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What you don’t know can hurt you
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Beginning last month, manufacturers of medical devices, biologic products, medical supplies, drugs and group purchasing organizations have begun the data capture required by the Physician Payment Sunshine Act. Many companies have been preparing for the process, but not all companies are ready or capable to accurately report the information or provide it in a format acceptable by CMS.
However, not being prepared does not excuse physicians from being responsible for the accurate and complete reporting of all financial benefits they have received from companies. Physicians involved in physician-owned distributorships or other businesses related to the devices or products used in patients need to be responsive and accurate with the required reports. Even physicians involved in industry-sponsored research will be reported as having received financial benefits.
Even though the Sunshine Act passed 3 years ago, there remains uncertainty about the process and the implementation of various provisions. Mistakes are likely, and time will tell if the mistakes are treated as part of the learning curve or enforceable penalties. For example, when asked about research, CMS stated that if the research agreement includes research protocol training for physician researchers, such training should be reported using the research template even if the training is useful or valuable outside of the specific research project. CMS has multiple web-based pages of frequently asked questions to explain the nuances of the legislation.
Anthony A. Romeo
The first official federal reports are due by March 31, 2014. Data will be collected, organized and published by Sept. 30, 2014 on a public website currently under development by CMS. There will be three types of publishing categories: general payments; research payments; and ownership and investment interests. Beginning in April 2015, CMS is required to submit annual reports to Congress and each state, which summarizes information from each medical device or pharmaceutical company during the preceding year, including any information regarding penalties paid. Patients, consumer groups, attorneys, hospitals, academic centers, hospital administrators, politicians, journalists, nonsurgical physicians and our peers will see and reflect on the data.
The public will be encouraged to access this website to evaluate physicians for possible conflict of interest, with government representatives suggesting this will help to reduce the cost of health care. CMS has published a brochure on open payments for patients, which clearly states the program puts new information into the hands of patients and the information should “encourage you to discuss these relationships with your physician.”
Industry collaboration
While CMS recognizes that collaboration between physicians and industry has led to essential medical advancements and improvement in patient care, there has been increasing concern that these relationships have led to compromised decision-making. The financial relationships do not automatically imply an inappropriate process, but the government and many of our peers believe that making these relationships transparent will help to avoid conflicts of interest and compromised care. Peter P. Budetti, MD, JD, the CMS deputy administrator for the Center for Program Integrity, believes patients should know when their physicians have a financial relationship with companies that are supplying medical devices or drugs used in their care. He suggests that public disclosure of these relationships will allow patients to have more informed discussions with their physicians. CMS has stated that physicians have the sole responsibility for the accuracy and completeness of the data submitted by the health care industry even though the law does not apply to physicians.
Many physicians remain uneducated about the reporting requirements of the Sunshine Act. The final ruling states that drug and device manufacturers must disclose any single payment to physicians of $10 or more, or aggregate payments of more than $100 per physician per year. Under these standards, more than 50% of physicians may be reported as having some financial relationship with industry. The information that must be collected includes the manufacturer’s name, covered recipient’s name, specialty, address, NPI number, state license number, form of payment, nature of payment and the NDC code for a drug or the product class for a medical device. Failing to report will be subject to penalties up to $150,000 per year. Companies that knowingly fail to report could face penalties of up to $1,000,000.
Physicians who are impacted by the Sunshine Act are concerned that companies will not get the information correct, which may lead to inaccurate public reports and unnecessary investigations. Most physicians will want to collect their own data, review the compensation data compiled by the company and have the opportunity to dispute claims that seem wrong, which is a provision provided by the final rules.
Mobile app
Physicians are encouraged to register with CMS to preview the data that will be made public and become familiar with the information reported about them. Furthermore, CMS has developed an Open Payment mobile app which should assist physicians in keeping track of any financial benefits received from industry partners. The app, however, does not communicate with CMS, and the data is compiled and owned only by the physician. CMS has no role in validating the data or comparing it to the report submitted by the medical manufacturers. However, if the physician uses the app to assist in auditing the reports submitted to CMS, it is likely the content within the app along with personal phone records can be subpoenaed if perceived violations are investigated. Furthermore, it has been reported that this app uses international servers and the security and privacy of the information contained within the app are questionable. Currently, CMS is sponsoring a contest to design a better app.
While the stated goal of this legislation is to bring potential conflicts of interest to light with the intent of reducing health care costs, the provisions of the Sunshine Act also will have a significant impact on continuing medical education (CME). Accredited CME activities have been excluded from tracking and reporting requirements as long as they follow all the specific CME guidelines, such as the strict standards developed by the Accreditation Council for Continuing Medical Education. However, all honoraria, meal and travel costs and other activity-related costs for commercially supported, non-accredited and promotional activities will be reportable, as well as any educational materials that do not directly benefit patients.
Commercially supported, non-accredited courses have become valuable to orthopedic surgeons who want to remain current with technological advances and desire to provide innovative procedures. These courses are often provided to residents and fellows to enhance their educational opportunities and frequently involve the use of cadavers, medical devices and capital equipment. The cost of the courses would be prohibitive to orthopedic surgeons if industry support and consultant physician involvement were discontinued.
Some have predicted that pharmaceutical and device companies will reduce their overall investments for CME and graduate medical education if they find their support is a poor business decision. This could become a critical issue by the end of 2014, especially if the funding for graduate medical education is reduced through further cuts in its base funding from Medicare. Reducing industry support for CME will force a significant change in the methods used to maintain our ability to provide innovative and advanced medical care.
We must be personally responsible for tracking any financial relationship we have with industry partners. We should not rely on industry or the government to accurately collect and report the data. You need to understand the details of the Physician Payment Sunshine Act, which is now in full effect. Before an industry partner submits their final report to CMS, you have 45 days to voluntarily review and audit their report to ensure accuracy before the report is published on a public website.
Learn how to dispute any information that is inaccurate. This can only be done if you have already started collecting any CMS-required reporting data. The CMS app, or other apps that will likely be available soon, may be helpful to maintain this information. But, beware of the potential risks of using these programs in terms of your privacy and security of data. We have begun a new era with regard to conflict of interest, with legislation that requires industry to provide detailed reports of physician-related financial relationships.
Even though physicians are not legally bound to produce these reports, we are ultimately responsible for the accuracy of the information available to the public. It is likely we will have many “cloudy days” with increasing scrutiny and decreasing medical education opportunities without the “sunshine” of driving down health care costs.
www.cms.gov/Outreach-and-Education/Outeach/NPC/Downloads/2013-08-07NPC-OpenPayments.pdf
www.federalregister.gov/public-inspection
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Disclosure: Romeo receives royalties, is on the speakers bureau and a consultant for Arthrex Inc.; does contracted research for Arthrex Inc. and DJO Surgical; receives institutional grants from AANA and MLB; and receives institutional research support from Arthrex Inc., Ossur, Smith & Nephew, ConMed Linvatec, Athletico and Miomed.