The Sunshine Act

John Fisher
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Stopping Medical Injustice

  

 

“Shedding light on industry payments to physicians would be good for the system. Transparency fosters accountability, and the public has the right to know about financial relationships.”

Senator Chuck Grassley, Jan. 2009 

On March 23, 2010, President Obama signed the Patient Protection and Affordable Care Act (“PPACA”) which in part requires Prescription Drug Sample Transparency (Section 6004) and Transparency Reports and Reporting of Physician Ownership or Investment Interest (Section 6002). 

The goal is to shed light on the pharmaceutical industry’s payments to physicians however critics argue that it will provide a skewed view on how payments are made to physicians.  The question remains whether the Act will provide increased understanding and transparency or if the Act will stifle industry-physician collaborations.

Proposed Regulations 

CMS issued proposed regulations on December 14, 2011 announcing the publication of draft rules that would implement the "Transparency Reports and Reporting of Physician Ownership or Investment Interests" section of the PPACA.

Senators Grassley and Kohl sent CMS a letter requesting that the final regulation be released no later than June 2012.

CMS sent a letter in response to Senators Grassley and Kohl stating that a final rule will be published later this year and CMS will not require data collection before January 1, 2013.  Pharmaceutical companies will likely begin collecting information now in order to prepare for the first deadline.

Drug Sample Disclosure

Manufacturers and Authorized Distributors of Record (“ADR”) of a covered drug that make distribution by mail or common carrier or by means other than mail or common carrier are required to report:

  • Name, Address, Professional Designation;
  • Signature of Requesting Practitioner;
  • Identity and Quantity of Sample Requested;
  • Identity and Quantity of Sample Distributed; and
  • Any other information the Secretary deems appropriate.

Penalties 

Failure to Timely Report will result in a $1,000 to $10,000 per payment/transfer of value not reported with the total penalty not to exceed $150,000.

KNOWING Failure to Timely Report will result in a $10,000 to $100,000 per payment/transfer of value not reported with monetary penalty not to exceed $1,000,000.

There are many exceptions as to what needs to be reported including charity care, litigation, discounts (including rebates to patients) and samples to name a few.  Additionally no reporting is required for payments under ten dollars unless the payments exceed $100 dollars in one calendar year; all amounts then become reportable.

A few states had enacted legislation similar to this Act and early studies have showed that physicians’ prescribing habits have not changed as a result of the laws in those states requiring disclosure.  However on a national level, it will be interesting to see how doctors respond to the new level of transparency.

But what do you think?  I would love to hear from you!  I welcome your phone call on my toll-free cell at 1-866-889-6882 or you can drop me an e-mail at [email protected] .  You are always welcome to request my FREE book, The Seven Deadly Mistakes of Malpractice Victims, at the home page of my website at www.protectingpatientrights.com

 

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