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Conflicts of interest may decrease with new health care law

Members of Congress and consumer advocates are hopeful that the new health care law requiring drug companies to disclose payments made to doctors for research, consulting, speaking engagements, travel and entertainment, will lower the risk of potential medical malpractice claims.

The overall goal of this legislation is to have doctors make decisions based on the best interest of the patient without regard to any relationship that doctor may have with a particular drug or medical device company.

It's well-known that many doctors receive some form of compensation from drug and device companies every year in exchange for providing medical advice or by giving lectures. The dollar amounts vary, but in some cases the figures have been in the hundreds of thousands or millions of dollars. According to analysis by The New York Times:

  • About a quarter of doctors take cash payment from drug or device makers.
  • Nearly two thirds accept routine gifts of food, including lunch for their staff or dinner for themselves.
  • Doctors who receive payments may practice medicine differently than those who are not willing to take such payments.

It is estimated that more than 1,100 drug, device and medical supply companies will have to file reports under this new law. All the data from these reports would be inspected and audited for accuracy. Manufacturers of prescription drugs and devices will also have to report any payments they've made to doctors who may have helped develop, assess or promote new products. Payments made to teaching hospitals that may have researched or developed inventions, will also need to be reported, especially if a royalty payment was made to a doctor.

As part of the health care law, any company that has at least one product covered by Medicare or Medicaid, will have to disclose all of its payments made to doctors other than its own employees. The federal government will post this payment data on a website, making it available to the general public. Penalties for failing to report this information could range from $10,000 up to a $1 million a year depending upon the offense.

This legislation will take effect as soon as established payment reporting procedures are in place and Medicare officials finalize the rules. It's the hope of the Obama administration, that this will greatly reduce the number of medical malpractice and medication errors of the American people.

Source: The New York Times, "U.S. to Force Drug Firms to Report Money Paid to Doctors," Robert Pear, Jan. 16, 2012

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