NC Physicians Received Improper Payments According to U.S. Justice Department
November 12th, 2007
Triangle Business Journal
By Adam Linker
RALEIGH – North Carolina physicians are among hundreds nationwide receiving millions of dollars from orthopedic device makers – arrangements that have drawn fire from federal officials.
The U.S. Justice Department says some surgeons nationally were paid to favor a certain company’s devices over those of competitors. Some payments to individuals and orthopedic groups across the country may have been improper, but surgeons interviewed say most of the payments were in exchange for valuable consulting work.
The surgeon who received the most in payments among North Carolina doctors is Dr. Bradley K. Vaughn of Raleigh, who has been paid about $1.8 million by Biomet Orthopaedics and $85,887 by Zimmer Holdings so far this year.
Vaughn, who practices with Raleigh Orthopaedic Clinic, issued a press release stating that his payments were for royalties as a co-holder of a patent for an artificial knee that he and another surgeon developed in the early 1990s.
The release stated, “Dr. Vaughn receives no payments to use specific medical devices. As a specialist in revision surgery, he uses a variety of manufacturers’ products. Dr. Vaughn receives no royalty payments for any devices implanted at any of the area hospitals in which he practices.”
Biomet, Zimmer and three of the nation’s other large artificial hip and knee makers settled with the Justice Department in September. As part of the agreement, all of the financial relationships between device makers and physicians now must be publicly disclosed, says Justice Department spokesman Michael Drewniak.
The other companies involved in the deal are DePuy Orthopaedics, Smith & Nephew and Stryker Corp.
The payments could raise concerns for consumers, especially if physicians favor a particular implant because of finances and not fit.
“Our investigations found that physicians were paid very large sums, and in many cases, the surgeons were required to exclusively use one company’s products,” Drewniak says. Physicians also were paid to favor certain implants without providing services to the company, which is against the law, he says.
Dr. Paul Lachiewicz, an orthopedic surgeon at UNC Hospitals in Chapel Hill, was paid $14,040 by Zimmer Holdings. In a separate transaction, the company also paid Lachiewicz and a partner, Dr. Scott Kelley, $81,250.
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