Policy and Medicine

Medical Marketing and Media Commentary – Grassley and Kohl Model of Bipartisanship on Physician Payment Sunshine Act

 

In October, I was asked to provide the following commentary for Medical Marketing and Media on the collaboration that Grassley and Kohl working together as a model of  bipartisanship in their drafting the Physician Payment Sunshine Act.

It was published in the December print edition

As healthcare reform moves through Congress, power moves from the hands of committee chairmen to the speaker and the Senate majority leader, who will decide, with little input, what stays in and out of the final bills. Both bills contain physician payment sunshine provisions requiring manufacturers to report payments of greater than $5-$10 to physicians and organizations.

The Senate version was worked on by Sens. Herb Kohl and Chuck Grassley for over two years in one of the best bipartisan collaborations ever on Capitol Hill. Both senators' staffs received input from numerous individuals and organizations to determine the most workable version. The goal was to capture the most useful information and, at the same time, not disrupt industry and the practice of medicine.  Their version was captured in the final Senate Finance version of the healthcare reform bills.

The House Sunshine provision is the exact opposite. The drafter, Rep. Peter Stark, did not go out and build any type of consensus or solicit input from others. Instead, he took a report that was developed by the Medicare Payment Advisory Council and put it into bill form with a whole lot of additional provisions. So, instead of just capturing physician payments, the House bill covers payments to every single entity that a pharma, device, insurance company and group purchasing organization may have. In addition, the bill gives industry less than two months to get in compliance with the reporting provisions or pay fines of over $1 million or a percentage of gross receipts. Let us hope that reasonable minds rule the day and the Senate provision is chosen over its unworkable House counterpart.

Tom Sullivan is president of CME provider Rockpointe

From the December 2009 Issue of MMM

Physician Payment Sunshine Act 2009: Comparison of House and Senate Provisions

 

The next three weeks the Senate will be tied up in the debate on healthcare reform.   

In each Healthcare reform bill (House and Senate) include provisions for disclosure of payments to healthcare professionals.

 We have produced a comparison of the Sunshine provisions in each of the two bills. 

One stark difference is that the house version begins reporting payments from 2010, and the senate version requires reporting payments beginning in 2012.

It is also important to note that the House version includes the kitchen sink of people and organizations that receive payments for services, donations, and grants.  The Senate version focuses reporting of payments to physicians and teaching hospitals.

Neither version provides context to the payments (many payments for research and education also include significant expenses).  These provisions may further incentive manufactures to move their research, education and publications to friendlier regions such as Central Europe and Asia.

Comparison of House Senate Sunshine Provisions - November 30, 2009

Physician Payment Sunshine: Media Support Equals More Stories

Continued media coverage of the sunshine provisions in the Senate and House health care reform bills continued today as the New York Times reported that such efforts may not be enough.  (They want more stories)

 

The sunshine provisions require the makers of drugs, medical devices and medical supplies to file annual reports to the government about their financial ties to doctors.

The legislation would also require the establishment of an online public database that patients could search, to see if their own physicians had been paid by the companies whose products the doctors prescribed.

Extreme radical pharmascolds believe this kind of disclosure and reporting is not comprehensive enough because there have already been instances “of doctors who, despite strict disclosure policies by their academic employers or the National Institutes of Health, failed to report payments from industry.” As we have covered such cases numerous times, the overwhelming majorities of such errors were never intentional, and were mostly due to confusion on the requirements by various journals and institution policies.

Internist and Stem Cell Ethicists Dr. Bernard Lo at University of California, San Francisco, who served as chairman of the IOM committee on Conflicts of Interest in Medical Research Education and Practice essentially called on “Congress to mandate industry disclosure of payments to all kinds of health care providers, medical researchers, medical institutions, professional medical associations, industry-sponsored foundations and disease advocacy groups.”

As the provisions in the Senate stand right now public disclosure of industry payments would be required to doctors and teaching hospitals, as well as ownership stakes in medical facilities and medical products companies. Groups not presently required to disclose include people like nurses and biomedical researchers or groups like professional medical associations.

Consequently, such a gap leaves open the possibility that Senator Charles Grassley (R-IA), a co-creator of the sunshine provision according to his spokeswoman is open to “expand the payment disclosure requirements to other medical players,”

According to the NYT article, “the health overhaul effort in the House goes further, calling for public disclosure of industry payments to a wide array of medical entities and medical professionals — a group as diverse as physicians, pharmacists, biomedical researchers, professional medical associations and health insurers.”

Proponents of such disclosure requirements believe that since these entities “are making determinations as to what procedures and drugs will be used,” sunshine provisions cannot leave any loopholes. For example, Representative Pete Stark (D-CA) believes that companies could give rebates to outpatient clinics to favor certain medical products over others, a scenario he uses to call for stronger measures.

In response to sunshine provisions, the Pharmaceutical Research and Manufacturers of America (PhRMA) told NYT “that any federal legislation requiring payment disclosures must be written in a way that did not imply that industry relationships with health care providers were automatically inappropriate.” Others who are skeptical of disclosure address the need for a federal database to use that would offer more detailed information than the few doctor payment listings now available to the public.

States like Minnesota and Vermont already require drug companies to report payments to physicians, and drug companies like Eli Lilly and Merck have introduced their own Web sites listing fees paid to doctors as we have previously written.

Eli Lilly and Sunshine – More Stories for Papers

Since Eli Lilly started reporting payments the first half of this year, they have paid 3,971 doctors and other medical professionals an average of about $11,230 each. The payments were for participating in an average of 12 speaking or consulting engagements during those six months, according to a company spokeswoman.

