Life Science Compliance Update

« February 2011 | Main | April 2011 »

32 posts from March 2011

March 29, 2011

VA Proposes Discontinuing Funding of CME for Staff Members

VA Class 
Earlier this month the Senate Veterans' Affairs Committee began its work on Veteran Affairs (VA) 2012 budget. In her opening statement, Chair Patty Murray (D-WA) noted that on balance, and given that other agencies are facing budget cuts, the “VA budget is a very good starting place from which to work.”

She noted that the President has requested an overall increase of $5.9 billion in discretionary spending over Fiscal Year 2011 levels, and that while health care spending is in good shape, there are some weaker points in the budget. For example, she pointed to the proposed cuts in spending for construction and non-recurring maintenance are very troubling. 

In addition, she noted that the budget documents lay out VA’s vision for a ten-year construction plan, “but what is missing in this budget is detail on how to close the gap between the funding we need to bring facilities up to date and the funding requested of the Congress.” 

She also called attention to the proposed $70 million cut for VA research funding and that she is worried that such a cut would imperil some critical projects and shove physician researchers out the door. Ms. Murray also discussed the VA’s problems facing processing disability benefits claims. 

Nevertheless, Ms. Murray applauded the budget request for including a series of cost-saving initiatives, including better controls on contract health care, better strategies for contracting, and cutting administrative overhead, all of which I will review with an open mind. Then, the committee heard testimony from the following individuals:

Maryann D. Hooker

On behalf of the American Federation of Government Employees (AFGE), which represents more than 200,000 employees at the VA, including nearly 120,000 employees who provide direct medical services to veterans within the Veterans Health Administration (VHA), Dr. Hooker’s testimony focused on the VA's proposal to achieve costs savings through staff and resource realignment.  

Dr. Hooker expressed concern about the lack of details in the Department's proposal, which assumes a yearly savings of $151 million over two years.  The proposal to realign staff and resources would follow on the heels of current VHA efforts to contain costs, including telehealth, team-based care, group appointments, and shorter appointments.  

Dr. Hooker cautioned that too often, "new VA health care initiatives are implemented without proper oversight or advance planning, resulting in reduced access and quality of care.  Sometimes they even cost the taxpayer more, in the form of costly contract care, less continuity of care, and higher staff turnover."

As a result, AFGE AFL-CIO National VA Council President Alma L. Lee asserted that, “balancing the VA's health care budget by reducing veterans' access to care is not the answer to the country's financial woes.” Instead of reducing access to care, Ms. Lee noted the need for “greater oversight of the VA's current initiatives such as telehealth and Patient Aligned Care Teams (PACT), as well as greater accountability over VA spending used to expand its top heavy management workforce, provide excessive bonuses, and continue unwarranted increases in costly contract care.”

AFGE testimony also conveyed opposition to the VA proposal to eliminate all continuing medical education (CME) reimbursement for physicians and dentists.  It was specifically noted how the “VA continues to rely heavily on more costly fee basis care and has difficulty recruiting and retaining clinicians.  It is in the best interest of all stakeholders to provide an environment of professional growth.”

As a result, AFGE Secretary Treasurer J. David Cox noted that AFGE “will not sit quietly by while VA returns to the era of hiring freezes and frozen medical center budgets," said.  He asserted that the AFGE will “question the way cost-cutting initiatives are designed and implemented and will continue to oppose cost-saving measures that diminish VA's world-class health care system."


While the other members testifying did not focus their testimony on CME, it is crucial that people realize the significant consequences Veterans could face if CME funding for VA health professionals is reduced or eliminated. The men and women who serve our nation deserve the highest standard of medical care and treatment. To give our veterans what they deserve for the sacrifices they have made, doctors working within the VA need to have the latest updates in medicine and technology.

CME is the best resource to achieve a higher standard of care for VA health professionals and to improve patient outcomes. If funding for CME is reduced or eliminated for VA healthcare providers, they will be faced not only with the financial burden of CME courses, but also the limitations of finding relevant, accredited CME courses within a convenient geographic location. They will also have to find programs that are interactive and address the patient populations within the VA, which include a wide array of conditions; anywhere from pain to post traumatic stress disorder.

Ultimately, as many of the international wars continue to deescalate and more soldiers come home, our VA health professionals will need more training and resources, not less. Reducing CME and medical education will not help our service members, and Congress, Veterans, patient advocates, medical professionals, and CME stakeholders must make the Obama Administration clearly aware of that.

March 28, 2011

CMS Open Door Forum on Transparency Reports Recap

As we noted last week, the Centers for Medicare and Medicaid (CMS) held a Conference Call entitled, “Special Open Door Forum on Transparency Reports and Reporting of Physician Ownership or Investment Interests.”

