Avoid stolen and counterfeit devices, or risk liability for poor patient outcomes
Harmonic scalpels and staples were missing at a hospital in Florida. A review of videotapes showed what appeared to be a surgical resident leaving the equipment storage room with items he was not authorized to take. After a picture of the resident was circulated, a security officer noticed a man in scrubs resembling the photo going into the storage room. The resident eventually confessed to the theft and was arrested.
Subsequent investigation revealed he was selling the devices to a Florida medical supply company that advertised itself as being a distributor of recycled and used medical equipment. The resident was convicted of grand theft.
Sometimes there are red flags for such incidents, such as employees who appear to be living beyond their means. One hospital scrub tech reportedly was living in a $600,000 house, driving two new BMWs, and building some condominiums. The employee subsequently was found to be stealing medical devices from his hospital.
In the current economy, outpatient surgery providers are reporting increases in stolen and counterfeit items.
"If they are being sold out your back door by your own staff so they can make a few extra bucks, this is costly theft — not only the cost of replacing missing instrumentation, but the risks when a backup piece is not available should a needed instrument break during a case," says Mark Mayo, executive director of the ASC Association of Illinois and principal at Mark Mayo Health Care Consultants, Round Lake, IL.
Hospitals and surgery centers might find themselves out more than a few dollars, however, says Dan Kelley, director of global brand protection, Ethicon Endo, Cincinnati. "If a facility elects to purchase from an unauthorized source, then it is buying products that have left the normal supply chain, which raises the potential for poor patient outcomes and subsequent liability," says Kelley. "The product may not have been stored or handled properly, which may create patient risk." Some counterfeit items have been found stored in residential garages in south Florida or other environments lacking cleanliness and temperature control, he says. "And if the general public knew those devices were going to be used on them, they would be shocked," Kelley says. "In addition the product may have been recalled or might be recalled in the future, and manufacturers would have no way of contacting you about those recalls," he says. For its part, Ethicon Endo-Surgery doesn' t warrant or assume liability for products purchased from unauthorized sources.
Another concern is counterfeit devices that are deceptively passed off as an original product by copying the look of a genuine device. Some counterfeit devices are poor quality, manufactured from the wrong material, and/or may have questionable effectiveness, Kelley adds.
Could you identify a counterfeit item?
Based on the growing number of counterfeits items detected each year, counterfeit items aren' t always easy to spot, Kelley says.
"Counterfeit packaging is deceptive and difficult to distinguish," he says. "Doctors, nurses, and patients think it' s our product."
Consider the class I recall of counterfeit polypropylene surgical mesh in 2010. Various sizes of counterfeit flat sheets of polypropylene surgical mesh were marketed in the United States labeled with the C. R. Bard/Davol brand name. They were distributed for more than a year. RAM Medical admitted purchasing misbranded surgical hernia mesh from a company in the United Arab Emirates and in India. The company also acknowledged selling boxes of mesh containing numerous microorganisms to several distributors and individuals. (For more information, go to http://1.usa.gov/clhXJD.)
Another potential liability exists with products stolen out of hospitals. More than 60 people have been charged with theft since 2004, Kelley says. At ebay.com, there are hundreds of listings for any piece of surgical equipment, he points out. These are products that are not available in general merchandise stores, Kelley says. "The question everyone should be asking is, ' What' s the source of that product?' " It might be safe to assume that the product is "walking out of hospitals," he says.
The counterfeit samples were not sterile although they were labeled as sterile. They had a weave pattern and structure that was different from the authentic mesh. The counterfeit mesh did not have properly finished selvage edges, and that factor might have allowed the counterfeit mesh to unravel. Also, the expiration dates on the labels of some of the counterfeit product samples did not match. RAM Medical was sentenced to three years of probation and ordered to pay a $100,000 fine and about $73,000 in restitution. Several lawsuits have been filed.
To avoid problems at your facility, consider these suggestions:
• Buy direct from a manufacturer or through authorized distributors.
Mayo says "I think you are going to find the bottom line here to be caveat emptor and make purchases from reputable vendors. People should not be out there on the internet or social media trying to save a few bucks buying instruments."
He admits that there is appeal to getting a deal on backup instrument tray sets when hospitals close or consolidate, but Mayo asks, "Is it worth the risk?"
Be wary of Internet promotions, e-mails, and flyer promotions, Kelley warns. Several sources are sending hospitals faxes and emails, and they say they can sell devices cheaper than hospitals can get from authorized sources. Managers are under pressure to cut costs, so they might be tempted to purchase from these sources, Kelley says.
Possible sources of diverted products include online auction sites; products stolen from hospitals; sales samples; damaged products, such as ones that are water damaged; obsolete hospital inventory; product that has been fraudulently rebated; product intended for training labs; and product imported from out of the United States, Kelley says.
• Track actual product usage versus purchases.
Look for shrinkage, Kelley advises "Figure out if you' re losing product," he says. "You know what you used on patients. Make sure what you used on patients equals what you purchased."
Another tip is to look for appropriate product utilization. For example, look at number of reloads used per stapler. Facilities that use a particular Ethicon stapler should be buying about 5.5 reloads per stapler. "If they are buying too many reloads versus the number of their guns, they may have a theft problem," Kelley says. Ethicon runs quarterly reports and contacts facilities at which the number of reloads doesn' t seem to match the number of stapler guns. If you use another manufacturer, ask what controls are being put in place to measure items such as this one, Kelley advises. Products that come in small packages like stapler reloads, and expensive capital equipment like flexible GI scopes are examples of common theft items.
At the Florida hospital where the resident thefts occurred, a large number of stents were replaced over several months. "I was called and asked what was my opinion of what was going on," says the director of security, who requested anonymity for this interview. "I said, ' They' re being stolen.' "
• Ensure missing items are reported.
Employees often are reluctant to report missing items because they think the items simply are misplaced, says the security director at the Florida hospital.
Missing items probably are stolen, the security manager says. "Some equipment may be misplaced, but reporting lets security department know if there is a problem," he says. If the missing items are found later, the theft report can be amended, he says.
• Increase security.
At the hospital in Florida where the resident thefts occurred, the storage room had a combination lock. "Everyone had the combination," says the security manager. "The doctor told us if he forgot it, he asked, and someone would give it to him." The security staff had recommended changes before the thefts, but the recommendations were ignored, the security manager said.
Now the storage room has card access and a video camera inside the storage room. Additionally, one staff person is assigned to work in the room.
Ensure that your facility has small, high-value products in a secure location, and place cameras in high-dollar supply areas, Kelley advises.
Audit product-handling processes and identify areas of risk, such as your receiving dock and trash cans, Kelley says. Be on the lookout for employees exiting with boxes or bags, Kelley says. Also, conduct background checks on all employees, he suggests.
"Make sure you' ve got proper processes in place to prevent people from stealing from you," Kelley says.
Harmonic scalpels and staples were missing at a hospital in Florida. A review of videotapes showed what appeared to be a surgical resident leaving the equipment storage room with items he was not authorized to take.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
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