Mr. RANGEL. The hearing will come to order. Mr. Gilman.
Mr. GILMAN. Thank you, Mr. Chairman.

Gentlemen, the medical profession has a code of ethics, am I correct?
Dr. BOYLE. That's correct.

Mr. GILMAN. In each locality they abide by the code of ethics?
Dr. BOYLE. That's correct.

Mr. GILMAN. And does the AMA also have a code of ethics?

Dr. BOYLE. The code of ethics of the local society is the code of ethics of the AMA, as is the State medical society, although the local society may have other requirements for membership other than those that would be imposed by the AMA.

Mr. GILMAN. Does the AMA encourage disciplining violations of the code of ethics?

Dr. BOYLE. We most certainly do.

Mr. GILMAN. What do you do in that direction?

Dr. BOYLE. The AMA, first of all, looks to its local societies to do that. You need to understand how this functions. Much of the function of this organization is like a central organism with a lot of parts. The arms and fingers and hands, if you will, of the AMA are the local affiliates. It's a federation of organizations, all of which adhere to the same standards. We look to local medical societies to pursue with every degree of vigilance possible, or vigor possible, the application of the code of ethics to the practices of individual physician members of those societies.

Mr. GILMAN. And if those societies are lax and are not doing anything, what do you do?

Dr. BOYLE. Our State medical associations do exert every pressure that they can on local societies and in many instances

Mr. GILMAN. What sort of pressure are you referring to?

Dr. BOYLE. The pressure of the leadership of the State medical association on the leadership of the local associations. These people, Mr. Gilman, accept their responsibilities very seriously and conscientiously. In the county societies that I am most familiar with in California, I can assure you that they take those responsibilities very, very seriously, even to the extent that in the last 4 or 5 years some of those societies have incurred legal costs in excess of several hundred thousand dollars in trying to discipline individual physicians, and then they are being brought into court by the physician complaining of the local society's activity. So they take those responsibilities very seriously.

The AMA looks to the State associations to provide that kind of activity with its local affiliates and the AMA in turn does advise State medical associations of things that we see that we think local associations or societies should be doing.

Mr. GILMAN. Can you tell us what else specifically the AMA is doing to try to stem the illicit practices of drug abuse and drug trafficking within the profession?

Dr. BOYLE. Yes. First of all, we do have now in almost every State as well as in the AMA councils which are concerned with the individual physician's behavior-because not infrequently that aberrant behavior may be represented in his practice with his patients-we have in California, for example—and I know this to be true in other

States-we have a local hot line where the people who think that a given doctor is in trouble can pick up the telephone and call the central office and inform them of what this physician's behavior is.

Mr. GILMAN. Well, if you get a complaint-if AMA gets a complaint that a physician is acting improperly or illegally, what does AMA do about it?

Dr. BOYLE. If the AMA were to have a complaint directed to us, and I know that we do from time to time, the AMA would instantly forward that complaint to the State medical association and ask the State medical association to pursue it. The State medical association, if this were a complaint of alleged criminal behavior, would report that to the State board of medical quality assurance. If it is a complaint that has been delivered to the State medical association either from the AMA or the local society or somebody else of some complaint with respect to physician behavior, there are local committees that are very actively involved in all kinds of efforts to try and improve the behavior of physicians. If this is in the area of drug abuse or substance abuse of any kind, that local committee would investigate.

It would do its very best to determine what the facts are, and if it appears that this were illegal behavior on the surface it would then be reported to the appropriate regulatory agency because we do not have the subpena authority; we do not have the regulatory authority that such an agency has. If it were a matter of what appeared to be aberrant behavior there would be counseling on the part of the local medical association, there would be counseling on the part of the peers of that physician's local medical community. In many instances you have no idea what the pressure of peer attitudes can be on a physician in a given community. If a physician's behavior, not only in this kind of prescribing but all other kinds of diagnostic and therapeutic activities, differs substantially from that which would conform with accepted good medical practice just the behavior of his own colleagues toward him on the hospital staff, in the community meetings and everything else is sufficient to cause that person to do one of two things: Either go get educated and find out what he or she is doing wrong, or in some instances to withdraw and become isolated. When that does happen, then again that reaches the point where the most that can be done under those circumstances is: First, to encourage that physician in areas of continuing education as best we can, but in the second instance, where it's just a person who is not subject to this kind of change, then we see to it that the appropriate agency having authority to discipline him gets that information.

