Good evening. So I did my neurosurgical training, did an orthopedic fellowship. I owed the Air Force four years. I grew up of modest means, so I practiced four years in the military at the Air Force base, was in academics as a professor for 10 years at Emory, and 11 years run the largest private practice in Atlanta. I also consult for a five-hospital healthcare system in Atlanta, run the neuroscience program. So I've been involved in, from your perspective, military neurosurgery, academic neurosurgery, private practice, still involved in double-S resident courses, and been fortunate enough since my fellowship to design implants. They're sold throughout the world, so luckily I've worked with good people, and some of the anterior and posterior cervical plates you put in, A-lift spacers, T-lift spacers, and pedicle screws, I've been involved with design. I've learned a tremendous amount over the years, and it's a school of hard knocks, because when I came through, this kind of program wasn't here. So I just want to talk about the neurosurgeon and industry. Now why does this matter to you? I'm just finishing up. I just want to get a job. I don't care about this stuff. Because any interaction you have with industry or hospitals will be recorded, okay? If you have a breakfast, lunch, or dinner, even snacks, that will be on the internet, and I'm going to show you that. Pizza-louting, sporting events, I mean, when Bill and I were residents, people would bring in pizza and take us to ballgames, things like that. Consulting, people get out of their training, they think they're the world's best neurosurgeon, the company should pay them $1,000 an hour, because I'm super bright and super talented, and they're going to give me a contract, and life is good. If you're fortunate enough and smart enough to design something, you'll get royalties, but the world today is one of total transparency. Now this is something I took off my phone. This is what Medtronic sent me this week. So there's now what's called the Sunshine Law that we're going to talk about. So Medtronic sent this to me to see if this is accurate. So this is up on the Medtronic website. So if you go to Medtronic website, look up my name, you can see exactly how much money I made. It's all transparent. They will report this to CMS or Medicare. So everything that we make will be up on a website. Let's just look at this. What do they have? $120 for food, and this one they paid $106. So I designed an artificial disc. They said, come to Miami. We'll have a design meeting. I went to Miami late one night, sat in a hotel room, ate crappy buffet food, and they assigned the value of $106. That's reported. Representing the AANS and the Neurosurgical Research Educational Foundation, not representing me or my intellectual property, we had a meeting with Medtronic, and they charged $11 for lunch. Now don't forget I had a snack. They charged me $3. I'm not making this up. So this is the level of transparency. So before you do anything, think about it. So what you need to know, obviously ethical and moral is number one. Legal is number two. It has to pass the red face test. What do I mean by that? I mean if it's written up in the Wall Street Journal, and you will be quoted and misquoted as I've been, you have to be willing not to blush, because it's going to be out there. And trust me, there's a lot of people right now that don't really like healthcare providers, and they think that neurosurgeons make way too much money. There's a big target on your chest. Need to protect yourself, because when you're dealing with the companies, don't take this wrong companies. Companies care about companies. And there's no bureaucracy alive that cares about any individual. So the company's going to do what's good for the companies, not to insult the companies. But these people will tell you the same thing. We're all numbers. We're all commodities to these companies. So you need to protect yourself. The companies may try to talk you into something, especially smaller companies just starting out that they don't have as much to lose. When you get to the larger companies, like these representatives here, they have excellent compliance officers. But that's not always the case. You have to have realistic expectations. You can't expect to go out and make a whole bunch of money. And when in doubt, ask people. People call me every other week, young neurosurgeons, about contracts. So there's a lot of experience out there. Users. Now, there's guidelines. There's the Office of Inspector General from the Department of Justice. We're going to have a talk about that. That's the government. There's AANS guidelines, and there's AdvaMed, and they're going to talk about AdvaMed. AdvaMed is something that's voluntary, where certain companies say, we're going to adhere to these standards. It's not the law. It's a voluntary program that the companies adhere to. So things to know. We're going to talk about fair market value, arm's-length transaction, and a kickback statue or AKS, the Stark Free Law and the Sunshine Law. Again, if you think this doesn't apply to you, next year when you're out and if you go to dinner with a rep, that's going to appear on a website potentially. It matters. So what's fair market value? Whether you're consulting, whether you work for your hospital as a consultant, as I do. I get paid $400 an hour. That's all on the web. Or whether you consult for ER coverage. That's fair market value. A hospital cannot, out of the blue, pick a number and say, we're going to give you X amount of dollars to cover the ER. If they do that, they're putting you at risk. Not just themselves, but you at risk. So consulting is based per hour. There's established guidelines. It's based upon certain things, your curriculum, data, and your experience. So if you go design for a company, when you're out of your residency, you're not going to get paid as much as somebody that has 28 patents. That ain't going to happen. So you have to recognize that. It's not more typically than $500 an hour. There's one contract I make $535 an hour, and I've got 14 patents with that company. And I sold $2 billion of implants. Most of my consulting is $400 an hour. Why am I telling you this? Because you need to know this. So you have to have these guidelines. If a