A separate NYT article focused on payments from Eli Lilly to Dr. Manoj V. Waikar, a psychiatrist in Palo Alto, Calif., who is also an adjunct clinical instructor in the department of psychiatry and behavioral sciences at the Stanford University School of Medicine. So far he has received $74,850 for consulting and speaking at 51 events. The company caps payments at $75,000 for each health care provider in any calendar year. As a result of just $1,500 per event, the article tried to determine why Dr. Waikar received such payments.

Dr. Waikar wrote in an e-mail message to NYT that he received fees for speaking to other health care professionals about disorders like schizophrenia and depression, which can be treated with the Lilly drugs Zyprexa and Cymbalta respectively. Having spoken so many times about the treatment of such diseases that affect millions should not be underscored by payments he received for such services, when doing so is not only legal, but essential for improving patient care.

In addition, Dr. Waikar’s speaking need not be overly scrutinized because Stanford only prohibits full faculty members from participating in drug company speakers’ bureaus. Dr. Waikar, who is an unpaid adjunct instructor, was allowed to engage in these critical educational events because he did not use his Stanford title, as the school’s policy requires.

Stanford announced they are reviewing the policy for adjunct professors, which is not surprising given that Philip A. Pizzo, MD The Dean of the Stanford Medical serves on the board of the anti industry group Prescription Project (which the Prescription Project has since taken down the board names from their website – so much transparency for these guys).

Not only was Dr. Waikar following Stanford’s rules explicitly, he even indicated in his email to reporters that not only were the “drug company presentations standardized to comply with drug marketing regulations, he and other speakers provided suggestions on the content.” Moreover, Dr. Waikar acknowledged that he was even able “to answer questions from doctors in the audience, drawing from his own practice experience or opinions, as long as he explained the basis of his answers.” Evidence of such “spontaneity” only goes to show how unbiased his work truly was.

As a result of his service, Dr. Waikar has been contacted by many doctors after his talks to consult about difficult cases, especially from primary care providers who have to treat complex psychiatric problems. Having this ability to reach out to him could not have been possible if it were not for the support of such talks by Eli Lilly.

Misinterpretation of Disclosure

The work of Dr. Waikar should ring loud for proponents of more disclosure like Dr. Lo, who still maintain that drug companies control the content of such speeches. If there continues to be a push for more disclosure, as others have indicated, the government will only begin to use this information against doctors, which will in the end only hurt patients.

One anti industry pundit stated about this case and working with industry in general:  “If you can live with public exposure of your accepting gifts and fees from the pharmaceutical and medical device and imaging industries, then go for it. But in a few years, this information will all be known, not just to you and the few people attending your seminars, but to your patients, to your employers and to the government."  Look out they want to sick the government on physicians working to educate other physicians (ouch)

The problem with reports like the IOM report is that “disclosure requirements often omit information that could help clarify the relationship between physicians and the treatments the doctors prescribe.” This statement is from Lisa A. Bero, a professor of health policy at the medical school of the University of California, San Francisco. In other words, the problem is not always the doctors failing to report.

Regardless of Dr. Lo’s recommendations, even as the New York Times admits, the IOM report itself indicated that “the public could benefit when doctors and researchers collaborated with the industry to develop new and effective products.” Since the report makes such an acknowledgement of the value of researcher-industry collaboration, present disclosure policies are more than enough for the public to judge whether such relationships exerted too much influence on patient care.

In the end newpapers will sell more stories of physicians and others working with industry if they can expand the people covered.  Americans love to hear specifics about others income, we love controversy.

Physician Payment Sunshine Act: House Affordable Health Care for America Act Sunshine Provision

The US House of Representatives released their latest version of the “Affordable Health Care for America Act,” which contains new language regarding the Physician Payments Sunshine Provision. The final bill language in the house version (starting on page 889 of 1990 pages) is summarized below.

 

The bill establishes a new section regarding “Financial Reports on Physicians Financial Relationships with Manufacturers and Distributors of Covered Drugs, Devices, Biologicals, or Medical Supplies Under Medicare, Medicaid, or CHIP and with Entities that Bill for Services Under Medicare.”

 

Differences between this bill and previous version introduced in July include:

 

The House moved the start date for this provision from 2011, to begin reporting of all information and payments made in 2010  and reporting on April 1, 2011 (but throughout the Bill there are different non corresponding dates) which would be an impossible task by any measure.

 

Added to the preemption criteria should not pre-empt state laws that require the disclosure of any type of information by any person or entity other than an applicable manufacture.

 

Added a GAO report to review the extent of reporting, and under reporting, the impact of federal pre-emption, changes to the patterns of payments as an effort to evade reporting, description of financial relationships subject to delayed reporting, and improvement in collection, and analysis.

 

Added Inclusion Criteria:

 

o   Payments associated with medical supplies to be reported.

 

o   Reporting of donations by manufactures and suppliers to self insured health plans.

 

o   Physician ownership interest by physicians or immediate family members in a manufacturer, group purchasing organization or distributor.

 

o   Broadly defining group practices to include group practices and hospitals.  

o   ”Any organization that purchases, arranges for or negotiates the purchase of a covered drug device biological or medical supply.

 

o   Establishes a study, to be conducted by the Comptroller General of the United States, to evaluate the extent of use of physician self-referral arrangements and the effects of such arrangements on the cost of providing advanced diagnostic imaging and radiation oncology services to Medicare beneficiaries.  This report will be submitted to Congress no later than July 1, 2011

 

o   Any entity under common ownership which sells medical products or provides assistance and support  to a manufacture or GPO, with respect to the production, preparation, propagation, compounding, conversion, processing, marketing or distribution of a covered drug device or medical supply. 

