Bander Center Case Book

Exploring Integrity in Medicine
The Bander Center for Medical Business Ethics
Casebook
Edited By
Rebecca L. Volpe, PhD
Erin Bakanas, MD, MA
Kelly K. Dineen, JD, PhD, RN
James DuBois, DSc, PhD
Revised Version. August 2016

Exploring Integrity 2
Cite as: Volpe RL, Bakanas E, Dineen KK, DuBois J (eds). Exploring Integrity in
Medicine: The Bander Center for Medical Business Ethics Casebook. St. Louis: Saint
Louis University. 2014.
Copyright © Saint Louis University 2014, 2016.
The Casebook may be used in whole or in part, without alteration and without prior
written permission, for not-for-profit educational purposes. We do ask that the citation in
the footer remain on all copies used for this purpose. For all other usages, express prior
permission is required. For permission, contact
The Bander Center at 314-977-1070
Available at: https://www.slu.edu/medicine/bander-center/education/casebook.php
Acknowledgements
This project was funded by the Bander Center for Medical Business Ethics, a
Center at Saint Louis University supported by an endowment from Dr. Steven Bander
and the BF Family Foundation. The mission of the Bander Center is to promote ethical
business practices in medical care and research through the development of training and
investigation opportunities for medical students, residents, and physicians in practice.
The cases published in this Casebook were written by the research assistants,
faculty, and associates of the Bander Center: Erin Bakanas, Joshua Crites, Kamal
Gursahani, Elena Kraus, Heidi Pieroni, and Rebecca Volpe. In some instances, the cases
were directly based upon previously published accounts of business challenges in
medicine: The original sources for the storylines are cited in a footnote following the case
narrative.
The editors played a variety of roles: Rebecca Volpe edited all cases, and in some
instances drafted the Mid-Level Principles of Biomedical Ethics and the AMA Principles
of Medical Ethics sections; Erin Bakanas reviewed cases to ensure that the medical
aspects were accurate and realistic; Kelly Dineen wrote the legal analysis section for each
case; and James DuBois provided a framework for the Casebook and wrote the
Acknowledgements and Introduction.
Cynthia McKenna produced the artwork for the cover.
Volpe RL, Bakanas E, Dineen KK, DuBois J (eds). Exploring Integrity in Medicine: The Bander Center for Medical
Business Ethics Casebook. St. Louis: Saint Louis University. 2014.
Contents
Page
Acknowledgements 2
Introduction: Guidance for Facilitators 4
Facilitation Guide 8
Case 1: Pricing for Health Care Services 10
Case 2: Pennywise State University gets Aggressive about Health Insurance 17
Case 3: An Avoidable Patient Fall and the Model of Care Delivery 24
Case 4: Observing Questionable Medical Business Practices 31
Case 5: Interventional Cardiology and a Potential Referral 39
Case 6: The Business of Prostate Cancer Screening 45
Case 7: Value Based Pay for Performance 52
Case 8: SellCells 59
Case 9: The Business of Knee Injuries 65
Case 10: Defensive Medicine 71
Case 11: Stock Option Ownership 76
Case 12: Start Up Company Conflict of Interest 82
Case 13: Balancing the Roles of Researcher and Physician 89
Case 14: Unforeseen Consequences: The Bayh-Dole Act 98
Appendix A: Index of Business Ethics in Medical Practice Cases 104
Appendix B: Index of Business Ethics in Medical Research Cases 105
Appendix C: SMART Decision-Making Strategies 106
Introduction
Nearly every dimension of medical practice and research includes a significant
business component. Decisions about prescriptions, ordering tests, and providing clinical
services, as well as dedicating effort to research all involve the exchange of money and
financially affect a variety of parties—patients, insurers and government payers,
physicians, and healthcare and research institutions. Exploring these dimensions through
case discussion provides the opportunity to increase sensitivity to the ethical issues, to
foster professional problem-solving skills, and to gain knowledge of relevant facts,
principles, and laws.
Addressing matters of medical business ethics also provides the opportunity to
engage at least two of the general competencies for graduate medical education
established by the Accreditation Council for Graduate Medical Education (ACGME):
professionalism, which includes recognizing “the importance and priority of patient care”
and being “able to identify ethical issues in clinical situations”; and systems-based
practice, which includes being “knowledgeable about the health care system, including
principles of economics, public health management, quality assurance and patient
safety.”1
The Casebook was developed with several assumptions in mind:
• The learners are adults—medical students, residents, and faculty—who learn best
through interactive sessions that require problem solving. Therefore, a case-based
approach is appropriate because it requires learners to ask questions, engage
different viewpoints, and apply general knowledge to specific situations.
• Learning time is at a premium and many educational sessions are limited to 1
hour—or 50 minutes of actual learning time. Therefore, we designed all cases in
this Casebook to be discussed within a 50-minute block of time.
• The facilitators may not have a lot of expertise in ethics, and particularly in
medical business ethics. Therefore, in writing analyses of cases, we made sure to
include relevant facts and to identify relevant ethical norms and laws with
references that allow for further reading.
At first glance, not every case in this Casebook may appear to address a matter of
“business ethics.” However, every case includes a business dimension at least indirectly;
identifying this dimension and exploring how it affects medical practice or research is
valuable insofar as it enables reflection on the incentives and values that influence
physician behaviors.
The Structure of the Casebook

Each chapter of the Casebook has the same structure:
• A Case Presentation followed by a question that asks what the involved clinician
should do. In each instance, we ask specifically what the clinician in the case
should do—even when it’s clear that others should also take action, in fact, even
when others are in the best position to fix the situation. The rationale for this is
simple: We intend this book for use in clinician training and want always to return
to the question, “What can you as a professional do in such a situation?”
• A Case Analysis framework that examines the relevant stakeholders, facts, norms,
and options—dimensions to the case that should be considered as participants
seek to answer the basic action question following each case.*
• Reflection questions that assist facilitators in identifying salient ethical issues that
might be discussed.
o Often the problem in the case involves not merely knowing the right thing
to do but figuring out how to do it amidst financial and professional
pressures. SMART problem-solving strategies can be helpful in these
instances, and so SMART reflection questions are included in each case
and the full SMART approach is outlined in Appendix C.
• References to works cited in the case analysis.
Engaging Norms—Both Ethical and Legal
When presenting norms, the editors adopted a standard strategy for each case. We
first identify how the mid-level principles of biomedical ethics—popularized by the
principlist framework of Beauchamp and Childress—apply to the case.2 Second, we
identify relevant sections of the AMA Principles of Medical Ethics.3 Finally, we identify
relevant laws—focusing on federal law and common principles governing Tort and State
laws. Disclaimer: This book is not meant to offer legal advice. We encourage users of
the Casebook to consult with legal counsel or risk management if they have specific
questions about legal matters raised in the cases. At the same time, since the business
dimension of medical practice and research is addressed in many laws, regulations, and
court cases, it would be foolish to ignore the legal dimension; good ethical deliberation
therefore takes into account a broad range of factual and contextual information,
including the societal norms expressed in law and the legal risk posed by going against
these norms—knowingly or unknowingly. We do not want identification of legal issues
to shut down ethical discussion. Rather, we present legal material in the spirit of the
twofold obligation presented in the AMA Principles of Medical Ethics: “A physician
shall respect the law and also recognize a responsibility to seek changes in those
requirements which are contrary to the best interests of the patient.”3 On the one hand,
there is a prima facie obligation to respect the law. On the other hand, there is an
*
The case analysis framework presented here, which focuses on stakeholders, facts, norms, and options
(SFNO) is based on the framework developed in James M. DuBois, Ethics in Mental Health Research
(New York: Oxford, 2008). The relevant chapter from this book is available for free at http://emhr.net.
explains more fully the significance of each component to the ethical analysis of a complex case.
obligation to advocate for changes in laws that do not serve patients well. We encourage
frank discussion of laws in the arena of medical business ethics with the aim of
identifying what serves patients well and what thwarts the aims of medicine.
How Were Topics Identified?
Business ethics in medicine is a relatively young field of inquiry, and there exists
no canonical list of topics that should be addressed in medical education. Accordingly,
several of the Casebook authors (James DuBois, Elena Kraus, Kamal Gursahani, and Erin
Bakanas) conducted a Delphi survey with experts and stakeholders in medical practice
and medical research with the aim of establishing a consensus on what topics should be
addressed in the undergraduate and graduate medical curriculum.4 The indices at the end
of the Casebook present the highest-ranked topics that were identified by the Delphi
panelists, and identifies which cases address the topic. We wrote cases to address each
topic. Most cases directly or indirectly address more than one topic.
All cases are based on real events that occurred in medicine. Our sources of case
material included personal experiences of some physician authors, published case studies,
and reports in the medical news.
How to Use the Casebook
We offer two forms of guidance on using the cases in the educational setting:
Logistical suggestions and guidance on the process of facilitating case discussion.
Because we believe instructors may want the Facilitation Guide handy while leading
sessions, we present it below as a table that can be printed and consulted during sessions.
Logistics of Case Discussion
We recommend the following:
• Handouts. As a facilitator, you will want a copy of the Facilitation Guide, the
case, case analysis, and reflection questions. Learners only need a copy of the
case. Ideally, each small group will have at least one hard copy of the case that
they can consult throughout discussion. (Cases do not fit onto 1 slide, so it is
generally not feasible to avoid printing copies.)
• Group Size. Even if you have a large group (say, 150 medical students) try to
form groups of 4–6 people at least for the initial discussion of cases. If you do not
have a sufficient number of trained group facilitators (who have studied the case
analysis and the Facilitation Guide), then ask groups to appoint a note taker who
will summarize the plenary discussion. After individual groups have completed
discussion, ask note takers to share their summary, and engage the larger group in
discussion using the guidelines presented in the Facilitation Guide.
• Space. We recommend facilitating case discussion in a space that allows people
to form small groups by forming a circle of chairs or by sitting around a table. If
this is not possible, ask learners to turn in their seats to form groups. If this is not
possible, find a new space because each learner needs the opportunity to engage
actively in discussion.
• Duration. If facilitators take time to explore the relevant stakeholders, facts,
norms and options in each case—allowing time for discussion, debate, and
summary of key points—then one or at most two cases might be covered in a 50-
minute learning period.
Teaching using case discussion can be interesting and educationally fruitful. It can
also be a poor use of time with little learning occurring. The difference between a fruitful
session and one that is not often is determined by the amount of preparation the facilitator
invests into the session and whether best practices are followed. The Facilitation Guide
published below distills best practices from several educational resources developed by
ethicists and moral psychologists.5-7
References
1. Accreditation Council for Graduate Medical Education. Common program

requirements: General competencies.
http://www.acgme.org/outcome/comp/GeneralCompetenciesStandards21307.pdf.
ACGME; 2007.
2. Beauchamp TL, Childress JF. Principles of Biomedical Ethics. 6th Edition. New
York: Oxford University Press; 2011.
3. AMA Counsel on Ethical and Judicial Affairs. Code of Medical Ethics, Current
Opinions with Annotations. Chicago, Ill.: American Medical Association; 2012.
4. DuBois JM, Kraus EM, Gursahani K, Mikulec T, Bakanas E. Curricular priorities for
business ethics in medical practice and research: Recommendations from Delphi
consensus panels. BMC Medical Education. In press.
5. DuBois JM (editor). Instructor’s Manual for “Stories worth discussing: The ORI
casebook.” Rockville MD: The US Office of Research Integrity; 2013. Available at
https://ori.hhs.gov/images/ddblock/Instructor's%20Manual_Final_edited.pdf.
6. Bebeau M. Moral reasoning in scientific research: Cases for teaching and
assessment. Bloomington, IN: Indiana University; 1995.
7. Antes AL, Murphy ST, Waples EP, Mumford MD, Brown RP, Connelly S,
Devenport LD. A meta-analysis of ethics instruction effectiveness in the sciences.
Ethics and Behavior, 19:379-402;2009.
Facilitation Guide
1. Educate yourself about the relevant ethical norms, facts, and laws prior to
presenting the case. Most information you will need is contained in the Case
Analysis section of each chapter.
• We recommend that you study the case and case analysis and make notes on
key learning points.
• If you lack the expertise to facilitate discussion of the complex ethical, legal,
and medical issues, we recommend that you seek a qualified co-facilitator.
• Alternately, you may want to assign some individual or subgroups of
participants the task of mastering a portion of the case analysis information
such as the relevant facts, the ethical principles, or the legal norms.
2. Start by asking the open-ended action question that follows each case.
• Doing so requires learners to identify the salient issues and to engage in
problem-solving by considering stakeholders, facts, norms, laws, diverse
options, the consequences of different options, who they might ask for help or
information, and so forth.
3. Teach by asking questions. Reflection questions prompt students to explore issues
and options when they seem to be reaching a conclusion prematurely or are having
difficulty identifying key issues.
• Introduce new factual information only if the group fails to mention it in the
course of discussion.
• When new information is presented, ask how it influences learner’s
deliberations.
4. Encourage exploration of multiple options.
• Even if you feel the group has quickly reached a recommendation that is best or
at least ethically defensible, ask them to consider alternatives and to explore the
values behind the alternatives.
• Cognitive dissonance and perspective taking foster ethical and professional
development.
5. Explore not only decisions, but also the processes used to arrive at good
decisions.
• In many cases, it is not difficult to recognize what is the right thing to do—but
it is very difficult to figure out how the individual in the case can do the right
thing in the midst of financial or professional pressures.
• Such cases provide an excellent opportunity to explore the use of good
decision-making strategies.
Appendix C includes SMART professional decision-making strategies, which
involve: Seeking help, Managing emotions, Anticipating consequences,
Recognizing rules and power dynamics, and Testing assumptions. Following
each case analysis, we have included a series of SMART decision-making
strategy questions to guide case discussion when the interpersonal,
psychological, or political issues seem more salient than the policy/ethics
issues. With some cases, you may wish to use only these questions to guide
discussion; in other cases, you may wish to use just 1 or 2 such questions; and
in other cases (e.g., those with a policy focus) these questions may not be
relevant.
6. Do not dominate but do manage discussion. Find courteous ways to prevent one
person from dominating discussion.
• Recognize tangents and redirect toward salient issues.
• Consult your Case Analysis notes and return to key teaching points.
7. Do not allow people to be passive.
• If the group is small enough, call on those who are silent.
• If you are overseeing multiple small groups, circulate and encourage everyone
to be active.
• If the group is large or you fear that some people will not participate actively in
discussion, then ask individuals to write their own response to the case prior to
engaging in discussion. Brief writing exercises are an excellent way of ensuring
that every individual actively engages the material.
8. Provide a conclusion. Conclude group discussion with a summary of the key
learning points and by identifying those options that are ethically defensible.
• In the Case Analysis, we do not defend a particular course of action; rather, we
present relevant facts, ethical principles, and laws that enable individuals to rule
out certain options, narrowing the field of defensible options.
• We do not assume that there is one right option for each case, but neither do we
think all options are equally good. We would prioritize options that are
consistent with the law, balance ethical principles in a reasonable manner, and
are consistent with the goals of medicine and fiduciary obligations generated by
a patient-physician relationship.
Case 1
Pricing for Health Care Services
By Heidi Pieroni
Dr. Jones is an internal medicine physician at Luke Health Systems (LHS) in a

large American city. During an office visit about a sinus infection, Sue Brigsby, a 55-
year-old female patient with Type 1 diabetes, complains to Dr. Jones about a bill she
received from LHS.
The bill was for magnetic resonance imaging (MRI) that Dr. Jones ordered as part
of a kidney function study six months ago. Dr. Jones ordered the study at the LHS
Hospital located across the street from his office. The MRI was for the purpose of
assessing the underlying cause of her hypertension that was not adequately controlled
with the current medication regimen.
Ms. Brigsby told Dr. Jones that the MRI bill from LHS Hospital was $4,000, plus
a $4,500 interpretation bill from the LHS radiology group. Ms. Brigsby indicated that her
insurance company was refusing to cover any of the costs because both the hospital and
radiology group are out-of-network providers. Even if the services were covered in-
network, Ms. Brigsby’s health insurance benefits require a $3,000 deductible; therefore,
she has to pay $3,000 out-of-pocket before any scheduled benefit can take effect.
Ms. Brigsby is unable to pay because she recently lost her job and pays $1,000
per month for Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation
coverage. Ms. Brigsby’s son, a college student, contacted LHS and the hospital was
willing to offer a 10% discount if the bill was paid in cash or by credit card within 30
days. He also contacted two other MRI service providers in the area and learned that the
same study was available elsewhere for as low as $900 for both the MRI and a
radiologist’s interpretation.
Angry and frustrated, Ms. Brigsby broke down and cried at the visit. She
wondered aloud how she was going to afford her overdue health care bills as well as her
medications, rent, and other living expenses. Ms. Brigsby was certain that the LHS
Hospital and radiologist’s charges were excessive, but she didn’t know what do to about
it.
How should Dr. Jones respond to Ms. Brigsby’s concerns?
Case Analysis
Stakeholders
The following are stakeholders in the case:

• Ms. Brigsby, because her health and financial outcomes are intertwined. She is
also an economic agent in a fee-for-service arrangement with the radiology group
and the hospital. For example, if Ms. Brigsby exhausts her available financial
resources to pay down the MRI bills, she impairs her ability to pay for continued
health insurance, routine care, and medications.
• Dr. Jones, because his employing organization (LHS) benefits financially from
the fee-for-service arrangement.
• LHS, because of the financial benefit of referrals and the risks of financial loss
from patients’ inability to pay non-negotiated rates. LHS has an interest in making
sure prior authorizations or payment arrangements are made before tests are
performed. LHS also has an interest in patients who wish to return for future
services.
• Third-party payers, including Ms. Brigsby’s insurance company, because they
share some financial risk with Ms. Brigsby. They have an interest in making sure
that preventive and routine care is accessible for Ms. Brigsby to reduce long-term
costs.
• Society, because unpaid medical bills, exorbitantly priced health care services,
and conflicts of interest drive up the cost of health care for everyone.
Facts
• The Accreditation Council for Graduate Medical Education (ACGME) includes

as one of its ‘global’ physician competencies being “knowledgeable about the
health care system, including principles of economics, public health management,
quality assurance and patient safety.”1
• “Future health care professionals, in order to be more attuned to the needs of
those they serve, will need to have a greater understanding of the factors and
parties that influence wellness, the delivery of healthcare, and public health.” 2
• Dr. Jones’ employment with LHS hospital raises ethical and legal questions about
his referral and whether it was sufficiently transparent. The self-referral may
constitute a legal issue or a conflict of interest, with the interests of the hospital
and Dr. Jones misaligned with those of Ms. Brigsby. The arrangement between
Dr. Jones and the hospital may not be known by Ms. Brigsby.
Norms
Mid-Level Principles of Biomedical Ethics3
• Autonomy: the obligation to respect the decision-making capacity of autonomous

persons.
o The primary responsibility for making an informed decision about which

physicians and facilities to visit for tests is the patient’s. However, patient
autonomy is a two-way street: health care providers are ethically obligated
to provide information that facilitates their patient’s autonomy. In this
case, Dr. Jones could have facilitated Ms. Brigsby’s autonomy by
reminding her to double check if LHS Hospital was in-network, or by
employing someone at his office who could help with insurance questions.
• Beneficence: obligations to provide benefits and to balance benefits against risks.
o Dr. Jones’ primary responsibility is to maximize Ms. Brigsby’s health and
wellbeing. Although physicians are not obligated to know in-depth
information about patients’ insurance plans, an awareness of cost and the
associated patient burdens is critical. A basic understanding of insurance
procedures and processes by Dr. Jones or his employees is a reasonable
expectation. If Dr. Jones consistently refers his patients to particular
providers without advising patients on insurance matters (either checking
in office or telling patients to check), Dr. Jones is failing to maximize
beneficence for his patients.
• Nonmaleficence: the obligation to avoid intentionally causing harm without
proportional benefit.
o Referring patients for services based on referral agreements or even
convenience can cause harm. In the case at hand, Ms. Brigsby’s financial
harm may negatively impact her ability to afford routine care and
prescriptions.
• Justice: obligations of fairness in the distribution of benefits and risks.
o The high costs of Ms. Brigsby’s tests were not only avoidable, but they
also require her to take on higher health care costs than a similarly situated
peer.
AMA Principles of Medical Ethics4
• I. A physician shall be dedicated to providing competent medical care, with

compassion and respect for human dignity and rights.
o Delivery of competent medical care requires more than clinical
competence; many other skills and competencies are required, including a
basic understanding of health insurance and health billing.
• VII. A physician shall recognize a responsibility to participate in activities
contributing to the improvement of the community and the betterment of public
health.
o Partnerships, tie-in agreements, and conflicts of interest can take
advantage of patients in an already-vulnerable position who rely upon
their physicians to look out for their best interests.
• IX. A physician shall support access to medical care for all people.
o The challenges of navigating complex health care plans can lead to
increased costs for patients. Physicians should strive to help patients find
affordable options to meet their needs and empower patients to consider
alternatives.
• VIII. A physician shall, while caring for a patient, regard responsibility to the
patient as paramount.
o If Dr. Jones ordered the study at the LHS Hospital because of affiliation
and convenience, he has sacrificed the interests of his patient to his
personal convenience or other secondary interests, such as financial
benefit.
• V. A physician shall continue to study, apply, and advance scientific knowledge,
maintain a commitment to medical education, make relevant information
available to patients, colleagues, and the public, obtain consultation, and use the
talents of other health professionals when indicated.
o It is not clear that Dr. Jones made relevant information available to Ms.
Brigsby. Arguably, whether the provider was in-network or out-of-
network is a basic piece of information that ought to have been
considered—and communicated—before almost everything else.
Legal
Referral to LHS for MRI

• There are five major federal laws that address fraud and abuse in health care: 1)
the False Claims Act; 2) Anti-Kickback Statute; 3) Physician Self-Referral Law;
4) Exclusion Statute; and 5) Civil Monetary Penalties Law. Multiple federal
agencies are involved in their enforcement, including, but not limited to, Health
and Human Services Office of Inspector General, the Centers for Medicare and
Medicaid Services, and the Department of Justice.5
• The Physician Self-Referral Law (commonly known as the Stark law) prohibits
physicians from referring patients for designated health services to entities with
whom they (or the physician’s immediate family members) have a financial
relationship.5 No intent or knowledge is required for liability to apply under the
Stark law. However, there are multiple exceptions to the Stark law based upon the
circumstances of either the referral or of the type of financial relationship.6
o Dr. Jones has a financial relationship with LHS, and MRIs are designated
health services under Stark, but Dr. Jones’ referral may fall into one of
two of the Stark exceptions: 1) the bona fide employment relationship
exception (if Dr. Jones is an employee and is paid a salary that is not based
on or conditioned on referrals) or 2) the in-office ancillary services
exception (designated health services provided in the same office by
practice physicians or those supervised by practice physicians).
o Dr. Jones may also be required to provide patients with written notice of
alternate providers when referring patients for certain imaging services.7
• The Anti-Kickback Statute (AKS) prohibits physicians from engaging in any
arrangements with other individuals (including patients and providers) or entities
that would induce or reward referrals for services through money or the transfer
of anything of value (directly or indirectly).5 There are serious criminal and
administrative sanctions as well as monetary penalties for a violation of the AKS.
o Dr. Jones cannot be required by LHS to refer to them.
o Regularly waiving co-payments and other charges can be an AKS

violation under certain circumstances. However, it is NOT a violation of
the AKS to waive fees for a particular patient after an individual
determination of inability to pay. If Dr. Jones is satisfied that the charges
are not an error, it is legally permissible for Dr. Jones to waive some fees
if he has the power to do so.
• Many states also have laws that prohibit self-referrals and kickbacks, as well as
licensure statutes that consider such arrangements as a basis for discipline or
revocation.8
Insurance Coverage
• COBRA plans are governed by the Employee Retirement Income Security Act of
1974 (ERISA). ERISA sets minimum standards and appeals processes for
coverage decisions.9
o COBRA coverage is an extension of existing insurance and therefore it is
legally required that Ms. Brigsby receive the same benefits that everyone
still on the employer’s group plan receives. Ms. Brigsby must be notified
in writing of any changes to the plan. It is illegal for plan benefits to be
decreased or changed for just the individuals on COBRA coverage.10
o The plan must also have an appeals process for coverage determinations.
• There may be lower cost options for Ms. Brigsby, such as a health plan created
under the Affordable Care Act or a state Medicaid plan, if she qualifies.11
Options
1. Dr. Jones could apologize to Ms. Brigsby and tell her that he will look into the
MRI and radiology bill on his end. Dr. Jones or someone from his office could
follow up with LHS to see if they have a charity care policy that would benefit
Ms. Brigsby and potentially cover some or all of her bill.
2. Dr. Jones could refer Ms. Brigsby to her insurance company, indicating that every
insurance plan is different, and she needs to work through the details with her
insurer.
3. Dr. Jones could refer Ms. Brigsby to a local legal clinic (local legal services
offices or law school legal clinics are often excellent resources) for assistance and
advocacy with her COBRA plan or negotiating with LHS.
4. Dr. Jones could refer Ms. Brigsby to an LHS social worker for assistance with
locating and qualifying for benefit programs, charity care services, appealing
previous coverage decisions, or other sources of financial assistance with health
care expenses.
5. Dr. Jones could waive the physician’s fees or co-pays. Dr. Jones could also ask
LHS to waive or more substantially lower Ms. Brigsby’s charges.
6. Dr. Jones could personally help Ms. Brigsby pay the bills.
7. Dr. Jones could consider a referral to an in-network psychologist or counselor to
assist Ms. Brigsby with the stress of job loss and financial difficulties.
8. To prevent similar future situations, Dr. Jones’ office could modify its procedures
and also urge LHS to amend scheduling procedures to include insurance review,
pre-authorization, and patient prompts to determine whether ordered tests are

covered and at what level (e.g., in-network v. out-of-network). Both entities could
provide patients with a list of other local MRI service suppliers as well as remind
patients to check with their insurance companies about coverage of the ordered
tests.
Reflection Questions
1. Is Ms. Brigsby’s complaint justified? If so, on what basis?

