March 2019

Ethics Corner

Jonathan N. Sembrano, MD
Ethics & Professionalism Committee Member

How does a physician avoid unethical self-referral practice when simultaneous practicing within and outside a government health system?

Many spine surgeons have dual employment, wherein they are part-time employees at a government facility, such as the Veterans Affairs (VA) Health Care System, and a non-government facility (private/academic institution). It is not unusual for patients seen at the government facility to be deemed by the surgeon, for one reason or another, to be more appropriately managed at another facility. Oftentimes, the surgeon also feels that his/her other practice site is the best facility to handle this problem. This then brings up the question of whether this type of practice represents abuse of government employment for self-gain.


A 68 yo male Vietnam war veteran had been going to the VA for healthcare for many years; he also had been dealing with chronic low back pain, which he attributes to multiple crashes as a paratrooper. Twenty years ago, he had spinal fusion (unrecalled levels), which helped at the time. Over time, however, his back pain has been getting worse; he also gets cramping and numbness in his legs with standing or walking for more than a few minutes. He has also developed an increasingly stooped posture. He underwent physical therapy for three months, with little effect. Medications such as ibuprofen and acetaminophen also give minimal relief. He had received several epidural injections over the years, initially with good response, but with decreasing effectiveness with subsequent injections. His primary care physician thus referred him to the Orthopedic Surgery service for his back problem.

The patient was seen at the orthopedic clinic by Dr. Jones, who, after examination and review of imaging studies diagnosed him with advanced multilevel spondylosis, spinal stenosis, degenerative scoliosis, and flatback syndrome / sagittal malalignment. Given the patient’s worsening and disabling symptoms, as well as failed nonoperative treatment, he recommended surgical treatment. He deemed that the best procedure would be multilevel fusion (T10-pelvis), with decompression and possible 3-column osteotomy. He discussed his recommendation with the patient, including the rationale, the anesthetic and surgical risks, and alternatives that included smaller surgery (e.g. decompression only or shorter fusion), continued nonoperative treatment, or living with his symptoms. The patient agreed to proceed with the bigger surgery.

Dr. Jones felt that it would be better for the patient to have this surgery done at the University, where he also practices. In his mind, the justification for sending the patient to the University for surgical care (at the VA’s expense) is justified by the following reasons: (1) these complex cases are more routinely done at the University, thus the OR and floor staff are more used to handling these cases; (2) the ICU facilities at the University are more advanced, and patient will likely benefit from this; (3) he has spine surgical partners at the University who are available for co-surgery, whereas he does not have this type of support at the VA. He thus asked for VA approval to send the patient to the University for surgical care.

The individual in charge of approving requests for non-VA care reviewed Dr. Jones’s request. She notes that this is the fourth time within the past month that Dr. Jones has made such a request, and that during his four years of practicing at the VA, he has regularly sent out patients only to himself, and he performs their surgeries at the University. She begins to wonder if this regular practice by Dr. Jones may constitute a breach of VA rules and regulations.


This is a somewhat complex scenario to fully analyze, as many possible aggravating and mitigating circumstances that make each individual case unique.

On one hand, we have the Stark Law, which is a set of United States federal laws that prohibit physician self-referral, specifically a referral by a physician of a Medicare or Medicaid patient to an entity providing designated health services ("DHS") if the physician (or an immediate family member) has a financial relationship with that entity. The VA Employees Handbook also clearly forbids employees from using their VA position for profit, including involvement in contract negotiations when they or a family member stands to financially benefit from the transaction.

On the other hand, many physicians who find themselves in this situation oftentimes do this out of genuine concern towards doing what is best for the patient, with little regard for enriching themselves. But why then would surgeons send patients to themselves or to the facility they work at, rather than simply placing a generic non-VA referral? There may be different reasons for this, but generally, especially after having developed some relationship with the patient, physicians would like to send the patient to where they feel the best care would be given. And when it comes to surgery, surgeons also generally feel that they have better control of the outcome if the surgery is done by their hands, especially if the procedure is something they feel comfortable/qualified performing, and if it is not a commonly performed or not always well-performed procedure in other institutions by other surgeons (such as multilevel T10-pelvis fusion and possible pedicle subtraction osteotomy in this case).

The following are recommended steps to mitigate the risk and perception of unethical self-referral for government-employed employed surgeons with dual employment:

  1. Have the case reviewed by your supervisor (e.g. chief of orthopedic service) to decide on whether non-VA care is justified.  That way, you are not unilaterally making the decision.
  2. Give the patient the option of going to a different surgeon/institution.
  3. If you deem that your other practice site is the best one to treat the patient (over other non-VA facilities in the area), consider sending the patient to a different equally qualified surgeon instead of yourself.
  4. Consider a smaller procedure (e.g. decompression only) that could be safely performed at the government facility and that may also reasonably yield good outcomes and does not burn bridges (i.e., fusion surgery may still be performed later if necessary). This recommendation is made with the acknowledgment that every case is different and that the smaller surgery option may not always be the most appropriate.
  5. For medically complex patients, involve other specialties (Anesthesiology, Surgical ICU, hospitalists) in setting guidelines to determine which cases are appropriate for referral to other institutions. This way, the decision is not simply made by the individual surgeon.


Chair: B. Stephens Richards, III Committee: Kamal N. Ibrahim, Past Chair; James M. Eule; Timothy A. Garvey; H. Robert Tuten; Christian P. DiPaola (C); Sang D. Kim (C); Olavo B. Letaif (C); Jonathan N. Sembrano (C); Paulo J. Silva Ramos (C); Bekir Y. Ucar (C); Anthony M. Petrizzo; Jochen P. Son-Hing; Jacob M. Buchowski; David A. Hanscom; Steven D. Glassman, Chair Elect; Sherif M. El Ghamry; Hee-Kit Wong