title: Surgeon ownership in medical device distribution: does it actually reduce healthcare costs?
abstract: BACKGROUND
  Surgeon ownership in medical device distribution is a new model that proposes to reduce the costs associated with surgical implants. In surgeon-owned distributorships (SDs), the surgeon becomes the purchaser through ownership and management of a distributorship. The purpose of this study is to determine whether significant cost savings can result from SDs.
  
  
  METHODS
  Five existing SDs were retrospectively reviewed, and their implant pricing was compared with non-SDs. The hospital pricing for implants supplied by the SDs was compared with 2010 pricing from the best contract/capitated rate for like implants from non-SDs.
  
  
  RESULTS
  The average first-year cost savings for the SDs was 36%, with US$2,456,521 total savings in 2010. For distributorships in business for over 2 years, the average annual price from the SDs actually decreased by 1.41%.
  
  
  CONCLUSIONS
  This study demonstrates that SDs are capable of providing substantial healthcare savings through lower implant costs and reduced annual price escalations.
authors.affiliation: a 1 Arrowhead Orthopaedics, Redlands, CA, USA.
authors.forename: John C
authors.initials: JC
authors.lastname: Steinmann
authors.affiliation: b 2 The Maryland Spine Center, Mercy Medical Center, Baltimore, MD, USA.
authors.forename: Charles
authors.initials: C
authors.lastname: Edwards
authors.affiliation: c 3 Cornerstone Orthopaedics and Sports Medicine, Louisville, CO, USA.
authors.forename: Thomas
authors.initials: T
authors.lastname: Eickmann
authors.affiliation: d 4 Alliance Surgical Distributors, LLC Redlands, CA, USA.
authors.forename: Angela
authors.initials: A
authors.lastname: Carlson
authors.affiliation: b 2 The Maryland Spine Center, Mercy Medical Center, Baltimore, MD, USA.
authors.forename: Alexis
authors.initials: A
authors.lastname: Blight
mesh_terms: D003132:Commerce / Q000191:economics* / Q000458:organization & administration; D017046:Cost Savings; D004864:Equipment and Supplies / Q000191:economics*; D017048:Health Care Costs; D006801:Humans; D017146:Models, Organizational; D010067:Ownership; D012189:Retrospective Studies; D066231:Surgeons / Q000191:economics* / Q000458:organization & administration
keywords: cost-savings; healthcare costs; orthopedics; surgeon owned distributorships; surgical implants