Transparency of faculty-compensated outside activities is vital for maintaining the public's trust. Many medical schools have recently required public disclosure of their faculties' compensated outside activities. We evaluated the accuracy of the disclosure of US medical school deans who served as directors of for-profit companies in 2009 because we could independently verify the compensated outside activities through publicly available databases.
We compiled a list of all US allopathic and osteopathic medical schools and performed a Google search for the names of each dean as of June 2009. We entered each name into 2 databases: the Morningstar directory of US corporate directors and executives (Morningstar, Chicago, Illinois) and EDGAR, the Securities and Exchange Commission (SEC) database of all submissions by companies and others who are required by law to file forms with the SEC).1,2 If we found a name in either database, we identified both the public company for which the dean served as a director, as well as the annual compensation from that company for 2009 that was disclosed on its “DEF 14A” and “4” forms. (The SEC DEF 14A form, or proxy statement, includes cash awards, stock and stock options as parts of all directors' compensation. The SEC 4 form is a “Statement of changes in beneficial ownership of securities.”) Next, we explored each dean's respective university/medical school Web site to see if it contained the information in Morningstar and EDGAR. We then contacted every medical school whose dean held an outside directorship to learn if it had a searchable page on its Web site that the public could access to identify its faculty's compensated outside activity. We compared the data on each school's Web site with the data filed with the SEC.
Of 161 deans, 9 were directors of 13 public companies, with 2 deans being directors of 2 companies and 1 dean being a director of 4 companies. We eliminated 1 pest control company and 2 financial services companies from our analysis because we did not believe that acting as a director of these companies constituted a conflict of interest. Seven deans remained who were directors of 10 health industry companies. One company, Bradmer Pharmaceuticals, is Canadian (Toronto, Ontario, Canada), and we were unable to discover what compensation, if any, it gave to its outside directors. The compensation for the other directorships was not de minimis—the range was $11 250 to $386 439, with the median compensation of $217 454. The range of compensation for each dean was $11 250 to $640 038, with a median compensation of $217 454. Four deans' Web pages neither disclosed that they were serving as outside directors nor their compensation for such service. The university Web page of the dean who was the director of 4 for-profit companies listed a financial services company, but both health care companies were missing. The medical school Web page listed no directorships.
One dean's official Web page disclosed the 2 directorships, but it did not disclose the compensation. Two medical schools' Web sites disclosed 3 directorships, with one dean holding 1 and the other 2 directorships; however, the Web sites underreported the deans' compensation by 39%, 56%, and 80% compared with the compensation calculated from the companies' EDGAR forms (Figure).
A recent report by an American Association of Medical Colleges (AAMC) task force expressed the rationale for transparency in faculty outside compensated activities:
Ultimately, the public needs the tools with which to understand the forces that may have an impact, positive and negative, on the care they seek. By embracing this public transparency, physicians and their institutions can minimize distrust and concern regarding relationships with industry. . . . 3(p18)
We believe that transparency requires timely, accurate and precise disclosure, and that disclosure should be accessible to the public. Public Web sites have been suggested as a mechanism for increasing transparency.3(p38) They are not a panacea. To improve transparency, we make the following recommendations:
Each medical school should have a publicly accessible Web site that discloses faculty compensation
Each faculty member should personally verify the data by comparison with the 1099-MISC received annually from the for-profit company as required by law for preparation of income tax returns.4
To facilitate cross-checking with other databases, financial disclosure data should be based on the calendar year rather than the medical school's fiscal or academic years.
Financial disclosure should include the exact compensation reported on each faculty member's 1099-MISC forms, rather than ranges of compensation.
The Web site should be updated annually.
In conclusion, although efforts have been made to increase the transparency of outside compensation, there is a need for substantial improvement in ease of access, timeliness, accuracy, and precision.
Correspondence: Dr Freshwater, University of Miami School of Medicine, 9100 S Dadeland Blvd, Ste 502, Miami, FL 33156-7815 (email@example.com).
Author Contributions: Dr Freshwater had full access to all of the data in the study and takes responsibility for the integrity of the data and the accuracy of the data analysis. Study concept and design: M. Freshwater. Acquisition of data: D. M. Freshwater and M. Freshwater. Analysis and interpretation of data: M. Freshwater. Drafting of the manuscript: D. M. Freshwater and M. Freshwater. Critical revision of the manuscript for important intellectual content: M. Freshwater. Administrative, technical, and material support: M. Freshwater. Study supervision: M. Freshwater.
Financial Disclosure: None reported.