On January 9, 2017, a physician was sentenced for his role in a criminal health care fraud scheme totaling approximately $2.8 million and focused on False Claims Act (FCA) related allegations concerning this physicians’ participation in very complex and elaborate physician-owned distributorships (PODs). PODs are described by the government as physician-owned entities that derive revenue from selling, or arranging for the sale of, implantable medical devices ordered by their physician-owners for use in procedures the physician-owners perform on their patients at hospitals or ambulatory surgical centers. In recent years, PODs have been subjected to heightened regulatory scrutiny and oversight because of the potential for abuse, fraud, and conflicts of interest; as a result, the future of PODs remains highly uncertain.
When someone says PODs, it is natural to think of a sci-fi movie. For the life sciences industry, PODs have another connotation; physician-owned distributorships. Physician-owned distributorships are “physician-owned entities that derive revenue from selling, or arranging for the sale of, implantable medical devices ordered by their physician-owners for use in procedures the physician-owners perform on their patients at hospitals or ambulatory surgical centers.”