2. Is Dr. Jones at fault? Does he have a professional obligation to Ms. Brigsby with
respect to her role as a consumer or payer of medical expenses?
3. Is Dr. Jones obligated to provide any advice or counsel on the matter of prices for
services and products that he prescribes? If so, to what extent?
4. What, if anything, should Dr. Jones do for Ms. Brigsby?
5. What, if any, changes should Dr. Jones make in handling orders for similar tests
or diagnostic procedures for other patients in the future?
6. How much, if any, expertise should health care providers have of their patients’
medical insurance plans?
7. Is it possible to practice competent medicine without any understanding of
insurance structures?
8. As the patient, what if anything should Ms. Brigsby have done differently?
9. How much of the responsibility for the present situation falls on Ms. Brigsby?
How much on Dr. Jones?
SMART Decision-Making Strategy Questions
1. Seeking help: What kind of assistance might Dr. Jones need in a situation such as
this? Who might Dr. Jones turn to for help?
2. Managing emotions: If you were in Dr. Jones’ position, what emotions might you
experience? How might you effectively manage them?
3. Anticipating consequences: What sorts of consequences should Dr. Jones
anticipate for each of the options she might consider in this case? This includes
both short-term and long-term consequences, and consequences to different
stakeholders including her patient, LHS, and herself.
4. Recognizing rules and power dynamics: What rules or norms are salient in this
case? To what extent is Dr. Jones in a position to resolve this problem, and to
what extent do other stakeholders have the authority to address it?
5. Testing assumptions: What assumptions might Dr. Jones make about LHS or
about Ms. Brigsby? Might some of these assumptions be mistaken? How might
she go about testing her assumptions?
References
1. Accreditation Council for Graduate Medical Education. Common program

requirements: General competencies.
http://www.acgme.org/outcome/comp/GeneralCompetenciesStandards21307.pdf.
ACGME; 2007.
2. Aretz H. Some thoughts about creating health care professionals that match what
societies need. Medical Teacher. 2011;33:608-613.
5. United States Department of Health & Human Services, Office of Inspector
General. Avoiding medicare and medicaid fraud and abuse: A roadmap for new
physicians. https://oig.hhs.gov/compliance/physician-
education/roadmap_web_version.pdf. Accessed June 14, 2014.
6. Social Security Act, §§1877 & 1903(s), Physician Anti-Referral Law (Stark Law),
42 U.S.C. §1395nn; 42 C.F.R. 411.350-411.389.
7. 42 U.S.C. 1395(b)(2) (in-office ancillary service exception); 42 U.S.C.
1395(e)(2) (bona fide employment exception); 42 C.F.R. §411.355(b)(7)
(disclosure requirement for certain imaging services).
8. See, e.g., Missouri Revised Statutes, §334.100.2(4), Physicians and Surgeons,
Denial, Revocation or suspension of license, alternatives, grounds for
reinstatement provisions.
9. United States Department of Labor. Health Plans and Benefits, Employee
Retirement Income Security Act [web site]. Accessed July 20, 2014.
10. United States Department of Labor, Employee Benefits Security Administration.
An employee's guide to benefits under COBRA (Revised). November 2012.
11. Center for Consumer Information and Insurance Oversight, Health & Human
Services, Centers for Medicare and Medicaid Services. Guidance on Hardship
Exemptions for Persons Meeting Certain Criteria, March 20, 2015; Centers for
Medicare & Medicaid Services, healthcare.gov. Accessed May 10, 2016.
Case 2
Pennywise State University gets Aggressive about Health Insurance
By Rebecca Volpe
Lisa Archer has been an employee at the Pennywise State College of Medicine
for 12 years. Her present role is as an administrative assistant in the Department of
Family and Community Medicine. Ms. Archer has just established a new therapeutic
relationship with Dr. Bruce, and on her first visit, Ms. Archer has several questions about
the new health insurance program that Pennywise State is rolling out for all its
employees.
Ms. Archer says to Dr. Bruce, “Well as you know they’re doing this, ‘Take Care
of Your Health Initiative’ (Take Care Initiative), which requires that I do three things in
order to avoid an additional $100 a month charge. First, I have to certify that I’ll have a
preventive physical exam, which is easy enough, because I just have to check a box. But
then, I have to make an appointment with a health screener and get a ‘biometric
screening’ where they measure my cholesterol, height, weight, and all that jazz. Finally, I
have to complete an online ‘wellness profile,’ through a separate company. And then the
results of the biometric screening get uploaded onto the online wellness profile. And, I’m
pretty sure that they’re going to transfer my personal health record—so this visit, for
example—and upload that onto my profile too.”
Dr. Bruce injects, “Really? I didn’t know that.”
“Yes, it’s true!” Ms. Archer continues, “and if I fail to do any of those three
things, I have to pay an extra $100/month—that’s $1,200 a year! Of course, Pennywise
State says that they’re doing this whole Take Care Initiative because they are projecting
double-digit increases in the cost of employee health care, and they can’t just maintain
the status quo.”
“So, I really have a number of questions and concerns,” Ms. Archer goes on.
“First of all, I think this type of program—where they charge you extra—is called a
penalty program, right? And the alternative is an incentive program? So, is there any
evidence that a penalty program is better than an incentive program? Also, I really don’t
want all my information online! I’m worried about confidentiality—who knows what the
wellness profile company will do with my information?
“Well,” Dr. Bruce says, “I understand your concern, but I think it’s safe to assume
that the online wellness profile is HIPAA compliant.”
“But even if they don’t give it away or sell it on purpose, don't we hear all the
time about breaches to the firewalls of major online companies? Plus, there’s one last
thing” Ms. Archer continues, “employees who smoke will be charged an extra
$75/month. But what if a patient does not report their smoking and then has a positive
screening test for nicotine---would their doctor be told? Couldn’t that affect the
therapeutic relationship?”
Dr. Bruce reflects that she really hasn’t paid much attention to the new insurance
program and wonders what she should tell Ms. Archer.
How should Dr. Bruce respond to this situation?
Case Analysis
Stakeholders

• Ms. Archer and other Pennywise State employees, because they are concerned
about privacy, confidentiality, the primacy of the physician-patient relationship,
and keeping health insurance affordable.
• Dr. Bruce, because in her role as a physician she should understand the insurance
and advocate for any needed improvements.
• Pennywise State University, because the organization needs to be able to afford
health insurance for its 44,000 employees.
Facts
• Some studies show modest savings from wellness programs1 and others do not.
Harvard School of Public Health professor Katherine Baicker—who authored one
of the studies showing a cost-savings from wellness programs—recently said that
it is “too early to tell” whether workplace wellness programs save money.2
• There is no evidence indicating that penalty programs (i.e., ‘the stick’) are more
effective than incentive programs (i.e., ‘the carrot’); in fact, if anything, incentive
programs seem to be more effective than penalty programs.3
• While clinical intuition indicates that patients sometimes lie to providers, this is
not well documented in the medical literature. However, some empirical literature
does indicate that patients lie to physicians (often about behaviors such as
drinking or smoking, or to obtain pain medications or exemptions).4
Norms

persons.
o The financial penalties Ms. Archer will face could be perceived as
coercive and may therefore negatively impact her right to be free from
controlling influences when making decisions that impact her wellbeing. If
Ms. Archer cannot afford to pay the $100/month penalty, she really has no
choice but to comply with the wellness program, making the ‘option’ to
participate in the wellness program not only farcical, but also coercive.
o One justification for penalty programs is that they reduce the overall cost
of health care, thereby financially benefiting patients like Ms. Archer. If
the programs are not effective in achieving this aim, on what basis are
patients’ rights infringed upon? If they are effective, does financial
benefit justify the potential harms associated with the program?
o Another justification for penalty programs is that they improve the health
of individual patients like Ms. Archer by encouraging preventive health
measures.
o There is the potential for harm if Ms. Archer loses trust in her caregivers
or if her personal health information is inadequately protected on the
online wellness profile, or if her insurance rates increase without
providing additional benefits.
o Health insurance works by sharing and pooling risks associated with
illness. The theoretical purpose of wellness programs is to bring down the
cost of health care, thereby benefiting the entire organization by
maximizing savings and minimizing costs.
o Wellness programs allocate individual costs based on health behavior and
to a lesser extent, on health status.
o Fixed financial penalty programs disproportionally affect those with lower
incomes.
o Wellness programs based on health status are potentially discriminatory
by disproportionately burdening those with underlying conditions and
disabilities.
• III. A physician shall respect the law and also recognize a responsibility to seek
changes in those requirements that are contrary to the best interests of the patient.
o If Dr. Bruce concludes that the Take Care Initiative is contrary to the best
interests of her patients, she may have a professional responsibility to try
to change it.
• IV. A physician shall respect the rights of patients, colleagues, and other health
professionals, and shall safeguard patient confidences and privacy within the
constraints of the law.
o The documentation Dr. Bruce makes in Ms. Archer’s health records may
be included on the online wellness profile. If true, this raises privacy
concerns related to inappropriate access and disclosure.
o Perhaps Dr. Bruce should systematically educate her other patients about
the Take Care of Your Health Initiative.
health.
o The Pennywise wellness program could contribute to the betterment of
public health, to the extent that it reduces health care costs and makes
employees more aware of their health status.
Legal
• Multiple federal laws are implicated by this situation, with complex and
overlapping applicability. Particularly relevant here are the Health Insurance
Portability and Accountability Act (HIPAA), the Americans with Disabilities Act
(ADA), and the Genetic Information Non-discrimination Act (GINA). These all
apply to wellness plans and insurer practices in the context of employment, and
the Employee Retirement Income Security Act (ERISA) applies to most
employer-based health plans. HIPAA also applies to the protection of patients’
personal health information.
• The major legal concerns are whether the wellness program is 1) lawful and non-
discriminatory and 2) protective of personal health information (privacy),
especially through the online wellness profile.
Non-discrimination
• HIPAA and ERISA prohibit health plans from discriminating against individuals
based on a health factor, including through the use of wellness programs, with
some exceptions.5 All group health plans, even those not subject to ERISA, must
comply with the non-discrimination provisions of HIPAA.
• Federal law divides wellness programs into two categories: 1) participatory
wellness programs (participatory programs) and 2) health-contingent wellness
programs (contingent programs).
o Participatory programs do not require individuals to meet specific health
measures to realize a reward; examples include reimbursement of gym
memberships or rewards for simply participating in a health fair. They are
presumed lawful if they are available to all plan members without regard
to health status. There is no legal limit to a financial reward for
participatory programs.7,8
o Contingent programs require individuals to satisfy some health-related
standard for a reward, such as a certain weight or smoking cessation.
Contingent programs are at greater risk of violating the non-discrimination
provisions of ERISA and HIPAA and must meet five specific
requirements, including notice to participants, reasonable alternative to
individualized health standards, and limited financial rewards.7
o The first three requirements of the Take Care Initiative are probably part
of a participatory program if the reward is realized by simply participating
in an annual exam, the biometric screening, and the online wellness profile
(but not requiring disclosure of any particular type or amount of
information).
o The smoking cessation part of the program is a health-contingent wellness
program because it is contingent on actual smoking cessation. The
program must obtain that information directly from the participant rather
than through their health care provider.
• There is no federal legal distinction between penalties and incentives in wellness

plans; both are included in the definition of reward.7,9
• Wellness plans must also comply with the ADA and GINA. An ADA compliant
plan may request medical history only if 1) the participant can choose to provide it
voluntarily, and the information is 2) kept confidential, and 3) kept separated from
personnel records. Voluntary means the employer neither requires participation
nor penalizes employees who do not participate.8 In 2016, the Equal Employment
Opportunity Commission (EEOC) issued proposed rules under the ADA and
GINA that limit the financial reward or penalty to employees for wellness plans
and health risk assessments.9
• Under GINA, a wellness plan may inquire about the participant’s genetic
information (including family and medical history) only if the program is 1)
voluntary, 2) program information is provided, 3) written authorization is
obtained, 4) no financial inducements are provided to the employee for providing
the information, and 5) no individual genetic information is provided to the
employer.10 Even if an individual voluntarily discloses genetic information, under
HIPAA the plan may not use or disclose genetic information for underwriting
(premiums and coverage cannot be based on genetic information).11
o To comply with GINA and the ADA, the wellness program and each of its
components must be voluntary, not be connected with financial
inducement for information disclosure, provide written information, and
obtain consent or refusal in writing.
o The Take Care Initiative Wellness Profile component must be optional in
order to comply with the law. Any requirement to provide health
information tied to a financial reward is impermissible. The plan should
not ask employees questions about their family medical history, which is
genetic information under GINA. The information in the Wellness Profile
can only be available to the individual and their health care providers, with
their consent.
Privacy
• HIPAA’s privacy rule applies to any information collected as part of the wellness
plan because her employer is also a health care provider and therefore is a covered
entity under HIPAA’s privacy rule.11,12
• The online wellness profile company is almost certainly a business associate
under HIPAA’s enhanced final rule and now subject to direct liability for
noncompliance.11
o Ms. Archer cannot be required to participate in the wellness plan or the
online wellness profile. If she does so voluntarily, the information is
probably protected in compliance with HIPAA in this particular
circumstance. In any event, the information should be structured to flow
into the medical record, rather than the medical record flowing into the
online wellness profile.
• A variety of state laws also impact health insurance regulation and health privacy
and confidentiality.13
Options
1. Dr. Bruce could listen empathetically to Ms. Archer but take no further action.
2. Dr. Bruce could investigate the specifics of the Take Care Initiative, including the
online wellness profile.
3. Dr. Bruce could correct Ms. Archer’s misinformation or misunderstandings about
the Take Care Initiative.
4. Dr. Bruce could make sure the Take Care Initiative was reviewed by the
University for legal compliance.
5. Dr. Bruce could advocate for change in the Take Care Initiative.
6. Dr. Bruce could support the Take Care Initiative because the University predicts
cost-savings.
7. Dr. Bruce could work with the University to develop or revise educational
materials for plan participants that include all legally required disclosures and
other important information. If Ms. Archer has questions, other patients do too.
1. What ought to be the individual physician’s role in institutional health policy?

2. Should physicians be advocates? If so, for whom/what? If not, why not?
3. How should the rights of individual patients be balanced against promoting the
public health and good of society?
4. Would you want your health record posted on an online wellness profile? Why or
why not?
5. Would you find a penalty or incentive program more motivating? Why? Do you
agree with the federal government’s approach of characterizing all penalties or
incentives as simply rewards?
6. Do you agree that contingent wellness program rewards should be limited to a
percentage of the total cost of individual coverage and is that percentage
appropriate (generally 30% but an additional 20% reward from smoking cessation
is now permissible)? Is the distinction between smoking and other health
behavior justified?
1. Seeking help: What kind of assistance might Dr. Bruce need in a situation such as
this? Who might Dr. Bruce turn to for help?
2. Managing emotions: If you were in Dr. Bruce’s position, what emotions might
you experience? How might you effectively manage them?
3. Anticipating consequences: What sorts of consequences should Dr. Bruce
anticipate for each of the options she might consider in this case? This includes
both short-term and long-term consequences, and consequences to different
stakeholders including her patient, Pennywise State University, and herself.
case? To what extent is Dr. Bruce in a position to resolve this problem, and to
5. Testing assumptions: What assumptions might Dr. Bruce make about Pennywise
State University or about Ms. Archer? Might some of these assumptions be
mistaken? How might she go about testing her assumptions?
References
1. Baicker K, Cutler D, Song Z. Workplace wellness programs can generate savings.

Health Affairs. 2010;29(2):304-311.
2. National Public Radio. Can your boss fine you for not disclosing your weight?
August 7, 2013.
3. Volpp KG, Asch DA, Galvin R, Loewenstein G. Redesigning employee health
incentives--lessons from behavioral economics. NEJM. 2011;365(5):388-390.
4. Simmons MS, Nides MA, Rand CS, Wise RA, Tashkin DP. Unpredictability of
deception in compliance with physician-prescribed bronchodilator inhaler use in a
clinical trial. Chest. 2000;118(2):290-295.
7. Federal Register, Vol. 78, No. 106, implementing the ACA and modifying IRS,
DOL, and HHS regulations regarding non-discriminatory employee wellness
programs, June 3, 2013, 33158-33192.
8. Federal Register, Vol. 78, No. 106 at 33160-33161.
9. Federal Register, Vol. 80, No. 75 at 21659-21670; Federal Register, Vol. 80, No.
210 at 66853-66862.
10. Federal Register, Vol. 78, No. 106 at 33160, 33176.
11. See, e.g., U.S. Equal Employment Opportunity Commission, ADA & GINA
incentives for workplace wellness programs letter.
http://www.eeoc.gov/eeoc/foia/letters/2011/ada_gina_incentives.html. June 24,
2011.
12. Office of Civil Rights, Department of Health and Human Services. HIPAA final
rule, Federal Register, Volume 78, No. 17, January 25, 2013, 5566-5702.
13. See, e.g., Niccolini R, Rothman J, Williams, T. Employee wellness programs:
unraveling the knot of HIPAA, GINA, ADA, and other applicable laws.
HEALTHLAWYERS.ORG.
http://www.healthlawyers.org/Events/Programs/Materials/Documents/IHC12/pap
ers/A_niccolini_williams.pdf. Accessed June 30, 2014.
14. The George Washington University's Hirsh Health Law and Policy Program & the
Robert Wood Johnson Foundation. Health Information & the Law: States [web
site]. Accessed August 4, 2014.
Case 3
An Avoidable Patient Fall and the Model of Care Delivery
By Kamal Gursahani
Mr. Henderson, an 86-year-old male with multiple medical problems presents to

the hospital for confusion. Although he answers questions and follows commands, he is
not oriented to place or year. His daughter, with whom the patient lives, reports that he is
fully oriented under normal circumstances.
In the emergency department, the patient is diagnosed with a urinary tract
infection and treatment with antibiotics is initiated. The doctors believe the infection is
likely the reason he is confused. Mr. Henderson is admitted to the general floor under the
care of Dr. Williams.
At 2 a.m. on hospital day two, Mr. Henderson pushes his call light when he needs
to urinate. A nursing assistant had emptied his urinal two hours prior but forgot to put it
back within the patient’s reach. After 10 minutes of waiting, the patient gets up from his
bed unassisted, attempts to get to the bathroom, and falls, hitting his head against the
baseboard of the wall. He is found unconscious on the floor bleeding from a scalp
laceration on the left side of his head. He awakens to verbal stimuli, but remains
confused, and does not follow any commands. He has no recollection of what happened.
Hospital administration is notified of the incident.
Dr. Williams orders a CT scan of the brain, which reveals a small acute left
subdural hematoma and Mr. Henderson is transferred to the ICU in the care of a
neurosurgeon.
Mr. Henderson is on a routine dose of a blood thinner following stent placement
for coronary artery disease and in the ICU, he receives a platelet transfusion. His repeat
CT brain scan at 24 hours is unchanged. He does well and is transferred out of the ICU
on hospital day five.
The patient’s daughter and son in law are furious about the fall and resulting
injury, prolonged hospital stay, and cost of the treatment. They ask Dr. Williams, “How
can this have happened in a hospital? It seems like he would have been safer at home.
Isn’t bleeding in the brain really dangerous? He could have died, couldn’t he? What
about the bill? And what about the follow up visits with the neurosurgeon… who is going
to pay for all of this?”
How should Dr. Williams and hospital administration approach this situation?
Case Analysis
Stakeholders

• Mr. Henderson and his family, because the fall was avoidable, and caused
significant physical harm to the patient as well as financial burden to the patient
and family.
• Health care providers, because the model of care delivery can impact a group’s
approach to patient safety. Patient safety errors are often systems errors, in that
they have multifactorial influences, ranging from group behavior to economic
incentives. For example, some argue that in a fee for service (FFS) system, there
is no incentive to improve patient safety, as injuries result in more testing,
treatment, and opportunities to bill for services. Alternatively, some argue that
using pay for performance (PFP) will improve patient safety by creating monetary
incentives to keep patients safe and healthy. In fact, The Centers for Medicare and
Medicaid Services (CMS) will not reimburse fees associated with preventable
hospital injuries.
• The hospital system, because it bears the cost of care related to the fall as well as
the costs associated with threatened or actual litigation.
• Payors, because they have an interest in spending judiciously, and expenditures
related to preventable patient injuries are not the best use of limited funds.
Facts
• Falls are the most common inpatient adverse event. Up to one-third of falls result
in injuries including fractures, subdural hematomas, bleeding, and, in some cases,
death. Patient falls can increase hospital bills dramatically: one study estimated
that costs increased 60% following a fall, and another study found that patients
who fell had bills that were $4,200 more than those who do not fall.1,2
• There are quality improvement initiatives across the nation to reduce hospital
falls.3
• There are financial implications for patient safety errors: CMS has limited
reimbursement for hospital-fall related treatment.4 If a fall results in an injury and
a diagnosis that was not present on admission, no reimbursement is provided.
• Factors that increase fall risk include confusion upon admission, treatment with
central nervous system affecting drugs that can impair cognition (e.g.,
sedative/hypnotics, antipsychotics, anticonvulsants, narcotics, etc.), and frequent
need to urinate or defecate, especially in the evening and during the night.1,5
Urinary tract infections can result in mental status changes, especially in the
elderly, as well as frequent urination.
• An interdisciplinary model of care delivery and fall prevention is required to
effectively implement a fall prevention program.6,7
• The Swiss cheese model of systems errors is a metaphor for understanding
medical error. According to the model, every step in a process has the potential
for error, to varying degrees, and often a subsequent step will stop the error from
cascading. The model is analogous to a stack of Swiss cheese slices. The holes are
opportunities for error, and when the holes line up, an error occurs. Functional
systems would create processes and checks in subsequent steps to avoid the holes
from lining up.8
• Professional competencies in medical residencies include focusing on patient
safety, analyzing and improving practice, working effectively in interprofessional
teams, and understanding and improving systems.9
Norms

persons.
o Health care providers cannot chemically or physically restrain all high-fall
risk patients; restraints are not effective in preventing falls11 and would
rob them of their right to control their own bodies. The central challenge is
identifying strategies that respect patient autonomy while keeping patients
safe.
o Physicians must be leaders in the area of patient safety in order to uphold
the standards of the profession.
o Physicians should above all keep their promise to do no harm. Yet many
health care environments and systems interfere with this maxim, including
the FFS model.

