Carter, John L.

English

The Catholic University of America Columbus School of Law

Journal of Contemporary Health Law & Policy (1985-2015) Volume 10 Issue 1 Article 37 1994 Medicine, Money, and Morals: Physicians' Conflicts of Interest. By Marc A. Rodwin. New York: Oxford University Press. 1993. 411 Pp. $25.00. John L. Carter Follow this and additional works at: https://scholarship.law.edu/jchlp Recommended Citation John L. Carter, Medicine, Money, and Morals: Physicians' Conflicts of Interest. By Marc A. Rodwin. New York: Oxford University Press. 1993. 411 Pp. $25.00., 10 J. Contemp. Health L. & Pol'y 629 (1994). Available at: https://scholarship.law.edu/jchlp/vol10/iss1/37 This Book Review is brought to you for free and open access by CUA Law Scholarship Repository. It has been accepted for inclusion in Journal of Contemporary Health Law & Policy (1985-2015) by an authorized editor of CUA Law Scholarship Repository. For more information, please contact edinger@law.edu. MEDICINE, MONEY, AND MORALS: PHYSICIANS' CONFLICTS OFINTEREST. By Marc A. Rodwin. New York: Oxford UniversityPress. 1993. 411 Pp. $25.00.Reviewed by John L. Carter*Inside the Beltway, the three C's have eclipsed both the foreign anddomestic agenda in anticipation of the 1994 elections. The three C's ofcourse are the assorted health plans promoted by President Bill Clinton,Congressman Jim Cooper, and Senator John Chafee. Outside theBeltway, there is an urgent demand for reform of the present health caresystem. The upcoming elections and a chorus of special interest voicesweighing in have created high anxiety on Capitol Hill. In the debate overmandatory alliances, single-payer plans, and universal coverage, the onlyuniversal characteristic is confusion. While the technocrats tinker withthe parameters of the new health care system, Marc A. Rodwin'sMedicine, Money, and Morals: Physicians' Conflicts of Interest provides acompelling argument that the way some physicians do business needsgreater scrutiny.Professor Rodwin identifies several troubling practices:1. Paying and receiving kickbacks for referrals. 2. Incomeearned by doctors for referring patients to medical facilities inwhich they invest (physician self-referral). 3. Income earned bydoctors for dispensing drugs, selling medical products, and per-forming ancillary medical services. 4. Payments made by hospi-tals to doctors to purchase physicians' medical practices. 5.Payments made by hospitals to doctors to recruit and bond phy-sicians. 6. Gifts given to doctors by medical suppliers.1Professor Rodwin provides several examples where physicians have beenexposed for engaging in financially self-serving practices. Medicine,Money, and Morals, however, is a polemic and must be read with a strongcaveat in mind. Professor Rodwin provides little empirical data of a sys-* John L. Carter is a graduate of the Columbus School of Law, The Catholic Univer-sity of America. Mr. Carter, a former researcher with The Washington Post, currently is alaw clerk for the Honorable Oliver Gasch, United States District Judge for the District ofColumbia.1. MARC A. RODWIN, MEDICINE, MONEY, AND MORALS: PHYSICIANS' CONFLICTS OFINTEREST 56 (1993).630 Journal of Contemporary Health Law and Policy [Vol. 10:629temic nature of his charges against the medical community. The authoradmits that the sources he employs "do not yield numbers on distributionand frequency that would satisfy the appetite of scholars trained in so-phisticated statistical techniques and sampling. But the lack of good datasets is a common problem." 2 The issue of the frequency of these practicesis a nagging unanswered question for the reader. With this qualifieraside, Professor Rodwin does document authoritatively, with copiousendnotes, cases of these practices occurring.Some physicians' financial arrangements promote self-dealing. Physi-cians often invest in medical laboratories which perform the diagnostictest doctors order for their patients. The author reports that in 1987twenty-five percent or more of the independent clinical laboratories werepartially or wholly owned by physicians.' This creates a financial incen-tive for doctors to order unnecessary tests. Professor Rodwin also re-counts the prosecution, under Medicare fraud laws, of Russel Furth, ahospital administrator who had agreed to pay two doctors seventy dollarsfor each patient they admitted to the hospital.4 At the present, physicianscan be prosecuted for accepting kickbacks involving Medicare patients aswell as under state law.5 Tougher federal Medicare fraud laws provideprosecutors with ammunition in combating this unseemly, if not alwaysillegal, practice of physicians receiving money for admitting patients to aparticular hospital. In his book, Professor Rodwin cites mostly legal casesinvolving Medicare fraud which is a probable result of stricter regulation.However, he also indicates that government intervention in providingand controlling medical care is not a cure-all remedy for abuses whichoccur within the system.While the preceding chapters provide a historical backdrop and a warn-ing on the hidden dangers of reform, the final chapter cuts to the heart ofthe matter. Chapter eight