 

 

§  This would mean that even the microscope manufactures, the advertising agencies, the realtor who sold the building to create the product and on and on, the manufacture would be liable if they failed to report if they bought lunch for the lab techs.

 

§  If a CME provider is owned by an advertising agency or connected with an organization involved in promotion would have to report any payments over five dollars to a physician or other healthcare provider.

 

§  Hospitals, and other health care entities (group practices), privately held manufactures, distributors, and group purchasing organizations are required to report physician ownership

 

Added Exclusion Criteria:

 

· Exempted retail pharmacies from reporting payments to physicians for prescribing generic drugs

 

· Exempted wholesale pharmacies from reporting

 

· Exclusion from reporting of payments made to a physician or hospital by a health plan for medical services provided to employees and family members of manufactures

 

· Exclusion for all indirect payments that is made to a covered recipient , where the manufacture is unaware of the identity of  recipient and not used to market product

 

· Exempted self insured health plans for employees of manufactures

 

 

A summary of the provisions is as follows:

 

Accordingly, manufacturers or distributors must provide in electronic form, all payments or transfers of value to a covered recipient, or to an entity or individual, no later than March 31, 2011, with the following information:

 

-   The recipient’s name, business address, physician specialty, and national provider identifier;

 

-   The value of the payment or transfer of value (other than a drug sample);

 

-   The date when the payment or transfer was made;

 

-   The name of the related drug, device, or supply, if available, to the level of specificity available;

 

-    A description of its form, indicated (as appropriate for all that apply) as— (I) cash or a cash equivalent; (II) in-kind items or services; and (III) stock, a stock option, or any other ownership interest, dividend, profit, or other return on investment; and

 

-   With respect to a drug sample, the name, number, date, and dosage units of the sample.

 

The term ‘payment or other transfer of value’ as defined by the bill means a transfer of anything of value for or of any of the following:

 

    (i) Gift, food, or entertainment

    (ii) Travel or trip

    (iii) Honoraria

    (iv) Research funding or grant

    (v) Education or conference funding

    (vi) Consulting fees

    (vii) Ownership or investment interest and royalties or license fee

 

Included under this definition are speaking fees, dividends, profit distribution, stock or stock option grant, or any ownership or investment interest held by a physician in a manufacturer (excluding a dividend or other profit distribution from, or ownership or investment interest in, a publicly traded security or mutual fund).

 

The above information must be complied by the manufacturer or distributor to include the aggregate amount of all payments or other transfers of value provided by the manufacturer or distributor to covered recipients, and to entities or individuals during the year involved. This includes all payments and transfers of value regardless of whether such payments or transfers of value were individually disclosed.

 

Recipients to Report Payments to Include:

 

• Physician
• Physician Group Practices
• Any other prescriber of a covered drug, device, biological or medical supply (adds nurses, nurse practitioners, lab techs, physician assistants, nurse midwifes and anyone ordering drug or supplies)
• Pharmacies and Pharmacists
• Health Insurance, group health plan including employees of health plans
• Pharmacy Benefit Managers and employees of PBM’s
• Hospitals
• Medical Schools
• Sponsors of Continuing Medical Education
• Patient Advocacy or Disease Specific Groups
• Organizations of Health Professionals (Medical Specialty Societies)
• Biomedical Researchers
• Group Purchasing Organizations

 

 

 

Exclusions: Manufacturers and distributors are not required to report:

 

• Any payments under $5;

 

• The loan of a covered device for a short-term trial period, not to exceed 90 days, to permit evaluation of the covered device by the covered recipient;

 

• Items or services provided under a contractual warranty, including the replacement of a covered device, where the terms of the warranty are set forth in the purchase or lease agreement for the covered device;

 

• A transfer of anything of value to a covered recipient when the covered recipient is a patient and not acting in the professional capacity of a covered recipient;

 

• In-kind items used for the provision of charity care;

 

• A dividend or other profit distribution from, or ownership or investment interest in, a publicly traded security and mutual fund;

 

• Compensation paid by an applicable manufacturer or distributor to a covered recipient who is directly employed by and works solely for such manufacturer or distributor;

 

• Payments made to a covered recipient by an applicable manufacturer or by a health plan affiliated with an applicable manufacturer for medical care provided to employees of such manufacturer or their dependents;

 

• Any discount (including a rebate);

 

• Any payment or other transfer of value (I) in which the applicable manufacturer is unaware of the identity of the covered recipient and is not using such activity or service to market its product to the covered recipient; and (II) that is not designed to market or promote the product to the covered recipient;

 

Product Development

 

The bill also establishes that payments under a product development agreement must be reported for services furnished in connection with the development of a new drug, device, biological, or medical supply, and must also be reported with the following information:

 

• The date of the approval or clearance of the covered drug, device, biological, or medical supply by the Food and Drug Administration; and

 

• Payments made two calendar years after this date

 

Clinical Investigations

 

Payments by the manufacturer or distributor must be reported in connection with a clinical investigation regarding a new drug, device, biological, or medical supply with the following information:

 

• The date that the clinical investigation is registered on the website maintained by the National Institutes of Health pursuant to section 671 of the Food and Drug Administration Amendments Act of 2007; and

 

• Payments made two calendar years after this date

 

Product development and clinical investigation payments will be confidential, and will not be subject to disclosure, and will not be made available until or after the date, in which the information is made public.

 

General Provisions

 

The bill does not require the disclosure of a payment or other transfer of value to a physician by a self-insured health plan.