company comes up and tells you more, don't do it. Because they're not doing it right. And again, these company representatives, they may disagree. Whatever you do, document, document, document. Everything you do is unrelated to your usage of the company's products. Everything you do is unrelated to the patients that you take to the hospital. It's called a Nerman. So you cannot do that. Now this isn't, here's why I'm showing this. We cover the Shepherd Spine Center, which is one of the top three spinal rehab centers in the country. Our group does. And so they said, we're going to pay you X amount of dollars. So we went out to a company, and there are companies that all they do are fair market value. And so they came up with this document here. It talks about our group, talks about the hospital, talks about how many phone calls we take an average day on call, how many patients we see, how many cases. We take 200 cases to the OR every year. It talks about what the hospital does, percentage of Medicare, Medicaid. It talks about MGMA. It talks about nerves. It talks about the different regions of the country, what nerve surges make per hour, consulting. It talks about all of that. If you're not down to this level of nitty grittiness when you sign a contract, you're doing it wrong. You're being naive, okay? If something sounds to you to be true, it is. So what if you design something? What do you think I've got the next best endovascular coil? Well, there are things called third party determination. So a company cannot say, oh, we're going to pay you $30,000. There are people that do determinations of this. And there's ways to value stock and everything. So all this stuff is payable in cash or stock or options. They can't pull this number out of the blue. The small companies sometimes will, but they are illegally doing that, okay? So if they buy your IP or intellectual property for what you know, and remember, knowledge is power, right? There's a recent book by Guy Gilder, who's at Bell Labs. Read this great book, Knowledge is Power. The greatest commodity that you have is your knowledge. You spent years in college, med school, residency. What separates you from everybody else? Your knowledge of how to do neurosurgery. That's yours. Don't give it away. There's legal ways to assess the value, and again, everything you do is unrelated to the use of a company, okay? So if somebody says, we're going to pay you 500 bucks to evaluate this widget, every case, run away from that. Again, everything that you do is unrelated to the product, the company, the hospital, the surgery center, everything. And I'm not an attorney, but I'll bet you the attorneys in here will tell you the same thing. And if I say something wrong legally, please correct me. You're on your own. Hmm? You're on your own. Always. So you may invest in a company, surgery center, et cetera, okay? But it's not related to your usage. You must disclose some such information. So before I came to this course here, all the faculty gave a full disclosure. If we have stocks or royalties or whatever we have, the honorarium, whatever we do is fully disclosed. It has to be. And there are very legal rules that vary state-by-state with investment if you own MRIs or buildings or physical therapy or ancillary services. So there are very clear legal industry views on physicians and industry. It's under the Office of the Inspector General or the OIG. It's called a safe harbor for your personal services. I want to tell you about some good signs regarding a good industry collaborator. I want to tell you to avoid physician-owned distributorships as my personal bias. And I want to tell you about the Sunshine Law. So there are guidelines by the AANS and the CNS and AdvaMed that you can read that very clearly state what is ethically and morally and legally appropriate. There are laws out there called the patient protection, which talks about sunshine, which means they're going to shed light. So anything that you do for industry will get disclosed on a CMS Medicare website. And all the companies or most of the companies now have websites that they can disclose. So your patients or your Aunt Ethel or your spouse's divorce attorney, whoever wants to look at this can go out there and see what you're making from your services. Nothing's hidden, okay? So when you sign a contract, and it better be a written contract for your personal services. It's in writing. It should be for about a year, never more than two. It talks about exactly what you're doing, what services you're providing. It talks about how much per hour at fair market value, and it states what the fee is. So you can't say, we're going to pay Dr. X $275 an hour for a year. No, no, no. There has to be, for so many hours per week, with a maximum rate of this. That has to be set out a priori, okay? So it's not I'm going to work and then submit a bill. There's a max that's set out. It's not based on the business again, obviously can't violate laws, and it must be reasonably necessary for the business to use you. So the business has to prove that they need your services. They just can't hire you as a consultant, hope you use their products, but really not need you. So the business plan has to be set out a priori for them to use you. So things to look for when you talk to your industry partners. It has to meet the safe harbor provisions that we talked about. They're not putting any pressure on you to use their products, okay? They have to be able to tell you specifically in writing why they want you to do that work, what particular expertise you bring that's not out there in the general knowledge base, okay? Like for a patent, it has to be non-obvious. So what you have to bring to them has to be non-obvious. And the company, the AdvaMed is not mandatory. Smaller companies don't sign on for AdvaMed, but if they follow the AdvaMed guidelines, which are on the internet, I think you can feel a lot better about it. There should be a chief compliance officer who you meet and know, and the company says there's a plan, there are records, there's communication, this is on paper, you may not teach off-label. Who knows what off-label is? What's off-label? Lateral mass screws? Exactly. Is lateral mass screws, it's funny you said that because I designed the first one in the