Life Science Compliance Update

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October 24, 2013

Physician Payment Sunshine Act: Open Payments Technology Vendor Mired in Healthcare.Gov

Over the past several years, we have covered almost every major and minor development regarding the Physician Payment Sunshine Act—now known as "Open Payments."

The goal of Open Payments is to bring transparency to the relationships that applicable manufacturers have with physicians and teaching hospitals. The main mechanism for bringing about this transparency, as contained in Section 6002 of the Affordable Care Act, is a public, searchable database that will be published and maintained online by the Centers for Medicare & Medicaid Services (CMS).

Various stakeholders have expressed concern over the years about the ability of this public database to capture this complex and intricate payment data accurately and sufficiently. Moreover, there has also been practical concerns about CMS' ability to actually aggregate all of the payment data that manufacturers will report. Most medium-sized manufacturers have over 1 million reportable payments per year.

Consequently, Healthy buzz recently reported that the same troubled contractor that is responsible for building—the health insurance exchange website that has been plagued with significant technical issues over the last three weeks—was also hired to create the Open Payments database and website, reported by Pharmalot.

Healthy buzz is a blog created and written by Charles Ornstein, one of the lead reporters for ProPublica and its "Dollars for Doc" campaign. Ornstein uses this story as an opportunity to remind the public that while CMS is less than one year away from the statutory deadline of publishing payments (September 2014), Ornstein's Dollars for Doc database is up and running. However, it is unclear whether the site will be updated with 2013 payment data.

According to Ornstein, "CGI Federal was tapped in July to build the software platform for the … Open Payments website." The contract, awarded on July 22, "is for approximately $10 million in the initial contract year," according to a spokesperson CMS.

CGI is also a federal contractor for CMS/OIG—recovery audit contractor or RAC—helping these agencies with healthcare claims and data.

PharmExecBlog, which reported CGI's involvement this summer, wrote that attendees at a conference felt that the timeline was "very optimistic." The article went on to say that "if that date gets pushed back, it probably won't be CGI's fault" because of a compressed timetable for physicians to review and contest the payments attributed to them—the 45-day review and correction and 15-day dispute period.

"According to a report this summer from the Government Accountability Office, CGI received $88 million for its work on, the most of any contractor."

CGI spokeswoman Linda Odorisio said in an email that "CGI teams, along with CMS and its other contractors, are working around the clock toward the improvement of, a system that is complex, ambitious and unprecedented.  We remain confident in our ability to deliver continuous improvement in system performance and a more positive user experience."

A CMS spokesperson said that while CGI is working on both Open Payments and the Health Insurance Marketplace, "the two programs do not share any on-the-ground CGI staff including programmers and project managers."

"The teams also have separate systems resources and technological infrastructure. The timeline for Open Payments is not related to the Marketplace or," the spokesperson wrote.

"A CGI official will testify Thursday at a House Energy and Commerce Committee hearing on the problems with the site.  The Washington Post has a nice profile on the company, and Reuters has a smart piece about CGI's role, as well," Ornstein writes.


Although CGI may have separate staff working on the Open Payments website, the recent glitches on should raise concerns for those Sunshine and transparency stakeholders eagerly awaiting the first publication of data in September 2014.

There may be some hope for CGI because the Open Payments website certainly has distinct differences from For example, Open Payments is not being used to purchase or look for health insurance and does not require the same type of interaction or assistance with certified navigators to find health insurance. However, there are also similarities between and Open Payments. is collecting certain geographic and demographic information from U.S. citizens to help find individuals health insurance. Similarly, Open Payments will be collecting registration information from physicians and teaching hospitals, including numerous data entry points including their license and NPI numbers, business addresses, specialties, and much more.

Moreover, Open Payments will be collecting the dates of payments, natures of payment, location of payments, amounts, descriptions and numerous other data entries. All of this information will have to be aggregated and as noted above, physicians and hospitals will have the opportunity to dispute this data—making Open Payments job difficult, even though CMS is not actually part of the dispute process.

More importantly, the final regulations promulgated by CMS, some argue, go beyond the intent of Congress, requiring additional nature of payment categories such as continuing medical education (CME), indirect payments, and journal reprints that were never intended to be covered. This will only make CGI's task harder as these "gray" areas will pose additional troubles for reporting and data aggregation—for CMS, CGI and applicable manufacturers.

In addition, the government shut down came at a critical point in Sunshine Act implementation as stakeholders were barely two months into data collection. As a result, many stakeholders continue to have unanswered questions about reporting obligations and CMS was releasing FAQs even after the August 1st deadline for reporting past.

This confusion and uncertainty is likely to appear when manufacturers submit their first reports in March, and CGI will be tasked with muddling through the varying interpretations that companies have on certain reporting provisions.

It is also unclear what impact the government shutdown had on CGI's creation and work on the Open Payments database. While entities such as ProPublica may be able to point to their database as an example for success, their database does not even come close to the regulatory and statutory requirements under the Sunshine Act (e.g., nature of payments, date of payments, addresses, related covered products, etc.). Moreover, ProPublica does not even cover 50% of the payments made by manufacturers.

Additionally, CGI's role in the Open Payments database may also raise concerns about the government's ability to use and share this data with other government databases, such as those used by CMS or OIG to identify fraud and abuse, or FDA and NIH regarding research.

Time will tell whether CGI's Open Payments database will actually achieve the intent of the Sunshine Act and CMS' final regulations. Now that is in the limelight, it may only be a matter of time before Senator Grassley calls for a hearing or writes a letter to CMS and CGI asking for updates or specific questions or concerns he may have based on the current fiasco.

Ultimately, it will exceed most stakeholders expectations if CMS actually posts the first round of payments by September 2014; it will be a miracle if the database posted will actually work and achieve its intended purpose without having technical and practical issues.


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