addresses: "What Needs to Be Done." Profes-sor Rodwin first dismisses two possible options: disclosure and completepublic intervention.As Professor Rodwin correctly notes, disclosure by physicians to theaverage person can never be complete by the fact of the physician's medi-cal knowledge alone.6 Lawyers similarly operate in superior position in2. Id. at 265.3. Id. at 71.4. Id. at 58-59.5. Id. at 297.6. Id. at 216.When information is too voluminous or complex for the average consumer toBook Reviewtheir relationship with their clients. Professor Rodwin writes that publicdisclosure in the medical community would not achieve the level found ingovernment-regulated employees and the legal field.7 This is a less per-suasive argument. Bill and Hillary Clinton have reached the highest levelin government in winning the White House. Still, they are surrounded indaily newspaper accounts of possible conflict of interests in the Whitewa-ter affair. While the President and the First Lady have not been accusedof violating any specific law, legal scholars have called the conduct of theRose law firm, where Hillary Clinton was partner, "a classic conflict ofinterest."8 Whitewater demonstrates a conflict of interest in both thelegal community and the government simultaneously. Professor Rodwinnotes that the media and public watchdog groups serve as deterrentsagainst possible conflicts of interest in the government.9 These groups,however, are not infallible. Only after the election of President Clintonhave the details of the complex Little Rock connections revealed morethan a simple bad investment by the Clintons. If Professor Rodwin hasfaith that the media and public interest groups can get the job done in thegovernmental arena, can they not play a role in monitoring physician andtheir financial interest in medical facilities through public disclosure?Although Professor Rodwin favors a larger role for government in theregulation of physicians, he cautions those who would support completegovernment control through direct employment of physicians. ProfessorRodwin writes: "When seeking to limit expenditures, government agen-cies may offer doctors financial incentives to limit services, just as HMOsdo today with risk-sharing plans. They may also pursue other policiesusing means that compromise physicians' loyalty to patients."'" Theinterpret, outside groups - such as consumer associations or professional assessors- can evaluate the data. But studies show that purchasers are less likely to searchfor alternative products and services when time is critical or when they are ill-equipped to distinguish between crucial, deferrable, and unnecessary services.Id. at 216. When a patient is uncomfortable or in pain, the option to shop for a secondopinion often is subjugated in hope of immediate relief.7. Id. at 218-19.8. See Alan Dershowitz, Ethics, Conflict of Interest at Root of Whitewater Investiga-tion, BUFFALO NEWS, Jan. 28, 1994, at 3; see also David Klaidman, For Better or Worse;White-collar Bar Questions the Wisdom of Hiring Joint Counsel for Hillary and Bill Clintonin the Whitewater Probe, CONN. L. TRIB., Feb. 14, 1994, at 8.9. RODWIN, supra note 1, at 214.10. Id. at 220. Professor Rodwin goes on to say that "the government is likely todevelop stricter conflict-of-interest policies than the private sector," and cites a VeteransAdministration regulation. Id. This example proves both of the author's points. The regu-lation of possible conflicts-of-interest is greater in the public sector but, as in the case ofthe VA, the quality of care is reduced despite governmental participation. VA hospitals19941632 Journal of Contemporary Health Law and Policy [Vol. 10:629mere fact that the government is involved does not insure against con-flicts of interest arising. All the afflictions which plague the vast defenseprocurement process will, and have already, infect any bureaucracy cre-ated to administrate a federal health care system."A model solution offered by Professor Rodwin is the Securities andExchange Commission (SEC). A Medical Regulatory Commission(MRC) would be created to "licens[e] medical personnel, providers, andsuppliers, and [to set] policy with respect to medical care financial prac-tices and conflicts of interest.' 1 2 The envisioned MRC would permitmedical care to remain in the private sector, "[jiust as the securities in-dustry belongs in the private sector but is subject to SEC control," whileregulating physicians' financial interest in the medical care industry.' 3The medical community's reaction to this proposal probably would beskepticism.Once Congress obtains federal oversight to the finances of the medicalcommunity, further regulation and price controls are a distinct reality.Congressmen, such as Fortney "Pete" Stark, the chairman of the Waysand Means subcommittee on health, would weld great regulatory powerover the medical care community. Professor Rodwin cites Representa-tive Stark on several occassions 14 and acknowledges the assistance ofCongressman Stark's staff in the preparation of the book.'5 The Con-gressman also provides a blurb for the dust jacket of the book. Represen-tative Stark is an ideologue who has argued for the nationalization ofsections of the medical care community.' 