o The providers in the present case should deliver the highest quality patient
care they can, regardless of their reimbursement structure. “Providers”
encompasses physicians, nurses, ancillary staff, and members of the
hospital administration.
health.
o Physicians have an ethical obligation to be advocates for better health
systems. In the present case, it is worth asking the question, “Do
physicians have a professional obligation to publicly advocate for a health
care system that thrives economically from keeping patients healthy as
opposed to sick?”
o The amount of reimbursement the physician receives should not influence

the type of or quality of care that is delivered.
Legal
• CMS sets payment policies for all federal health care programs. Falls are
considered hospital acquired conditions for which reimbursement is not
provided.13,14 Hospitals are also prohibited by federal law from passing on the
costs of hospital acquired conditions to the patient.13-15
• State tort law governs professional malpractice and hospital liability for
preventable falls. In many states, the hospital as well as the caregivers may be
liable for a patient’s injuries. For liability to attach in malpractice cases, the
following conditions must be met: 1) a professional duty to the patient (provider-
patient relationship), 2) a breach of that duty, 3) that is the cause of 4) harm to the
patient with 5) damage that can be monetized.16
o Falls with injuries during a hospitalization are among the most
straightforward malpractice cases.
o The providers here all have a professional duty to the patient under their
care in the hospital. They failed to implement appropriate fall prevention
strategies and the patient was injured as direct a result. His injuries
resulted in more advanced care and possible long-term care needs, all of
which are damages.
• State laws vary on whether apologies by providers or expressions of sympathy
can be used later as evidence in a malpractice trial.17 Some states prohibit the use
of expressions of sympathy but still allow the use of actual statements of fault.18
• Prompt disclosure of mistakes can improve the process for all involved and
minimize the overall costs involved in malpractice cases.19
• The hospital probably has an adverse event and error disclosure protocol that the
doctors should follow in answering the family’s questions and concerns.
Following the disclosure protocol as early as possible may have minimized some
of the family’s distress and deescalated the situation.19
Options
1. Dr. Williams could disclose the error to the patient’s family in compliance with
any existing hospital protocol. In the absence of a protocol, Dr. Williams could
disclose the error anyway and apologize.
2. Dr. Williams could listen empathetically but refrain from taking responsibility or
apologizing.
3. Dr. Williams could tell the family they need to speak with hospital administration.
4. The hospital could further encourage physicians, nurses, and other providers to
uphold professionalism standards by mandating basic patient safety training and
outcomes as part of employment requirements.
5. As part of an overall evaluation, Dr. Williams could encourage the hospital to
consider increasing use of patient sitters along with a formalized training and
evaluation program. Patient sitters are generally more affordable than skilled
nursing staff and can monitor patients for their safety.
6. Dr. Williams and the hospital administration could explore educational campaigns
to engage the community to improve patient safety and foster interdisciplinary
cooperation.
7. The hospital and Dr. Williams could consider an interdisciplinary review of this
event, overall hospital fall rates, and existing fall protocols. They could revise or
replace those protocols as needed, using established sources such as the
evidenced-based, interdisciplinary protocols available from the Agency for
Healthcare Research and Quality.6 If the hospital does not have an error
disclosure protocol, the administration could consider working with or
encouraging the general counsel’s office to develop one.
8. Dr. Williams and the hospital administration could support expansion of current
changes in the health care financing system, such as pay for reporting or pay for
performance, which discourage increased utilization of resources resulting from
hospital-acquired conditions.
1. When patient safety errors occur, where does the responsibility lie? Where do the
solutions lie? How much responsibility rests with the institution and how much
rests with physicians, nurses, and other providers?
2. What are the barriers to implementing safe environments?
3. What could the providers have done differently to prevent the fall? What factors
contributed? Are all falls preventable?
4. What is the Swiss cheese model of systems errors and how might it apply to this
case?
5. Do you agree with the federal government’s approach of non-reimbursement for
hospital acquired falls? For whom do you think this economic disincentive is most
effective in changing behavior?
6. What, if any, are the obligations of physicians to advocate for improved health
systems structures?
7. Should providers promptly disclose when a patient safety error occurs? Should
they apologize? Why or why not? If yes, to whom should they be speaking?
1. Seeking help: What kind of additional information does Dr. Williams need in a
situation such as this? Who might Dr. Williams turn to for assistance? Have Dr.
Williams and the other healthcare providers involved welcomed correction and
owned to mistakes?
2. Managing emotions: If you were Dr. Williams, what kind of emotions do you
think you would be experiencing? How could these emotions influence your
decision-making? How can you effectively manage these emotions?
3. Anticipating consequences: What consequences should Dr. Williams anticipate
for each of the options in this case? What are the short- and long-term
consequences? Which stakeholders will be affected and how? How can risks be
minimized? How might this decision impact Dr. William’s career?
case? To what extent is Dr. Williams in a position to address this problem, and to
5. Testing assumptions: What are Dr. Williams’ assumptions in this case? Might Dr.
Williams be making faulty assumptions about the causes of the situation or
alternatives?
References
1. Hitcho EB, Krauss MJ, Birge S, et al. Characteristics and circumstances of falls in
a hospital setting: a prospective analysis. Journal of general internal medicine. Jul
2004;19(7):732-739.
2. National Quality Forum. Evidence on Total Fall Rate (NQF# 0141) and Injury
Fall Rate (NQF #0202). 2012. Accessed 12/3/2013.
3. Oliver D, Healey F, Haines TP. Preventing falls and fall-related injuries in
hospitals. Clinics in Geriatric Medicine. Nov 2010;26(4):645-692.
4. Centers for Medicare & Medicaid Services. Hospital-Acquired Conditions (HAC)
in Acute Inpatient Prospective Payment System (IPPS) Hospitals. In: Services
DoHaH, ed. http://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/HospitalAcqCond/downloads/HACFactSheet.pdf. 2012.
5. Krauss MJ, Evanoff B, Hitcho E, et al. A case-control study of patient,
medication, and care-related risk factors for inpatient falls. Journal of general
internal medicine. Feb 2005;20(2):116-122.
6. Rand Corporation, Boston University School of Public Health, ECRI Institute.
Preventing falls in hospitals: a toolkit for improving quality, prepared for Agency
for Healthcare Research and Quality.
http://www.ahrq.gov/professionals/systems/long-term-
care/resources/injuries/fallpxtoolkit/fallpxtoolkit.pdf. Accessed June 30, 2014.
7. National Guideline Clearinghouse. Prevention of Falls (Acute Care) [web site],
Accessed 6/30/2014.
8. Reason, J. (2000). Human error: Models and management. BMJ 320(7237): 768-
770.
9. Association of American Medical Colleges. Competencies and the path to
mastery in quality and patient safety.
https://www.aamc.org/download/313174/data/te4qcompetencies.pdf. Accessed
June 30, 2014.
11. Centers for Disease Control and Prevention. Falls in Nursing Homes, 2012.
Available at: http://www.cdc.gov/homeandrecreationalsafety/falls/
nursing.html#restraints. Accessed August 10, 2014.
13. Centers for Medicare & Medicaid Services. Inpatient prospective payment system
final rule, Federal Register Vol. 77, No. 170, August 31, 2001, 53258-53750.
14. Centers for Medicare & Medicaid Services. Fiscal year 2013 final list, hospital
acquired conditions. Accessed June 30, 2014; Medicaid.gov, Provider preventable
conditions [web site]. Accessed June 30, 2014.
15. Centers for Medicare & Medicaid Services. Present on admission reporting [web
site]. Accessed June 30, 2014.
16. Furrow B, Greaney T, et al. Liability and quality issues in health care (5th ed).
Thompson West (2004).
17. National Conference of State Legislatures. Medical Liability/Medical Malpratice
Legislation. 1/14/2014. NCSL [web site]. Accessed May 10, 2016.
18. Mo.Rev.Stat. Section 538.229.1 (August 2015).
19. Schvve, P. Hospitals create a culture of safety and trust by being transparent about
medical errors. Expert commentary on proactive reporting, investigation,
disclosure, and remedying of medical errors leads to similar or lower than
average malpractice claims costs. AHRQ Innovations Exchange [web site].
Accessed June 30, 2014.
Case 4
Observing Questionable Medical Business Practices
By Elena Kraus
Dr. Amy Aucel works as an orthopedic surgeon specializing in back pain in a

private clinic with two other physicians. They all have privileges at a nearby hospital.
The practice distributes salaries to their physicians depending on how the group does as a
whole. The practice has historically been very busy and lucrative. Because of their
success, the practice was able to add a fourth physician, Dr. Fraxure, about two years ago.
Unfortunately, Dr. Aucel is increasingly concerned about some patterns of care
she is observing from Dr. Fraxure. First, Dr. Fraxure sees significantly more patients than
the other physicians in the practice see on a daily basis. Dr. Aucel believes this is because
in lieu of a complete history and physical, Dr. Fraxure tends to depend more on MRIs,
which he orders for virtually all his patients. This does not completely surprise Dr. Aucel,
since Dr. Fraxure convinced the practice to invest in its own MRI center, and she knows
this arrangement incentivizes the overuse of this expensive imaging.
What is most troubling, however, are the patients who come to her for a second
opinion after seeing Dr. Fraxure. Often, they are looking for an alternative to surgery.
After a thorough physical exam and a re-examination of their MRIs, Dr. Aucel finds most
of the MRIs results are inconclusive and therefore do not necessarily indicate surgery. On
a number of occasions, she has seen elderly patients with significant comorbidities
scheduled for surgery; patients who would not expect to appreciate significant benefits
from surgery.
Dr. Aucel’s colleagues do not share her concerns about Dr. Fraxure. They
attribute Dr. Fraxure’s practice patterns to differences in medical judgment and believe
that a few more MRI scans will not hurt patients because they are offering a convenient
and discounted MRI service. After all, the clinic has never done better financially, and
they are all seeing increases in their salaries.
How should Dr. Aucel respond to this situation?
Case Analysis
Stakeholders

• Dr. Aucel, because she benefits financially when the practice orders more MRIs
and performs more surgeries. She is also affected (positively or negatively) by the
reputation of the practice. Because she is part of the practice, Dr. Aucel has at
least some ethical and legal responsibility for the quality and nature of care
delivered by the practice.
• Dr. Fraxure (similar to Dr. Aucel), because he benefits financially when he and
others in the practice order more MRIs and perform more surgeries. He is also
affected by the reputation of the practice and of the care provided for the patients
of the practice. He has a direct legal and ethical responsibility for the care he
provides.
• Dr. Aucel, Dr. Fraxure, and all of the providers in their practice because they face
the possibilities of substantial civil, criminal, and administrative penalties for
violations of fraud and abuse laws (directly or through conspiracy charges).
These include allegations of criminal behavior, license revocation, and exclusion
from the practice of medicine.
• Other practice colleagues, because they too have their reputations and finances at
stake.
• Patients, because their health is at stake: unnecessary surgeries are harmful and
financially burdensome. Unnecessary MRI scans are also harmful and financially
burdensome, although less so than unnecessary surgeries.
• Insurance companies and Centers for Medicare and Medicaid Services, because
they are paying for unnecessary procedures and tests, and this, in turn, drives up
costs to patients and taxpayers.
• Numerous federal and state agencies, because they are responsible for
implementing and enforcing health care fraud and abuse laws.
• Other physicians, because unnecessary care hurts their collective reputation as
well as damages public trust in the profession.
• State medical boards, because they are responsible for the protection of the public
through licensure and regulation of physician practice.
Facts
• Empirical studies have shown that financial incentives inherent in physician self-
referral arrangements result in increased use of services and higher payments
from third-party payers.1
• Regardless of MRI service ownership, there is evidence of significant overuse of
MRIs (and many other health care services). One study of lumbar spine MRIs
indicated less than half of requests for this procedure were considered appropriate,
and an additional 27.2% were of uncertain value.2
• Addressing bad behavior can improve staff satisfaction and retention, improve
practice reputation, improve patient safety and risk-management, and create more
productive work environments.3
• Unprofessional behaviors are associated with poor adherence to practice
guidelines, loss of patients, low staff morale and turnover, medical errors and
adverse outcomes, and malpractice suits.3
Norms

persons.
o If Dr. Fraxure is not doing an appropriate history and physical, his
treatment recommendations are based on incomplete knowledge of his
patient. The patient then does not have sufficient information about his
medical needs to make an informed decision about his medical care.
o Dr. Fraxure is causing physical harm to patients by performing
unnecessary medical procedures, emotional harm due to the stress
incurred, and financial harm insofar as unnecessary procedures are an
unnecessary expense.
o Dr. Fraxure’s fraudulent tests place an unfair burden on patients and the
healthcare system.

o Dr. Fraxure’s practice may be in violation of this principle if he is
prioritizing his own financial wellbeing at the expense of providing
competent medical care.
• II. A physician shall uphold the standards of professionalism, be honest in all
professional interactions, and strive to report physicians deficient in character or
competence, or engaging in fraud or deception, to appropriate entities.
o Dr. Aucel believes that Dr. Fraxure is potentially incompetent or engaging
in fraud or deception. It appears that Dr. Fraxure is ordering unnecessary
and costly tests and performing unnecessary surgeries. Dr. Aucel has an
obligation to address the situation.
o These responsibilities extend to all the practice’s patients. The patients’
wellbeing ought to take precedence over financial gains.
Legal
• Various fraud, abuse, and waste laws could apply; many of the laws require no
specific intent to defraud, and cases often involve physicians who do not
understand the difference between medical practices and other businesses.
• These cases also frequently involve physicians who are simply ignorant, negligent
or sloppy with business practices, relationships, and billing. The federal
government places tremendous trust in physicians to provide appropriate care and
guard federal resources allocated through Medicare, Medicaid and other federal
programs.6
• There are five major federal laws that address fraud and abuse in healthcare: 1)
the False Claims Act (FCA), 2) Anti-Kickback Statute (AKS), 3) Physician Self-
Referral Law (Stark), 4) Exclusion Statute, and 5) Civil Monetary Penalties Law.
Multiple federal agencies are involved in their enforcement, including, but not
limited to, Health and Human Services Office of Inspector General (OIG), the
Centers for Medicare and Medicaid Services (CMS), and the Department of
Justice (DOJ).6
• Violation of fraud and abuse laws can lead to civil and criminal penalties,
substantial fines, exclusion from federal programs (including exclusion from
employment by any organization or person that participates in federal programs),
and revocation of medical licensure.6
• The False Claims Act (FCA) dates back to the late 1800s and criminalizes any
knowing (including “should have known”) presentation of a false claim for
payment to the federal government.7 No specific intent to defraud the government
is required. The FCA has been widely applied to health care to enforce claims for
health care services that are false as defined as 1) fictitious (billing for non-
existent patients), 2) exaggerated (billing for services in excess of what was
provided or upcoding), and 3) excessive or medically unnecessary. Violations of
Stark and the AKS are also a basis for FCA prosecutions (e.g., one arrangement
that violates Stark or the AKS gives rise to the additional FCA prosecution).6,7
• The FCA allows the government to bring suit against the provider(s) through the
DOJ or a private party with knowledge of the conduct (whistleblower) may bring
suit on behalf of the government through its qui tam provision.7
o Even though Dr. Fraxure is seeing more patients than his colleagues, he
should not be billing significantly more overall because he is providing a
lower level of care. If he is generating more revenue than his colleagues
while performing minimal examinations on patients, there may be
fraudulent billing occurring, such as upcoding.
o Dr. Fraxure is probably violating the FCA by ordering medically
unnecessary MRIs and performing unnecessary surgeries.
o The pattern of second opinion patients with no clear-cut indications for
surgery, including those who are at very high risk due to underlying health
issues, probably triggers the knowledge component of the FCA and places
Dr. Aucel and colleagues outside the law and at risk of liability if the
government does take action.
• The Stark law prohibits physicians from referring patients to entities with whom
they (or immediate family members) have a financial relationship for designated
health services.6 Nearly half of states have similar laws that apply to private
insurance.8 No intent or knowledge is required for liability to apply under the
Stark law. However, there are multiple exceptions to the Stark law based upon the
circumstances of either the referral or the type of financial relationship.9
• Physician group practices are exempt from the Stark law prohibition for 1)
referrals for patients to be examined by physicians in the same group practice and
2) in-office ancillary services (including imaging services) if the services are a)
personally provided by the referring physician or b) directly supervised by a
practice physician and c) are conducted in a building in which the group’s
designated health services are provided. However, any profits or bonuses the
group practice members enjoy must be structured in a manner that is not directly
related to the volume or value of referrals by the group practice physicians.9
o The doctors may refer to each other within the same group practice under
the group practice exception and the imaging services may be lawful
under the in-office ancillary services exception (depending on additional
unknown facts).
o Nonetheless, their profits cannot be related to the volume or value of
referrals. Therefore, the fact that some of the physicians noted that Dr.
Fraxure’s excessive MRIs are increasing their salaries is of serious
concern.
• The Office of the Inspector General (OIG) and the Centers for Medicare and
Medicaid Services (CMS) have created processes for voluntary self-disclosure of
suspected violations of Stark, AKS, FCA and other fraud and abuse laws.10 ,11
• The federal government has increased its scrutiny on even lawful self-referrals to
imaging centers recently.12
o The group’s referrals to their own MRI center are self-referrals under
Stark. The group has a financial relationship with the MRI center. It can
only be permissible under the law if it meets the Stark in-office ancillary
services exception.
o In any event, effective January 2011, the practice is required to provide
patients with written notice of at least five local, alternative providers of
MRI services.13
• The Anti-Kickback Statute (AKS) prohibits physicians from engaging in any
arrangements with other individuals (including patients and providers) or entities
that would induce or reward referrals for services through money or the transfer
of anything of value (directly or indirectly).6,14 There are serious criminal and
administrative sanctions as well as monetary penalties for a violation of the AKS.
o For example, if the group requires their physicians to refer to their own
MRI center, it would be an AKS violation.
• Many states also have laws that prohibit self-referrals and kickbacks, as well as
licensure statutes that consider such arrangements as a basis for discipline or
revocation.8,15
• The practice group may have ways to terminate or sanction Dr. Fraxure for
unethical behavior based on their business organization documents or
employment agreements. However, this does not relieve the individual physicians
from potential fraud and abuse liability.
Options
1. Dr. Aucel could continue working at the clinic under threat of legal liability.
2. Dr. Aucel could confront Dr. Fraxure directly with her suspicions that he is
not acting in the best interest of patients.
3. Dr. Aucel could follow up with her colleagues regarding her concerns with
more information and attempt to persuade them that Dr. Fraxure’s practices
put them all at risk. This could include advocating for measures ranging from
sanction to termination of Dr. Fraxure.
4. Dr. Aucel could urge the practice to hire a lawyer with expertise in health care
law and ask for a formal opinion and an internal audit including chart reviews
and billing practices of the group’s physicians.
5. Dr. Aucel could urge the group practice to work with a health care lawyer to
explore self-disclosure of fraud and abuse via the federal process.
6. Dr. Aucel could urge the practice to develop a compliance program going
forward. Mandatory compliance programs are often a condition of fraud and
abuse settlements with the federal government.
7. Dr. Aucel could approach the problem using graduated interventions:3
a. Have an informal talk with Dr. Fraxure indicating her concern about
one or a handful of specific incidents.
b. Schedule a meeting with her colleagues and Dr. Fraxure to provide
non-punitive awareness of Dr. Fraxure’s patterns using information on
patient and procedure volume from the practice.
c. Restrict Dr. Fraxure’s privileges or terminate his employment, and/or
report his behavior to appropriate authorities.
8. Dr. Aucel could approach a health care lawyer individually to self-disclose
fraud and abuse or to bring a qui tam action as a whistleblower.
9. Dr. Aucel could leave the practice.
1. What is the best approach for confronting colleagues suspected of

unprofessional, unethical, or illegal acts?
2. How can physicians keep up-to-date on legal requirements that impact their
practice?
3. How can physicians stay aware of patterns of ethically or legally questionable
practices by others in their own practice? Are physicians responsible for this
knowledge? Are there systems or processes that might help?
4. How can physicians create a culture of compliance to prevent fraud and abuse
violations before they occur?
5. How has the implementation of third-party payment challenged the
responsibility of physicians and patients to be good stewards of health
resources?
6. Despite an emphasis on professionalism in medical practice, what experiences

in your medical training or practice have exposed you to unprofessional
behavior? What have these experiences taught you about the implications and
consequences of unprofessional behavior? What have they taught you about
approaches for addressing such behavior?
1. Seeking help: What kind of additional information does Dr. Aucel need in a
situation such as this? Who might Dr. Aucel turn to for assistance? Would it help
to involve a mentor or consultant?
2. Managing emotions: If you were Dr. Aucel, what kind of emotions do you think
you would be experiencing? How could these emotions influence your decision-
making? How can you effectively manage these emotions?
3. Anticipating consequences: What consequences should Dr. Aucel anticipate for
each of the options she might consider in this case? Which stakeholders will be
affected and how? How can risks be minimized?
case? To what extent is Dr. Aucel in a position to address this problem, and to
5. Testing assumptions: What are Dr. Aucel’s motives in this case? What
assumptions might Dr. Aucel make about Dr. Fraxure and the other partners in the
practice? How can Dr. Aucel determine if her assumptions are mistaken? How
might she test these assumptions? How will others view her choices?
References
1. Mitchell JM, Scott E. Physician self-referral: Empirical evidence and policy

implications. Advances in Health Economics and Health Services Research.
1992;13:27-42.
2. Emery DJ, Shojania KG, Forster AJ, Mojaverian N, Feasby TE. Overuse of
magnetic resonance imaging. JAMA Internal Medicine. 2013;173(9): 823-825.
3. Hickson GB, Pichert JW, Webb LE, Gabbe SG. A complementary approach to
promoting professionalism: Identifying, measuring, and addressing unprofessional
behaviors. Academic Medicine. 2007;82(11):1040-1048.
6. U.S. Department of Health & Human Services, Office of Inspector General.
Avoiding medicare and medicaid fraud and abuse: A roadmap for new
physicians. 2014.
7. Department of Justice. A primer on the False Claims Act. 2014.
http://www.justice.gov/civil/docs_forms/C-FRAUDS_FCA_Primer.pdf.
8. Mitchell JM. The prevalence of physician self-referral arrangements after Stark II:
Evidence from advanced diagnostic imaging. Health Affairs. 2007;26(3):w415-
424.
9. Social Security Act, §§1877 & 1903(s), Physician Anti-Referral Law (Stark Law),
42 U.S.C. §1395nn; 42 C.F.R. 411.350-411.389.
10. Centers for Medicare and Medicaid Services. Self disclosure protocol. 2014.
http://www.cms.gov/Medicare/Fraud-and-
Abuse/PhysicianSelfReferral/downloads/6409_SRDP_Protocol.pdf.
11. U.S. Department of Health & Human Services, Office of the Inspector General.
Updated: OIG's provider self disclosure protocol. April 2013.
https://oig.hhs.gov/compliance/self-disclosure-info/files/Provider-Self-Disclosure-
Protocol.pdf.
12. U.S. Government Accountability Office, Report to congressional requesters,
higher use of advanced imaging services by providers who self-refer costing
medicare millions. September 2012.
13. 42 U.S.C. 1395(b)(2) (in-office ancillary service exception); 42 U.S.C.
(b)(1)(group practice exception); 42 C.F.R. §411.355(b)(7) (disclosure
requirement for certain imaging services).
14. Social Security Act §1128(b), Physician Anti-kickback Law (AKS), 42 C.F.R.
1001.
15. See, e.g., Missouri Revised Statutes, §334.100.2(4), Physicians and Surgeons,
Denial, Revocation or suspension of license, alternatives, grounds for
reinstatement provisions.
Case 5
Interventional Cardiology and a Potential Referral
By Heidi Pieroni
Dr. Taylor began medical school only a few years after Dr. Andreas Gruentzig
performed the first coronary angioplasty on a human in 1977. The result of Gruentzig’s
research spurred the development of a new subspecialty: interventional cardiology. Dr.
Taylor soon found himself fascinated with the field of cardiology and gravitated toward
this subspecialty in residency. Dr. Taylor now works in a large group practice that
recently adopted minimum volume criteria to continue performance of interventional
procedures. Dr. Taylor supports this policy because high-volume interventional centers
and high-volume interventional clinicians tend to have better patient outcomes. However,
Dr. Taylor took some time off last year for health reasons, and he will likely fall short of
the caseload requirement (150 cases in the preceding two years).
Carol Irwin enters his office shortly after Dr. Taylor comes to this realization. Ms.
Irwin was referred to him for evaluation of a heart murmur. After a careful history and
physical exam, Dr. Taylor orders an echocardiogram, which reveals an atrial septal defect
(ASD). Ms. Irwin’s condition requires ASD closure, which would help Dr. Taylor make
up his falling numbers. However, due to the complexity of this case, he wonders if he
ought to refer the case to Dr. Loft, a young partner in the practice who sub-specializes in
the particular technique that may be appropriate for Ms. Irwin. As Dr. Taylor deliberates
over his options he considers that keeping Ms. Irwin would not only be beneficial to him
per the new volume criteria but performing this procedure would be a valuable
experience and, as an experienced interventional cardiologist, Dr. Taylor is confident in
his ability to achieve a successful outcome.†
What variables should Dr. Taylor take into account in deciding what to do?
†
Case adapted from: Zientek D. The evolution of conflicts of interest in a new subspecialty: A case study
of the development of interventional cardiology. Narrative Inquiry in Bioethics. 2011; 1(2): 88-90.
Case Analysis
Stakeholders