Mr. GILMAN. Just one or two more questions, Mr. Chairman. Doctor, you started listing the activities of the AMA. What other activities do you have for checking behavior?

Dr. BOYLE. As far as the AMA is concerned, again, I just have to say a lot of these things are done through other parts of our organization, through other parts of our federation. The AMA has spent I don't know how many hundreds of thousands of hours in volunteer time out in counseling young people, attempting to try and prevent the drug abuse from getting there before it starts, in conducting seminars for physicians in the whole area of substance

abuse, in advising local agencies in becoming involved in the activities that are intended to try and get at the illicit use of drugs.

Mr. GILMAN. Mr. Chairman, with your permission, I'd like to request that Dr. Boyle supply us with a list of AMA's activities for the record and that they be inserted at this point in the record, a list of the activities for trying to stem the drug abuse and illicit narcotic trafficking and improper activities by your own physicians.

Mr. RANGEL. Without objection. There's no problem?

Dr. BOYLE. Fine. No problem.

[The AMA response to this request is included in the letter of November 22 on p. 322.]

Mr. GILMAN. Mr. Chairman, one further question, and I know I have overextended my time. Dr. Boyle, there's been some reports that we have received that there are many physicians that have a proprietary interest in pharmacies. Would you consider that to be a conflict of interest?

Dr. BOYLE. Yes, I personally do.

Mr. GILMAN. Is that a violation of any of the professional ethics? Dr. BOYLE. No. Just having a proprietary interest in a pharmacy is not a violation of ethics. The AMA's position on this, however, is that it would be unethical behavior if this in any way exploited the patient or the individual.

Mr. GILMAN. Suppose that physician was referring prescriptions to his own pharmacy. Is that a conflict?

Dr. BOYLE. In my opinion, it's a conflict of interest. It would become unethical behavior if in fact the physician were directing that person to go only to that pharmacy and that pharmacy was charging more and providing less service than was freely available in the community.

Mr. GILMAN. Well, am I correct that the association, the AMA, does not frown upon a physician owning a pharmacy?

Mr. PETERSON. We will be glad to submit in writing the specific policy statements on that issue. It is discouraged to have an ownership of or interest in a pharmacy. However, there may be circumstances, and particularly when you get into the more rural and isolated areas, where you might deprive patients of access to pharmacies that physicians may not have the ability to provide drugs to patients through a pharmacy. With respect to the steering, so to speak, by physicians to a particular pharmacy, that would be frowned upon and would be against the policy.

Mr. GILMAN. Is this a widespread practice?

Dr. BOYLE. I believe that it is not, Mr. Gilman. I think there are instances in which it occurs.

Mr. GILMAN. Do you have some data?

Dr. BOYLE. I think we could find for you the data in at least some States where this has been compiled. I would suspect we could find it for you fairly quickly in California because not too long ago-about 10 years ago now I guess there was a law adopted which made it illegal for a physician or any member of the family to own an interest in a pharmacy.

Mr. GILMAN. You say California has adopted a statute making it illegal, and yet AMA doesn't prohibit this?

Dr. BOYLE. We do not prohibit having a proprietary interest in a pharmacy. We believe that anybody ought to be able to own an interest in anything they want to. Whether it becomes a behavior which we would discourage or frown upon or not approve of or any word you want, first, it would become absolutely unethical behavior if this resulted in any exploitation of the patient, period.

Mr. RANGEL. Wait a minute. I'll wait until you finish.

Mr. GILMAN. I would be pleased to yield to the chairman.

Mr. RANGEL. It really doesn't make any difference to the AMA as to what is ethical or what is unethical. The only question that you've addressed is whether or not a member of the American Medical Association is in tune with the standards of the local chapters. So, you can take positions or not take positions; the question of what is ethical is really not important. You don't have your own ethical standards. That's what you have done, if I understood you correctly.

Dr. BOYLE. We will be glad to provide you with it.