 

Hospitals and other health care entities that bill under Part A or Part B of Medicare for services must also report on the ownership shares of each physician who, directly or indirectly, owns an interest in the entity.

 

Manufacturers and distributors must also report any investment or ownership interest (other than an ownership or investment interest in a publicly traded security and mutual fund) by a physician (or an immediate family member of such physician) during the preceding year with the following information:

 

• The value and terms of each such ownership or investment interest.

 

• The dollar amount invested by each physician holding such an ownership or investment interest.

 

 

Drug Samples

 

Information regarding the use of free drug samples will not be made public but may be made available outside the Department of Health and Human Services by the Secretary for research or legitimate business purposes pursuant to data use agreements.

 

Penalties

 

Any reporting entity that fails to submit the payment information outline above in a timely manner will be subject to a civil money penalty of not less than $1,000, but not more than $10,000, for each payment or other transfer of value or ownership or investment interest not reported. The total amount of civil money penalties will not exceed $150,000. Knowingly failing to submit payment information will result in a civil money penalty of not less than $10,000, but not more than $100,000, for each payment. The penalty will not exceed $1,000,000, or, if greater, 0.1 percentage of the total annual revenues of the reporting entity.

 

Summary

 

Overall this is a punitive provision which will require an army of employees and contractors to collect data at every level.  Of which most of this data will be of little use to anyone. It is designed to shut down commerce between manufactures, physicians and group purchasing organizations. 

 

The physician ownership provision is especially punitive in requiring disclosure of ownership in everything a physician may be involved in.

 

For CME it will require reporting of payments to CME providers, by manufactures and health plans, and may limit ownership by advertising agencies and health plans in continuing medical education companies.

 

In the end, I am not sure what “problem” they are attempting to resolve and with all the additional reporting by everyone, it does not sound like much in the area of drug development will be accomplished.  Before congress takes such drastic steps they should step back and consider the damage this could do to the entire healthcare industry.

 

Given that the healthcare reform bill has grown from 1,000 pages to 2,000 pages, expansion of government control of the economy and limiting choices appears to be the theme of the day.  The Sunshine Provisions are just one more example of that.

 

US House of Representatives

 

Sunshine Provisions House Bill

 

House Healthcare Reform Physician Payment Sunshine Provisions 10-29-09

 

House Healthcare Reform Physician Payment Sunshine Provisions 7-14-09,

 

House Healthcare Reform Draft Physician Payment Sunshine Provision 6-22-09

 

Policy and Medicine

 

House Versions

 

Physician Payment Sunshine Act: House American's Affordable Health Choices Act of 2009, Physician Payment Sunshine Provision

 

Physician Payment Sunshine Act: Democrat House Draft for Healthcare Reform -- Physician Payment Sunshine Provisions

 

Senate Versions

 

Physician Payment Sunshine Act: Senate Finance Chairman’s Mark - America’s Health Future Act of 2009 – Physician Payment Sunshine Provision

 

 

 

 

Physician Payment Sunshine: Lilly’s Disclosure Used Against Massachusetts Physicians

At least 60 Massachusetts doctors collectively have earned more than a half-million dollars this year as speakers paid by pharmaceutical giant Eli Lilly & Co. - including two Boston Medical Center physicians whose participation is being reviewed for possible violation of a hospital policy against marketing activities by its doctors. Was the lead for a story in this morning’s Boston Globe.   

The article focuses on the use of physicians in speakers programs or “bureaus” in which doctors generally use company prepared materials to materials to explain a drug’s uses and dosing to their colleagues, is widespread in the drug industry. But the practice is under growing scrutiny and some academic medical centers are barring their doctors from participating, believing that physicians essentially become hired advertising guns, with weakened credibility.

The article goes on to outline that the Lilly report, published last month includes payments to  more than 60 Massachusetts doctors, who were paid approximately $588,000 for its speakers programs in the first three months of 2009. Some doctors earned up to $50,000 giving talks to their colleagues.

At Boston Medical Center, Dr. Brian McGeeney, a neurologist, received $30,000 during that period, and Dr. Elliot Sternthal, an endocrinologist, was paid $11,587.50, according to a faculty registry on Lilly’s website.   There is a controversy that this may violate Boston Medical Center hospital policy (wonder who brought this to the papers attention --- lets think “Prescription Project”). 

In e-mailed statements, the doctors defended their talks. Sternthal said he determines “the structure of the presentation by my choice of disease state and clinical trial slides, order of presentation and emphasis of teaching points. This is in compliance with BU/BMC policy.’’ McGeeney said he has “worked with Eli Lilly on their product Cymbalta,’’ a depression drug, “and have been compensated for this work in accordance with FDA’’ and industry guidelines.

Overall the article shows how “transparency” will be used against physicians to cast a shadow on their credibility and question their ethics as has been the case in several other cities and reports from states.

The Pharmascolds have not been shy about how they plan to use “transparency” In the MedPAC (Medicare Payment Advisory Commission) Report released earlier this last year, one of the key reasons for Sunshine “Helping media and researchers to shed light on physician industry relationships and explore whether manufacturers and physicians are complying with industry and professional standards.”

Early last year Peter Laurie, MD of Public Citizen (Ralph Nader) gave a presentation on the uses of transparency to the Prescription Project with basically the same talking points and instructions for reporters.

In addition to BMC, the region’s other academic medical centers also have or plan to adopt policies restricting physicians’ role as speakers for companies. These rules could force some doctors to withdraw from the Lilly program - though some hospitals essentially leave it up to physicians themselves to decide whether they are in violation.

