Is it an Aspen or a Medical Device?

Recently, the Spine Blogger was asked by one of his readers on his opinion about the LANX Aspen Spinous Process System (ASPS). Aspen is the name of a Colorado Ski Resort Town, but the origins of the name come from the genus Populus (a tree) having leaves attached by flattened leave stalks so that they don't flutter in the wind.

But we are not talking about a device that flutters in the wind, nor does it flutter between the Spinous Process. It doesn't take a rocket scientist to see that this is a great device. The Aspen Spinous Process System is an interspinous process device that was design to address degenerative disc disease and spondylolisthesis. This is a fusion device and it is very, very slick. This product can be used in a 360 and can be inserted via a minimally invasive approach. I would assume it can also be used in a TLIF. The Spine Blogger loves the graft cylinder(that's what I call it). For those of you using the X-Stop, remember what Meatloaf sang; " Stop right there, before you go any further......., try the Aspen " I love this product, it is a winner. The SpineBlogger wants to know what our readers think.

PS: The viewing public would like to see Lanx products on their website, enough with the historical perspective on the name of towns in Colorado!

Is there a Doctor in the House?

On Wednesday night, the President addressed the country on his mandate to reform the US Healthcare System. On Thursday morning we started the process of attempting to make sense of how this will affect our personal lives and careers. Have you ever heard the saying; "Change is Good." You know, the one that CEO's in our industry love to use. Well, based on the response that we hear, change is really not good, at least for most Americans. America continues to carry the curse of our puritanical ancestors of having no flexibility and being much more conservative than we like to admit. Before discussing this new healthcare paradigm, some things need to be brought to light regardless of what side of the political spectrum the reader sits on.

Whether you liked what the President had to say or not, 46 million Americans do not have healthcare insurance. I am not going to argue about what category these uninsured people fall into, 46 million is 46 million. (I'll leave that debate to the spin doctor analysts). The U.S. spends more dollars on healthcare than any other advanced nation without better outcomes. Why? Is it because our doctors are poorly trained? No! Is it because we don't have state of the art technology available to us? No! Is it because our hospitals are not managed properly? Yes! Is it because insurance companies are publicly traded and driven by Wall Street's insanity? Yes! Is it because Americans in general don't take care of themselves? Yes! Or, is it because we have become a litigious society?

Just look at our industry, lawyers love medicine, healthcare and the medical device industry. When the President stated that a fee-for-service system creates an incentive for physicians to run more tests and perform additional operations, whether these procedures actually help the patient, misses the point. Yes, there are physicians that know how to manipulate the reimbursement system, but why does the government choose to place a "bullseye" on their back when there are others that need to be held accountable.

Until the Congress and Mr. Obama (a Harvard lawyer by education) comprehend the magnitude of Tort Reform, nothing will be resolved. The fact remains that many physicians are an open target for potential litigation when they do not "CTA" by ordering more tests and potentially not operating. But before we castigate Mr. Obama, let's not forget what Mr. Bush did when he was in office. He claimed to be against excessive government expenditures and did absolutely nothing to rein in the single largest contributor to the federal deficit, Medicare. In addition, "W" was irresponsible when it came to the plight of the uninsured or the concern regarding the cost of healthcare when he stated; "People have access to healthcare, all they have to do is go to an emergency room." But I'm not writing to make a pitch for Obama nor to bury Bush. I'm writing because we need to figure out how to provide healthcare for an estimated 15 million illegal immigrants (do we deport them if they don't become citizens), millions of unemployed college graduates (why isn't Wall Street and Corporate America doing something to help these kids), and people who have fallen through the cracks whether they are between jobs or not.

The potential backlash of not hammering out a realistic public plan could potentially have greater collateral damage than imaginable. Unfortunately, no one likes change, nor does everyone involved want to make concessions. The fact remains that if there is an overhaul of the current healthcare model our industry will pay a price. Why isn't the AMA, the Orthopedic and Neuro lobbying groups, and our own industry addressing the socioeconomic benefit to providing state of the art healthcare to Americans? There has to be a reason why our outcomes aren't better. Could it be that Americans in general don't take good care of themselves? Why don't these lobbyist talk about how the insurance industries main objective has always been to make doctors employees or wards of the state? Why would you take the incentive (fee for service) away from a free-market healthcare system? The bottom line is we're on the clock and if our industry along with its physician allies don't step up, it will be too late once a plan is enacted. The Spine Blogger wants to know what you Cowboys and Cowgirls think?