• Drs. Taylor and Loft, because the more procedures they do, the more they bill.
Additionally, better outcomes may increase reimbursement with the initiation of
value-based reimbursement (e.g., pay for performance). They also benefit from
the experience of performing the procedure. Finally, Dr. Taylor benefits from the
increase in his numbers, bringing him closer to meeting the caseload requirement.
• The group practice, because it benefits from enforcing the new volume criteria,
which will lead to better patient outcomes and, theoretically, more financial gain.
However, the practice could also suffer by limiting Dr. Taylor’s privileges and
thus increasing the workload of other practice cardiologists.
• Ms. Irwin, because it is in her best interests for the most experienced and
specialized cardiologist to perform her procedure.
• Future patients (society), because they benefit from having access to trained
physicians. However, society also benefits from an environment that emphasizes
trust in the physician-patient relationship, where the physician is expected to
recommend the best possible treatment course for the patient. This requires
adequate physician self-assessment of knowledge and skills.
Facts
• Some individual studies have shown that that high–volume interventional centers
and high-volume interventional clinicians tend to have better patient outcomes.1
More recent review articles and consensus statements have qualified the role of
high-volume centers and clinicians in patient outcomes.2,3
• The current consensus statement from the American College of Cardiology, the
American Heart Foundation, and the American College of Physicians Task Force
on Clinical Competence and Training now recommends only 50 procedures per
year (averaged over two years) to maintain competency and avoid adverse
outcomes related to inexperience.2 Dr. Taylor is well within that recommendation.
• To acquire skills or expertise in an area, physicians need practice with patients
and cannot always refer to the most experienced physician.4
• After proficiency has been obtained, achievement in a given domain is limited by
factors unaffected by experience and training, such as basic abilities, mental
capacities, and innate talents.5 Thus, Dr. Taylor may be as qualified as Dr. Loft, or
his innate talent may be greater, despite his lack of extensive experience in this
procedure.
Norms

persons.
o To make an autonomous, fully informed decision about her medical care,
Ms. Irwin needs to know Dr. Taylor’s past experience and competence in
performing the required procedure.
o Dr. Taylor needs to base his decision on the best interest of his individual
patient.
o By not referring Ms. Irwin to a potentially more qualified physician, Dr.
Taylor exposes her to increased risk.
• Justice: Obligations of fairness in the distribution of benefits and risks.
o If society wants to enjoy the benefits of competent physicians, then they
must assume some risks by allowing procedures to be performed in a
responsible manner by physicians who are developing skills.

o Dr. Taylor is confident that he could provide competent, compassionate,
and respectful care for Ms. Irwin. However, he suspects that Dr. Loft may
have more technical expertise.
o Dr. Taylor has an obligation to continue his medical education and
enhance his skills: in order to do so he needs to do more procedures and
take on more complicated cases even when cardiologists with greater
expertise work in the practice.
o Ms. Irwin’s wellbeing and safety ought to take precedence over Dr.
Taylor’s educational and career aspirations. Though his ability to continue
performing certain types of procedures is at risk, the patient’s health is
ultimately more important.
Legal
• Dr. Taylor must disclose all material information to Ms. Irwin in order for her to
make an informed decision about the procedure. At a minimum, this includes the
diagnosis, the nature and purpose of the treatment, risks of treatment, and
alternatives (including doing nothing).8 There is also some limited legal support
for the duty to disclose physician-specific risks such as level of experience and
past outcomes.
• Courts judge whether informed consent is sufficient based on one of two
standards, depending upon the state law. The first standard is the reasonable
patient standard, meaning the information that a reasonable patient, in Ms. Irwin’s
situation, would find material. The second is the reasonable provider standard,
meaning the information that a reasonable provider would consider material to
disclose to the patient.8
• Dr. Taylor is not prohibited from referring to a doctor within his own group
practice, nor is the volume requirement of 150 procedures expressly prohibited by
federal law, so long as the quota is purely based on quality and the physicians’
compensation does not reflect the volume of those referrals or procedures.
Otherwise, federal fraud and abuse laws may be implicated. Nonetheless, it may
be prudent for the practice to develop written guidelines that consider a variety of
experiential factors, rather than just quantity. The volume requirement could
create an incentive for unnecessary procedures.
Options
1. Dr. Taylor could inform Ms. Irwin of the diagnosis and the recommended
procedure without providing information about Dr. Loft’s expertise in the relevant
sub-specialty or Dr. Taylor’s need for additional procedures of this type to
maintain his standing.
procedure and include information about his 30 years of experience and
impressive patient outcomes balanced against his recent lower procedure volume.
Dr. Taylor could add assurances that he can perform the procedure and that she is
in good hands.
procedure and include information about his confidence in his abilities balanced
against his recent lower procedure volume but give Ms. Irwin Dr. Loft’s
information as an alternative choice or for a second opinion.
procedure but recommend that she make an appointment with Dr. Loft for the
procedure.
5. If Dr. Loft is going to perform the procedure, Dr. Taylor could ask to assist with
the procedure.
6. Dr. Taylor could ask Dr. Loft about the possibility of her consultation or stand by
assistance during surgery to build Dr. Taylor’s expertise. Dr. Taylor could then
inform Ms. Irwin as per number 2 above but include the information about Dr.
Loft’s assistance during the procedure.
7. Dr. Taylor could present the recent consensus guidelines to the group practice and
encourage them to revise their volume requirements and other measures of quality
accordingly.
1. How can physicians balance their responsibility to continue their education and
develop their skills with prioritizing patient welfare?
2. If a physician is confident they can provide competent care, to what extent do
they need to disclose information such as competing obligations, individual past
patient outcomes, or level of experience?
3. Throughout your medical training or practice, when have you felt comfortable
learning by doing and when have you felt obligated to rely on other more
experienced physicians? What have these experiences taught you about honesty in
patient communication and the necessity of skill acquisition?
4. Society benefits from having well-trained physicians, but some patients must
agree to care by physicians who are in training. How does the good of society
factor into whether Dr. Taylor should perform the procedure?
5. Do you think volume alone is a sufficient indicator of physician procedural
competence? What are the benefits and harms of volume requirements?
6. Should physicians disclose their individual level of experience and previous
outcomes? Should experience and outcomes be considered part of the material
information required for informed consent? Why or why not?
1. Seeking help: What further information does Dr. Taylor need to make a decision
in a situation such as this? Who might Dr. Taylor turn to for help? Would it help
to involve a mentor or consultant?
2. Managing emotions: If you were in Dr. Taylor’s situation, what kind of emotions
do you think you would be experiencing? How could these emotions influence
your decision-making? How could you effectively manage these emotions?
3. Anticipating consequences: What consequences should Dr. Taylor anticipate for
each of the options he might consider in this case? This includes short- and long-
term consequences as well as positive and negative consequences. Which
stakeholders will be affected and how? How might Dr. Taylor’s decision impact
his career?
4. Recognizing rules and power dynamics: What laws or policies are salient in this
case? What are the causes of the problem in this situation, and what causes might
Dr. Taylor be able to change?
5. Testing assumptions: What are Dr. Taylor’s motives in this case? What
assumptions might Dr. Taylor make about Ms. Irwin, Dr. Loft, and the procedure?
How can Dr. Taylor determine if his assumptions are mistaken? How might he
test these assumptions?
References
1. Spaulding C, Morice MC, Lancelin B, et al. Is the volume-outcome relation still

an issue in the era of PCI with systematic stenting? Results of the greater Paris
area PCI registry. European Heart Journal. 2006;27(9):1054-1060.
2. Harold JG, Bass TA, Bashore TM, et al. ACCF/AHA/SCAI 2013 update of the
clinical competence statement on coronary artery interventional procedures.
American College Cardiology. 2013;62(4): 357-396.
3. Klein, LW, et al. Quality assessment and improvement in interventional
cardiology: A position statement of the society of cardiovascular angiography and
interventions, Part II: Public reporting and risk adjustment. Catheterization and
Cardiovascular Interventions. 2011;78(4): 493-502.
4. Ericsson KA. Deliberate practice and acquisition of expert performance: A
general overview. Academic Emergency Medicine. 2008;15(11):988-994.
5. Ericsson KA. Deliberate practice and the acquisition and maintenance of expert
performance in medicine and related domains. Academic Medicine. 2004;79(10
Suppl):S70-81.
8. Furrow, B, Greaney, T, Johnson, S, Jost, T, Schwartz, R. Health Law (7th ed.),
West (2013).
Case 6
The Business of Prostate Cancer Screening
By Kamal Gursahani
A 65-year-old male, Mr. Engle, visits his longtime private urologist, Dr. Kruger,
for his annual exam. Mr. Engle has no new complaints, just baseline occasional difficulty
initiating a urinary stream. He has a history of lithotripsy for an obstructing ureteral stone
15 years ago and hypertension controlled on medication.
During the annual exam, Dr. Kruger performs a digital rectal examination and
finds a mildly enlarged prostate with normal texture. Dr. Kruger orders a prostate-specific
antigen (PSA) test as he does every year. Mr. Engle is transferred to the in-office
laboratory (a different room in the same office) where his blood is drawn and analyzed by
an in-house lab tech.
A few days later, Dr. Kruger calls Mr. Engle to report a PSA level of 4.1 ng/mL,
which is a little higher than his level from last year of 3.8 ng/mL. Dr. Kruger relates the
slight possibility that this increase signifies cancer, but more likely represents benign
enlargement. When Mr. Engle reacts with obvious concern, the doctor offers to do a
biopsy to make sure Mr. Engle does not have cancer, to which Mr. Engle agrees.
Mr. Engle undergoes an uncomplicated ultrasound guided prostate biopsy in Dr.
Kruger’s office. He is sent home on an antibiotic as prophylaxis against infection. Dr.
Kruger sends the tissue samples to his in-house pathologist for analysis.
Mr. Engle presents to the emergency department the next day with fever,
vomiting, and hematuria. After an exam and blood work, he is diagnosed with acute
prostatitis and admitted by Dr. Kruger for IV antibiotics to treat the infection. During that
time, Mr. Engle is informed that his biopsy was negative for cancer, but the infection had
been caused by a common strain of bacteria, E Coli, that turned out to be resistant to the
prophylactic antibiotic.
Two weeks later, Mr. Engle stops by Dr. Kruger’s office with a plate of cookies
made by his wife. He gives Dr. Kruger a high five and thanks him, saying “See ya next
year, doc!”
How might Dr. Kruger reevaluate the way he practices medicine?
Case Analysis
Stakeholders

• Mr. Engle and other patients, because unnecessary tests and other interventions
place them at risk with little expectation of benefit. Patients may also lose the
opportunity to make informed decisions, if information is presented to them in a
biased manor. Finally, patients incur additional costs associated with potentially
unnecessary evaluations and interventions.
• Dr. Kruger and other urologists, because prostate cancer positives and false
positives lead to more physician services (more business), regardless of the
reimbursement scheme. Urologists are also likely to have industry relationships in
the business of prostate cancer management.1
• Other physicians, including primary care physicians (PCPs), because it may be
safer and more cost effective for PCPs to make decisions about the management
of cancer screenings. PCPs may have industry relationships, but those
relationships are unlikely to be specific to prostate cancer screening.
• Hospitals and hospital providers, because prostate cancer positives and false
positives lead to more physician services (more business), and in the current
reimbursement schema, hospitals and physicians still make money off many
preventable complications of treatment.
• The pharmaceutical industry, because greater diagnosis of disease leads to greater
use of pharmaceutical therapy and more business in general for drug companies,
as well as any drugs used to treat the complications of diagnostic procedures or
therapies related to prostate cancer (e.g., prostatitis).
• Society, because medically inappropriate tests and procedures drive up the cost of
health care for everyone.
• Taxpayers and the federal government, because unnecessary testing is likely
leading to unnecessary Medicare spending and the federal government is
responsible for enforcement of fraud, waste, and abuse.
Facts
• There is strong evidence against use of PSA: one systematic review pooled six
randomized controlled trials (n=387,286) and divided patients into screening with
PSA versus no screening. The authors found that all-cause mortality and prostate
cancer mortality were unaffected by screening with PSA. The authors also report
that one of the six studies reported up to 76% of PSA positives were false
positives, and another study reported a complication rate of 0.7% for biopsies.2
• The U.S. Preventive Services Task Force recommends against the use of PSA
screening for prostate cancer; however, they also acknowledge that decisions
about whether to offer the screening should be guided by shared decision making
and a careful explanation of the benefits and harms of screening.3
• There is no difference in prostate cancer mortality when comparing patients who

received PSA test and those who received a digital rectal exam, although the
incidence of cancer diagnosis was 12% higher for PSA patients.4
• A recent study found that urologists who self-refer billed for 72% more specimens
per biopsy than urologists who refer out for pathology services, and also that
cancer detection rates were 12% higher for men treated by urologists who referred
out for services.1
• A conflict of interest exists in clinical care when the physician’s primary interest
(the wellbeing of the patient) is threatened by a secondary interest, such as
financial gain. Self-referrals for pathology services create a financial secondary
interest that can jeopardize the physician’s primary interest.
Norms

persons.
o Mr. Engle needs to be provided with the information necessary to make an
informed decision about whether he should have a PSA level drawn or a
prostate biopsy. Dr. Kruger may make recommendations based on best
evidence and his own experience, but his advice must be free from
coercion.
o Dr. Kruger is obliged to weigh the risk associated with tests and
treatments against the potential benefit to his patient. It would be unethical
for Dr. Kruger to include his own potential financial benefit in the risk-
benefit analysis.
o If Dr. Kruger administered the ultrasound guided prostate biopsy without
medical justification, he unnecessarily placed Mr. Engle at risk for
infection (which occurred) and other potentially harmful side effects.
o Unnecessary testing places an unjust burden on patients and the health
care system; resource stewardship is a professional obligation.

o If Dr. Kruger is ordering unnecessary tests and procedures, he is not
providing competent medical care and is failing to respect his patient’s
rights to avoid discomfort that has no reasonable possibility of benefit.

o If Dr. Kruger is not disclosing his financial conflict of interest, he is
deceiving his patients by withholding information and depriving them of
their right to make fully informed decisions.
o Dr. Kruger should investigate whether he is in violation of federal law
regarding kickbacks.
o Dr. Kruger needs to revisit the U.S. Preventive Services Task Force
recommendations and consider whether his practice pattern is justifiable
or leaves him at risk of appearing to either promote his own self-interest or
being ignorant of current best evidence.
Legal
• Under federal law, physicians may not refer patients for designated health
services to other providers or institutions with whom they have a financial
relationship. Many states have similar laws that apply to private insurance.7,8
There are several exceptions to the federal law.
• Under the in-office ancillary services exception, physician group practices may
refer for certain designated health services, including laboratory and pathology
services, if those services are personally performed or supervised by them or
another physician in the same group practice.8 Nonetheless, even legally
permissible arrangements may incentivize overtreatment.
• The False Claims Act (FCA) criminalizes any knowing presentation of a false
claim for payment to the federal government.7 The FCA has been widely applied
to health care to enforce claims for health care services that are false as defined as
1) fictitious (billing for non-existent patients), 2) exaggerated (billing for services
in excess of what was provided or upcoding), and 3) excessive or medically
unnecessary.9
o The federal government has displayed willingness in recent years to
pursue physicians for excessive treatment. Dr. Kruger’s decision to
conduct a biopsy after a very slightly elevated PSA may be considered
excessive or medically unnecessary, especially if this is a pattern of
practice.
• State law requires physicians to practice within the standard of care. Dr. Kruger
could be subject to a malpractice case for failing to follow the standard of care of
watchful waiting of a PSA level of 4.1.
• To succeed in a medical malpractice case, a patient must establish the following:
1) the physician’s professional duty to the patient (provider-patient relationship),
2) breach of that duty, 3) that is the cause of 4) harm to the patient 5) with
damage that can be monetized.10
o Physicians are rarely liable in malpractice for overtreatment as long as it
does not result in more injury to the patient.
o Mr. Engle did not suffer any long-term complications. Therefore, the
economic harm or damages to Mr. Engle are not likely substantial enough
to justify a lawsuit absent ongoing complications, such as incontinence
and impotence.
Options
1. Dr. Kruger could continue practicing as he currently does.

2. Dr. Kruger could limit his financial conflict of interests by outsourcing his
laboratory and pathology testing or transferring his interest in the laboratory, thus
eliminating the potential financial incentive for unnecessary screenings.
3. Dr. Kruger could consider the ways in which he communicates with patients with
marginal PSA elevations. Could Dr. Kruger have framed the options in a more
objective manner? If so, how?
4. Dr. Kruger could set practice guidelines based on the current literature for
screening and treatment approaches, including factors such as the percent rise in
PSA that justifies a biopsy.
5. Dr. Kruger could examine the extent to which his ability to perform procedures
coupled with his desire to please patients may unduly influence what approaches
he offers patients.
6. Dr. Kruger could participate in the development of best practices for urologists in
communications with patients about testing and treatment choices.
7. Dr. Kruger could institute a procedure requiring disclosures of conflicting
interests and possible bias to patients who go to his lab for testing and offer a list
of alternate labs to patients.
8. Dr. Kruger could stop ordering routine PSA screening tests, because evidence-
based medicine does not support the practice.
9. Dr. Kruger could stop offering biopsies in patients with no significant elevations
in PSA.
1. Should physicians who have financial relationships with labs be reimbursed for
the screening of their patients for prostate cancer? What are the pros and cons of
this approach?
2. How can physicians keep up-to-date on common pitfalls in particular medical
tests, diagnoses, and treatments? Are physicians responsible for this knowledge?
Are repercussions appropriate for physicians who fail to practice evidence-based
medicine?
3. Should there be a Stark law exception for in-office lab services if the medical
group meets specific criteria? Why or why not? If yes, what criteria should be
met?
4. Can conflicts of interest be eliminated? If not, why not? If so, how should they be
managed? Does disclosure eliminate conflicts of interest?
5. How has the implementation of third-party payment challenged the responsibility
of physicians and patients to be good stewards of health resources?
1. Seeking help: What further information does Dr. Kruger need to evaluate his
practice? Where can he find this information? Who might Dr. Kruger turn to for
assistance?
2. Managing emotions: If you were in Dr. Kruger’s situation, what kind of emotions
might you experience? How could these emotions influence your decision?
3. Anticipating consequences: What short- and long-term consequences should Dr.
Kruger anticipate for each of the available options? How might each of the
various options impact Dr. Kruger’s career? Which stakeholders will be affected
and how? How can Dr. Kruger maximize benefit and minimize risk for all
stakeholders involved?
4. Recognizing rules and power dynamics: What laws, policies, or norms are salient
in this case? To what extent does Dr. Kruger have the ability to resolve this issue?
What factors might limit his ability to resolve the issue?
5. Testing assumptions: What are Dr. Kruger’s motives in this case? What
assumptions might Dr. Kruger make about his practice and patients like Mr.
Engle? How can Dr. Kruger determine if his assumptions are correct? How will
others view Dr. Kruger’s choices?
References
1. Mitchell J. Urologists’ self-referral for pathology of biopsy specimens linked to

increased use and lower prostate cancer detection. Health Affairs.
2012;31(4):741-749.
2. Djulbegovic M, Beyth RJ, Neuberger MM, et al. Screening for prostate cancer:
Systematic review and meta-analysis of randomised controlled trials. BMJ.
2010;341:c4543.
3. U.S. Preventative Task Force. Final Recommendation Statement: Prostate Cancer
Screening. May, 2012.
http://www.uspreventiveservicestaskforce.org/Page/Document/RecommendationS
tatementFinal/prostate-cancer-screening.
4. Andriole GL, Crawford ED, Grubb RL, 3rd, et al. Prostate cancer screening in the
randomized Prostate, Lung, Colorectal, and Ovarian Cancer Screening Trial:
Mortality results after 13 years of follow-up. Journal of the National Cancer
Institute. 2012;104(2):125-132.
7. Mitchell JM. The prevalence of physician self-referral arrangements after Stark II:
Evidence from advanced diagnostic imaging. Health Affairs. 2007;26(3):w415-
424.
physicians. 2014. https://oig.hhs.gov/compliance/physician-

education/roadmap_web_version.pdf.
9. U.S. Department of Justice. A primer on the False Claims Act. 2014.
http://www.justice.gov/civil/docs_forms/C-FRAUDS_FCA_Primer.pdf.
10. Furrow B, Greaney T, et al. Liability and quality issues in health care (5th ed).
Case 7
Value Based Pay for Performance
By Heidi Pieroni
Pay for performance (PFP) is an umbrella term for initiatives aimed at improving
the quality, efficiency, and overall value of healthcare. These payment systems provide
financial incentives to hospitals and physicians who meet various metrics or measures of
quality in their care of patients. In theory, paying providers for achieving better outcomes
for patients should improve care, but in practice studies have yielded mixed results—
there is limited evidence that PFP is an effective tool for improving quality of care or
containing healthcare costs. Furthermore, serious concerns have been raised about the
impact of PFP on poorer and disadvantaged populations: there are fears that PFP
programs may increase avoidance of complex patients and exacerbate health disparities if
those patients negatively impact the quality metrics.*
Dr. Smith is a busy internist in Boston who treats a large population of diabetic
patients. One patient, John Green, has recently been weighing on his mind. Mr. Green has
been a patient of Dr. Smith’s for many years, and only recently has Mr. Green become
difficult. Mr. Green suffers from a number of complications of poorly controlled
diabetes, including painful peripheral neuropathy. Recently, despite the advice,
information, and encouragement from Dr. Smith, Mr. Green gained significant weight
and resumed smoking. Furthermore, Mr. Green does not follow his diabetes care plan: he
does not consistently measure his blood sugar or take medications other than for pain.
Mr. Green also has recently made it a habit to stop by the clinic without an
appointment; at these visits he claims to have lost his prescription for pain medication
and requests another prescription. In the last unexpected visit several weeks ago, Dr.
Smith reviewed a pain contract with Mr. Green, and Mr. Green agreed to abide by the
terms. Dr. Smith now suspects the Mr. Green is either abusing the medication or selling
it. Furthermore, Mr. Green missed his scheduled appointments for hemoglobin A1c
testing and blood pressure checks. Although Mr. Green’s last lipid profile was cause for
concern, he did not appear to take his discussion with Dr. Smith seriously.
Dr. Smith is frustrated by Mr. Green’s behavior, and he is considering ending the
therapeutic relationship. But Dr. Smith is not sure how to go about doing so in a way that
is both legal and ethical. He is aware that the PFP model his medical group uses could be
swaying his decision; because Mr. Green is failing to comply with diabetes measures, Dr.
Smith’s performance profile would undoubtedly improve were he to drop Mr. Green.**
What should Dr. Smith do?
*
James, J. Health Policy Brief: Pay-for-Performance. Health Affairs, October 11, 2012.
**
Case adapted from: Farber N, Snyder L. The Difficult Patient: Should You End the Relationship? What
Now? An Ethics Case Study. American College of Physicians Ethics Case Studies 2009;
http://www.medscape.org/viewarticle/706978. Accessed December 11, 2013.
Case Analysis
Stakeholders