In a hallmark of “fair” reporting the only sources quoted in the article are Eric Campbell “Academics who want to be drug salesmen should go be drug salesman. But don’t do it under the shroud of academia.’’  Steve Nissen – doctors in speakers bureaus “are actually acting as an agent for the pharmaceutical company. That does create divided loyalties, and universities are realizing the challenges that presents.’’ And of course the gadfly blogger Daniel Carlat who claims he was offered over $170,000/year from Schering Plough (I wonder if this was a plant).

This is not the first paper to report on the Lilly reports papers in Miami, and Kansas have used these against local physicians.  In addition newspapers in Vermont and Minnesota regularly report on payments to physicians without any consideration to the value that those services and payments provide to physician learners, patients and new innovations.

Just last week WCVB Boston ran a unflattering story in which Dan Carlat calls himself a drug whore.  I would question the use of this language as most people having sex are not whores in the same way the vast majority of physicians working with industry are not whores but providing beneficial services for the healthcare system as a whole. 

 

Thomas Stossel outlines in the story how he sees working with industry as beneficial for innovation and is hopeful in the future that those physicians working with industry will speak out on the benefits of what they are doing.   There. is however a certain amount of “fear” in the medical community that they are being shamed away from working with industry.

 

Next year when the Massachusetts statewide reporting of all payments to physicians begins expect to see allot more of these types of stories.

Unfortunately in the eyes of the naive press disclosure of payments to physicians will be used against them in what could be considered almost vial attacks with little understanding of the value that these often FDA mandated “promotional” talks give to physicians in the non-academic settings.

Physician Payment Sunshine Act: Senate Finance Chairman’s Mark - America’s Health Future Act of 2009 – Physician Payment Sunshine Provision

Senate Finance Committee Chairman Max Baucus (D-MT) released his Chairman’s Mark on America’s Health Future Act of 2009.  A Chairman’s Mark is a recommendation by committee chairman of a measure to be considered in a markup (A committee session where a bill is reviewed and amended).

 

The America’s Health Future Act of 2009 Physician Payment Sunshine Provision includes provisions for pre-emption of state laws, a $10 per event or $100 cumulative payment quota, and requires reporting of payments to physicians, group practice or hospitals with a medical residency program and does not include a small business exemption.  The bill requires reporting on significantly fewer entities than the house version.

 

Below is an outline of the Physician Payment Sunshine Provisions within the chairman’s mark.

 

Reporting

The bill would require any manufacturer of a covered drug, device, biological, or medical supply that makes a payment or another transfer of value to a physician, a physician medical practice, a physician group practice, or a hospital with an approved medical residency training program to report annually, in electronic form, specified information on such transactions to the Secretary of HHS. The report would include:

 

· The transfer recipient‘s name, business address, amount of the payment;

· Date of the payment;

· A description of the form of the payment;

· A description of the nature of the payment;

· If the payment is related to marketing, education, or research specific to a covered drug, device, biological or medical supply the name of that product; and

· Any other category of information that the Secretary determines appropriate.

 

If the recipient requests a transfer of payment to another entity or individual at the request of the recipient the manufacturer should disclose that information.

 

Clinical Trials and Product Development

Delayed reporting requirements would apply for payments made pursuant to a product development agreement or clinical trial.

 

Exclusions

Information excluded from these reporting requirements include payments or transfers of $10 or less, unless the aggregate annual payments or transfers to a recipient exceeds $100. If the annual payments or transfers to a recipient exceed $100.

 

Other excluded information includes:

 

· Samples intended for patient use;

· Patient educational materials;

· Loan of a covered device for a short-term time period;

· Discounts and rebates;

· Payments made to a physician for the provision of health care to employees;

· Payments to a physician who is also a licensed, non-medical professional if the payment is solely related to non-medical services, payments to a physician solely for services related to a civil or criminal action or an administrative proceeding, and in-kind items used for charity care.

 

Timeline

This reporting requirement would begin on March 31, 2012 and continue on the 90th day of each subsequent calendar year.

 

The Chairman‘s Mark also requires any such manufacturer, or related group purchasing organization to report annually to the Secretary, in electronic form, certain information regarding any ownership or investment interest (other than in a publicly traded security and mutual fund) held by a physician (or an immediate family member) in the manufacturer or group purchasing organization during the preceding year.

 

Penalties

Manufacturers or group purchasing organizations would be subject to a civil money penalty (CMP) of not less than $1,000 but not more than $10,000 for each payment or transfer not reported. The total amount of the penalties for any annual submission shall not exceed $150,000. Any manufacturer or group purchasing organization that knowingly fails to submit information would be subject to a CMP of not less than $10,000 but not more than $100,000 for each payment or transfer not reported. The total amount of the penalties for this failure to report category of submissions shall not exceed $1,000,000 annually.

 

Website

Beginning September 30, 2012 and on June 30 of subsequent years, submitted information will be available on an Internet website that will include information on enforcement actions during the preceding year, background information on industry-physician relationships, and a separate listing for payments related to clinical research, and other information that the Secretary deems appropriate.

 

Preemption

Effective January 1, 2011 the Chairman‘s Mark would preempt any state (or political subdivision of a state) law or regulation that requires manufacturers to disclose the type of information required under this provision regarding payments or transfers to covered recipients. The Mark would not preempt any state (or political subdivision of a state) law or regulation that requires the disclosure or reporting of

 

• Any information not required under this provision;
• The types of information excluded from reporting requirements under this provision, with the exception of the $10 de minimis/$100 aggregate reporting requirement;
• Information by any person or entity other than an applicable manufacturer or covered recipient described above; and
• Information reported to a Federal, state, or local government for public health purposes.