Fool Me Once, Shame on Me! Fool Me Twice Shame on You!

Late this afternoon, it was reported in the WSJ that Jeffrey Wang has lost his position as executive director at the UCLA Spine Center. In addition to this action, he is being investigated by the school for allegedly failing to disclose that he was paid by various companies (Medtronic, Paradigm, FzioMed, Facet Solutions, and DePuy Spine) whose products he was working on.

In a 6-7 year period, Dr. Wang failed to notify the state and the medical school that he was receiving consulting payments, stock options and royalties from the five aforementioned companies. Whether Dr. Wang is entitled to compensation is not an issue. The failure to report these relationships is a violation of university guidelines. Therein "lies" the problem.

The SpineBlogger has raised this question in a previous blogs, how does an intelligent and successful surgeon continue to exhibit a pattern of failing to abide by the disclosure rules of the state and university. One can argue that in a free-market Dr. Wang is entitled to earn whatever the industry affords him for his services. Unfortunately, as an employee of UCLA he is held to a different standard as an employee of the University. The bottom line is that as an employee the University owns his mind. At this juncture the University is considering other sanctions.

Dr. Wang has established a stellar reputation in our industry. Maybe, its time he start thinking about private practice. Maybe now some people are beginning to understand why our industry is being scrutinized under the watchful eye of the DOJ, the SpineBlogger wants to know what you think?

Guilty!!!!!!!

Two senior Synthes executives pleaded guilty to illegally promoting off label use of Norian XR on 200 patients that resulted in three deaths. Michael Huggins and John Walsh pleaded guilty to a single misdemeanor count of introducing adultered medical devices into interstate commerce. They face a $100,000 fine and the potential of spending one year in prison (minimum security I hope). Two other Synthes executives, Tom Higgins and Richard Bohner are expected to plead guilty in the upcoming weeks. So the Norian XR saga comes to an end. I hope Hansjoerg is taking care of your legal fees and fine considering that Person #7 was fully aware of what was going on!

Does the US Healthcare System require a Tune-Up

Today, the President mandated that it is time the Congress work towards enacting new legislation that will truly affect the way all Americans and illegal immigrants are provided with some type of healthcare coverage. The challenge that we as a nation are confronted with is reshaping healthcare due to exorbitant healthcare cost and lack of coverage. The annual cost of healthcare is $2 trillion dollars per year, with an estimated 46 million people whom lack coverage. This includes illegal immigrants, healthy young adults who choose not to have coverage, probably because they cannot afford it, and people eligible for Medicare. Regardless, lack of coverage is lack of coverage. If this group needed medical attention they add to the rising cost of healthcare. The major challenge that Obama faces is that both parties agree to disagree on how this plan should be shaped. How divisive and selfish of a nation have we become? Yet, they do agree on some issues.

Supposedly, the Democrats and Republicans agree on setting a precedent for quality of care rather than quantity of procedures (I think that's funny). That would be like asking a lawyer to be compensated on quality of representation versus quantity of billing hours (leave it to a bunch of lawyers). Who intends on establishing this criteria? Both parties would like to create an on-line market place where consumers can shop pricing. Can we really simplify medicine and offer it on the internet? Has anyone ever looked at CPT and ICD-9 Codes? The parties want to bar insurance companies from denying coverage to a subscriber that has a pre-existing condition, yet, the insurance companies want something in exchange. They would like to make sure that all those young people that have fallen through the cracks are forced to have some type of coverage. This is based on a statistical probability. US Healthcare was once accused of discriminating against elderly subscribers because they wanted young people who tend not to get sick as easily. But would this be affordable coverage? Young people (many college graduates) cannot afford healthcare insurance because they cannot find a job.

