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Third-Party Involvement In Hip Replacement Recall Questioned

August 22, 2011

Johnson & Johnson’s (J&J) unusual decision to hire a third party to oversee patient claims related to an artificial hip recall in their DePuy Orthopaedics Inc. unit has drawn mixed reaction from medical industry and legal experts, according to a Sunday report by Reuters’ Toni Clarke.

According to Clarke’s report, Indiana-based DePuy recalled the metal ASR hip system approximately a year ago after it “failed at a higher-than-expected rate, with some patients experiencing pain, swelling, joint dislocation and sometimes systemic damage to the central nervous system, thyroid and heart.”

That recall–the latest in a long line of recalls of J&J branded or affiliated products–has prompted more than 2,000 lawsuits in U.S. state and federal courts, Clarke says. Now the company has enlisted Broadspire Services, which “manages workers compensation and other medical claims on behalf of insurance companies and employers” to handle patients claims for “out-of-pocket medical costs associated with the recall.”

“The move has prompted debate among industry and legal experts,” the Reuters reporter said. “Some see it as an efficient way to outsource a process that is unrelated to making artificial hips. Others see it as a way for J&J to limit payments while gaining control of medical records and other material that could be used against patients in court.”

Typically, Clarke said, a company and their legal team oversee recalls directly, answering patient requests, paying reimbursement claims, and following each patient’s doctor’s recommendation regarding whether or not a device should be replaced or removed. However, in the DePuy case, the final call is up to Broadspire’s physicians, not the patient’s own doctors.

“While Broadspire physicians cannot directly override a patient’s doctor in terms of treatment, they make the decision on whether to pay,” she wrote. “That can effectively rule out surgery for patients who cannot pay.”

“Doctors who are evaluating these cases are being paid indirectly by DePuy, and research suggests that even when we are very well-intentioned we can be influenced by conflicts of interest,” Kristin Smith-Crowe, an associate professor of management at the University of Utah and a business ethics specialist, told Reuters. “This is a bit of a red flag in terms of the way this situation is set up.”

DePuy spokesperson Lorie Gawreluk defended Broadspire’s involvement.

“Similar to the process insurance companies use to evaluate claims from subscribers, medical records are collected by Broadspire if a patient requests financial assistance,” she told Clarke in an email. “Broadspire requires no more information than a typical insurance provider would request, and like an insurance provider, Broadspire has a team of reviewers who review claims.”

“Patients and lawyers argue that the hip recall claims should not be treated in the same way as a standard medical claim,” Clarke added. “An insurance company, after all, does not decide whether to reimburse policyholders for medical costs related to a problem it caused itself. Moreover, lawyers representing patients say the amount of information being collected by Broadspire is excessive.”

For example, the Reuters article reports that in August 2010, DePuy officials contacted orthopedic surgeons, asking them to give their patients an information packet detailing the recall. Clarke says that the package included “a form letter from doctor to patient, written by DePuy, asking the patient to set up an appointment to discuss any concerns and to bring with them a signed medical release giving the physician permission to share information with DePuy.”

In exchange for their cooperation, the company offered doctors $50 for each completed form.

“I have been doing this work for 35 years and it is almost unprecedented for a large corporate defendant to run out and preemptively attempt to identify potential claimants,” Alex MacDonald, a partner at the law firm MacDonald Rothweiler Eisenberg who is not involved in the case, told the news agency. “J&J is reaching out to doctors and asking them to use their influence with their patients in the hope that the doctor will help identify potential claimants in a lawsuit.”

Gawreluk called the procedure “standard practice for“¦ healthcare professionals.”

The hip replacement systems are just the latest in a long line of J&J products to be recalled over the past two years. Other recalls during that time included products such as children’s pain reliever, allergy medication, antacids, insulin cartridges, contact lenses and more. Their handling of some of these recalls “has in some cases sparked Congressional and federal criminal investigations,” Clarke noted.

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