• Dr. Smith, because there is a financial disincentive (i.e., the PFP model) for Dr.
Smith to maintain a therapeutic relationship with Mr. Green. In addition, Dr.
Smith will likely experience other benefits if he no longer treats Mr. Green;
treatment of difficult, non-cooperative patients can be extremely frustrating and
time/energy-consuming. Yet this raises the question: does a physician’s
professional obligation to a patient change if the patient is difficult?
• Mr. Green, because his medical treatment will be disrupted, and he may well
suffer both physically and emotionally due to being discharged from Dr. Smith’s
practice.
• Other physicians in Dr. Smith’s medical practice and their patients, because
competing with other PFP practices may encourage the physicians in Dr. Smith’s
practice to act, perhaps unethically, to improve their performance profiles.
• The Drug Enforcement Agency and other state agencies, because they are
involved in licensure and authorization of prescriptive privileges, prescription
monitoring program enforcement and compliance.
Facts
• In lieu of discharging Mr. Green, who is a long-term patient, alternate approaches

may be effective in improving his health status.
• So-called difficult patients are not rare: the prevalence is estimated to be 15% of
patients.1 Patients in chronic pain, such as those like Mr. Green with peripheral
neuropathy, are commonly considered among the most difficult patients.2
• Mr. Green’s behavior related to his pain medication may or may not be evidence
of substance abuse. Patients in chronic pain may display “drug-seeking” behavior
because of uncontrolled pain that will resolve once pain is treated appropriately.
The incidence of substance abuse in the chronic pain population is no more than
that in the general population. 2
• Chronic pain can lead to a multitude of related comorbidities, including
depression, apathy, withdrawal, feelings of hopelessness, etc. It is possible that
Mr. Green’s more recent behavior is related to these issues.2
• Patients may not follow treatment recommendations for many reasons, and there
are a variety of models for maintaining relationships while improving compliance.
For example, case management models in which a nurse or other health
professional maintains regular communication with the patient can be helpful in
increasing compliance. Referrals to a mental health provider or interdisciplinary
pain treatment center, if available, may be useful in managing health problems.2
• Contracts with patients, such as the pain contract reviewed with Mr. Green, are
increasingly common in medicine as an approach to dealing with “difficult”
patients. Some have called for the addition of provisions that emphasize that the
provider will not completely abandon the patient.3
• A physician must not abandon a patient. Abandonment has been defined as the
physician's unilateral withdrawal from the relationship without formal transfer of
care to another qualified physician.4,5
• Physicians have a professional obligation of self-management, including
acknowledging and accepting their own emotional responses to patients and
attempting to ensure personal wellbeing.1
• The ethical obligation of the physician to maintain a therapeutic relationship with
a patient is not without limits.6 Experts have argued that a physician may refuse to
continue caring for a patient; e.g., when continuing that relationship may harm
other patients or the physician, as in the case of a patient who threatens physical
violence.7 Likewise, physicians are not required to violate their own fundamental
personal values, standards of medical care, ethical practice, or the law in
providing patient care.4
• Ignoring the difficult patient or exporting (referring or dropping) the patient to
another physician does not make the difficulty disappear.1 Either of these
extremes is not an appropriate option without more thoughtful exploration of
underlying issues with Mr. Green.
• Pay for performance initiatives’ quantification of quality is arguably insufficient
as it is based on pre-determined measures of quality.8
Norms

persons.
o Interactions with Mr. Green should ensure that he is empowered to make
good choices, e.g., by providing adequate information and fair warning
about conditions under which the patient-physician relationship might be
terminated.
o Discharging Mr. Green from Dr. Smith’s practice might violate the
principal of beneficence. Dr. Green has a lengthy relationship with the
patient that will not easily be replaced, if it is replaced at all.
o Discharging Mr. Green could cause physical and mental harm. Mr. Green
could also lose trust in physicians in general. If Mr. Green does not find or
chooses not to see another physician, his physical condition will likely
rapidly decline.
o The PFP model may incentivize providers to exclude certain types of
patients from their practice: patients who are non-compliant, have
language barriers, or limited access to transportation may lower a
providers’ PFP score.
o Some physicians may exhibit a tendency to discriminate against patients

with mental health and substance abuse disorders, which may contribute to
behaviors labeled “noncompliant.” Mr. Green’s behaviors suggest he may
require treatment for underlying problems, whether they are mental health
issues, chronic pain, or substance dependency.

o The abandonment of a patient for economic reasons violates the
physician’s duty to show respect for human dignity and human rights. Mr.
Green’s condition and perhaps his economic status make him vulnerable,
and his expulsion from the practice would potentially leave him untreated
and suffering. Physicians must carefully assess patients in chronic pain for
underlying issues, exacerbating factors, and co-morbidities. Patients on
long-term opioid therapy should be carefully assessed for tolerance and
the other overall effectiveness of the therapy. This includes a clear
delineation of expectations and follow-through on those expectations.
• VI. A physician shall, in the provision of appropriate patient care, except in
emergencies, be free to choose whom to serve, with whom to associate, and the
environment in which to provide medical care.
o A physician is not required to violate his or her own personal values or
standards of medical care in providing patient care. The reasons for
discharging a patient must be justifiable and ethical.5,6 Discharging a
patient because of economic concerns is ethically objectionable.
o Dr. Smith may be putting his own interests above Mr. Green’s due to his
own frustration and the financial incentive to discharge him.
Legal
• Patient abandonment is a legal and ethical issue. Physicians have an obligation to

treat patients with whom they have a relationship unless the relationship is
terminated by 1) mutual consent, 2) explicit dismissal by the patient, 3) patient
needs that are outside the provider’s competence and training, 4) patient need for
services outside the scope of the original agreement, or 5) the patient’s failure to
cooperate.11,12
• “Failure to cooperate” cases require patient actions sufficient to show an implied
termination of the relationship by the patient.11
o Even though Mr. Green has missed appointments, he has returned several
times to the office unexpectedly: This is evidence that he does not intend
to terminate the relationship.
o It may be that Mr. Green’s case is sufficiently complicated to warrant

referral to a specialist (and thus outside the scope of this doctor-patient
relationship).
• A physician who terminates a relationship must follow and document procedural
safeguards to avoid abandonment and harm to the patient. Some state medical
boards have specific requirements, but general safeguards include appropriate
written notice to the patient and assistance with continuity of care, such as
providing referrals to appropriate alternate providers.13,14
o There is a long-standing doctor-patient relationship between Dr. Smith and
Mr. Green.
o Physicians are not legally obligated to continue a particular type of
treatment, including any medication that is not medically indicated. In
fact, physicians are legally obligated to follow the standard of care,
including discontinuing non-therapeutic and harmful treatment. Cessation
of unnecessary or harmful treatment, such as tapering off non-therapeutic
opioids, is not abandonment.
• Most states have prescription monitoring programs (PMP), although participation
is voluntary in at least half of the states.15 Massachusetts has a PMP, and in 2013,
the state began automatically enrolling all prescribers of controlled substances.
The PMP allows prescribers to search the database for a patient’s recent history of
filled prescriptions for controlled substances.16
o If available, Dr. Smith should use the PMP to see if there is any evidence
that Mr. Green filled prescriptions he claimed to have lost or is using
multiple prescribers to obtain pain medication.
Options
1. Dr. Smith could discharge Mr. Green from the practice with a formal letter and 30
days advance notice and assist Mr. Green with finding another physician.
2. Dr. Smith could increase communication with Mr. Green to explore the reasons
he is not following treatment recommendations, including an open discussion of
his concerns about pain control, substance misuse, and mental health issues. Dr.
Smith could help Mr. Green identify his own values, beliefs and goals to inform
the plan of care.
3. Dr. Smith could draft a formal agreement with Mr. Green that includes
commitments to increased communication, regular blood tests, urine opioid
screenings, and conditions for discontinuation of prescription pain medications.
Dr. Smith should decide if this agreement will include conditions for
discontinuation of the relationship, in which case he will provide Mr. Green with
notice and assistance with finding a new physician, or if it will include a provision
that Dr. Smith will not abandon Mr. Green (although treatment may change).
4. Dr. Smith could recommend interdisciplinary supports for Mr. Green’s increased
pain and assist him with a referral.
5. Dr. Smith could keep Mr. Green as a patient and increase communication with
Mr. Green but reconcile himself to the fact that patients have the right to make
decisions in keeping with their own values, despite the risks.17 Even if Mr. Green
is not complying with his physician’s recommendations, he is probably getting

more out of seeing Dr. Smith than a doctor with whom he does not have a long-
standing therapeutic relationship.
1. What obligations does Dr. Smith have to Mr. Green considering Mr. Green’s
resistance to treatment and lack of cooperation?
2. What are the legal requirements of notifying Mr. Green of discharge from Dr.
Smith’s practice? How are the ethics considerations different from the legal
requirements in this case? What is the relationship between law and ethics?
3. Is Dr. Smith making assumptions about his patient regarding pain and compliance
rather than providing compassionate care with increased communication and
support?
4. How much does the stigma of drug abuse and non-compliance impact our attitude
toward patients? How can or should physicians manage those issues?
3. What potential questionable business practices are associated with pay for
performance incentives?
1. Seeking help: Where might Dr. Smith seek additional information or an unbiased,
objective opinion? Who could Dr. Smith turn to for advice and assistance for this
case?
2. Managing emotions: If you were in Dr. Smith’s situation, what kind of emotions
would you be experiencing? How could these emotions affect your decision-
making? How would you effectively manage these emotions?
3. Anticipating consequences: What consequences should Dr. Smith anticipate if he
drops or keeps Mr. Green? Which stakeholders will be affected and how? What
consequences does Dr. Smith have some control over? How can risks be
minimized and benefits maximized?
4. Recognizing rules and power dynamics: What rules or social norms are salient in
this case? What factors place limitations on Dr. Smiths’ choices?
5. Testing assumptions: What are Dr. Smith’s motives in this case? What
assumptions is Dr. Smith making about Mr. Green? How can Dr. Smith determine
if his assumptions are correct? How might he test these assumptions?
References
1. Haas LJ, Leiser JP, Magill MK, Sanyer ON. Management of the difficult patient.
American Family Physician. Nov 15 2005;72(10):2063-2068.
2. IOM (Institute of Medicine). 2011. Relieving Pain in America: A Blueprint for
Transforming Prevention, Care, Education, and Research. Washington, DC: The
National Academies Press.
3. Lieben, SR, Kim, SY, Volk, ML. Power and control: Contracts and the patient-
physician relationship. International Journal of Clinical Practice. 2011;65(12):
1214-1217.
4. American College of Physicians,ethics and human rights committee. Ethics
Manual. 6th ed. Philadelphia: American College of Physicians; 2012.
5. Pellegrino ED. Nonabandonment: An old obligation revisited. Annals of Internal
Medicine. Mar 1 1995;122(5):377-378.
6. Thieman S. Avoiding the claim of patient abandonment. Missouri Medicine. Oct
1996;93(10):634-635.
7. Gordon HL, Reiser SJ. Do physicians have a duty to treat Medicare patients?
Archives of Internal Medicine. Mar 8 1993;153(5):563-565.
8. Wharam JF, Farber NJ, Figaro M, et al. Can Pay-for-Performance be Ethical? An
Analysis by the Society of General Internal Medicine Ethics Committee, [web
site] April 28, 2009.
11. Furrow B, Greaney T, et al. Liability and Quality Issues in Health Care (5th ed).
12. Darr K. Pay for performance in hospitals. Hospital Topics. Spring 1993;71(2):4-6.
13. Childs v. Weis. In: 440 S.W.2d 104 TCA, ed1969.
14. Carnahan S. Law medicine and wealth: Does concierge medicine promote heath
care choice, or is it a barrier to access? Stanford Law and Policy Review.
2006;121:149.
15. Prescription Drug Monitoring Center of Excellence at Brandeis University.
Mandating PDMP participation by medical providers: current status and
experience in selected states. Feb 2014.
http://www.pdmpexcellence.org/sites/all/pdfs/COE%20briefing%20on%20manda
tes%20revised_a.pdf.
16. Massachussetts Department of Health and Human Services. Massachussetts
online prescription monitoring program [web site]. 2014.
17. Hall M. A theory of economic informed consent. Georgia Law Review.
1997;511:528-532.
Case 8
SellCells
By Erin Bakanas
Mary Smith is a patient with secondary progressive multiple sclerosis. Diagnosed

two decades ago, she has tried every available Food and Drug Administration (FDA)
approved drug and has participated in two clinical trials, but unfortunately the disease
progressed. She is now wheelchair bound and unable to work.
Through her own research, Mrs. Smith learned about adult stem cell replacement
as a possible treatment. Initially available only abroad, adult stem cell replacement
recently became available in the U.S. Mrs. Smith contacts the company, SaveYourCells,
and is given the name of a local doctor who can evaluate her as a potential recipient of
the adult stem cell therapy. After the evaluation, she is deemed an appropriate candidate.
Mrs. Smith pays $28,000 for stem cell replacement, which will involve the removal of
some of her own stem cells, manipulation by SaveYourCells to make more, and then
reinfusion of the cells.
Mrs. Smith is referred to a neurologist, Dr. Walker, who is reimbursed $500 by
SaveYourCells to supervise the first stem cell infusion treatment in his office. After Mrs.
Smith’s first series of infusions, she reports improvement or resolution of a number of her
multiple sclerosis symptoms. She and her husband plan to finance a second round of
infusions, but before this can happen the FDA shuts down SaveYourCells.
The FDA indicates that the stem cell therapy involves changing patients’ cells in a
way that constitutes the production of a product or drug, and thus requires FDA approval
and regulation. SaveYourCells argues that it is simply a laboratory service provider and
that it only provides treatment to independent doctors who request it for their patients.
Critics note that SaveYourCells was cofounded by Dr. Strongback, an orthopedic
surgeon who himself is a recipient of the therapy and was instrumental in bringing adult
stem cell therapy to the U.S. Dr. Strongback is an investor in the company and a member
of its board of directors. He is also the physician who evaluated Mrs. Smith for treatment.
SaveYourCells closes its lab in the U.S. and informs patients they will now be
working with doctors outside U.S. jurisdiction. In the meantime, the company also
announces it will work with the FDA to set up a research arm.
Mrs. Smith is devastated by this news. She schedules an appointment with the
neurologist, Dr. Walker, and expresses her great frustration and disappointment. She asks
him what she should do.*
What advice should Dr. Walker give to Mrs. Smith?
*
Case adapted from: FDA Challenges Stem Cell Companies As Patients Run Out Of Time, by NPR Staff,
February 02, 2013, 4:42 PM ET.
Case Analysis
Stakeholders

• Mary Smith, because she is experiencing the progression of multiple sclerosis,
and had hoped to continue her stem cell treatments only to discover it was no
longer available and that the FDA was questioning whether appropriate safety
evaluations had been conducted. Mrs. Smith also has made a significant personal
financial investment in her treatments from SaveYourCells.
• Dr. Strongback, because of his financial interest as a founder, investor, and board
member of SaveYourCells. His professional reputation as a physician, especially
because he continues to see patients, will also be impacted by the outcome of the
FDA evaluation.
• Dr. Walker, because his professional reputation as a practicing neurologist will be
impacted by the ongoing FDA evaluation. He also has a financial interest because
he is reimbursed directly from SaveYourCells for treating patients in his office.
• Other patients who have turned to SaveYourCells for treatment for a variety of
medical problems, who may have failed multiple other treatment options and are
likely highly invested in the success of the treatment from SaveYourCells.
• The medical research community, because they have an interest in maintaining
the integrity of scientific inquiry.
• The FDA, because they have an obligation to protect patients from unproven and
unsafe products.
Facts
• According to the Institute of Medicine, “A conflict of interest is a set of

circumstances that creates a risk that professional judgment or actions regarding a
primary interest will be unduly influenced by a secondary interest. […] Primary
interests include promoting and protecting the integrity of research, the welfare of
patients, and the quality of medical education.”1
• The American Medical Association offers the following definition of informed
consent: “It is a process of communication between a patient and physician that
results in the patient's authorization or agreement to undergo a specific medical
intervention. This communication should include the following elements:
diagnosis, the nature of the proposed treatment, risks and benefits of the
treatment, and risks and benefits of alternative treatment including no treatment.”2
• The International Study for Stem Cell Research (ISSCR) has issued Guidelines
for the Clinical Translation of Stem Cells, stating that it is responding to “an
urgent need to address the problem of unproven stem cell interventions being
marketed directly to patients. Numerous clinics around the world are exploiting
patients’ hopes by purporting to offer new and effective stem cell therapies for
seriously ill patients, typically for large sums of money and without credible
scientific rationale, transparency, oversight, or patient protections. The ISSCR is
deeply concerned about the potential physical, psychological, and financial harm
to patients who pursue unproven stem cell-based therapies and the general lack of
scientific transparency and professional accountability of those engaged in these
activities.”3
Norms

persons.
o Patients who pursue treatment, especially under the referral and guidance
of physicians, need to have complete and accurate information in order to
make a reasoned decision about their treatment options.
o Patients assume unknown burdens because the stem cell infusion program
has not been evaluated for safety. Patients may experience physical
benefits, but the nature of those benefits is unknown.
o The safety of the SaveYourCells infusions has not met FDA standards; the
potential harms of the stem cell modification and reinfusion are not
established.
o By offering the SaveYourCells technology to Mrs. Smith, Dr. Strongback
and Dr. Walker have not adhered to FDA requirements.
o Treatment innovations are necessary but cannot be fast tracked. The
SaveYourCells treatment was not scientifically evaluated prior to being
administered to patients.
o Drs. Strongback and Walker have financially profited from
SaveYourCells; it is unclear whether their primary focus is the safety and
wellbeing of patients or their own self-interests.
Legal
• The FDA is a federal agency responsible for “protecting the public health by
assuring the safety, effectiveness, quality, and security of human and veterinary
drugs, vaccines and other biological products, and medical devices.”5 The FDA
acts pursuant to the Federal Food, Drug & Cosmetic Act (FDCA) to regulate drug
safety and the Public Health Service Act (PHSA) to regulate biological products
(biologics) safety.6
• The FDCA and PHSA have detailed regulations for the development,
manufacture, and labeling of all drugs and biologics to ensure quality, efficacy,
and safety. Drugs and biologics that do not comply are deemed adulterated and
misbranded in violation of federal law.6,7 The FDA is empowered to stop their
manufacture and distribution.6,8
• The FDA’s Center for Biologics Evaluation and Research (CBER) also regulates
human cells, tissues, and cellular or tissue-based products (HCT/Ps) intended for
implantation, transplantation, infusion, or transfer into a human recipient. Stem
cells are HCT/Ps.9
• HCT/Ps are classified by the FDA as drugs, biologics, or combined
drug/biologics. Most HCT/Ps are subject to the FDA’s strict regulatory
requirements for drugs.6
• Investigators wishing to study a new drug or biologic in humans must first submit
an application for an Investigational New Drug (IND). There are also procedures
for emergency INDs when a practitioner or investigator wishes to use the product
for a particular patient because of an urgent medical need.10
• The FDA has stringent requirements for disclosures of financial conflicts of
interest by investigators and others involved in research of products under their
jurisdiction (e.g., drugs, biologics, HCT/Ps). The FDA will deny a new drug or
biologic application for omitted, incomplete, or false information.11
• Organizations who accept federal research funding are required to have processes
for reviewing and managing conflicts of interest.12
Options
1. Dr. Walker could encourage Mrs. Smith to travel abroad to undergo a second
round of infusions.
2. Dr. Walker could discuss the concerns of the ISSC and the FDA with Mrs. Smith,
including the conflicts of interest involved in this case so that she has information
about the possible risks associated with the treatment itself as well as the risks of
the treatment without FDA oversight for safety.
3. Dr. Walker could offer to treat Ms. Smith as her neurologist. He could disclose
his conflict of interest to Mrs. Smith and explain the lack of evidence for the
treatment. He could also do further research and share the information with her.
4. Dr. Walker could offer to assist Mrs. Smith in participating in the FDA study once
it is set up.
5. Dr. Walker could advise Mrs. Smith to wait for the FDA evaluation and (possible)
approval to be completed and promise to continue to work with her as her
neurologist in the interim.
6. Dr. Walker could work with SaveYourCells to apply for an emergency IND for
Mrs. Smith.
1. What are the conflicting interests in this case?