During the conference call, a number of issues and questions were discussed regarding Section 6002 of the Affordable Care Act (ACA)—commonly known as the Physician Payment Sunshine Act—which requires the public reporting of payments or other value transfers made to physicians and teaching hospitals by manufacturers and group purchasing organizations of drugs, devices, biologicals, and medical supplies that are covered by Medicare, Medicaid or the Children’s Health Insurance Program.

Before addressing the questions and comments, the moderator noted that CMS will soon begin a draft notice of proposed rulemaking on Section 6002, which is expected to be published later this year. She also noted that stakeholders should submit comments on the questions discussed during this conference call by April 7.

Comments can be emailed directly to Additionally, a recording of the call will be accessible until March 28 at 1-800-642-1687, meeting code: 51513536.

An audio recording and transcript of the call will be posted to the Special Open Door Forum website and will be accessible for downloading beginning on or around April 21, 2011.

A number of organizations and individuals participated in the conference call, including representatives from the Pharmaceutical Research and Manufacturers of America (PhRMA), AdvaMed, Biotechnology Industry Organization (BIO), and the Association of Clinical Research Organizations. The moderator went through each of the questions and then participants offered comments.

Question 1: Other forms of payment or transfer of value

In response to this question, the overwhelming majority of comments indicated that CMS should not expand Section 6002 to other forms of payments or transfers of value.

Many comments firmly asserted that CMS must first clarify the statutes and rules applying to the current forms. Specifically, many participants noted that CMS is already going to be getting so much data from manufacturers on physician payments that it will be challenging enough to collect this information, organize it, and then make such information public. For example, one participant noted that in just a mid-sized pharmaceutical company, there could easily be more than 1 million transactions, with over 300,000 physicians. When you multiply that by all the companies in the U.S., this means a tremendously overwhelming amount of information and data to collect and analyze.

Accordingly, the unanimous sentiment was that CMS should get the proposed regulations done first, and not to expand to other forms. If, for whatever reason CMS decided to expand, one participant noted that it is crucial for CMS to indicate the intent of collecting this additional data, and to ensure that in their data collection process, CMS does not stifle innovation.

Question 2: Definitions of nature of payment or other transfers of value

Participants responding to this question were almost unanimous in asserting that CMS does not need to expand the definitions of natures of payment or transfers of value. It was noted that expanding the definition would provide no additive value than what Congress already proposed, and which is now public law. With respect to narrowing or broadening the scope of the definition, many participants emphasized the need to clarify the specifics of reporting.

Participants also expressed that Section 6002 already has enough categories for reporting and that there is no need for additional. On this issue, many noted the importance of CMS defining each category clearly, so that consumers, health care providers, and researchers can use the data correctly.

It was also noted again that currently, Section 6002 will give CMS so much information that CMS must first focus their proposed regulations on exactly what definitions will be used and the hierarchy of reporting that should be used. Specifically, many participants emphasized the potential for payment categories to overlap, and the need for CMS to ensure that reported payments do not fall into multiple categories or are counted twice.

Additionally, participants noted that the definitions were already specific enough, and in some instances too specific. For example, the requirement that payments for travel include destination was discussed and it was recommended that CMS tie travel in with the nature and purpose of the event in which travel was paid for, instead of a granular specification.

Question 3: Additional categories of information to report

One participant noted her experience in Massachusetts with payment reporting. She noted how payment for research grants often goes to an institution, and not a principal investigator. She recommended that the PI be included in the listed payment in addition to the teaching institution. This participant also noted that payments to other health care providers are reported in Massachusetts, and she recommended that categories be expanded under “teaching hospitals” to include nurse practitioners, physicians assistants, pharmacists, and other prescribers.

The majority of participants however emphasized that there is no need to add additional categories. Instead, many reiterated the need for CMS to ensure that payments are not double counted in categories, and the need for CMS to have clear and specific instructions spelled out about how payments are defined, such that they are only reported in one category.

Question 4: Ownership or investment interest

In response to this question, participants noted that under Section 82 of ACA, there is already a reporting requirement for physician owned hospitals. One participant noted that CMS should include a distribution model of physician owned hospitals. This participant also noted that CMS should review the legislative history that gave rise to these issues, and to review correspondence from the Office of the Inspector General (OIG) regarding physician owned companies.

Question 5: Average consumer information

Many participants emphasize the need for CMS and the Health and Human Services (HHS) Secretary to consult with health care stakeholders to assure that information provided to the public has an objective background, is directed at targeted to specific audiences, and that the information is clearly defined and explained. BIO recommended that CMS conduct focus group research and consult with experts to assure that the information presented is useful and not misleading. 