Mr. RANGEL. Wait a minute. You're not going to tell me, I hope, Dr. Boyle, since you have no investigative powers, that you are afraid that you're going to be sued for libel and slander. If, in fact, I have violated the code of ethics of the State of New York as a doctor, strike that out-I violated the AMA standards, you can refer every day, every week, saying Rangel has violated the standards, but you're not thinking about canceling my membership with the AMA. If you're not going to do anything, then those standards that you have are really for the books. You're not going to affect me professionally because you don't see that as the role of the AMA. Isn't that correct?

Dr. BOYLE. No, that's not correct, Mr. Rangel.

Mr. RANGEL. This is the most positive testimony I'm about to receive. Tell me what happens when a doctor is in violation of the standards of the American Medical Association. What do you do?

Dr. BOYLE. If a physician is in violation of the code of ethics of the AMA and that were to come to our attention, we would bring this to the attention of the State-in your instance, the State of New York.

Mr. RANGEL. I'm a doctor and I come to you and I say that I'm in violation. I don't believe you have the right to have any standards at all and so here I am in violation. So you refer it to New York State and everything is worked out in New York State. What are you going to do to me? Nothing; you just refer the case.

Dr. BOYLE. We would anticipate that the State of New York would give that physician opportunity of due process to

Mr. RANGEL. Due process. They haven't called me in.

Dr. BOYLE. Well, they will, believe me.

Mr. RANGEL. You're dependent on the fingers and the hands and the feet and the toesies of the local organizations but you have no power or have not assumed any power to adversely affect my ability to practice medicine in violation of your "code of ethics." You refer it.

Dr. BOYLE. First of all, Mr. Rangel, I'm sure you recognize the fact that the ability of an individual physician to practice medicine depends upon the license which is given to him or her by the State in which that person practices.

Mr. RANGEL, Or States.

Dr. BOYLE. Or States.

Mr. RANGEL. So clearly we're talking about physicians that have violated the code of ethics in one State. We don't have a Federal standard. That's why the Congress will be getting involved, because the American Medical Association has not found it included in their function or bylaws or constitution to set any Federal standards. The truth of the matter is, as I said earlier, if I was jailed in New York and lost my license to practice in the State of Virginia-it doesn't apply as long as I come in from the Virginia local AMA. You're not going to determine whether the law is unconstitutional in New York. You don't have that function.

Dr. BOYLE. You lose your license to practice in the State of New York, I would presume.

Mr. RANGEL. Don't do that. You're a doctor now.

Mr. NELLIS. It just isn't so.

Mr. RANGEL. You're a doctor and if you refuse to assume any Federal standard because you say it's a State responsibility, then for God's sake don't assume that under your code of ethics that because I lose my license in New York State that you're now going to say that the State of Virginia is supposed to deny me the right to practice medicine. Dr. BOYLE. First of all, it would depend upon the State laws, not upon the standards of ethics of the American Medical Association. Mr. RANGEL. So the felon doesn't do violence to your standards. Dr. BOYLE. Whether or not somebody is licensed. Now as far as ethical behavior is concerned, we may declare somebody to be in violation of the code of ethics of the AMA, in which case that person may lose their membership in the AMA, for whatever value that has to the individual.

Mr. RANGEL. That's very important and that's why I want you to elaborate on that. There are instances where you are not dependent on the local and the State associations, that you—that is, the AMA—has made an independent determination that one of its members violated the American Medical Association's code of ethics, notwithstanding the local's, you're saying that

Dr. BOYLE. OK; what we're saying is this, that the court in which that will be tried is the court of local jurisdiction.

Mr. RANGEL. What court? I'm talking about ethics.

Dr. BOYLE. The area in which this will be determined is the court of local jurisdiction, the judicial council of the local medical association. Everybody has them.

Mr. RANGEL. I understand.

Dr. BOYLE. But is is our code of ethics that we are asking and we expect people to conform to.

Mr. RANGEL. So you farm out the cases to the locals.

Dr. BOYLE. If it's violated, we expect that to be taken up in the jurisdiction in which that occurs.

Mr. RANGEL. What if they don't take it up?

Dr. BOYLE. On occasion-there have not been many but there have been cases in which these have been heard before the judicial council of the AMA State medical associations.

Mr. RANGEL. That's not your job. Don't you really believe that doctors who take the oath that individually and generally speaking they have a very high standard of professional conduct? Further, there's