2. What are Dr. Walker’s responsibilities to SaveYourCells? To Mrs. Smith? To
other patients? To maintaining the integrity of scientific inquiry?
3. Should patients be told about their doctor’s investment ties? Why or why not?
4. Patients who have failed multiple conventional therapies and experience
progressive health decline represent an especially vulnerable treatment
population. In the arena of treatment innovation, what safeguards would you
propose to help physicians uphold the principle of beneficence in treating such
patients?
5. Should HCT/Ps such as the SaveYourCells infusion be regulated as stringently as
drugs or biologics by the FDA? Why or why not?
1. Seeking help: What further information does Dr. Walker need before offering
advice to Mrs. Smith? Who might he turn to for help?
2. Managing emotions: If you were in Dr. Walker’s situation, what emotions would
you likely experience? How might these emotions affect your decision-making?
How would you manage your emotions effectively?
3. Anticipating consequences: What consequences should Dr. Walker consider
before giving Mrs. Smith advice? These include short- and long-term
consequences as well as positive and negative consequences. What consequences
would Dr. Walker have control over?
4. Recognizing rules and power dynamics: What laws, policies, and/or norms are
salient in this case? What factors limit Dr. Walker’s options in this case? Which
factors are creating problems in this case? Which stakeholders have the ability to
resolve these problems?
5. Testing assumptions: What are Dr. Walker’s motives in this case? What
assumptions is Dr. Walker making about Mrs. Smith, the SaveYourCells
company, the FDA, and the other stakeholders? How can Dr. Walker determine
the accuracy of his assumptions?
References
1. Lo B, Field MJ, Institute of Medicine (U.S.). Committee on Conflict of Interest in

Medical Research Education and Practice. Conflict of interest in medical
research, education, and practice. Washington, D.C.: National Academies Press;
2009.
2. American Medical Association. Council on Ethical and Judicial Affairs. Code of
medical ethics, current opinions with annotations. Chicago, Ill.: American
Medical Association; 2008/2009:v.
3. ISSCR: International Society for Stem Cell Research. Guidelines for the clinical
translation of stem cells; 2008.
5. Food and Drug Administration. About FDA, basics, FDA Fundamentals [web
page]. Accessed 7/25/2016.
6. See United States of America v. Regenerative Sciences, 741 F.3d 1314 (U.S.
Court of Appeals, D.C. Cir), 2014.
7. See 21 U.S.C. §§ 351 & 352 (FDCA manufacturing and labeling
requirements); 42 U.S.C. § 262(j)(PHSA incorporating the FDCA's
manufacturing and labeling provisions); see 21 U.S.C. §§ 331(k), 353(b)(4); 42
U.S.C. § 262(j) (actions that cause a drug or biological product to be adulterated
or misbranded is a violation of federal law).
8. 21 U.S.C. § 332(a); 42 U.S.C. § 262(j) (FDA may seek an injunction in federal
court to prohibit violations).
9. U.S. Department of Health & Human Services. What are Stem Cells? How are
they Regulated? [web page]. Accessed 7/29/2016.
10. U.S. Department of Health & Human Services, Food and Drug Administration.
Standard operating policies & procedures (SOPPs) 8205: emergency INDs;
effective 2007.
Guidance for clinical investigators, industry, and FDA staff: financial disclosure
by clinical investigators; February 2013.
12. U.S. Department of Health and Human Services, Responsibility of Applicants for
Promoting Objectivity in Research for which Public Health Service Funding is
Sought and Responsible Prospective Contractors: Final Rule. Federal Register,
Vol. 76, No. 165, August 25, 2011.
Case 9
The Business of Knee Injuries
By Kamal Gursahani
A 44-year-old male, Mr. Davis, twists his left knee while skiing at Vail. Despite
the pain, he takes anti-inflammatories and continues to ski for the next three days,
unwilling to cut his vacation short.
When he returns home, Mr. Davis sees an orthopedist, Dr. Adams, for continued
knee pain. Dr. Adams orders a MRI, which reveals a torn anterior cruciate ligament
(ACL). Dr. Adams recommends surgery. Mr. Davis does his own research and finds that
in many cases, it may take months to recover from knee surgery. He decides to get a
second opinion and sees a sports orthopedist, Dr. Baker. Dr. Baker’s opinion is no
different from Dr. Adams. Mr. Davis schedules the surgery, but while waiting, decides to
do some more research. He discovers an orthopedic surgeon, Dr. Carter, who published
an article describing a new technique for torn ACLs that results in shorter recovery time.
Mr. Davis decides to pay Dr. Carter a visit.
Mr. Davis flies to Pittsburgh from his home in Ohio for the third opinion. Dr.
Carter reviews the MRI and concludes that the diagnosis made by Dr. Adams and Dr.
Baker was ambiguous based on the imaging provided. Dr. Carter orders another MRI at
the University of Pittsburgh, which shows that Mr. Davis’s ACL is completely intact and
that his pain is actually due to an avulsion fracture of the fibula. Dr. Carter recommends
physical therapy, not surgery.
Mr. Davis is shocked at how different Dr. Carter’s conclusion is from Drs. Adams
and Baker. When he asks Dr. Carter how the diagnoses and treatment options could differ
so much, Dr. Carter says, “I’m not sure. If your ACL really was torn, there is no way you
could have skied the next day. But with an avulsion fracture, which is really small, you
might have been able to get by because it doesn’t affect the stability of the joint.”
Basically, Dr. Carter says that the first MRI was inconclusive because there was no
definitive injury to the ACL. Only the avulsion fracture was apparent, and that was seen
on both MRIs. Therefore, Dr. Carter concludes that Mr. Davis did not need the surgery
that was recommended by Drs. Adams and Baker.
Mr. Davis does physical therapy for two months and then continues the
recommended at-home therapies on his own. He sees significant improvement and starts
running again. He plans to go skiing again next winter.*
How should Dr. Carter handle this situation? Should Drs. Adams and Baker make
changes to the way they practice medicine? Why or why not?
*
Case adapted from: Kolata G. Sports Medicine Said to Overuse M.R.I.’s. The New York Times. October
28, 2011;Health.
Case Analysis
Stakeholders

• Drs. Adams, Baker, Carter, and other sports orthopedists, because surgical repair
of knee injuries leads to more referrals and business. Medically inappropriate
interventions, however, might lead to increased patient complications and
potential physician liability.
• Radiologists and imaging centers, because they provide the imaging services for
knee injuries.
• Outpatient surgical centers, because surgical repair of knee injuries leads to more
business.
• Patients, because imaging and surgery exposes them to potential harm as well as
potential prolonged recovery time, lost work and wages, and decreased quality of
life.
• Patients also have an interest in knowing that their physicians are not unduly
influenced by conflicts of interest.
• Society and third-party payers, because medically inappropriate tests and
procedures drives up the cost of health care for everyone.
• The state medical boards, because they license physicians for the safety of the
public.
Facts
• The typical clinical presentation of an ACL injury is a classic ‘popping’ followed

by immediate pain and swelling with a feeling of instability and ‘giving way’
episodes that prevents further activities. ACL injury is much more common in
women versus men and usually occurs from a non-contact injury during skiing,
soccer, or basketball.1
• ACL tears are diagnosed in three ways.1
o Good history and properly performed knee exam can be 80%+ sensitive
for ACL injury. This option is low risk for the patient and also generally
low-cost for the health care system (doctors’ office fees).
o MRI is also commonly used and has a sensitivity of 90-98% for ACL
tears. Bone bruising is also visible on MRI and is present in approximately
90% of ACL injuries. MRI is minimally risky for properly screened
patients; however, it is more costly than exam alone at approximately
$800 to several thousand dollars per scan depending on facility and
location, exclusive of interpretation fees.2
o Diagnostic arthroscopy is expensive and invasive. Its use has decreased
while the use of MRI has increased in the past decade. This option has a
2.5% complication rate (e.g., infection, blood clots, hemarthrosis).3
• ACL injuries are managed either operatively or non-operatively. Surgical
reconstruction is typically used if the patient wants to return to a high level of
athletics or if the injury is affecting everyday activities. However, existing
literature does not support the idea that outcomes are significantly different
between operative and conservative treatment.4,5
Norms

persons.
o If Drs. Adams and Baker have financial conflicts of interest that impact
their medical recommendations, this infringes on Mr. Davis’ ability to
make decisions based on accurate, objective medical information.
o Physicians ought not recommend interventions that are known to risk
unnecessary harms to patients (e.g., surgical complications absent
countervailing benefits).
o The treatment recommendation should be based solely on professional
judgment about what is most likely to benefit the patient.
Drs. Adams and Baker must consider if they are acting as good stewards
of scarce health care resources.

o If Drs. Adams and Baker are recommending unnecessary knee surgeries,
they are not providing competent medical care and are failing to respect
their patients’ rights to avoid unnecessary discomfort and expense.
o Dr. Carter should consider whether she has a professional responsibility to
report what she may perceive to be the incompetent medical practices of
Drs. Adams and Baker.
o Drs. Adams and Baker may simply need a refresher on the peer-reviewed
literature around ACL tears. They have a professional obligation to stay
up-to-date on the standard of care in their field.
o The literature appears to be inconclusive with regard to evidence for or
against surgery. As with many decisions in medicine, this choice is
physician dependent, leaving the decision to the discretion of Drs. Adams
and Baker.
VIII. A physician shall, while caring for a patient, regard responsibility to the
o Even if fee-for-service medicine is not categorized as a financial conflict
of interest, Drs. Adams and Baker should establish processes to minimize
the influence of pay-for-service on their medical decision-making.
Legal
• The Ohio state medical board may take disciplinary action against a physician for
several behaviors relevant to Drs. Adams and Baker. These include, 1) “failure to
employ acceptable scientific methods in the selection of…modalities for
treatment of disease,” 2) [m]aking a false, fraudulent, deceptive, or misleading
statement…in relation to the practice of medicine and surgery,” and 3) “obtaining
of, or attempting to obtain, money or anything of value by fraudulent
misrepresentations in the course of practice.”8
o Unnecessary surgeries fueled by incompetence, error, or financial gain
jeopardize a physician’s medical license. State boards are more likely to
institute disciplinary proceedings when there is a pattern of practice.
• Unnecessary procedures that are billed to the federal government are a violation
of the False Claims Act (FCA). Violation of the FCA is a criminal offense and
can lead to substantial fines and other criminal penalties, exclusion from federal
programs (including exclusion from employment by any organization or person
that participates in federal programs), and revocation of medical licensure.9,10
• The FCA criminalizes any knowing (including “should have known”)
presentation of a false claim for payment to the federal government.10 No specific
intent to defraud the government is required. The FCA has been widely applied to
health care to enforce claims for health care services that are false as defined as 1)
fictitious (billing for non-existent patients), 2) exaggerated (billing for services in
excess of what was provided or upcoding), and 3) excessive or medically
unnecessary.9,10
o Accepting reimbursement from the federal government for treatment and
repair of ACL injuries in patients with no such injury violates the FCA.
• The state of Ohio has criminal fraud laws that apply to both Medicaid related
claims and private insurance fraud.11
o If. Drs. Adams and Baker are knowingly recommending unnecessary
treatment, they could face state felony charges.
o Conviction of a felony is also a basis for disciplinary action by the state
medical board.8
• Private insurance companies with whom Drs. Adams and Baker contract almost
certainly have provisions that allow them to audit provider records and rescind
payment. Private insurance companies can also bring civil law suits against
providers who conduct unnecessary procedures or upcharge for breach of
contract, fraud, and misrepresentation.
Options
1. Dr. Carter could call Drs. Adams and Baker and explore why they arrived at
different diagnoses and recommendations.
2. Mr. Davis could follow up with Drs. Adams and Baker and tell them about Dr.
Carter’s diagnosis and the success of his treatment plan.
3. Dr. Carter could call the medical director to whom Drs. Adams and Baker report
and relay their misdiagnosis.
4. Dr. Carter could contact the Ohio state medical board about Drs. Adams and
Baker.
5. Dr. Carter or Mr. Davis could report suspected fraud to the Office of the
Inspectors General; anonymous submissions are accepted.
6. Mr. Davis could contact his insurance company about his concerns.
7. Dr. Carter or Mr. Davis could contact the Ohio Department of Insurance Fraud
Unit.
8. Insurance companies could stop reimbursing for most surgical repairs to ACL
tears or develop more specific criteria for reimbursement.
Reflection questions
1. Who takes on the financial risk of a false positive MRI? How do physicians
mitigate this financial risk?
2. Are there ways to redesign systems to prevent the potential for fraud in this
scenario?
3. What are the potential patient safety concerns with regard to the case?
4. How might the reimbursement criteria for physicians in this scenario impact their
medical decision-making?
5. How is medical decision-making affected by a fee-for-service system?
6. What are a surgeon’s billing options if he or she opens the knee to find there is no
ACL injury to repair?
7. What are the challenges to the physician and patient if reimbursement is affected
by outcome? For instance, an outcome might be the patient’s ability to work and
to participate in activities, rated as inadequate, adequate, back to baseline or
above.
1. Seeking help: What additional information does Dr. Carter need before addressing
the situation? How might he obtain this information? Who could Dr. Carter ask
for advice? How should Dr. Carter evaluate the two different diagnoses to
minimize bias?
2. Managing emotions: If you were in Dr. Carter’s situation, what kind of emotions
would you experience? How could these emotions affect your decision-making?
How would you effectively manage these emotions?
3. Anticipating consequences: What consequences should Dr. Carter expect when

addressing this situation? Which consequences are under Dr. Carter’s control?
Who will be affected and how?
case? To what extent does Dr. Carter have the ability to resolve this issue of
medical practice? To what extent do other stakeholders have the ability to address
this situation?
5. Testing assumptions: What are Dr. Carter’s motives in this case? What were Drs.
Adams and Baker’s motives? What assumptions is Dr. Carter making about Drs.
Adams and Baker? How can Dr. Carter determine if her assumptions are correct?
How might she test these assumptions?
References
1. Cimino F, Volk BS, Setter D. Anterior cruciate ligament injury: Diagnosis,

management, and prevention. American Family Physician. 2010;82(8):917-922.
2. Heathcare Bluebook. Knee MRI (no contrast). 2014;
https://http://www.healthcarebluebook.com/page_Results.aspx?id=292&dataset=
MD&g=Knee MRI %28no contrast%29. Accessed 3/10/2014.
3. Allum R. Complications of arthroscopic reconstruction of the anterior cruciate
ligament. The Journal of Bone and Joint Surgery. 2003;85(1):12-16.
4. Linko E, Harilainen A, Malmivaara A, Seitsalo S. Surgical versus conservative
interventions for anterior cruciate ligament ruptures in adults. The Cochrane
Database of Systematic Reviews. 2005(2):CD001356. (There is insufficient
evidence to suggest operative versus non-operative management because surgical
techniques were outdated).
5. Streich NA, Zimmerman D, et al. Reconstructive versus non-reconstructive
treatment of anterior cruciate ligament insufficiency. A retrospective matched-
pair long-term follow-up. International Orthopaedics. 2010;35(4): 607-613.
8. Ohio Revised Code 47 §4731.22.
physicians. 2014. https://oig.hhs.gov/compliance/physician-
education/roadmap_web_version.pdf
10. U.S. Department of Justice. A primer on the False Claims Act. 2011.
https://www.justice.gov/sites/default/files/civil/legacy/2011/04/22/C-
FRAUDS_FCA_Primer.pdf
11. Ohio Revised Code 29 § 2913.
Case 10
Defensive Medicine
By Kamal Gursahani
A 36-year-old man, Mr. George, presents to his private insurance assigned

primary care provider (PCP) for the first time for low back pain. The pain started after he
helped a friend move, three weeks prior to the visit. Mr. George has been taking anti-
inflammatories with some relief, but the pain keeps coming back. He has not modified
any of his activities. He has not missed any work, and he continues to be able to run long
distances despite the symptoms. Mr. George finds that the pain is worse when he gets
home from work, where he sits at his desk for long periods of time.
Mr. George decides to see a doctor because he is tired of the pain. He wants
surgery, but his insurance requires a referral. Mr. George believes surgery will help
because his friend, who happens to be a lawyer, had an operation six months ago for
similar symptoms and feels 100% better.
Mr. George can urinate and have bowel movements normally. He has no
numbness or weakness, and his physical exam is normal.
The PCP diagnoses Mr. George with acute low back pain, explains that an MRI
would not be useful at this time and surgery is risky, and there is little proven scientific
evidence of any long-term benefit. The PCP prescribes muscle relaxants to add to Mr.
George’s use of anti-inflammatories and advises minimizing strenuous activity for the
next two weeks and walking around more during work hours to prevent spasms. The PCP
also gives Mr. George a set of strengthening exercises to start once the pain improves and
asks him to follow up in 4-6 weeks if necessary.
Mr. George is not satisfied with this plan. He says, “Why did I even come here
today? Are you absolutely sure I don’t need surgery? Shouldn’t you do an MRI or refer
me to a spine surgeon? I know a lot of people who have sued doctors for just this type of
treatment.”
How should the PCP respond to Mr. George’s questions? How should the PCP
respond to the insinuation that Mr. George will sue?
Case Analysis
Stakeholders

• Primary care providers (PCPs), because of the culture of litigation and the
pressure to satisfy the patient. As the first line of access to patients, PCPs are
often also faced with being the “gatekeepers” of medicine; they can choose to
refer or deny access to further testing and treatment.
• Mr. George and other patients, because unnecessary imaging exposes them to
harm.
• Physicians (e.g., spine surgeons, radiologists) and imaging centers, because
receiving more referrals, rather than less, from their PCP colleagues results in
financial benefit.
• Spinal device manufacturers, because they benefit financially from surgical
procedures with their products.
• Society, because medically inappropriate tests and procedures drive up the cost of
health care for everyone.
Facts
• Low back pain is very common. It accounts for 2.3% of physician visits in the
US, and more than 20% of Americans report experiencing significant back pain in
the last three months. Low back pain is also the leading cause of disability in
Americans <45 years of age. Most people with acute low back pain report
complete recovery after several months, but up to a quarter may still have pain at
12 months.1
• The cost associated with the management of low back pain exceeds $100 billion
annually, inclusive of opportunity cost due to lost wages, missed work, and
decreased productivity.1
• Evidence-based recommendations from the American College of Physicians
regarding the diagnosis and treatment of low back pain call for imaging only for
patients who have severe or progressive neurologic deficits or signs or symptoms
that suggest a serious or specific underlying condition.2,3
• Clinical practice guidelines for back pain that lasts less than four weeks state that
medication, recommendations to patients to remain active, and information about
back pain are appropriate.2
• Depending upon the MRI and physical exam findings, back pain due to disc
disease is surgically managed with either a lumbar discectomy or a more
extensive decompression and lumbar fusion procedure.3-5
• Studies that compared the benefits of lumbar fusion vs. non-operative intensive
physical therapy and education have shown little difference in outcomes in terms
of quality of life, use of health care resources, and symptom improvement.3,4
Similarly, the long-term differences in patient outcomes between surgical and
non-surgical treatment of herniated lumbar discs are not significant, particularly
in the absence of neurologic deficits.5
o Given surgical costs and the risk of complications relative to modest

benefit, surgery is not justified for most patients with low back pain unless
they have neurologic compromise and correlated MRI findings.
• It is estimated that the number of lumbar fusion procedures increased by 134%
from 1993 to 2003,4 and more than doubled between 2000 and 2011.6 This
increase may reflect the powerful financial incentives that accompany fusion
procedures, which often include complex instrumentation produced by major
device manufacturers. These procedures also have generous reimbursement rates
for both the facility and the physician, even when compared to other types of
surgery.6
Norms

persons.
o Patients have the right to ask for treatments they believe will be of benefit
to them, but not the right to demand unnecessary treatment.
o Unnecessary interventions cause harm to the patient.
o Referring patients for costly imaging and/or surgical procedures that do
not benefit the patient drives up the cost of health care for other patients.

o The PCP is obliged to refer Mr. George to other health professionals when
medically indicated; the PCP ought not refer to other health professionals
for the sole reason of appeasing a litigious patient.
o Despite the fact that Mr. George has threatened to sue, the PCPs primary
obligation is unchanged: to provide competent medical care.
• IX. A physician shall support access to medical care for all people.
o If the PCP routinely refers patients for unnecessary tests and procedures,
the PCP is increasing the cost of care and therefore impeding access to
medical care for all people.
Legal
• Physicians have no legal obligation to provide and patients have no legal right to
receive care that is not medically necessary and is outside the standard of care.
• In fact, the physician is practicing within the standard of care. Compliance with
clinical practice guidelines is an indication of this, although courts are divided on
their treatment of guidelines.9
• To succeed in a medical malpractice case, a patient must establish the following:
1) the physician’s professional duty to the patient (provider-patient relationship);
2) breach of that duty; 3) that is the cause of; 4) harm to the patient; 5) with
damage that can be monetized. 9
o The physician does have a duty to the patient because of an existing
physician-patient relationship but no breach or harm has occurred. The
patient is still working and active with no signs of neurologic compromise
and care is consistent with clinical practice guidelines.
o There is no malpractice cause of the action in this case.
Options
1. The PCP can attempt to educate Mr. George by sitting down and addressing each
and every concern and informing him of the limitations of an MRI and surgery.
2. The PCP can acknowledge that Mr. George may be feeling powerless because of
the pain and fears about its duration. Reassuring Mr. George that the pain will
most likely improve with time may reduce his anxiety and aggression and foster
better communication. The PCP could discuss the practice guidelines and tell Mr.
George that if the pain remains or worsens over time, additional testing may be
warranted.
3. The PCP can refer Mr. George to another primary care physician to get a second
opinion.
4. The PCP can refer Mr. George to his local imaging center to get a MRI, just to be
sure.
5. The PCP can refer Mr. George to a local spine surgeon.
6. The PCP can permanently refer Mr. George to another primary care physician.
1. What is defensive medicine? What are its effects? How can providers try to
minimize the negative effects of litigation threats?
2. How might the threat of legal action change a physician’s medical decision-
making?
3. What are some of the ways health care professionals have tried to combat
defensive medicine?
1. Seeking help: What further information does the PCP need before responding to
Mr. George and his threat to sue? Who should the PCP turn to for advice?
2. Managing emotions: If you were in the PCP’s position, what emotions would you
likely experience when confronted by a threat to sue? How might these emotions
affect your decision-making? How might you effectively manage these
emotions?
3. Anticipating consequences: What are the main options open to the PCP, and the
consequences of each of those options? This includes short- and long-term
consequences as well as positive and negative consequences. Which stakeholders
will be affected and how? What consequences does the PCP have control over?
case? To what extent does the PCP have the ability to resolve the issue, and to
what extent do other stakeholders have the ability to resolve the issue?
5. Testing assumptions: What are the PCP’s motives in this case? What assumptions
might the PCP be making about Mr. George in this case? How could the PCP
determine if his assumptions were correct?
References
1. Vega C. Surgery and low back pain--Is the choice clear? Best Evidence Review,
2011. Accessed Feb 25, 2011.
2. Chou R, Qaseem A, Snow V, et al. Diagnosis and treatment of low back pain: A
joint clinical practice guideline from the American College of Physicians and the
American Pain Society. Annals of Internal Medicine. Oct 2 2007;147(7):478-491.
3. Chou R, Baisden J, Carragee EJ, Resnick DK, Shaffer WO, Loeser JD. Surgery
for low back pain: A review of the evidence for an American Pain Society
Clinical Practice Guideline. Spine. May 1 2009;34(10):1094-1109.
4. Mirza SK, Deyo RA. Systematic review of randomized trials comparing lumbar
fusion surgery to nonoperative care for treatment of chronic back pain. Spine. Apr
1 2007;32(7):816-823.
5. Jacobs W, van Tulder M, et al. Surgery verses conservative management of
sciatica due to lumbar herniated disc: A systematic review. European Spine
Journal. 2011;20:513-522.
6. Lee J. Rethinking spine care: Some hospitals moving beyound surgery in serving
back pain patients. Modern Healthcare. March 2014.
Case 11
Stock Option Ownership
By Heidi Pieroni
Dr. Sara Pierson, a Professor of Pediatrics at Large University, is the Principal

Investigator (PI) for a large NIH-funded R01 grant focused on respiratory syncytial virus
(RSV). RSV is the leading cause of bronchiolitis and pneumonia in children and infants
under the age of one and can also affect the elderly. The NIH study focuses on the basic
immunologic properties of RSV.
Dr. Pierson has also recently been invited to be the PI for a multi-site, Phase II
clinical trial of a RSV vaccine. The trial will test a pediatric population for the safety and
immunogenicity of an inactivated vaccine for RSV. A publicly traded small biotech
company, VacSponsor, which makes the vaccine, is sponsoring the study.
Dr. Pierson believes that the VacSponsor study is important work, and also thinks
that the results from the VacSponsor project could be fruitfully incorporated into the R01
project.
Dr. Pierson has stock options in VacSponsor, which she must disclose to her
institutional conflict of interest committee so that her role and a conflict of interest plan
can be reviewed. Values above $5,000 are considered significant financial interests by
her institution. Her ‘put’ in the company’s stock has declined past the exercise prices
(meaning her equity interest cannot be easily valued), so she is not sure how to estimate
the value of her interests and is not convinced that her stock with VacSponsor will affect
her work on the proposed project.
How should Dr. Pierson proceed?
Case Analysis
Stakeholders

• Dr. Pierson, because if the vaccine is determined to be safe and effective it may
be subsequently licensed to a larger company for marketing, which will directly
benefit Dr. Pierson financially as well as advance her career.
• VacSponsor, because the company could see enormous profits if the vaccine is
found to be safe and effective.
• The children and infants in the VacSponsor trial, because they are exposed to risk
as subjects of research. The subjects could also potentially benefit from the
vaccine received, although the benefits of the trial vaccine are unknown at this
time. It is also possible that the information generated via the study will benefit
the study subjects at a later date, if they develop bronchiolitis or pneumonia.
• Society, because both studies could provide valuable information and lead to a
safe and effective vaccine if they are conducted with integrity.
Facts

primary interest will be unduly influenced by a secondary interest.”1 A PI’s
primary interest in research is the integrity of the research study. A financial
interest in the vaccine manufacturer could unduly influence Dr. Pierson’s actions
to compromise the integrity of the study.
• Ownership of equity in a drug or device manufacturer developing the study
component constitutes a significant financial conflict of interest.1
• The AAMC guidelines—and the policies of many institutions of higher
education—prohibit individuals with a financial conflict of interest from serving
in the role of PI.2
• Industry funding and relationships in biomedical research have led to biased
reporting in clinical research and a general reduction of openness in science.1
• Phase I research studies involve administering a new drug to a small group of
people for the first time to evaluate its safety, to determine a safe dosage range,
and to identify side effects. Phase II clinical research studies involve giving the
drug to a larger group of people to see if it is effective and to further evaluate its
safety.3
Norms

persons.
o Dr. Pierson’s conflict of interest could lead her to overstate the potential
benefits of the drug while obtaining consent, which would undermine the
subject’s ability to give informed consent.
o Researchers are obligated to “do no harm,” and to “maximize possible
benefits and minimize possible harms.”4 This includes designing protocols
to maximize benefits to both individual research subjects as well as to
society. Thus, it is necessary to determine if the PI has conflicts of interest
that may lead to an increased risk to safety. Dr. Pierson’s financial interest
in VacSponsor could knowingly or unknowingly influence the way she
conducts this research. It could affect her enrollment of patients into
control versus experimental groups; and bias her assessment of the vaccine
safety and efficacy.
o If VacSponsor licenses the vaccine to other larger companies before
conducting all the necessary research, it could lead to financial benefits
before the long-term effects of the vaccine are properly understood.
Society could therefore potentially be harmed.

