Drug, medical device companies paid teaching hospitals, docs nearly $6.5B last year

The pharmaceutical and medical device industry contributed a shade under $6.5 billion to the nation's teaching hospitals and physicians last year, the Wall Street Journal has reported. That sum includes consulting services, research and promotional speeches about drugs. The money also included non-clinical payments, such as the value of free food provided to doctors by drug and medical device sales representatives. 

The Centers for Medicare & Medicaid Services (CMS) has posted the data in its searchable open payments database, part of its efforts in healthcare financial transparency that were mandated by the Affordable Care Act.

About half of 2014's total payments, or $3.23 billion, were categorized as research-related activities, and roughly 81 percent of those payments were in the form of cash or cash equivalents, according to the WSJ.

Some individual companies made hundreds of millions of dollars in payments. Genentech spent $373.4 million, although more than $250 million went to City of Hope National Medical Center in Southern California for royalties on cancer medications patented by the hospital.

The American Medical Association (AMA), however, questioned the data's accuracy in a statement to the WSJ. "The vast majority of the data released ... has not been independently validated by physicians, which makes it less usable for the patients it's intended to benefit," the AMA said.

In its first round of physician payments released last year, CMS came under criticism for not properly vetting the data, leading to gaps and overlaps in the data, prompting the agency to vow to fix the issue. Another database CMS released last year, which chronicled payments from the Medicare program directly to physicians also contained data gaps and was difficult to use without database administration software.

To learn more:
- read the Wall Street Journal article (subscription may be required)
- check out the CMS database