 

CME

The bill will require reporting of continuing medical education (CME) grants/payments to Medical Schools and Hospitals with approved medical residency training programs.

 

 

Other Transparency Sections

In addition to payments from manufactures, there are several other transparency measures addressed in the chairman’s mark.

 

Insurance Companies 

· Beginning in 2010, to ensure transparency and accountability, health plans would be required to report the proportion of premium dollars that are spent on items other than medical care.

 

Hospitals

· Beginning in 2010, hospitals would be required to list standard charges for all services and Medicare DRGs.

 

Drug Samples

· Submit to the Secretary of HHS rather than make available (as the current law requires) data on drug samples including recipient, amount, theft and losses.

 

Nursing Homes

· Discloser of Ownership

· Staffing Data

· Results of State Facility Surveys

· Enforcement Actions

· Expenditures on Staffing Expenditures for Direct Patient Care

Imaging Services

For Imaging Services the referring physician must inform the individual at the time of the referral that:

 

· The individual may obtain the services from a person other than the referring physician; a physician who is a member of the same group practice as the referring physician; or an individual who is directly supervised by the physician or by another physician in the group practice.

· The individual must be provided with a written list of suppliers who furnish services in the area in which the individual resides.

· This new requirement would apply to services furnished after January 1, 2010.

 

Summary

The bill covers significantly fewer recipients than the House Version and the original Physician Payment Sunshine Act introduced in January

 

Overall the chairman’s version is very reasonable and a good test for transparency.    It also takes into consideration time for manufactures to develop procedures to comply with the law.

Health Care Reform: Medical Device Manufactures, Sunshine Provisions and Big Fees

Medical Device Manufactures are making news in the health care reform debate by refusing to negotiating with the White House and Senate Finance Committee on expense cuts and fees.  In addition they are calling for expansion of the Physician Payment Sunshine Provisions of the House Health Care Reform Bill.

Sunshine

The Sunshine Provision in the current house health care bill states that in 2011, any manufacturer, group purchasing organization, or distributor must electronically submit to the Secretary of Health and Human Services (HHS)

1) The amount invested by each physician;

2) Any transfer of value to a physician; and

3)The value and terms of each ownership or investment. There is an exemption for payments to providers who provide health care services to a manufacturer’s employees, and non-healthcare-related subsidiaries.

One amendment sponsored by “Blue Dog” Indiana Democrat Baron Hill and favored by AdvaMed dealing with the Sunshine Provision would require drug and device manufacturers “to annually post payments made to physicians on a public government database,” and extend this disclosure “to physician-owned hospitals, distributors and group purchasing organizations.”   This type of amendment would expand the types of entities subject to the physician payment disclosure mandates.

The Wall Street Journal provided further coverage of these amendments noting that industry is “supporting a federal requirement,” instead of statewide requirements because it would be overly burdensome and confusing, which would force “manufacturers to spend millions of dollars to track all payments.” This would significantly drain valuable resources such as staff and money that could be used to advance research and development of new devices and drugs.

$40 Billion Fee

If the reporting requirements were not enough to square away doctors from conducting important research and device development, the Senate Finance Committee draft bill calls for device makers to pay $40 billion in fees over 10 years by assessing all manufacturers at a rate, based upon their U.S. sales, necessary to generate $4 billion annually beginning in 2010.” According to WSJ, these fees “resulted from a lobbying move” in which “representatives of the device industry … suggested that the government levy a tax on their adversaries: hospital-purchasing groups that negotiate for lower prices on medical supplies and some devices.”

The idea of such taxes on device makers is shocking. As Michael Mussallem, president of heart-device maker Edwards Lifesciences Corp. put it best: a “$40 billion tax would cut into research and hurt companies' ability to add jobs." Moreover, the idea that these taxes would be collected on market shares is too vague and uncertain. Adding a tax like this into the healthcare bill would only hurt patients even more, and industry even worse considering the present legislation already includes “significant cuts in Medicare reimbursements for diagnostic imaging such as CT scans and MRIs.

Ultimately, General Electric spokesman, Peter O'Toole, summed up the goals of every device manufacturer: "We want to ensure that patient access to these critical, life-saving technologies is maintained." We do as well, and taxing these companies because Congress is rushing another thousand page bill pass the public is not acceptable. Take action now, before the hospital you go to or your physician cannot perform a hip replacement or pacemaker because the business who makes it went out of business.

 

Physician Payment Sunshine: Eli Lilly Post Payments to Health Care Professionals

On Friday Eli Lilly became to first major pharmaceutical company to publish an online registry detailing 1^st Quarter 2009 payments it has made to physicians and other health care professionals - a report known as its "faculty registry."    

Lilly faculty are physicians and other health care professionals contracted to provide specific services on behalf of Lilly and the Lilly alliance partnerships. Faculty appearing in the registry either advised Lilly or conducted medical lectures designed for health care professionals and patient education. The site discloses each professional's name, location, description of the services provided and the compensation paid, among other details.

According to the Wall Street Journal Blog Lilly compensated physicians and health care professionals $22 million for services in the first quarter.  Nearly 3,400 physicians and other health care professionals are in the dataset. The average payment per service provided is just over $1,000, with health care professionals conducting six activities on average.

"This registry is consistent with Lilly's efforts to increase transparency," said Jack Harris, M.D., Lilly's vice president of its U.S. medical division. "We see greater transparency as integral to rebuilding trust in our industry."