So the real question is; what would a public plan look like? And, would it drive private insurers out of the marketplace? The only model that the government has is Medicare and we all know how physicians feel about compensation under a federally subsidized program. You don't think doctors dropped out of Medicare because they were fairly compensated? So the real question is, would a public plan that offers affordable coverage to any of those 46 million drive private insurers out of the marketplace? Probably not! What it would do is cut into their profitability and provide their shareholders with less than optimal return on their investment. Let's be honest, the US insurance industry has taken advantage of the Anti-Trust Laws by colluding with Congress and ripping off its subscribers and particularly physicians that initially wanted to participate in their plans. You don't think doctors dropped out of insurance plans because they were compensated fairly? Doctors are you starting to see the picture?

The REALITY is that most people (you and I) would not even be eligible for a public plan if we already have some existing coverage. What the government needs to figure out is how to provide healthcare for individuals that have fallen through the cracks or are unemployed. So why is the cost of this plan much greater than expected? Because when someone loses their job and needs to continue coverage the cost of COBRA premiums or premiums in general are mind boggling. Recently, someone that lost his job was paying $1,500 premiums per month for a family of five. Someone that was single and lost their job was paying a premium of $500 per month. Even with sound financial planning what are the consequences if you or anyone has a catastrophic illness? Should you have to foreclose on your house because the system has failed us? People who cannot afford insurance or are not covered have to be supported by some type of plan. But why do we continue to debate this issue and what will it take for the government to act? Special Interests!

We live in a country where you the reader has freedom of choice to become what you can be, and make as much as you can, yet when it comes time to paying taxes to offset a national healthcare crisis we bitch and moan about contributing. Let's face economic facts, the government cannot keep printing money unless you want to be a Banana Republic and we cannot keep borrowing money from the Chinese unless you want your grand-children to speak Chinese. How indifferent can we be? For those of you that complain about a senseless war that is costing us trillions of dollars, have you stood up to be heard? Probably Not! The cost of this war alone could have covered a plan. Unfortunately, many people in Congress are subsidized by the military industrial complex. When the Stimulus Package was passed, did anyone complain about how much the Democrats and Republicans took in pork? Probably Not! Did anyone complain about TARP? The bailout of AIG and Goldman Sachs? Probably Not!

Whether we like it or not, everyone is going to get squeezed. Companies are going to have to make concessions on pricing, it's already happening with capitated markets. When that happens, physicians, distributors, and direct sales people will earn less money. The Spine Blogger wants to know what you think?

What is Innovation?

Recently, Arutz Sheva, an Israeli National News platform ran an article featuring what was called an innovative implant. As usual, the SpineBlogger asked the proverbial question: Is it new? Is it true? Will it make a difference?

Scorpion Surgical Technology (I'll even give them some press) has developed a spinal anchoring device with the intent of replacing fusion and stabilization procedures. The General Manager claims that the technology has particular value for osteoporotic patients. Question: Based on our current state of affairs in spine, have we really had bad outcomes with osteoporotic patients? One of the claims made is that the device is expected to prevent loosening of the construct and revisions. Question: Why does loosening of Pedicle Screws occur? What are the revision rates for primary fusions?

The device is supposedly geared towards minimally invasive applications. The interesting part of the video includes a Trocar Drill Guide that is part of a miniature Crane -like device. Rather than utilize a pedicle screw, this implant is called a "Curved Nail" that is cannulated and is inserted over a guide wire (I would call this percutaneous insertion) and it looks like the nail has some type of perforations for boney ingrowth. Could this be a problem if it is perforated and the surgeon needs to perform a revision? The concern that I have when I assess this technology is whether the design is really cutting down on operating room time and does it have too many parts for assembly?

But the question that SpineBlogger needs to ask is whether Israeli start-ups have an affinity for developing technologies that address questions that are not of major concern in the US Market? Example: Disc-O-Tech's Inflatable Nail or IP? At best they made some money selling the IP. Expanding Orthopaedics Expandable Pedicle Screw for osteopenic patients, Mazor Technologies, around for years, and now the Scorpion device.

Adjacent disc degeneration is a biological and chemical phenomenon that our industry believes can be minimized by designing different products with effective biomechanical variations. The question that must be asked is, will this product make a difference? The SpineBlogger will be keeping a watchful eye on this company. For those investors that are looking for a return on their investment, I have some property along the Pacific Coast Highway that might make a better investment.