country, and I got in trouble for it because I didn't know, and 88 is a fellow, I designed it, it was promoted. I got a letter saying you're promoting off-label products, I said what's off-label? I didn't know. So a lateral mass screw, is that standard of care? Yeah, so it's standard of care because we regulate, physicians regulate standard of care, the FDA regulates companies, the FDA does not regulate you. The FDA regulates companies and how companies can promote things. So on-label means when you pull out a package insert, then it says it, whether it's a drug or not. So an off-label use means it's not on the package insert, on-label means it's on the package insert. It is not related to standard of care, which is defined by us. The fees are determined by fair market value, there's no perfect formula as we talked about, but the company or your consultant should be able to explain it. It's been my opinion, this is purely conjecture, a lot of companies tend to overpay people because they want the business. It's my opinion or conjecture that hospitals tend to underpay people because they hide behind the compliance officer who says that they can't do that. So just be aware that there's a range here that's open to interpretation. You don't get money up front, they don't give you a check for $50,000 for a year. You have to plan the work, okay the work, submit the work, and then get a check, okay? And so when I go teach, like I went to teach for Medtronic for an artificial disc, it was Dr. Haid, you're going to spend this many hours, we're going to cover this much for travel, and this is the amount you're going to get, period, and do you agree, signed on, yes. You go do it, then after you do it, Dr. Haid, you did this, this, this, this, yes. That's a proper way to do it, okay? So you have to submit invoices, all this stuff, okay? So you just can't get a check. The Office of Inspector General has talked about physician-owned distributorships or pods. Does anybody here know what a pod is? Okay, a pod means that, let's just say that instead of using Medtronic implants, I'm going to go and design my own implants or work with a guy down the street, this is my interpretation, a guy down the street to design them. So I'm partial owner of that company. So now I'm deciding what patients I operate on. I'm putting in implants made by a company that I'm a partial owner. Could be a conflict of interest. In the United States, it's not illegal yet, okay? The state of California workers' comp says they can't do it. Scripps Clinic says they can't do it. In my hospital system, I push through something that says they can't do it because I think ethically to me, it doesn't pass the sniff test, okay? It's already been written up on a Wall Street Journal article and a New York Times article. There's a nurse surgeon in Alabama. He comes across looking like a fool because he is, okay? Because making all this money based upon implants that he or she puts in, and it's been demonstrated to alter surgeons' indications, okay? So I'm not speaking on behalf of the AANS. I'm speaking on behalf of Reg Haid here. So it's mainly spinal implants. Personally, I have, this is personal, not the AANS, I have trouble with the ethics of it. I think it alters neurosurgical behavior. It's not illegal. The surgeon gets paid directly on the use of implants, and it's outlawed by a certain place. So though it's not illegal and though the AANS does not have a stance, it's my personal recommendation that I think it crosses the line, but I'm speaking personally for me and not for the AANS. Is that fair, Bill? Sure. Here's why. The Office of Inspector General has put out a special fraud alert, and fraud alerts are very rare. So the government says, the government says, we believe product substantial fraud and abuse risk can pose dangers to patient safety. OIG views PODS as inherently suspect under the anti-kickback statute. Why is a neurosurgeon, why would you want to place yourself in that position? That's kind of silly, right? It's like your mama telling you nothing good happens after midnight. She's right. So basically, there's a lot here. We can give it to you and send it to you in a handout. Why you should be very suspect if you go to practice, that they engage in PODS, again. So the Sunshine Act reports money to surgeons on their website. We talked about from the very first slide, includes dinners, gifts, a $3 snack. That I don't think I had a snack, but they gave a snack. But I was charged a $3 snack, okay? So some businesses already do this. Medtronic's been doing it for several years before it was law. So what does the government say? Well, they say if you get more than $10 per transfer, so if you get a lunch and get tacos and it's $11.03, it's reportable. Or if you get a lunch 10 times, it's $12. If it succeeds $100 a year, it's reportable. It doesn't take much to go to a ball game or go play golf or anything with a rep and exceed that. So my personal rule is, if I happen to have friends that are reps, I pay my own way, always. And sometimes I pay their way. And I keep records. Because people out there will accuse you of things. So this will be made public by the time that you guys can get out in practice. CMS or Medicare makes some formal recommendations. Basically what it means is check the website, make sure that the companies are providing accurate information. That's what that means. So the bottom line, I personally believe capitalism is good, and I think that's why America's a great country. I think greed is bad. Gordon Gekko was wrong. I personally tell my younger partners to be very careful if you go to ball games or social events with other young reps who you're friends with. And if you do, pay your own way and just keep track or just make a habit of it. If something sounds good to be true, it is, because it's not worth it. And so be very conservative in all you do. If it sounds too good to be true, it is. Have realistic expectations. And remember, you're first and foremost a doctor. We're neurosurgeons. It's a higher calling. There's no reason to put yourself in a bad position for a couple bucks. It's not worth it. So do what your mom would be proud of is the bottom line.

ethical considerations

legal considerations

neurosurgeon

transparency

Sunshine Law

financial interactions