"Our contracted faculty are key resources in our efforts to improve individual patient outcomes," Harris said. "They advise us on how to bring the best new cures and treatments to market, and give lectures to their peers on Lilly products and disease-state information to help keep them current on the ever-changing field of medicine. And many of our faculty educate patients, at the request of their treating physician, on how to use the Lilly medicine prescribed to them."

Lilly's faculty registry is part of its commitment to enhancing transparency. In 2004, Lilly became the first company to voluntarily make public its clinical trials and its clinical trials data.  In 2007, Lilly added another first by publicly reporting all of its educational grants and charitable contributions.

The registry includes videos and descriptions of services that are provided by health care providers for consulting and educational services and outlines the needs for such services.

Lilly announced last September it would begin to voluntarily disclose physician payments starting in the second half of 2009. In February 2009, Lilly entered into a Corporate Integrity Agreement with the Office of the Inspector General of the U.S. Department of Health and Human Services and was required to disclose the information.    Though those agreements only require Lilly to disclose this information directly to the States and Government, Lilly took the next step in providing disclosure on a public website.

The registry does an excellent job in explaining the need for professionals and should serve as a role model for other companies (Merck, Pfizer and GSK) plus others in best practices to provide disclosure of payments to physicians.

 

Physician Payment Sunshine Act: Payment Disclosure Laws -- History and Challenges in Minnesota

Physician Payment Sunshine provisions are now part of the healthcare reform bills working their way through the house and senate. 

One Minnesota physician who has seen the effects of payment disclosure first hand , sent an open letter this week to the Minnesota Board of Pharmacy asking for an explanation as to why, though not required by the law, the payments to physicians are listed on the Board’s website.    

In this article we will explore the history of the Minnesota law and the problems that the payment disclosure law has created for physicians, patients and economically for the state.

History

The Minnesota Board of Pharmacy has collected reports on physician industry disclosure since 1997, according to Dr. Cory Wiberg, who became Executive Director in 2005. According to Dr. Wiberg’s Office Manager—who has been with the Board for about 30 years—the reports were filed away and were never publicized because “nobody ever requested to view the reports.”

In 2004, Ralph Nader’s Group “Public Citizen” sent a “researcher” to look at and make copies of the reports. A couple of months after, Gardiner Harris of the New York Times contacted Dr. Wiberg to obtain copies of the reports. Then Tom Sheck of Minnesota Public Radio, and another researcher from California also asked for copies in the spring of 2006.  

Less than one week after he took over as Executive Director, he received a question from a Washington, DC law firm that represents several pharmaceutical manufacturers. They had a question about an interpretation of the law that establishes the gift limitation. After giving his response, Dr. Wiberg learned his answer “differed from the answer his predecessor had given the firm.” He also began receiving other questions that he then decided to list on the Board’s website under Frequently Asked Questions (FAQ).

Since his answer differed from his predecessor’s, Dr. Wiberg submitted all of the questions he received to the Minnesota Attorney General's Office (AGO) and requested a formal legal opinion. Specifically, “The request for a legal opinion was sent to Assistant Attorney General Tiernee Murphy who, at the time, was the AAG assigned to the Board, and her supervisor, Steve Gunn, reviewed the opinion.” Accordingly, the full Minnesota Board of Pharmacy unanimously adopted the Minnesota AGO legal opinion at its January 2006 meeting. The AGO opinion became the basis of the FAQ document posted on the Minnesota Board of Pharmacy’s website. In fact, according to Dr. Wiberg, the FAQ is in most places taken verbatim from that opinion including:

· Considering nominal meals and luncheons to doctors gifts;

 

· Counting these meals towards the state's limit of no more than $50 in gifts by a drugmaker to a doctor per year; and

 

· Preventing physicians from getting paid to complete marketing surveys.

Board of Pharmacy: Accountability

In early 2007, the researchers from Public Citizen published an article in the Journal of the American Medical Association (JAMA) which focused on the payments to physicians reported to the Minnesota Board of Pharmacy, causing numerous requests for copies of the reports. That is when Dr. Wiberg decided to place the reports on the Board's website as a matter of efficiency.

In choosing to do so, the Board sparked a new fight with physicians, who are pointing out the problems with the Minnesota disclosure law: J. Michael Gonzalez-Campoy, MD, PhD, FACE Medical Director and CEO, Minnesota Center for Obesity, Metabolism and Endocrinology, PA (MNCOME), Past President, of the Minnesota Medical Association(MMA), and current member of the Board of Directors of the American Association of Clinical Endocrinologists (AACE) is representing his colleagues in Minnesota, and in the specialty of endocrinology.

Dr. Michael Gonzalez-Campoy: Call to Action

Dr. Gonzalez-Campoy wrote to the Minnesota Board of Pharmacy after realizing the harm to medicine and patient care from anti-industry campaigns in Minnesota .  In his first letter, “The catalyst” for his inquiry was that several of his patients began to question the use of prescribed medications because of news reports claiming that doctors are getting paid by pharmaceutical companies.  As a result, patients expressed concern that doctors could not be trusted to provide unbiased care to their patients, and physicians were getting paid by industry for self gain—according to information on the Board’s website.

In response, he asserted that nothing could be further from the truth, even though Dr. Wiberg disagreed. Standing firm, Dr. Gonzalez-Campoy emphasized that physician industry relationships deploy newer, better treatments. Although these advances require the involvement of specialists to teach their colleagues, distinguishing the roles that specialists have as researchers and as physician educators from their primary role as health care professionals is unnecessary. 

