Industry says 'no' to expansion of sunshine regs

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The government recently issued draft rules for a major area of health reform, outlining how accountable care organizations (ACOs) can work. Could the sunshine provisions, another big plank of the reform law, be up next?

During a recent teleconference, the Centers for Medicare & Medicaid Services (CMS), which pledged to issue an initial round of sunshine regulation this year, sought input from stakeholders regarding the Physician Payment Sunshine Act (PPSA).

The first two among several pre-published questions asked whether CMS should require disclosure of additional forms of payment and additional specific categories of payments beyond those specified in the law. “No,” came the resounding reply from industry participants, which included representatives from trade groups PhRMA, BIO and AdvaMed.

The sunshine law lists 14 natures of payment and transfers of value that drug and device makers need to record. Except for samples, everything from food and entertainment to gifts, consulting fees and honoraria is fair game. In the interest of transparency, information tracked in 2012 is to be reported the following year to CMS, which will aggregate the data and post it on a publicly searchable website.

More important than expanding on those 14 areas, is for CMS to “clarify within the regulation the definitions that will be used and the hierarchy that should be used for reporting,” said Marjorie Powell, senior assistant general counsel at PhRMA.

“Manufacturers need clear information regarding how to report payments that may fall into multiple categories so payments are not reported twice,” Powell said. For instance, a payment to a data and safety monitoring board for a clinical trial can be categorized as a research payment or a consulting fee. Double-counting these could result in incorrect information finding its way into the public database and could mislead patients.

But Jekkie Kim, legal/policy analyst for Healthcare for All, a Massachusetts-based consumer advocacy organization, lobbied for expanding one aspect of the information categories. “Perhaps you might consider including [NPs and pharmacists] as covered recipients,” Kim said.

Under the federal sunshine provisions, covered recipients include physicians and teaching hospitals. But in Massachusetts, which has had a payment-reporting law on its books, disclosure of payments or transfers to other clinicians is required, as well, and “We've seen a lot of payments being made [involving these prescribers],” said Kim.

Potential conflict of interest may arise with any prescriber. But by expanding the sunshine law's definitions and categories, the government risks over-reaching in the kind of disclosure it imposes on industry and on physicians, said another participant. “It's hard to see what additive value would be brought by categories beyond that which Congress focused on in the legislation,” said Dr. Michael Seidman during the teleconference.

After the call, Seidman, who is an ENT doctor with Henry Ford Health System in Michigan, told MM&M by e-mail that he felt some of the comments, and CMS's questions, clearly reflected an “omnipotent” type of disclosure. “Clearly some of the regulatory issues being imposed are very appropriate but many are onerous and this trend is worsening."

Indeed, another participant wondered openly whether CMS will require companies to track information for every person who takes a cookie or a coffee off an exhibit booth.

Equally scary for industry is that patients interpret every payment as problematic. Julie Cohen, VP, government affairs, AdvaMed, said the group supports disclosure of relationships between device firms and physicians but urged during the call: in order that patients not form the “mistaken position that all relationships are suspect, make sure [disclosure data] includes background information on why these relationships exist and why they are important.”

“Those relationships are essential to innovation and to improved patient medical care,” clarified Powell.

Physicians and other providers also need a mechanism to be able to correct inaccuracies in the data, said Sandra Dennis, deputy general counsel for healthcare at BIO.
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