o Dr. Pierson ought not allow her financial interests to influence the
recruitment of patients into this study or the interpretation of study results.
She must not compromise the patients’ rights to make voluntary and
informed decisions to participate.
o Conflicts of interest can lead to unconscious or even blatant dishonesty
and deception.
o It is appropriate and admirable that Dr. Pierson wants to work on
developing a vaccine for this vulnerable population, and to advance
scientific knowledge. However, she needs to do so in such a way that the
knowledge she produces as a result of her study is reliable and valid.
o Dr. Pierson would not have a doctor-patient relationship with the
individuals enrolled in her research study; she would have a researcher-
subject relationship with them. Nevertheless, as a physician-researcher,

Dr. Pierson is obliged to treat her subjects ethically and responsibly.
Legal
• The Food and Drug Administration (FDA) is the federal agency responsible for
“protecting the public health by assuring the safety, effectiveness, quality, and
security of human and veterinary drugs, vaccines and other biological products,
and medical devices.”7 The FDA requires robust investigation of new products for
safety and efficacy through clinical research.
• Federal law protects human subjects in clinical research through the Common
Rule, a set of regulations issued by the U.S. Department of Health and Human
Services.8 Fifteen other federal agencies have adopted the Common Rule,
including the Food and Drug Administration (FDA).9
• Institutional Review Boards (IRBs) are responsible for protecting the wellbeing of
human subjects (i.e., participants) in research at their institutions.8 Conflicts of
interest impact the wellbeing of human subjects.
• The Common Rule specifies the following requirements for research that are
relevant to conflicts of interest: 1) risks must be minimized; 2) risks must be
reasonable in relation to anticipated benefits; 3) subject selection is equitable; and
4) informed consent is obtained from subjects or their legal representatives (e.g.,
parents).10 In addition, the possibility of coercion must be minimized.11
• IRBs are empowered by law to approve, disprove, conditionally approve, suspend
or terminate research activities for the protection of subjects.12 IRBs may also
require additional information be provided to participants that would
meaningfully enhance their rights and welfare.13
interest by investigators and others involved in research of products under their
jurisdiction (e.g., drugs, vaccines). The FDA will deny a new product application
for omitted, incomplete, or false information.14
• There are also stringent regulations for disclosures of financial conflicts of
interest when research is supported by the government.15
• Organizations involved in research have conflict of interest review and disclosure
processes to protect the welfare of human subjects, which is required if they
accept federal funding. The Department of Health and Human Services has issued
guidance for institutions, IRBs, and investigators involved in even privately
sponsored research that recommends policies and procedures for management of
financial conflicts of interest, including disclosure to research participants.16
• Some authors have advocated for mandatory ongoing review of research by the
institution when significant conflicts of interest exist in specialized research.17
Options
1. Dr. Pierson could work with her institutional conflict of interest committee in a
proactive manner to develop a management plan that complies with federal law.
2. Dr. Pierson could divest ownership interests in VacSponsor.
3. Dr. Pierson could ask Large University to appoint an independent faculty

investigator as the PI of the VacSponsor trial and restrict Dr. Pierson’s role to that
of co-investigator or collaborator. The PI could not have a financial relationship
of any kind with Dr. Pierson nor could the PI be a close friend or relative. The PI
also should not be subject to Dr. Pierson’s approval authority or report to her
directly or indirectly.
4. Dr. Pierson could recuse herself from participant selection, recruitment, consent,
and unblinded data analysis.
5. Dr. Pierson and Large University could require all members of the research team
to fully disclose their financial relationships to all study subjects.
6. Dr. Pierson or Large University could assign responsibility for the clinical
assessment of the progress of the subjects to a new PI or other designee. The role
of Dr. Pierson or her laboratory staff in this trial could be restricted to the analysis
of blinded data.
7. The Large University IRB could require mandatory ongoing review of the
research.
8. If Large University holds equity in VacSponsor it could explore ways to address
the institutional conflict of interest.
1. What is the specific conflict of interest that exists in this case study?
2. Could the outcome of the study significantly benefit the public? Why does this
matter?
3. Should Dr. Pierson be allowed to pursue this research as PI in view of her conflict
of interest? If so, should any conditions be put in place for Dr. Pierson as PI? If
not, can someone else serve in the role of PI? Is society harmed if no one else is
qualified to serve as PI?
4. Assuming Dr. Pierson has a conflict of interest, would disclosure of the conflict to
the study subjects and the government resolve the problem?
1. Seeking help: What kind of assistance does Dr. Pierson need before making a
decision in this case? What resources could she turn to for help?
2. Managing emotions: If you were in Dr. Pierson’s position, what kind of emotions
would you likely experience? How would these emotions affect your decision-
making? How could you effectively manage your emotions?
3. Anticipating consequences: What positive and negative consequences should Dr.
Pierson anticipate for the options available? How can the benefits be maximized
and the risks/harms be minimized?
4. Recognizing rules and power dynamics: What laws, rules or norms are salient in
this case? To what extent is Dr. Pierson in a position to resolve the issue and to
what extent do the other stakeholders have the authority to address the issue?
What factors are limiting her choices?
5. Testing assumptions: What are Dr. Pierson’s motives in this case? Would bias
affect her decision-making? What assumptions could Dr. Pierson be making in
regard to the VacSponser company and the other stakeholders? How could she
test her assumptions?
References

Medical Research Education and Practice. Conflict of interest in medical
research, education, and practice. Washington, D.C.: National Academies Press;
2009.
2. AAMC Task force on Financial Conflicts of Interest in Clinical Research:
Protecting Subjects, Preserving Trust, Promoting Progress--Policy and
Guidelines for the Oversight of Individual Financial Interests in Human Subjects
Research.
3. NIH Website, "Clinical Trial Phases." http://www.nlm.nih.gov/services/
ctphases.html. Accessed 7/12/14.
6. Protection of human subjects; Belmont Report. Federal Register. Apr 18
1979;44(76):23191-23197.
7. Food and Drug Administration. About FDA, basics FDA fundamentals [web
8. 45 CFR § 46, Subparts A-E.
9. 21 CFR §§ 50, 56, 312 and 812.
10. 45 CFR § 46.111(a); 21 CFR § 56.111(a).
11. 45 CFR § 46.116; 21 CFR § 50.20.
12. 45 CFR § 46.109(a); 45 CFR § 46.113.
13. 45 CFR § 46.109(b), 21 CFR § 56.109(b).
Guidance for clinical investigators, industry, and FDA staff: Financial disclosure
15. U.S. Department of Health & Human Services, Responsibility of Applicants for
Promoting Objectivity in Research for which Public Health Service Funding is
Sought and Responsible Prospective Contractors. 76 Federal Register 165; 2011
(amending 42 CRF§§ 50, 94).
16. U.S. Department of Health & Human Services. HHS final guidance: Financial
relationships in clinical research: issues for institutions, clinical investigators, and
IRBs to consider when dealing with issues of financial interests and human
subject protection; 2004.
17. Wilson RF. The death of Jesse Gelsinger: New evidence of the influence of
money and prestige in human research. American Journal of Law & Medicine, 36:
295 (2010).
Case 12
Start Up Company Conflict of Interest
By Heidi Pieroni
Dr. Gold is an Assistant Professor of Medicine in the Hematology-Oncology

Division at a respected university. In her research on ovarian cancer, Dr. Gold discovered
a monoclonal antibody (MAB) to a protein in ovarian cancer cells that slows cancer
progression in a mouse xenograft model. Dr. Gold applied for but did not receive NIH
funding for a Phase I study of the MAB in humans.
After successfully raising local venture capital money and gaining approval from
the university, Dr. Gold starts a small biotech company called Antibody Therapeutics, so
she can develop the antibody and further study its effects. Because she developed the
antibody at the university, the university must license the MAB technology to Antibody
Therapeutics. Dr. Gold has very little involvement in the license negotiations between
Antibody Therapeutics and the university. Though she is neither an officer nor a member
of the Board of Directors, Dr. Gold is a member of Antibody Therapeutics’ Scientific
Advisory Board, for which she receives $30,000 annually. She also owns 100,000 shares
of founders’ stock.
Antibody Therapeutics chooses to sponsor a Phase I trial of MAB in humans with
ovarian cancer, and requests that Dr. Gold serve in the role of PI because she is the
leading expert on the subject.
Should Dr. Gold serve as PI for the Antibody Therapeutics study?
Case Analysis
Stakeholders

• Dr. Gold, because as founder of Antibody Therapeutics—which uses technology
generated in her university laboratory under a license from the University—the
outcome of the MAB study holds significant financial and intellectual interest.
• Antibody Therapeutics, because the company could profit from the outcome of
the study.
• The women who would serve as subjects in the clinical trial, because they
undergo risk as research subjects. They could also potentially benefit from the
study (if the antibody turns out to be safe and effective).
• Society, because this research could provide valuable information and lead to
more effective treatment for ovarian cancer. However, if Dr. Gold is not
collecting and reporting her data with integrity (e.g., if she is falsifying or
fabricating her data) it could cause harm to future patients and future researchers.
Facts
• Ownership of equity in a company that manufactures the study drug or device is

recognized to be a ‘significant’ financial interest.1
• As a general rule, absent compelling reasons to the contrary, the AAMC
guidelines and the policies of many institutions of higher education would
discourage or prohibit participation in a clinical trial as PI if an individual has
significant ownership of the sponsoring corporation.2
• Some evidence suggests that industry funding and relationships in biomedical
research have led to biased reporting in clinical research and a general reduction
of openness in science.3
Norms

persons.
o Dr. Gold ought not allow her financial interests to influence the
recruitment of patients into this study or the interpretation of study results.
She must not compromise the patients’ rights to make voluntary and
informed decisions to participate.
o It is necessary to determine if the PI has conflicts of interest that may
compromise scientific integrity. Dr. Gold could knowingly or
unknowingly influence her enrollment of patients into control versus
experimental groups, and that could in turn influence her clinical
assessment, which might lead to an unwarranted positive assessment of

MAB.
o The prior decision by the NIH not to fund the study is worrisome; it could
indicate that there are methodological problems in the study design, that
there is a lack of peer or institutional support, or that preliminary results
have not provided strong enough evidence to warrant a Phase I study. On
the other hand, given limited NIH funding, many strong proposals are not
funded, and industry funding might move a promising idea from bench to
bedside.
o The participants of the study could be harmed by the use of MAB if it is
too early to safely conduct a Phase I study. Society too could be harmed if
Dr. Gold’s conflict of interest leads to biased reporting of findings, which
could lead to unnecessary expenditures on future research based on
compromised data or the use of a drug that has not been thoroughly
studied.

o Even if Dr. Gold fully discloses her conflict of interest, participants might
be unknowingly misled through their interactions with her, particularly
concerning recruitment and informed consent.
o A conflict of interest might influence Dr. Gold’s recruitment of subjects
for the study as well as interpretation of study results.
o Pushing the study to Phase I without sufficient evidence could potentially
result in harm to the participants. Dr. Gold’s conflict might lead her to
prioritize study outcomes over the welfare of the subjects.
Legal
• The Food and Drug Administration (FDA) is the federal agency responsible for
enforcing federal law in protecting the public health by assuring that new drug
and biologic products are safe and effective.6 Within the FDA, monoclonal
antibody products are studied by the Center for Drug Evaluation and Research to
“ensure that safe, efficacious and high quality monoclonal antibody products are
available for the diagnosis, prevention and treatment of illnesses.” 7 The FDA also
oversees safe and consistent manufacturing of products, including those used in

Phase I studies.8
o Regardless of funding source, FDA requirements apply to all products
under study for possible introduction into the market for patient treatment.
o Antibody Therapeutics must demonstrate safe and consistent
manufacturing of the MAB product (even for Phase I use).
o Dr. Gold and Antibody Therapeutics must demonstrate satisfactory
research procedures and design if they hope to eventually gain FDA
approval to market the MAB product for cancer treatment.
• Phase I studies cannot begin until the FDA approves an Investigational New Drug
(IND) application. The FDA also allows for early exploratory IND studies (before
Phase I studies) that are very short in duration and limit exposure to human
research subjects; these allow drug manufacturers to test new chemical entities or
compounds before fully investing in the IND process.10
o Even in this early stage, Antibody Therapeutics and Dr. Gold must comply
with federal regulations and seek approval through an IND application to
begin Phase 1 trials. The FDA will review the data provided in making the
determination to issue an IND number.
interest by investigators and sponsors of products under their jurisdiction (e.g.,
drugs, biologics, etc.). Investigators must disclose all conflicts of interest in all
phases of application (e.g., IND applications and premarket approval
applications). The FDA will deny a new product application for research biased
by conflicts of interest or for omitted, incomplete, or false disclosures.11
• Federal law expressly identifies the following financial conflicts of interest: 1)
compensation affected by the outcome of the clinical trial (e.g., equity interest in
sponsor or royalties tied to product sales); 2) significant equity interest in the
sponsor (e.g., any ownership interest in a private company); 3) proprietary interest
in tested product (e.g., patent, trademark, licensing, etc.); 4) significant payment
of other sorts (e.g., payments to investigator or institution exceeding $25,000).12
o Dr. Gold has significant equity interest in Antibody Therapeutics (100,000
shares of stock) and has received significant payments of other sorts
($30,000 per year as advisor). The proprietary interest is unclear but
should be addressed.
• The “FDA may consider clinical studies inadequate and the data inadequate
if…appropriate steps have not been taken…to minimize bias.”12 When evaluating
whether conflicts of interest biased a study, the FDA considers “designs that
utilize such approaches as multiple investigators… blinding, objective endpoints,
or measurement of endpoints by someone other than the investigator may
adequately protect against any bias.”12
o It is in Dr. Gold’s and Antibody Therapeutics’ interest to take careful steps
in the study design and procedures to minimize bias if they hope to
successfully bring the MAB product to market.
• If the FDA has serious questions about the integrity of data because of a conflict
of interest, it can initiate audits of the data, require further analysis or additional
independent studies, or exclude the data altogether.12
o Failure to minimize the effects of bias could lead to increased scrutiny,

expense or even exclusion of completed research data by the FDA.
• The Department of Health and Human Services’ regulatory guidance directs
institutions involved in research to have formal processes for managing financial
conflicts of interest (e.g., conflicts review committees, disclosure to research
participants, and the use of independent organizations to hold or administer the
institution’s financial interests).14 Some authors have advocated for mandatory
ongoing monitoring of research when significant conflicts of interest exist.15
o The University should consider measures to minimize the impact of its
financial interest in Antibody Therapeutics.
o The University could require ongoing independent monitoring of the study
to minimize the adverse impact of its conflict of interest.
Options
1. Dr. Gold could divest her interest in the company if she wants to serve as PI.
2. Dr. Gold could serve as PI with a proper conflict of interest management plan in
place. (Explore if a proper plan is possible, and if so, what it requires)
3. Dr. Gold or the University could identify a faculty investigator to serve as the PI
and limit Dr. Gold’s role to co-investigator or collaborator. The FDA’s guidance
should be followed in selecting the individual. The faculty investigator should not
be a close friend or relative or have a subordinate relationship to Dr. Gold.
Furthermore, Dr. Gold’s interaction with human subjects would then be limited,
especially in the recruitment, selection, or consent process.
4. The university could require all members of the research team to fully disclose
their financial relationships to all human research participants before allowing Dr.
Gold to proceed as PI.
5. If the university holds equity in Antibody Therapeutics it could find a way to
address the institutional conflict of interest, such as through engagement of an
independent entity. Ideally, the university would eliminate its holdings in the
company before the clinical trial takes place.
6. The University or Dr. Gold could require independent monitoring of the research
in light of the multiple conflicts of interest.
1. What conflicts of interest exist? What, if any, is the specific financial conflict of
interest? Is there more than one conflict of interest?
2. How could the outcome of the study benefit the public? Why does this matter?
3. Should Dr. Gold be allowed to pursue this research as PI in view of her conflict of
interest? If so, should any conditions be put in place for Dr. Gold as PI?
4. Is there a risk to data integrity? If so, why does this matter?
5. Assuming Dr. Gold has a conflict of interest, would disclosure of the conflicts to
the study subjects resolve the problem?
6. Should the FDA have the legal authority to exclude all research conducted
pursuant to an application to market a new drug because of a conflict of interest?
Why or why not? What are the consequences of exclusion?
7. Does it matter if investigators and sponsors comply with conflict of interest
disclosures just to get a drug to market rather than because it is the ethically
appropriate action?
1. Seeking help: What additional information does Dr. Gold need before making a
decision? Who could Dr. Gold turn to for help? Would it help to involve a mentor
or consultant?
2. Managing emotions: If you were in Dr. Gold’s situation, what emotions might
you be experiencing? How might these emotions affect your decision-making?
3. Anticipating consequences: What consequences should Dr. Gold anticipate should
she choose to be the PI on the Antibody Therapeutics study? What consequences
if she chooses against it?
4. Recognizing rules and power dynamics: What laws or norms are salient in this
case? Which factors would be problematic if Dr. Gold took or did not take the PI
position? To what extent does she have control over these issues?
5. Testing assumptions: What are Dr. Gold’s motivations in this case? What biases
could affect her decision-making? What assumptions might Dr. Gold be making
about the situation?
References

Medical Research Education and Practice. Conflict of Interest in Medical
Research, Education, and Practice. Washington, D.C.: National Academies Press;
2009.
2. AAMC Task force on Financial Conflicts of Interest in Clinical Research.
Protecting Subjects, Preserving Trust, Promoting Progress--Policy and
Guidelines for the Oversight of Individual Financial Interests in Human Subjects
Research.
3. Protection of Human Subjects; Belmont Report. Federal Register. Apr 18
1979;44(76):23191-23197.
6. Food and Drug Administration. About FDA, basics, FDA fundamentals [web
7. Food and Drug Administration. Science and Research (Drugs), Monoclonal
Antibodies [web page].
http://www.fda.gov/Drugs/ScienceResearch/ucm294604.htm Accessed 7/25/16.
8. 21 CFR § 211; U.S. Department of Health & Human Services, Food and Drug
Administration. Guidance for industry: GCMP for phase I investigational drugs.
July 2008.
9. 21 CFR § 312.
Guidance for industry, investigators, and reviewers: exploratory IND studies.
January 2006.
Guidance for clinical investigators, industry, and FDA staff: Financial disclosure
12. 21 CFR § 54.1.
13. 21 CFR § 54.5.
14. U.S. Department of Health & Human Services. HHS final guidance: Financial
relationships in clinical research: issues for institutions, clinical investigators, and
IRBs to consider when dealing with issues of financial interests and human
subject protection; 2004.
15. Wilson RF. The death of Jesse Gelsinger: New evidence of the influence of
money and prestige in human research. American Journal of Law & Medicine, 36:
295 (2010).
Case 13
Balancing the Roles of Researcher and Physician
By Joshua Crites
Dr. Blackstone, a primary care physician who has been in private practice for
eight years, was recently recruited by an academic medical center for her expertise in
treating obesity related diseases. Eager to dive into more academic endeavors, she
designs a study to examine the effects of peer support groups for patients who are trying
to make lifestyle changes to lose weight. Subjects are randomized either to a control
group (lifestyle changes only) or an intervention group (lifestyle changes and weekly
“check-ins” with a support group). Each subject in the intervention group is asked to
meet regularly with other members of the peer support group for one year and to
complete quarterly progress reports. She recruits patients from her outpatient clinic—
both her own patients and those seeing colleagues.
Five months into the peer support study, Dr. Blackstone learns about a new drug,
Theniva, for weight loss that has been tested in Phase I clinical trials. The drug
manufacturer contacts her to participate in a multi-center, Phase II clinical trial they are
sponsoring. Theniva works by mimicking neurologically active hormones related to
satiety, effectively “tricking” a person’s brain into believing that the person is full. Dr.
Blackstone reviews the Phase I study results, which reveal only minimal risk, and agrees
to help recruit study subjects to the Phase II study. To be eligible for participation in this
study, subjects must be under age 45, not currently pregnant, and agree not to attempt to
manage their weight through other means, including diet and exercise, during the study.
This means that subjects could not participate in the peer support study and the Theniva
study simultaneously. The Theniva protocol requires Dr. Blackstone to enroll 10 patients
locally in order achieve statistical power for the study.
Dr. Blackstone has enjoyed a solid recruitment rate for her peer support group
study, partly the result of her close professional relationship with many of her patients.
She has enrolled more than enough participants to ensure adequate statistical power of
that study. However, this recruitment success means that the number of patients eligible
for the Theniva trial is limited. After two months of recruiting, Dr. Blackstone has been
able to enroll only eight participants. She is acutely aware that the most likely way to
reach recruitment goals for Theniva study would be to pull participants away from her
peer support study.
During a review of her schedule for the next week, Dr. Blackstone sees that
Darlene is scheduled for a follow-up visit. Dr. Blackstone recruited Darlene, a 28-year-
old woman who has struggled with obesity since early childhood, into the peer support
group study during her initial visit three months prior. On the day of Darlene’s scheduled
appointment, Dr. Blackstone sees on Darlene’s intake vitals that she lost 11 pounds since
her last visit. This is positive news, though Dr. Blackstone would still like Darlene to lose
another 50 pounds to reach a recommended healthy weight for a woman of her age and
build.
When Dr. Blackstone enters the exam room, Darlene is noticeably slimmer and
exhibits a much more positive demeanor than in the past. She thanks Dr. Blackstone
effusively for suggesting the peer support study, and excitedly tells Dr. Blackstone that in
light of her increased energy she and her husband are considering trying to conceive their
second child. Dr. Blackstone congratulates Darlene on her weight loss success, and, in
the course of the visit, clears her of any additional follow-up for what brought her in three
months ago. Before sending Darlene to the checkout nurse, Dr. Blackstone congratulates
Darlene again, and considers approaching her about the Theniva trial.
How should Dr. Blackstone balance her responsibilities as a principal investigator with
her responsibilities as Darlene’s physician?
Case Analysis
Stakeholders