BIO also recommended that CMS conduct such research here, and also establish a taskforce comprised of representatives from industry, the provider community and public advocacy groups to advise on the development of the required background information on industry-physician relationships to be posted on the website.

AdvaMed noted that reported information must emphasize how the interaction between industry and physician advances medical care, technology and treatment, in order to provide safe and effective medical care. They recommended that companies be allowed to provide additional contact information surrounding payments so that patients can better understand the payments.

ACRO noted that there are two kinds of payments: One from consumers for the agency to assess, evaluate the usefulness of information for consumers, and how it affects their decision-making in healthcare, research, participation, etc. The second kind is payment information that will affect the physicians and hospitals, which the information is reported on or from. ACRO noted that this kind of reporting is already having a negative impact on health care because doctors do not want to be principal investigators because their names will then be in a public database.

Other participants emphasized the need for physicians and hospitals to have the ability to correct errors in the publicly reported information. Under this comment, some noted the idea of letting doctors or hospitals check payments before they are made public because it is important that the public can rely on such payments being accurate.

Another participant recognized that not all payments or conflicts of interest are wrong. Instead, he noted that doctors and hospitals can have conflicts of interest, rather, it is what they do to manage them that is important.

Question 6: Reporting of data

Participants recommended that CMS consider the use of a spreadsheet, which is used in industry and is a common form accepted by states that already have reporting laws in place. Some recommended that CMS create a standardized template for manufacturers for providing and reporting data for consistency, given the large nature of information being reported and the potential for inconsistency.

Others noted that manufacturers should get a confirmation from CMS when the information is submitted. They also emphasized that CMS should provide a reasonable time to correct data, after submission, and a reasonable chance to correct data after it has been posted.


One important question that was noted by BIO is the definition of “covered recipient.” Specifically, BIO asked CMS, if a manufacturer makes a payment to someone other than a covered recipient, and that entity makes a further payment to a physician or teaching hospital, is that subsequent payment reportable?

There is no possible compelling reason to expand what was passed by congress at this time.  It will take a miracle for CMS to issue workable rules in the time frame and reasonable expect companies to comply (which no human would consider 3 months to implement reasonable).

Ultimately, this conference call clearly showed that CMS has a lot of important factors to take into consideration when putting together this proposed rule and regulations. The overwhelming nature of the reporting, the potential for error and abuse, and a number of other problems must be addressed by CMS. Consequently, it is still uncertain exactly what value this database would provide to consumer or patients, and how this will actually save Americans money and reduce costs.

March 25, 2011

Another Dip Into the Muddy Waters of COI

Over the past several years, “the debate over how to manage or discourage physicians' financial conflicts of interest with the drug and medical device industries has become more heated” and a number of “critics have questioned or dismissed the concept of “conflict of interest” itself.” To address this issue, Howard Brody, MD, PhD, noted that a definition for conflict of interest must first be established.

Dr. Brody wrote in a recent article in the American Journal of Bioethics that, “a satisfactory definition relates conflict of interest to concerns about maintaining social trust and distinguishes between breaches of ethical duty and temptations to breach duty.”

In the article, entitled “Clarifying Conflict of Interest,” Dr. Brody noted that, “numerous objections to such a definition have been offered,” but “none of which prevails on further analysis.” He asserted that, “those concerned about conflicts of interest have contributed to misunderstandings by failing to demonstrate when social arrangements leading to temptations to breach duties are in themselves morally blameworthy.”

As a result, Dr. Brody wrote his article as an attempt to clarify “conflict of interest” in order to help “develop productive modes of engagement between medicine and for-profit industry that avoid the serious ethical pitfalls now in evidence.” 

Consequently, in response to Dr. Brody’s article, Lance K. Stell, PhD, professor of philosophy at Davidson College, and Thomas P. Stossel, professor of medicine at Harvard Medical School and director of translational medicine at Brigham and Women’s  Hospital, asserted that Dr. Brody’s article persisted to use “biased, pejorative epithet to frame all of the complex remunerated relationships between the medical profession and the medical products industry.”

In their comment, entitled “Another Dip Into the Muddy Waters of COI,” Drs. Stossel and Stell rightly noted that physician-industry “relationships have been mutually beneficial for the medical profession and for industry.” But most important by far “are the benefits that have accrued to patients who have gained access to more effective, safer, and easier to take medicines; vastly improved monitoring and imaging; faster and more precise diagnostics; programmable insulin pumps, pacemakers, and cardioverters that can report their recorded activity over the phone; and better prosthetics and surgical devices.”

Accordingly, Drs. Stossel and Stell recognized that “anecdotes, “tales from the crypt,” of physician and industry misconduct, which Brody cites, are not even close to compelling data tending to show that, on balance, these relationships produce more patient harm than benefit.” In fact, they recognized that “Brody has no evidence tending to show that a physician afflicted with an industry-related “conflict of interest” will be less trustworthy/more treacherous in his or her relationships with patients, and more likely to harm them.”