6 Government intervention inthe medical care industry does not insure against possible conflicts of in-terest. On December 28, 1993, the Washington Post reported on a studyhave a notorious reputation for the poor quality of care they provide. Bill McAllister,Competition Prescribed for the VA: Clinton Plan Calls for Overhaul of Hospitals, WASH.POST, Sept. 18, 1993, at Al. 8 Deaths Now Tied to Lapses at Veterans Hospital, N.Y. TIMES,Apr. 23, 1991, at A14.11. RoDwIN, supra note 1, at 221.12. Id. at 24013. Id.14. Id. at xiv, 44, 126-28, 239-40, 266.15. Id. at 393.16. Congressman Stark, who represents the bay area of California, promotes aggres-sively his own vision of health care for America. In 1990, Representative Stark called Dr.Louis Sullivan, then Secretary of Health and Human Service and an African-American, "adisgrace to his race" when Secretary Sullivan opposed federally sponsored national healthinsurance. Lawmaker Says His Racial Insult of Health Secretary Was Mistake, N.Y TIMES,Aug. 4, 1990, at A8. Congressman Stark apologized to Dr. Sullivan under pressure fromcongressional leaders. Stark Gives Sullivan a Formal Apology, WASH. POST, Aug. 8, 1990,at A6.Book Reviewreleased which evinced that Congressman Stark was the leading recipienton the Ways and Means Committee of money from political action com-mittees (PACs), which represent many, of the health care and industrygroups.' 7 While the acceptance of PAC money is not illegal, it presentssimilar conflicts of interest Professor Rodwin decries in the medical careindustry. Government regulations prohibit direct compensation andgifts,"8 but congressmen receive compensation indirectly from vested in-terests in th form of PAC money which pays for their re-electioncampaigns.A better solution than the unpalatable elixir of governmental over-sight, lies in Professor Rodwin's suggestion that fiduciary laws, which nowregulate other professions, be extended to physicians.' 9 The doctor topatient relationship would take on an additional fiduciary duty imposedon the physician. Physicians would be required to refrain from financialself-dealing in their relationships with patients. Reasonable steps wouldinclude a ban on doctors investing :in diagnostic labs which they utilize.There should be an immediate end to the practice of directly paying phy-sicians for the admission of patients to a specific hospital.2" Physiciansshould avoid also the appearance of a conflict of interest by refusing anycompensation or gifts from pharmaceutical companies.2 ' These fiduciarylaws could be enforced by state medical licensing boards, and the courts,when physicians breach the duty owed to their patients. In the practice oflaw, this method of enforcement has been successful in maintaining thefiduciary duty owed to a client, notwithstanding the Whitewater affair.Enforcement in this manner would avert the need for a medical regula-tory bureaucracy.Professor Rodwin's prose is clear and concise. The book is accessibleto one who has neither a medical nor legal background. ProfessorRodwin avoids both the tedious professorial tone and the stiff and obtusestyle that accompanies most legal writings. The book is documented withthe notes appearing at the end. Utilizing endnotes avoids footnotes from17. The study was conducted by Citizens Action, which supports a single-payer plan.The study reported Representative Stark received a total of $328,171 in PAC money fromhealth and insurance groups between Jan. 1, 1991 and Oct. 30, 1993 . Charles R. Babcock,Health Interests and Lawmakers, WASH. PosT, Dec. 28, 1993, at A13.18. RODWIN, supra note 1, at 187.19. See generally id. at 190-211.20. Id. at 57-60.21. Physicians should decline any gifts, other than ones of de minimis value. ProfessorRodwin points to the restrictions on Congressional employees from accepting any giftsover $250. Id. at 187.1994]634 Journal of Contemporary Health Law and Policy [Vol. 10:629consuming every page and leaves with the reader the decision to investi-gate a particular point if interested. The author also provides a helpfullist of acronyms to prevent the reader from becoming an MIA in a sea ofAMAs, ABAs and HMOs. In Medicine, Money, and Morals, ProfessorRodwin champions a stronger governmental role in regulating the finan-cial interest physicians have in medical facilities which physicians employin the treatment of their patients. While the reader can disagree with theprescription the author offers to remedy the problem, one cannot ignorethe legitimate concern and potentiality for conflicts of interest whichspurs Professor Rodwin to call for the rehabilitation of the presentsystem.

Medicine, Money, and Morals: Physicians\u27 Conflicts of Interest. By Marc A. Rodwin. New York: Oxford University Press. 1993. 411 Pp. $25.00.

https://scholarship.law.edu/cgi/viewcontent.cgi?article=1476&amp;context=jchlp

Medicine, Money, and Morals: Physicians\u27 Conflicts of Interest. By Marc A. Rodwin. New York: Oxford University Press. 1993. 411 Pp. $25.00.

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The Catholic University of America Columbus School of Law