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In November 2020, the U.S. Department of Health and Human Services Office of Inspector General (OIG) issued a “Special Fraud Alert” highlighting the “inherent risks” of illegal fraud associated with pharmaceutical and medical device companies paying physicians and other health care professionals to speak at company-sponsored events.[1]
Such speaker program events typically involve the physician, who is paid an honorarium, talking about a drug or medical device marketed by the company...
In November 2020, the U.S. Department of Health and Human Services Office of Inspector General (OIG) issued a “Special Fraud Alert” highlighting the “inherent risks” of illegal fraud associated with pharmaceutical and medical device companies paying physicians and other health care professionals to speak at company-sponsored events.[1]
Such speaker program events typically involve the physician, who is paid an honorarium, talking about a drug or medical device marketed by the company sponsoring the event. The company often pays remuneration to the program attendees in the form of free meals and drinks. The OIG noted that in the last three years, drug and device companies reported shelling out nearly $2 billion to health care professionals for speaker-related services.
Companies undoubtedly expect a return on this huge investment. However, getting that return on investment can create an illegal kickback scheme. The OIG referenced numerous OIG and Department of Justice fraud cases brought against companies and individual physicians involving remuneration paid in connection with these speaker programs that violated federal anti-kickback laws.
Particularly troubling, some of these fraud cases involved drug companies requiring physician speakers to write a minimum number of prescriptions for the companies’ medications as a condition for receiving the speaker honoraria. Other cases involved programs attended by health care professional attendees who had previously attended the same program or by health care professionals’ friends, significant others or family members who did not have a legitimate business reason to attend. Such circumstances refute the notion routinely offered by Pharma that these programs are primarily “educational.”
The federal anti-kickback statute protects patients from medical referrals or recommendations by physicians who may be influenced by inappropriate financial incentives. Under the statute, it is a felony to knowingly and willfully solicit, receive, offer or pay any remuneration to induce or reward, among other things, prescribing drugs reimbursed by Medicare, Medicaid or other Federal health care programs. Violating the statute is punishable by up to a $100,000 fine or 10 years in prison.
The severity of the penalty is justified by the substantial patient harm that can result from such fraud. As the OIG stated, speaker program remuneration to physicians “may skew their clinical decision making in favor of their own and the company’s financial interests, rather than the patient’s best interests.”
The OIG’s fraud alert concluded by noting that because of the pandemic and the curtailment of in-person gatherings, there has been a substantial decrease in speaker program-related payments to physicians. The OIG suggested that because of the legal risks, companies and physicians should think twice about resuming these programs. The OIG should be applauded for taking such a strong, patient-protective stance.
References
[1] Department of Health and Human Services, Office of Inspector General. Special fraud alert: Speaker programs. November 16, 2020. https://oig.hhs.gov/fraud/docs/alertsandbulletins/2020/SpecialFraudAlertSpeakerPrograms.pdf. Accessed December 4, 2020.
