search warrants on Pacific Hospital of Long Beach, a 184-bed facility owned and run by Mr. Drobot, and on Industrial Pharmacy Management LLC, a Drobot company based in Newport Beach that dispenses medications to patients in doctors' offices.

    ReplyDelete
  59. Dirk Kuyper got a job! Did the board not do a background check? The state he left ATEC in should have been an indication of what to expect. Good luck and keep your secretaries indoors!

    ReplyDelete
    Replies
    1. Now he can hire his son again.

      Delete
  60. Guaranteed cause the kid has never gotten a job on his own anyway

    ReplyDelete
  61. Major POD in S.Cal has shut down. They are somehow connected to the FBI raid on the Long Beach hospital. This may be the begining of the end for POD's!!!

    ReplyDelete
    Replies
    1. There are 20 POD's associated with Pacific......which one was shut down?

      Delete
    2. Can you name the PODs involved? Would be interesting to know.

      Delete
  62. Which POD was shut down? Sounds like the Feds are moving in on all the egregious PODs. May be a major shut down over time. Maybe some docs will go to prison?

    ReplyDelete
  63. It is nice blog for the reader can get some ideas about how to safe their Garase.


    ReplyDelete
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    very good information on External Fixator, Orthopaedic Implants and Instruments product i got know useful information thanks for this.

    External Fixator, Orthopaedic Implants and Instruments.

    ReplyDelete
  65. Stryker strikes again only it's worse this time! Their latest batch of victims, the Cervicore victims, were injured even more grievously than the hip implant victims and there was even more criminality involved. CerviCore is an artificial disk implant meant for implantation into the cervical spine. Not only is it a metal shedding Frankenstein design like the Stryker hip implants, the Cervicore disk never received FDA approval for use in patients. It gets worse, the Cervicore disk never even received FDA approval to be used in clinical trials or IDE (Investigational Device Exemption). The Cervicore disk is such a piece of shit that it could not even get and IDE from the FDA but that didn't stop Stryker's doctors from implanting them in the spine of patients.

    Currently the is a class action lawsuit being filed against Stryker Medical.

    file:///C:/Users/Chris/Downloads/File%20Stamped%20Copy%20of%20Complaint.pdf

    On Friday April 11, 2014 the law firm of Zoll, Kranz & Borgess, LLC filed a lawsuit behalf of a group of fourteen plaintiffs against Howmedica Osteonics Corp. (which does business as Stryker Spine) alleging Howmedica’s trial device called called CerviCore injured them.

    Stryker Howmedica Facing Class Action Law Suit

    ReplyDelete
  66. I agree with the comments about PODS, but what about the inducements from the Hospitals for "profit sharing" and eliminating vendors based on cost alone, isn't that an inducement for the Surgeon? Hospitals are not innocent, in fact they are getting rich while claiming to be "non profit". BS!!!

    ReplyDelete
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    ReplyDelete
  68. THE PERSON WRITING THE ORIGINAL BLOG. EITHER A SOCIALIST OR DOES NOT UNDERSTAND OUR FREE MARKETS. HE GOT CARRIED AWAY. YES! THERE ARE FRAUDS IN MANY PLACES BUT MEDICAL DOCS FOR MOST PART POLICE THEMSELVES. YES ,THERE ARE SOME PHYSICIANS AND HOSPITALS THAT MAY KNOWINGLY ENGAGE IN THESE BUT VERY FEW AND GOVT. AND ITS RELATIVELY INEPT GROUP OF PEOPLE OVERREACH. YES ,THERE IS WASTE IN MEDICINE TOO AND THERE IS ROOM FOR RATIONING BASED ON WHAT WE CAN AFFORD. WE ALL NEED TO TIGHTEN OUR BELTS. BUT OURS IS THE FREE MARKET OF MEDICAL ECONOMY AND THE BEST OF THE BEST ,PEOPLE, SERVICES AND DEVICES PREVAIL. COMPETITION DOES THEM GOOD AND COMPETITION DOES THEM HARM. BUT THERE IS NO ROOM FOR WISHFUL OVERJEALOUS OVERREACHING ATTITUDES IS NEITHER NEEDED NOR DOES ANY GOOD. WHY DON'T YOU PUT YOUR CREATIVITY TO SOME RATIONAL POSITIVE WAYS OF INNOVATION INTO LOW COST MODALITIES OF DELIVERING HEALTH CARE . OBVIOUSLY ,I AM A DOC. AND AM FAMILIAR WITH CAUSES AND CONSEQUENCES OF ALL THIS IRRATIONAL RESENTMENT AND CRITICISM.
    GOOD DAY.

    ReplyDelete