Pharma Payments Increase Doctor Brand Prescriptions

For years, many pharmaceutical and medical device companies have paid doctors for speaking engagements as well as offered free meals, gifts and entertainment. A new study by ProPublica analyzing drugmaker spending and Medicare prescription data to conclude that these payments and gifts translate into higher patient prescriptions for brand-name drugs. The analysis concludes that physicians who accepted payments from drug and device companies were two to three times as likely to prescribe high rates of brand-name drugs.

This analysis is part of ProPublica’s ongoing investigation of the financial ties between doctors and medical companies called Dollars for Doctors. The study compared physicians in five common medical specialties (family medicine, internal medicine, cardiovascular disease, psychiatry, opthalmology) based on the types of payments they received as well as those who didn’t receive any payments. The stated goal of the analysis was to determine if physicians who received industry money from pharmaceutical or medical device companies prescribed different rates of brand-name drugs than peers who didn’t.

According to the study results, the doctors who did not receive payments prescribed a lower rate of brand-name drugs than those who received payments for meals (only). And those that received payments for meals prescribed brand-name drugs at a lower rate than those who received other types of payments.

The study paper explicitly indicates that they didn’t try to establish a causal link between payments and different brand-name prescribing habits. Indeed, it speculates that drug companies might give money to physicians who already are heavy brand-name prescribers.

The study was made possible because of the release of data concerning 2014 Medicare Part D payments (through a FOIA request) as well as pharmaceutical payments to doctors (by the Open Payments program). ProPublica matched the data by full name and practice location.

The Obama Administration has been pushing for increased transparency in government health care spending. It released for the first time in April 2015 prescriber-level Medicare data. The Part D data publicly released covered calendar year 2013, but ProPublica gained access to 2014 data through a FOIA request.

The Affordable Care Act required the Centers for Medicare and Medicaid Services to collect information concerning financial relationships of manufacturers with physicians and hospitals. The federal government has now released data from the program years 2013 and 2014. The 2014 data was used by ProPublica in its analysis.

As the government releases more data, there will no doubt be more analysis of it to see if these payments in fact operate as kickbacks for the referral of federal health care program business. If doctors are receiving anything of value for the referral of Medicare/Medicaid business, then it may violate the Anti-Kickback Statute or Stark Law. In turn, the doctors and drug companies engaging in these practices are violating the False Claims Act.