Life Science Compliance Update

April 20, 2016

CMS Update Call on Open Payments

Recently, the Centers for Medicare & Medicaid Services (CMS) held a National Provider Call on Open Payments: Program Overview and Prepare to Review Reported Data. Robin Usi and Erin Skinner took turns educating participants how to identify the parts of the review, dispute, and correction process and how to take appropriate actions in the Open Payments system.

What is Reported?

As a reminder, any direct or indirect payments, or other transfers of value, that are made to covered recipients (i.e., physicians, teaching hospitals, physician owners, investors). Certain ownership or investment interests that are held by physician owners or investors, or their immediate family members are also reported.

Who is Responsible for Reporting?

Applicable manufacturers of covered products and entities under common ownership with applicable manufacturers who also provide assistance and support, as well as applicable Group Purchasing Organizations (GPOs), are required to annually report to CMS.

Who is Reported On?

There are three categories of individuals and entities that are reported on – covered recipient physicians, covered recipient teaching hospitals, and physician owners or investors. Covered recipient physicians cover individuals, such as: doctors of medicine or osteopathy legally authorized to practice medicine or surgery by the state; doctors of dental medicine or dental surgery legally authorized to practice dentistry in the state; doctors of podiatric medicine legally authorized to perform by the state; doctors of optometry legally authorized to perform as a doctor of optometry by the state; and chiropractors licensed by the state and legally authorized to perform by the state. Covered recipient teaching hospitals can change from year to year and each year, Open Payments publishes a list of these teaching hospitals on their website.

Program Year Timelines

For the 2015 program year, data collection ran from January 1, 2015 through December 31, 2015. Payment data was submitted by applicable manufacturers and GPOs from February 1, 2016 through March 31, 2016. Therefore, the review and dispute period for physicians and teaching hospitals is April 1 through May 15, 2016, and the period for applicable manufacturers and GPOs to review and correct the data runs fifteen days after that close, to June 1, 2016. The data is scheduled to be displayed on the website on June 30, 2016.

Registration Process

In order to be able to review and dispute any data reported in the Open Payments system prior to its publication, users must register for the Open Payments system using the two-step registration process. Physicians and teaching hospitals who registered during 2013 or 2014 do not need to register again. Additionally, a physician may nominate one authorized representative to perform system functions on their behalf and teaching hospitals can designate up to ten authorized representatives and authorized officials to act on its behalf in the Open Payments system.

Review, Dispute, and Correction Record Statuses

There are several different status' that can show for each record. A status of "initiated" means the dispute has been initiated by a physician, teaching hospital, or principal investigator. Once the reporting entity acknowledges the dispute, the status will change to "acknowledged." If the reporting entity and physician, teaching hospital, or principal investigator have resolved the dispute in accordance with the Final Rule and no changes were made to the disputed record, the status will change to "Resolved No Change." If the dispute was resolved by the reporting entity with updates made to the record, the status will change to "Resolved." If the physician, teaching hospital, or principal investigator has withdrawn the dispute, the status will reflect that.

Question and Answer Session

At the end of the call, the presenters allotted time for questioners who had previously submitted questions and for those who were on the call and had specific questions.

The first question was whether or not every physician in a particular practice need to register for the Open Payments system. The answer was yes, each physician needs to register since all payments are reported to physicians individually. Once a physician has registered, they can appoint an authorized representative, but each physician needs their own account.

It is also important to note that CMS does not send an email of alleged payments to physicians, making it important for physicians to register for Open Payments so they can see what payments are being assigned to them.

Another question was asked about whether there are any plans for an institutional reviewer role in the future to allow compliance officers to review data for teaching hospital faculty process review and dispute. While CMS cannot speak to any current plans, they took comments under advisement for future improvements to the program.

For any other help or issues, CMS recommends that you contact the CMS Open Payments Help Desk.

April 18, 2016

District of Columbia Makes Changes Transparency Law to Align with Open Payments

Late last week with only a photo attachment, the District of Columbia Department of Health announced to the pharmaceutical industry that the District is changing its gift reporting requirements to meet the requirements with the new Open Payments reporting.

Chapter Eighteen of the District of Columbia Municipal Regulations requires manufacturers and labelers of prescription drugs dispensed in the District who engage in marketing in D.C. to report to the Department of Health their costs for pharmaceutical drug marketing in the District. Each manufacturer or labeler is required to report their annual prescription drug marketing costs in a report filed with the Department of Health on or before July 1 of each year.

This year, the aforementioned changes will be reflected in the Nature of Payment, Form of Payment, and Primary Purpose sections. The categories will have to align with Open Payments categories. Some responses will now be limited to the updated set of values.

While payments made to physicians or teaching hospitals must be reported to the United States Department of Health and Human Services (HHS), companies are not required to report this information to the District of Columbia. However, payments made to recipients other than physicians and teaching hospitals must be reported to the District of Columbia. Reporting requirements for aggregate and advertising expenses remain unchanged.

