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Vermont law restricts gifts to health care providers, requires annual disclosure from manufacturers
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Vermont lawmakers recently passed legislation that bars pharmaceutical and medical device manufacturers from offering gifts to health care professionals. The law also requires full disclosure of allowable expenditures and gifts.
The law takes effect on July 1 and requires manufacturers to disclose allowable expenditures by Oct. 1 for the fiscal year ending June 30.
"This act is necessary to increase transparency for consumers by requiring disclosure of allowable expenditures and gifts to health care providers and facilities providing health care," the law says. "This act is also necessary to reduce real or perceived conflicts of interest which undermine patient confidence in health care providers and increase health care costs by influencing prescribing patterns."
The statute defines "gifts" as "anything of value provided to a health care provider for free" or "any payment, food, entertainment, travel, subscription, advance, service or anything else of value" given to a provider unless the good or service is a an "allowable expenditure" or the provider reimburses the cost of the gift at fair market value.
"Allowable expenditures" are defined as "payment to the sponsor of a significant educational, medical, scientific or policy-making conference or seminar, provided the payment is not made directly to a health care provider; funding is used solely for bona fide educational purposes; and all program content is objective, free from industry control and does not promote specific products."
Annually, manufacturers of prescribed products must disclose the "value, nature, purpose and recipient information of any allowable expenditure or gift" to any health care provider, except royalties and licensing fees, rebates and discounts for prescribed products provided under normal business arrangements, samples, and payment for clinical trials, which must be disclosed according to separate provisions of the law.
Manufacturers of prescribed products that disclose allowable expenses must pay an annual $500 fee. Violations are subject to civil penalties of no more than $10,000 per violation, and the state attorney general may initiate legal action for injunctive relief, costs and attorney's fees.