• Darlene, because she is likely to believe that any recommendation (or suggestion)
Dr. Blackstone offers is intended to benefit her directly. Such a belief may
prevent Darlene from making an accurate risk-benefit assessment and may lead
Darlene to make decisions about research participation that she would not make
were the study not being presented by her own primary care physician. This
mindset is created by her physician-patient relationship with Dr. Blackstone and
likely reinforced by the benefits she has enjoyed by participating in the peer
support group study.
• Dr. Blackstone, because as a physician-researcher she has obligations to her
patients and research subjects that may conflict. Dr. Blackstone must make
treatment recommendations based on the specific needs of an individual patient
when acting as a physician. On the other hand, as a researcher, Dr. Blackstone
must recruit enough patients to achieve significant statistical power and make
decisions (such as whether a participant is randomized into the intervention or
control arm) based on the study protocol.
• Patients recruited from other physicians into Dr. Blackstone’s peer support study,
because they may have an impression similar to Darlene’s that proposed research
participation is intended to benefit them directly (though this attitude may be
tempered by the fact that Dr. Blackstone is not their personal physician). They,
like Darlene, should make a decision about participating based on the
understanding that they are entering into research and that any benefits they might
receive are secondary to the goal of acquiring information intended to extend the
body of scientific knowledge.
• Colleagues in the practice, because if they are only wearing the “doctor hat,” they
have an obligation to protect the interests and wellbeing of their patients. Patients
of these physicians may suffer a loss of trust if they do not benefit from research
participation but believed that it was being recommended because of an
expectation of direct benefit; this loss of trust could hamper the physician-patient
relationship.
• Future patients who have struggled to maintain or reduce weight, because the
findings from both studies may present a better alternative to other interventions
they have tried in the past.
• The drug manufacturer, because a drug such as Theniva could be quite profitable
but they cannot market the drug until appropriate clinical trials have been
completed.
• Society, because there could be a reduction in physician trust should members of
society come to believe that physician-researchers are abusing their standing as
physicians to enroll patients into research studies. Alternatively, successful
strategies to manage weight could be an incredible boon to society and help
control skyrocketing health care costs.
Facts
• Despite increased attention from health care providers and pharmaceutical

companies, obesity continues to rise at an alarming rate, contributing to a range of
preventable diseases.1
o Research into novel behavioral and pharmacologic treatments is
scientifically valuable and may result in a reduction of obesity and obesity
related disease.
• There is an inherent, sometimes unavoidable—but perhaps manageable—conflict
of interest for the physician-investigator created by the competing obligations of
the roles.2
• Individuals recruited by their physicians to participate in research, especially
when that physician is also an investigator on the proposed study, are more likely
to experience the therapeutic misconception, that is, to confuse enrolling in a
research study with receiving individualized therapy.3,4
• A phase I research study involves administering a new drug to a small group of
people for the first time to evaluate its safety, to determine a safe dosage range,
and to identify side effects.A Phase II clinical research study involves giving the
drug to a larger group of people to see whether it is effective and to further
evaluate its safety.5
primary interest will be unduly influenced by a secondary interest.”6 The primary
interest of physicians is the welfare of their patients while the primary interest of
researchers is protecting the integrity of research. Secondary interests can include
financial gain, prestige, and personal obligations. In a dual role, the integrity of
research can constitute a secondary interest that interferes with the primary
obligation to the patient’s welfare.6
Norms

persons.
o Dr. Blackstone’s patients may (consciously or unconsciously) believe that
Dr. Blackstone’s offer of study participation is a clinical recommendation.
This could contribute to the therapeutic misconception and threaten the
understanding of informed consent, thereby undermining autonomy.2
o Given that Darlene is currently eligible for the Theniva study, respecting
her autonomy may mean that Dr. Blackstone should at least inform her of
the opportunity to participate. If Darlene is actively trying to become
pregnant or becomes pregnant she would not be eligible for the Theniva
study.
• Beneficence: the obligation to provide benefit to others and to balance benefits
against risks.
o In her role as a researcher, Dr. Blackstone has only a secondary obligation

to provide benefit directly to research participants; her primary obligation
as the researcher is to ensure the integrity of the research study.6 Darlene
seems to be benefiting from the peer support group study, which has
minimal risks; the balance of benefit and burden is less clear were she to
enroll in the Theniva study. It may burden Darlene to delay a second
pregnancy as well.
o Dr. Blackstone’s obligations as Darlene’s physician are distinct from her
obligations as an investigator, and arguably Dr. Blackstone should
prioritize her physician-obligations rather than her researcher-obligations.
Prioritizing her physician-obligations over her researcher-obligations
would likely mean keeping Darlene in the peer support study, since it
seems to benefit her with little risk of harm.
o Both physicians and researchers have an obligation not to harm their
patients and/or research participants without the prospect of benefit. The
difference lies in how risk of harm is justified. In clinical settings, risk of
harm to a patient is ethically justified by the physician’s intent to benefit
that person directly; sometimes physicians prescribe medications that may
have side effects or recommend lifestyle changes that may be
uncomfortable, but the prospect (and intent) of direct benefit “outweighs”
those risks. Concerning research, exposing participants to risk is balanced
by their informed consent to participate and by the prospect of benefit to
future individuals.
o The Theniva study likely represents increased (and perhaps unforeseen)
risk of harm with an unknown likelihood of direct benefit. If Dr.
Blackstone was not Darlene’s physician, it may be justifiable to recruit her
to the Theniva study on the grounds that Darlene would provide her
consent and that the study is likely to benefit others in the future.
However, because Dr. Blackstone is obligated not only to avoid harm but
also to seek direct benefit for Darlene, she should not recruit Darlene to
the Theniva study.
o Dr. Blackstone must balance her researcher-obligation to be maximally
inclusive when selecting research participants (i.e., giving everyone a fair
chance to participate) with her physician-obligation to protect her patients
and promote their individual wellbeing.
o Dr. Blackstone must also manage her multiple researcher conflicts because
pulling some patients out of the peer group study to place them in the
Theniva study may create a bias in the data from the peer group study. It
also may create a bias in the Theniva study because those participants
have been involved in a weight loss activity prior to enrollment. Asking
patients to participate in unsound research is not an appropriate
distribution of risks and benefits.

o Dr. Blackstone should be clear about, and reinforce at regular intervals,
her dual-role as physician and investigator—especially amongst those
research participants recruited from her own practice.
o This principle may also obligate Dr. Blackstone to remind her own
patients that the primary purpose of research (whether the peer support
study or the Theniva study) is to advance scientific knowledge and that
any benefits they may experience personally are secondary to that goal.
o In caring for patients who are at risk for obesity related diseases, Dr.
Blackstone is obligated to seek treatments that will improve the health and
wellbeing of those patients. This obligates her not only to recommend
treatments guided by the particular needs of individual patients but also to
engage in research to develop better interventions for future patients.
health.
o Social determinants of health contribute significantly to obesity. Dr.
Blackstone’s peer support study may contribute to the improvement of the
community and the betterment of public health.
o Particularly salient in this case, Dr. Blackstone can never fully step out of
her role as the physician for her patients who are participants in research
studies for which she is an investigator. This may mean that she chooses to
exclude patients for whom she believes participation may not to be in their
best medical interest.
Legal
• Physicians are obligated to act within the standard of care for the welfare of their
patients.
• Physicians have a legal duty to disclose their competing interests; some courts
have declared such information as material to the informed consent process for
treatment.9
• Malpractice actions can be based on failure to obtain appropriate informed
consent within the standard of care when it causes harm to the patient.10
• Federal law protects human subjects in clinical research through the Common
Rule, a set of regulations issued by the U.S. Department of Health and Human
Services.11 Fifteen other federal agencies have adopted the Common Rule,
including the Food and Drug Administration (FDA).12 The Common Rule requires
that an Institutional Review Board review and approve the recruitment plan for a
clinical trial such that subject selection is equitable.13
Options
1. Dr. Blackstone could have a study coordinator or other study staff member not
associated with Darlene’s clinical care inform Darlene of the Theniva study, give
her all the relevant information, explain options, and engage in an informed
consent process with Darlene if she is interested in participating.
2. Dr. Blackstone could tell Darlene about the Theniva study and let Darlene make
up her own mind about what to do.
3. In light of Darlene’s success in losing weight from her participation in the peer
support group study, Dr. Blackstone could choose not to tell Darlene about the
Theniva study.
4. Dr. Blackstone could work to add another researcher as co-PI and they each could
agree not to seek consent from their own patients.
5. Dr. Blackstone could consult with the pharmaceutical company sponsoring the
Theniva study to determine whether recruitment could begin after a sufficient
number of individuals have completed the peer support study. Dr. Blackstone
could also decide to stop enrollment in the peer support study now that she has
sufficient numbers and move to recruiting for Theniva.
6. To avoid potential complications related to therapeutic misconception, Dr.
Blackstone could remove her own patients from those studies for which she is an
investigator and recruit additional subjects from other physicians and clinics.
7. Dr. Blackstone could exclude from the Theniva study those patients that are
enrolled in her peer support group and instead only enroll new patients or those
who did not join or stay in the peer support group study.
8. Dr. Blackstone could refuse to act as an investigator on the Theniva study as
doing so creates competition between studies for subject recruitment.
1. In what ways are the roles of physician and researcher similar? How are they
different?
2. How might physician-researchers best manage the inherent conflict of interest
represented by these two roles? Can (or should) this conflict be avoided
altogether?
3. When is it permissible for physicians to recruit research participants from their
own patient pool? When is it impermissible? What situations might create a
stronger moral obligation either to include or exclude their own patients from
research participation on studies for which they are investigators?
4. When should the primary obligations of a physician override the primary
obligations of a researcher? When might the converse be true?
5. What obligations, if any, do physicians in an academic medical center have to

conduct their own research or act as a co-investigator on other studies (whether
local or multi-center)?
1. Seeking help: What additional information does Dr. Blackstone need to properly
address this situation? Who might be able to help? Would it help to involve a
mentor or consultant?
2. Managing emotions: If you were in this situation, what emotions would you likely
experience? How might these emotions affect your decision-making? How would
you manage these emotions effectively?
3. Anticipating consequences: What consequences should Dr. Blackstone consider
before deciding what to do? These include short- and long-term consequences as
well as positive and negative consequences. How can risk and benefit be balanced
in this case?
situation? What factors limit Dr. Blackstone’s options in this case? Which factors
are creating problems here?
5. Testing assumptions: What are Dr. Blackstone’s motives in this case and how do
they compare with the motives of other stakeholders? What assumptions might
Dr. Blackstone be making? How might these assumptions be tested?
References
1. CDC Centers for Disease Control and Prevention. Adult Obesity Facts. Overwight
and Obesity 2014; http://www.cdc.gov/obesity/data/adult.html. Accessed
3/26/2014.
2. Brody H, Miller FG. The clinician-investigator: Unavoidable but manageable
tension. Kennedy Institute of Ethics Journal. Dec 2003;13(4):329-346.
3. Appelbaum P, Roth L, Lidz C, Benson P, Winslade W. False hopes and best data:
Consent to research and the therapeutic misconception. Hastings Center Report.
1987;17(2):20-24.
4. Horng S, Grady C. Misunderstanding in clinical research: Distinguishing
therapeutic misconception, therapeutic misestimation and theraputic optimism
IRB: Ethics and Human Research. 2003;25(1):11-16.
5. NIH Website, "Clinical Trial Phases." http://www.nlm.nih.gov/services/
ctphases.html. Accessed 7/24/14.
Medical Research Education and Practice. Conflict of Interest in Medical
Research, Education, and Practice. Washington, D.C.: National Academies Press;
2009.
9. See, e.g., Moore v. Reagents of the University of California, 51 Cal.3d 120, (Cal.
Supreme Court, 1990).
11. 45 C.F.R. § 46 (2009).
12. Dept. Health and Human Services, Office of Human Research Subject
Protections, Federal Policy for the Protection of Human Subjects [web site],
visited 7/25/2016; 21 C.F.R. §§ 50, 56, 312, 812 (2015).
13. 45 CFR § 46.111.
Case 14
Unforeseen Consequences: The Bayh-Dole Act
By Erin Bakanas
The Bayh-Dole Act of 1980 allows recipients of government funding who

develop a patentable invention to retain the patent rights. Prior to the passage of the Act,
the government retained ownership of the inventions produced by government-funded
research. As a result, multiple discoveries did not move forward in marketing and
development because private companies could not obtain an exclusive license and were
forced to compete with many other companies, reducing profit significantly. Many
important discoveries did not make it to the marketplace.
While the Bayh-Dole Act is seen as promoting the dissemination and utilization
of scientific information, there are potential conflicts that result from its provisions as
well. For example, consider a physician-researcher at Big University who received
federal funding to study treatments for Fabry disease. Patients with Fabry disease lack an
enzyme necessary for the metabolism of a glycolipid, which then accumulates in various
tissues. The abnormal accumulation of the glycolipid can result in a range of symptoms
and system failures including abdominal pain, fatigue, heart failure, renal failure, and
malabsorption and weight loss. Patients with Fabry disease have a shortened life
expectancy and usually die from advanced cardiovascular or renal disease.
The Big University team developed an enzyme replacement therapy (ERT) that
alleviated pain and slowed organ damage in patients with Fabry disease. The ERT was
patented by Big University, and subsequently developed and marketed by ERT
Incorporated. The ERT product was the only available treatment for Fabry disease in the
U.S.
Recently, the FDA forced ERT Incorporated to close one of its manufacturing
sites for ERT because of contamination in the product. As a result, there is a national
shortage of the drug. ERT Incorporated rationed the drug and patients are being given
one third of the recommended dose. Patients are noticing a return of symptoms with the
dose reduction, and there is additional concern that end organ damage is also
accelerating. Patients with Fabry disease are now petitioning the NIH to require Big
University to grant a license for the ERT patent to other drug companies so national
production can increase.
How should the physician- researcher who led the team in developing ERT for Fabry
disease respond to this situation?
Case Analysis
Stakeholders

• The physician-researcher, because his ability to conduct research depends on his
ability to secure grant funding. He financially benefits from the successful
patenting and marketing of his innovation because grantee institutions must share
profits with the inventor. He also has a relationship with his patients that could be
negatively impacted if he is perceived as contributing to obstructing their access
to ERT.
• The research institution, because the ability to attract funding and patients
depends on having a solid reputation for responsible business and patient care
conduct, and the institution might profit significantly if it chooses to bring the
product to market.
• The pharmaceutical company, ERT Incorporated, because its stockholders expect
the company to make money.
• Government regulatory bodies (in this case the FDA and NIH), because of their
obligation to both protect and promote the public interest.
• The greater scientific research community, because of their obligation to balance
promoting scientific inquiry, making profits, and benefitting while not harming
patients.
• The community of patients with Fabry disease, because their wellbeing and
survival are dependent upon their access to necessary medication.
Facts
• Fabry disease is estimated to affect 1 in 117,000 persons. In the US, the estimated
number of persons affected varies, from a low of about 2,000 to a high of about
50,000.1
• A patent is an “intellectual property right granted by the Government of the
United States of America to an inventor to exclude others from making, using,
offering for sale, or selling the invention throughout the United States or
importing the invention into the United States for a limited time in exchange for
public disclosure of the invention when the patent is granted.” 2 The owner of the
patent can grant limited or exclusive use to other companies through a license.
• The Orphan Drug Act of 1983 created a profitable market for drug and biotech
companies. The Act created additional financial incentives and extended
ownership rights for companies that invest in research and manufacturing of drugs
for rare diseases, defined as conditions that impact less than 200,000 people in the
United States.3 Treatments for Fabry disease are included under the Orphan Drug
Act.
• The cost of care for people with Fabry disease is extremely high, with therapies
costing several hundred thousand dollars per year.4
Norms

o Fabry patients benefit from a system that supports the production and
distribution of the ERT that counteracts the multisystem decline caused by
the disease.
o The Fabry patients who received reduced (possibly sub-therapeutic) ERT
will be harmed by both symptom increase and disease advancement if the
situation is not resolved in a timely manner.
o The treatment population in this case is being asked to bear the full burden
of the plant shutdown and ensuing drug shortage.
o The physician-researcher has successfully brought his research product to
commercial availability, in keeping with the provisions of the Bayh-Dole
Act. However, he now faces another provision of the Act in deciding
whether to support expansion of ERT production by companies other than
ERT Incorporated.
o The physician-researcher takes care of patients with Fabry disease and will
have to manage the physical consequences of the ERT shortage in their
clinical care, as well as respond to their petition to get enzyme
replacement production expanded.
Legal
• The Bayh-Dole Act (1980) allows institutions that use government funding to
retain the patent rights for innovations that result from research conducted by their
scientists. While institution retain the patent rights, they often grant limited or
exclusive licenses (or permission for use) to a small number of companies for
production—such as for the manufacturing of a drug. However, under a set of
specific criteria, including health and safety concerns of the public, the
government does retain the right to “march-in” and force the patent holder to
grant licenses to other users.7
• The patent holder usually resists the government “marching in” because of future
economic losses. Once the government forces the patent holder to share their
intellectual property to more groups, the patent holder will have great difficulty
defending its patent in the future and will suffer economically from the increased
competition.
• There are strict procedural requirements involved in march-in rights and include
notice and comment periods, as well as appeal processes. The government may
terminate the process at any time.7
o If the government elects to march-in, the process will take time. It is
possible that ERT Incorporated may correct its manufacturing deficiencies
in time to prevent other companies from acquiring a license.
o A march-in can cause financial harm to the institution and the
manufacturer by limiting their ability to enforce their patent in the future
and driving down prices through competition, making it more difficult for
private companies to realize a return on their investments.
• By law, institutions are required to have agreements in place with researchers by
which invention rights are transferred from the researcher to the institution. The
researcher continues to receive a portion of any royalties.7
o The physician-researcher will continue to earn royalties from the
invention, even if other companies are granted a non-exclusive license.
o The FDA, through federal law, incentivizes development of drug therapies
for rare diseases. The Orphan Drug Act aids development of drugs for
diseases affecting less than 200,000 or more than 200,000 but the cost of
development cannot be recovered.8 The incentives include extended
market exclusivity and modified approval requirements. The FDA can
withdraw the drug manufacturer’s rights to market exclusivity if there are
insufficient quantities of the drug.9
Options
1. The Big University physician-researcher could advocate for an exploration of all

options to expedite the restoration of an adequate supply of ERT, including the
option of allowing another company to produce the enzyme.
2. The physician-researcher could choose to not get involved and instead let the NIH
resolve the problem.
3. The physician-researcher could gather support and advocate for the government to
exercise its march-in rights.
4. The physician-researcher could support ERT Incorporated retaining the exclusive
right to manufacture ERT.
5. The physician-researcher could encourage the University and ERT Incorporated
to challenge the FDA’s findings and actions in closing the plant to get ERT
Incorporated manufacturing ERT again.
6. The physician-researcher could disclose his conflict to his patients with Fabry
disease.
1. Physician-researchers often care for patients with limited treatment options for
their conditions, such as Fabry disease. They also research and develop new or
novel treatments for those same diseases and may profit from the sales of their
discoveries if they make it to market. How can these physician-researchers best
manage these conflicts?
2. Do large research institutions have any obligations beyond promoting research
with the goal of getting innovations to market?
3. Should the NIH step in and grant other companies licenses to produce drugs or
treatments in the event of severe shortages?
1. Seeking help: What additional information does the physician-researcher need to

properly address this situation? Who might be able to help? Where might the
physician-research find an unbiased, objective opinion?
2. Managing emotions: If you were in this situation, what emotions would you likely
experience? How might these emotions affect your decision-making? How would
you manage these emotions effectively?
3. Anticipating consequences: What consequences should the physician-researcher
consider before addressing the situation? These include short- and long-term
consequences as well as positive and negative consequences. What consequences
does the physician-researcher have control over? How can risk and benefit be
balanced in this case?
4. Recognizing rules and power dynamics: What laws or norms are salient in this
situation? What factors limit the physician-researcher’s options in this case?
Which stakeholders have the ability to address these problems and how can this
be done?
5. Testing assumptions: What are the physician-researcher’s motives in this case and
how do they compare with the motives of other stakeholders? What assumptions
might the physician-researcher be making of Big University and industry? How
might these assumptions be tested?
References
1. Martinez P. How common is Fabry disease? 2012;

http://www.fabrydisease.org/about-fabry-disease/general-fabry-disease-
information/item/233-how-common-is-fabry-disease, 2014.
2. United States Patent and Trademark Office, Department of Commerce. Patents.
Accessed September 4, 2014.
3. 21 CFR § 316.
4. See e.g. Genzyme.U.S. patient support. Genzyme Patient Support Services.
Accessed December 20, 2013.
7. The University and Small Business Patent Procedures (Bayh-Dole) Act of 1980.
Public Law 96–517, 96th Congress. December 12, 1980. 94 Stat. 3015, codified at
35 U.S.C. §201 et seq. 35 U.S.C. §203 (March-in rights).
8. Orphan Drug Act, Public Law 94-414 (1983); 21 C.F.R. § 316.
9. 21 C.F.R. § 316.36.
Appendix A. Index of Business Ethics in Medical Practice Cases
Case #1 #2 #3 #4 #5 #6 #7 #8 #9 #10
Topic
Problems that can arise from ✓ ✓ ✓ ✓ ✓ ✓
COI
General health care
✓ ✓ ✓ ✓ ✓
organization and systems ✓
Fostering patient care ✓ ✓ ✓ ✓ ✓

quality and safety
Medical professionalism,
the goals of medicine, and ✓ ✓ ✓ ✓ ✓
their relationship to medical
ethics
The structure and ethical
issues surrounding ✓ ✓ ✓ ✓ ✓ ✓
reimbursement systems for
physicians
COI arising from physician
relationships with ✓ ✓ ✓
pharmaceutical and device
industries
The legal framework for the ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
business of medicine
Appendix B. Index of Business Ethics in Medical Research Cases
Case #11 #12 #13 #14

Topic
The ideals of the medical research ✓ ✓
profession
Potential problems that conflicts of interest ✓ ✓ ✓
cause
Strategies for managing conflicts of interest ✓ ✓ ✓
in research
Challenges of playing the roles of both ✓ ✓
physician and researcher
Legal and policy issues surrounding ✓ ✓ ✓ ✓
conflicts of interest in research
Appendix C. SMART Decision-Making Strategies*
*
This table was developed by the Professionalism and Integrity in Research Program (PI
Program). It is used with permission. It may not be used for commercial purposes.

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Exploring Integrity in Medicine

The Bander Center for Medical Business Ethics

Revised Version. August 2016

Copyright © Saint Louis University 2014, 2016.

Available at: https://www.slu.edu/medicine/bander-center/education/casebook.php

The Structure of the Casebook

Engaging Norms—Both Ethical and Legal

How Were Topics Identified?

How to Use the Casebook

Logistics of Case Discussion

We recommend the following:

1. Accreditation Council for Graduate Medical Education. Common program

Dr. Jones is an internal medicine physician at Luke Health Systems (LHS) in a

How should Dr. Jones respond to Ms. Brigsby’s concerns?

The following are stakeholders in the case:

• The Accreditation Council for Graduate Medical Education (ACGME) includes

Mid-Level Principles of Biomedical Ethics3

• Autonomy: the obligation to respect the decision-making capacity of autonomous

o The primary responsibility for making an informed decision about which

AMA Principles of Medical Ethics4

• I. A physician shall be dedicated to providing competent medical care, with

Referral to LHS for MRI

o Regularly waiving co-payments and other charges can be an AKS

pre-authorization, and patient prompts to determine whether ordered tests are

1. Is Ms. Brigsby’s complaint justified? If so, on what basis?

SMART Decision-Making Strategy Questions

1. Accreditation Council for Graduate Medical Education. Common program

How should Dr. Bruce respond to this situation?

The following are stakeholders in the case:

Mid-Level Principles of Biomedical Ethics5

• Autonomy: the obligation to respect the decision-making capacity of autonomous

AMA Principles of Medical Ethics6

employees more aware of their health status.

• There is no federal legal distinction between penalties and incentives in wellness

1. What ought to be the individual physician’s role in institutional health policy?

SMART Decision-Making Strategy Questions

1. Baicker K, Cutler D, Song Z. Workplace wellness programs can generate savings.

Mr. Henderson, an 86-year-old male with multiple medical problems presents to

The following are stakeholders in the case:

Mid-Level Principles of Biomedical Ethics10

• Autonomy: the obligation to respect the decision-making capacity of autonomous

AMA Principles of Medical Ethics12

• I. A physician shall be dedicated to providing competent medical care, with

o The amount of reimbursement the physician receives should not influence

SMART Decision-Making Strategy Questions

Dr. Amy Aucel works as an orthopedic surgeon specializing in back pain in a

How should Dr. Aucel respond to this situation?

The following are stakeholders in the case:

Mid-Level Principles of Biomedical Ethics4

• Autonomy: the obligation to respect the decision-making capacity of autonomous

AMA Principles of Medical Ethics5

• I. A physician shall be dedicated to providing competent medical care, with

1. What is the best approach for confronting colleagues suspected of

6. Despite an emphasis on professionalism in medical practice, what experiences

SMART Decision-Making Strategy Questions

1. Mitchell JM, Scott E. Physician self-referral: Empirical evidence and policy

The following are stakeholders in the case:

Mid-Level Principles of Biomedical Ethics6

• Autonomy: the obligation to respect the decision-making capacity of autonomous

AMA Principles of Medical Ethics7