The D.C. Department of Health recommends that companies who have filed reports in previous years use the Microsoft Excel file published online, as it will reflect changes and updates in the law. Complete instructions for filling out the forms are found in the PDF document, as well as on the fifth tab of worksheet of the Excel document.

The Company Information, Gift Expenses, Advertising Expenses, and Aggregate Cost worksheets should be filled out electronically according to the instructions, and submitted in Excel format to The Company Information worksheet should also be printed and sent to the D.C. Department of Health, along with a $5,000 filing fee check made payable to "D.C. Treasurer."

This change was supposed to take place in 2013 when the Physician Payment Sunshine Act preempted state reporting. The District of Columbia is a little late to this change.


March 22, 2016

ProPublica: Tying Open Payments Physician Data to Medicare Part D Data

ProPublica is once again trying to make a "correlation equals causation" argument between payments made to physicians and their prescribing patterns. ProPublica is arguing that an analysis they performed showed that "doctors who receive payments from the medical industry do indeed tend to prescribe drugs differently than their colleagues who don't."

They are arguing that doctors who received more than $5,000 from companies in 2014 had the highest brand-name prescribing percentages, giving an example that among internists who received no payments, the average brand-name prescribing rate was 20%, compared to about 30% for those who received more than $5,000.

What is interesting in the data is the absolutely high number ranging from 70-90% of generic medications both physicians who don't work with industry and those who do work with industry. In both groups a vast majority of their prescriptions were for generic medications which generally over 20+ years from initial development. A slight increase in the use of branded drugs should be considered a good thing for patients. As it is well known that it takes many years for physician adoption to newer therapies.

However, there is no proof that industry payments sway doctors to prescribe particular drugs, or even a particular company's drugs, just that payments are "associated with an approach to prescribing that, writ large, benefits drug companies' bottom line." There may be much more to the story if ProPublica found a link between payments made to physicians and the brand of drug they prescribed.

It is important to note, as laid out in more detail below, that physicians consider many factors when deciding which medications to prescribe. Some physicians treat patients for whom few, or no, generics are available; for example, doctors who treat patients with HIV/AIDS. Other physicians specialize in patients with complication conditions who have tried generic drugs with no success.

One physician that we discussed this with independently, thought it was appalling that there was no consideration of patient outcomes. If the physicians patients benefiting from the branded drugs then there should be credit given to those physicians working with industry.

According to Holly Campbell, spokeswoman for the Pharmaceutical Research and Manufacturers of America, "many factors" affect doctors' prescribing decisions and according to a 2011 survey of physicians, more than ninety percent of physicians felt that "a great deal of their prescribing was influenced by their clinical knowledge and experience."

Ms. Campbell believes that by working together, "biopharmaceutical companies and physicians can improve patient care, make better use of today's medicines, and foster the development of tomorrow's cures." Physicians provide insights and feedback to inform companies about their medicines to improve patient care and patient health.

By meeting with industry professionals, doctors get a chance to better understand the drugs that exist, the outcomes, and any side effects. Dr. Amer Syed of Jersey City, NJ, said that he does look at the quality of medication and the benefits patients get from taking the medicine before deciding what to prescribe, stating that his "whole vision of practice is to keep the patients out of the hospital."


ProPublica examined Medicare Part D prescription data and pharmaceutical and medical device company payment data (found under Open Payments) to measure any relationship between industry payments and brand-name prescribing.

Interestingly, when ProPublica broke down the data by payment type, they found that physicians who received speaking payments had higher rates of brand-name prescribing than those who received other types of payments, and that physicians whose only payments were for meals had lower rates of brand prescribing than those who received other payments. This may speak to the idea that physicians who prescribe the same drug over and over again do so because they are comfortable with it, they know the results and the side effects, and since they know the drug so well, the company asks them to speak for them.

There is a huge "but" with the data cited to by ProPublica. The data does not consider whether branded drugs, for the indications prescribed, are superior to generic medications (or combinations of generic drugs), nor whether patient outcomes were different. Data that confirms safety and efficacy are much more likely to describe branded products than they are generics.

We are big proponents, however, of giving credit where credit is due. In this case, ProPublica did a nice job describing the circular relationship between companies and doctors. They published a quote by Dr. Kim Allan Williams, Sr., the president of the American College of Cardiology, who stated the more physicians learn and understand a new drug's "differentiating characteristics," the more likely they are to prescribe it, and the more they prescribe it, the more likely they are to be selected as speakers and consultants for the company. According to Dr. Williams, "that dovetails with improving your practice, and yes, you are getting paid to do it."

Dr. Williams also explained that new drugs are somewhat responsible for the significant decrease in cardiovascular mortality in the past three decades, and that the relationship between doctors and companies in cardiology may be driving that progress.


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