AMA Report (2): Physicians' Self-Referral

The subject 2 Physicians’ Self-Referral is one of a series of 8 Reports of the Council of Ethical and Judicial Affairs (CEJA) of the American Medical Association. These reports have not yet been adopted as AMA policy; they will be discussed and debated in June 2008. If they receive the support of the majority of the delegates from the state and specialty societies, they will become policy. Anyone, including the general public, can provide testimony on CEJA reports either in person at the meeting or by writing to ceja@ama-assn.org.

I am presenting each Report as a separate thread on this blog. By clicking on the link above, you can gain access to the specific wording of the Reports, 1 through 6 are to be Amendments to the Constitution and Bylaws of the American Medical Association. Reports 7 and 8 are for Informational purposes. Why should the public be interested in these reports? They are part of the ethics of the system of medicine in the United States and may be reflected elsewhere in the world. Through the practice of medicine by all physicians, the rules presented in these reports can be applied to and may affect all patients. You may write directly your comments to CEJA at the e-mail address above and, of course, you are certainly welcome to post your comments on this particular Report here.

Should physicians refer patients to their own privately financed laboratories or services? Here is the Report’s discussion of a conflict of interest issue in such referrals:

SELF-REFERRAL: CREATING CONDITIONS FOR CONFLICT OF INTEREST

Physicians may lawfully enter into a variety of commercial and other relationships that can benefit both their patients and their own financial situation. , Physician ownership of specialty hospitals, for example, can ensure that patients have access to services that would not otherwise be available, thus also benefiting the wider community.1 Similarly, physician arrangements with diagnostic services, physical therapy or home care providers, opticians, or pharmacies can help ensure quality care and provide patient convenience while generating income for the physician. However, if such self-referral arrangements create conditions that do not promote the best interests of patients, they create an intolerable conflict. Hence the need for ethical scrutiny and guidance.

A conflict of interest is “a set of conditions in which professional judgment concerning a primary interest (such as a patient’s welfare or the validity of research) tends to be unduly influenced by a secondary interest (such as financial gain).” Primary interests are determined by the professional duties of the physician and are understood by the profession to be “the primary considerations in any professional decision . . . .”10 Secondary interests, financial or otherwise, are present to some degree in virtually every treatment decision a physician makes. Such interests are not necessarily illegitimate themselves and may even be desirable—provided that professional duties are the primary consideration. Because it can be difficult to recognize when secondary interests become inappropriate, both ethics and the law provide guidance.

The Report concludes with the following recommendations:

Business arrangements among physicians that encourage self-referral can benefit patients by enhancing access to health care services. However, these arrangements are ethically challenging because they create situations in which patients’ medical interests can be in tension with physicians’ financial interests. Such conflict-creating arrangements can have adverse consequences for patients and can undermine a robust commitment to professionalism in medicine. Physicians should generally avoid entering into such arrangements unless they provide definable benefits for patients.

Physicians who enter into legally permissible contractual relationships—including acquisition of ownership or leasehold interests in health facilities, products, or equipment; or contracts for service in group practices—are expected to uphold their responsibilities to patients first. When physicians enter into arrangements that provide opportunities for self-referral they must:

(1) Ensure that referrals are based on objective, medically relevant criteria.

(2) Ensure that the arrangement:

(a) is structured effectively to provide appropriate, high quality health care services or products not otherwise available in the community;

(b) does not require the physician-owner to make referrals to the entity or otherwise generate revenues as a condition of participation; and

(c) adheres to open, fair business practices vis-à-vis the medical professional community—for example, the arrangement permits investment by nonreferring physicians.

(3) Take steps to mitigate conflicts of interest, including:

(a) ensuring that financial benefit is tied to the physician-owner’s equity interest, not volume of referrals for services or sales of products;

(b) establishing mechanisms for utilization review to monitor referral practices; and

(c) making alternate arrangements for care of the patient when conflicts cannot be appropriately managed/mitigated.

(4) Disclose their financial interest in the facility, product, or equipment to patients, inform them of available alternatives for referral, and assure them that they will not be treated differently if they choose to obtain the recommended services/products elsewhere.

(5) Disclose their financial interest to third-party payers or other stakeholders on request.

Go to the link above and read the entire Report. Do you think that these recommendations would make physician self-referral more likely to be in the best interest of the patient? ..Maurice.