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It has come to your attention that you have five major orthopedic surgeons, all using different vendors for their knee and hip implants

It has come to your attention that you have five major orthopedic surgeons, all using different vendors for their knee and hip implants

Dale Buchbinder

You are the executive in charge of finances for the operating room at Sleepy Hollow General Hospital. It has come to your attention that you have five major orthopedic surgeons, all using different vendors for their knee and hip implants. You have held several meetings with the implant companies and determined that if you went with one standard set of implants, you could reduce your implant costs by 40%, a potential net savings of $2.8 million to your institution in the next year. This seems to be a reasonable objective, and you set up meetings with the different orthopedic surgeons.

First you meet with Dr. Goodcut and tell him you would like to standardize the implants in the hospital. Dr. Goodcut tells you he believes that this is a good idea. However, he will only use the products from Alpha Company. He has used them for many years, he knows how to use the equipment, and feels they are by far the best product.

You next meet with Dr. Safari, one of your busiest orthopedic surgeons. You again explain this process. He in turn agrees this is a good idea. However, he will only use the products from Beta Company. He has essentially the same logic and reasons as Dr. Goodcut. This is beginning to seem like a theme.

You meet with the three remaining busy orthopedic surgeons to see if they might be interested in switching to another implant company. However, two of the surgeons would like to know what is in it for them if they make the switch. The third surgeon in this group will only use products from Gamma Company. He has the same reasons that you have previously heard from the first two surgeons. At best, you may be able to go with three vendors instead of five;however, this will yield only a $200,000 savings.

You are a bit concerned at the surgeons’ reluctance to select a standard implant company. Their reasoning seems insincere to you. You begin to examine the websites of each of these companies. Each company lists physicians who have either been involved in the development of the product, or have played consulting roles with their companies. Additional investigation leads you to the discovery that Dr. Goodcut has been involved with the development of the products at Alpha Company. In addition, he is listed on the patent for several other devices. You find similar relationships between the companies and the other two orthopedic surgeons who are unwilling to switch their implants. You begin to be concerned these surgeons have more reasons than stated to resist switching. Each of them may, in fact, have a conflict of interest.*

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