The Art of Whistleblowing

"Truth is the most powerful force on earth"

The dictionary defines "Whistleblower" as a person who informs on another, or makes public disclosure of corruption or wrongdoing. Synonyms for the word are foulness, contamination, and pollution. In today's blog, the Spine Blogger discusses the motivation and intent as to why any industry professional would bring legal action against a company, by claiming that an organization would employ fraudulent schemes to increase revenue and market share. These schemes would include; sham consulting agreements (never in our industry), illusory training, bogus research, bogus speaking fees, lavish entertainment lodging expenses, expensive meals and wines, gifts and discounts.

In order to comprehend the magnitude and severity of potential accusations, industry professionals need to understand and abide or be prosecuted for violating the Anti-Kickback Act, 42 U.S.C. Section 1320(a)-7b(b). It states; "IT IS UNLAWFUL TO KNOWINGLY OFFER OR PAY ANY REMUNERATION IN CASH OR IN KIND for referral of any product for which payment is sought from any federal funded healthcare program such as Medicare, Medicaid or Tricare.

So why do we work in an industry where there have been multiple whistleblowing lawsuits brought against various companies? Could it be that there is a lack of ethics, integrity and rationality? In all likelihood many of our readers probably believe that a "whistleblowers" only motivation for retaliation is to make money or that they are a disgruntled employee. If we understand the process in filing a lawsuit, there has to be a chain of evidence, or a claim, that can be substantiated legally. Any attorney that files a frivolous claim on behalf of a whistleblower can be sanctioned by the court. That is why we don't see half as many whistleblower cases as has been reported by another orthopaedic platform. In addition, if the government becomes involved in a "qui tam" lawsuit the process could take years due to investigating the alleged offenses, with a 15-25% payback to the relator. So why the lawsuits, and what are the ramifications for the whistleblower?

The behavior that companies and their executives have exhibited in our industry has been the main catalyst behind these suits. The gross margins are phenomenal (Wall Street can you sink your teeth even further into our industry and make our CEO's insane), the egos are Everest like, and independent distributors and direct sales people have the ability to make more money than many middle or upper managers. In 2006 alone the industry was fined roughly $350 million plus dollars by the federal government. Medtronic was fined $40 million related to kickbacks paid to surgeons in exchange for their business (The Poteet Suit), Zimmer, Biomet and Smith and Nephew agreed to pay $311 million dollars executed under a deferred prosecution payment with the US Attorney's office for the District of New Jersey for violations of the Anti-Kickback statute and the civil Federal False Claims Act. Stryker was spared any monetary punishment because the word on the street was that one of its former CEO's assisted and cooperated with the US Attorney (Christie) to minimize collateral damage. (I don't hear any CEO's crying foul) In 2008, Medtronic paid a $75 million dollar fine to the federal government to settle a whistleblower lawsuit that exposed the company's sales and pricing strategy to defraud Medicare for fraudulent indiscretions by Kyphon. In 2008, Patrick Chan a neurosurgeon pleaded guilty in an Arkansas court to taking kickbacks from medical device suppliers and paid $1.5 million dollars to the government and a whistleblower. This resulted in an ongoing investigation into Blackstone and other medical device companies. It is interesting to note how Orthofix has cleaned house and distance itself from the Blackstone reputation. If the DOJ is truly committed to vigorously investigating, prosecuting, and punishing those healthcare companies and providers who seek to manipulate the system for their own financial game, its time to step up to the plate.

But what about the Whistleblower? Unfortunately, the immediate response is to distance oneself from the individual. But why? Is it because we personally don't have the strength and courage to stand up to an industry that has spun out of control? If it hasn't, why is the DOJ and Big Brother keeping a watchful eye on the industry witnessed by the Kuklo and Blackstone investigations? Are we so driven by money that we put blinders on and frown upon a whistleblower's accusation until it effects us personally? If the argument is that we police ourselves, then our industry is nothing more than a three ring circus. Look at AdvaMed. Look at the lack of power NASS exhibits. Just look at who dictates policy for our trade shows (the Spine Cartel) and you can understand why there is a need for people to stand up and be heard. In all likelihood being the Whistleblower is a lonely journey, yet, one that should be respected. Potentially blackballed and threatened these people should be applauded for their strength and courage. The Spine Blogger wants to know what you think?