Specifically, Drs. Stossel and Stell pointed out that “whether patients trust their physicians less than they used to is a different question.” While Brody may have indicated a loss in trust, Drs. Stossel and Stell cited “repeated surveys, which show consistently that physicians rank at or near the top of “most trust” professionals. Moreover, they discussed how “recent surveys report almost no perception of bias by physicians participating in industry sponsored medical education activities (e.g., Kawczak et al. 2010).”

In addition, Brody himself acknowledges, “that some of his like-minded colleagues have oversold anecdotes and muddled personal preferences as “evidence” of harm.” However, Brody’s article “simply repeats this behavior and cannot provide anything new.”

For example, Brody “resorts to complaining that the evidence we would need is difficult to come by (as if that justified making it up) and that industry remuneration may be gratuitous (“is not necessary”) to justify elevating “conflict of interest” to ethically emergent status.” Drs. Stossel and Stell recognized that judging “whether or what level of industry payments for physician services or time is appropriate is an exercise in subjectivity.” 

They pointed to the example of another article Brody wrote, and stated that “contributions from Coca-Cola (which also manufactures sugar-free products) to the American Academy of Family Physicians enable that association to help its members provide better patient care—the larger the contributions, the more social benefit.

While “Brody has the right to wish physicians provided services for free or paid for their own education, imposing his preference in the real world will result in physicians unable or unwilling to comply. Since the paid relationships create value, the unintended consequence of his mandate is lost value.”

The problem with Brody’s approach is that “anyone can quickly bring to mind instances of industry misdeeds: physician greed, arrogance, and avarice, journals peddling flawed studies, industry-sponsored and not, the Food and Drug Administration (FDA) apparently being influenced by politics, etc.” And “anyone can also bring to mind instances where the FDA stood fast against improper pressures, where a patient’s getting on the right medicine was lifesaving, of doctors staying more up-to-date because of sponsored continuing medical education (CME).”

In other words, Drs. Stossel and Stell acknowledge, “myriad heuristics are “available” to help simplify vast complexity and “conflict of interest” (COI) is one of those heuristics.” According to the authors, it’s wrong to use COI and “say that physicians have only recently come to worry about potentially ill effects of outside influence,” because the Hippocratic Oath “makes the physician swear that he will keep himself and his art holy and pure.” So what has prompted the recent prominence given to this heuristic?

Taking a closer look at the use of COI, Drs. Stossel and Stell noted that a literature search for COI found more than 7,300 hits, most published in the last decade (Lanier 2008). “Viewed from 10,000 feet, the outbreak of COI literature has all the characteristics of an “availability cascade” (Kuran and Sunstein 1999).”

For Brody, the COI heuristic is “available” and “biases his reading off of the “police blotter” side of medicine’s relationship with the medical products industry.” As a result, “he grants that having a “conflict” is not equivalent to professional misconduct, but rather is some sort of risk factor for untrustworthiness,” in which an activity “low in value prompts regarding it as risky.”

Accordingly, Drs. Stossel and Stell explain that the COI heuristic is so “available” to pharmascolds like Brody because “affectively, they regard the medical products industry’s relationship with medicine as lacking in value, which prompts their judgment about its riskiness.”

What is problematic about the “risk” approach that pharmascolds take in using the COI heuristic is that “they show so little interest in calculating the rate of professional

misconduct, given the large number of physician exposures to sponsored CME and promotional marketing.” Instead, “what the COI heuristic lacks in analytical precision is more than offset by its pejorative epithet function, which casts an unflattering light on everything distorted by its dim beam.”

In the end, while “Brody and his fellow pharmascolds have been very influential in putting the medical products industry on the defensive” and getting databases for reporting and transparency from industry, Drs. Stossel and Stell note that their efforts have been “a vast waste of money” that “will not improve patient care one bit.”

In fact, they assert that efforts from Brody and pharma critics will only “hurt patient care by diverting scarce resources from research, development, and education to monitoring and “compliance.”

Such consequences have already taken place. For example, “patients will not access the database for the simple reason that they will have no idea what the numbers mean for any practical decision they face. But the pharmascolds will benefit from the database.”

Ultimately, these databases “will provide them with an enormous amount of information to riffle through, subsidized by grants that will help their careers.” While economists would call this “rent seeking,” Drs. Stossel and Stell call it a “conflict of interest.”


Preview | Powered by FeedBlitz


April 2018
Sun Mon Tue Wed Thu Fri Sat
1 2 3 4 5 6 7
8 9 10 11 12 13 14
15 16 17 18 19 20 21
22 23 24 25 26 27 28
29 30