Dr. Gonzalez-Campoy acknowledged the role of the Board to collect data on industry payments to physicians, under Minnesota statutes. He also clarified however, that the Board does not have a mandate to interpret the law—which the website attempts to do--and actually interferes with the practice of medicine, leading to patient harm.  Specifically, there is no accountability when the Board issued its opinion regarding the gifts because there is no authorship of the opinions the board posts. As a result, he firmly states that his letter, on behalf of his colleagues and patients,serves:

“as a request to make the public aware that all income which by law must be declared to the Minnesota Board of Pharmacy, is ethical, moral and legal, and represents the standard of care,” and that the working relationship between physicians and industry is not suspect. 

He notes that current treatments and technologies were made through the physician-industry relationships to treat patients, and any implication that this is not so, needs to be removed from the Board’s website. Specifically:

“The income reported to the Minnesota Board of Pharmacy represents part of the legal work product of physicians, and it is entirely for the good of medicine and our patients” and that  “This income should not be distinguished from the income physicians derive from patient care.”

The actions of the Minnesota Board of Pharmacy have unintended consequences and will continue to have a very negative impact on the doctor-patient relationship, research and development, and medical education. This negative impact has resulted in a decrease in support from industry that many physicians, patients, and students benefitted from.

Ultimately, efforts to control costs with the implementation of “transparency laws” are misguided because media coverage leads people to distrust their doctors, and some to stop taking their medications.  Dr. Gonzalez-Campoy believes, and demographics back him up, that:

“the real cost driver is an aging population that does not have access to timely medications as prescribed by their physicians,” which causes us to  “spend more on office visits, lab testing, ER visits, and long-term complications, when we don’t consider the global cost of care.”

MN Board of Pharmacy Response

Dr. Wiberg disagreed with Dr. Gonzalez-Campoy, that the postings on the Board's website implied that the working relationship between physicians and industry is suspect. In response to the first letter Gonzalez-Campoy wrote to the Minnesota Board of Pharmacy on behalf of his colleagues and patients, Dr. Wiberg noted the following corrections he would make to the Board’s website:

 

· Edit the FAQ to acknowledge that the Board adopted a formal legal opinion issued by the AGO during a public meeting in January of 2006;

 

· Edit the FAQ document to add information that indicates that the reported payments are legal under Minnesota law; and

 

· List Minnesota Board of Pharmacy members and staff who authored the FAQ and opinion

 

 

In addition, Dr. Wiberg recognized that acknowledging all of the payments reported by manufacturers as "entirely for the good of medicine and . . . patients," would be something more appropriate for the legislature. Ironically, the Director noted that even though “there is a considerable amount of disagreement in this country concerning the value of certain payments that manufacturers make to practitioners,” his website still maintains ‘their interpretation.’

Some specific changes and factors with the Board's adoption of the legal opinion it received from the Attorney General's Office included:

 

· Some pharmaceutical manufacturers directed their sales representatives to restrict providing food on their sales calls;

 

· Manufacturers of educational materials such as brochures, journal articles and patient teachings aids are NOT considered gifts or have to be reported; 

 

· FDA 2003 guidance to the industry allows manufacturers to provide grants to support medical education, if they do not control the programs;

 

· Pressures from advocacy groups such as The Prescription Project and Public Citizen.

 

Gonzalez-Campoy Fires Back

In reaction to the Board of Pharmacy’s response to his initial letter, Dr. Gonzalez-Campoy did not hesitate to press the Director for more answers and transparency. In particular, he declared that the Boards published interpretation caused harm to patients by:

 

· Eroding the patient-doctor relationship by the innuendo of impropriety;

 

· Hurting medical education by mandating students to take anti-industry classes, and deeming industry sponsorship of medical education suspect, which is creating a generation of physicians who lack fair balance;

 

· Hurting the physician-industry relationship because anti-industry messages cause “leadership” of medical groups to shut down their institutions to industry colleagues and their sales are discredited;

 

· Threatening the steady scientific work force Minnesota enjoyed by anti-industry messages in medical and graduate schools, making it difficult to recruit talented scientists and physicians to work in Minnesota when they learn of the negative practice environment;

 

· Stagnating medical research/development because investors are unsure;

 

· Causing the tax base provided by medical industry and the employment opportunities it had brought to Minnesotans to dwindle, such as pharmaceutical companies choosing not to work in Minnesota (even though they continue to do business in Minnesota);

· Depriving dollars previously spent in Minnesota, which helped the economy, including dinner programs for physician education and travel to Minnesota by physician educators, are now being spent elsewhere;

 

· Wasting Minnesota taxpayer dollars to collect and process data from the by the Minnesota Board of Pharmacy staff; and

 

· Not reaching optimal patient care because efforts to cut pill costs do not consider global cost of care for individuals or what optimal treatment is.

 

The harm done to patients, medical education and medical research “has its roots in Minnesota.” The opinions regarding the Minnesota gift laws were a direct catalyst for a major withdrawal by industry in Minnesota, and subsequently in other states, negatively impacting patient welfare and medicine nationally.

 

Other physicians, companies, state and federal institutions should support Dr. Gonzalez-Campoy and his colleagues before patients lose their voice and are forced to make health choices based on politically funded propaganda.

 

The research and dedication Dr. Gonzalez-Campoy and his colleagues employ regarding these issues makes them champions for the overwhelming percentage of physicians who practice individualized, patient-centered care, and consider using industry support essential to improving health outcomes for their patients. 

 

Minnesota

 

Minnesota: Board of Pharmacy Q&A

 

Disclosure Reports (1997-2008)

 

(Part 1 of 2) in our next article we will be discussing recent activities around the Minnesota Law.

 

Physician Payment Sunshine Act: House American's Affordable Health Choices Act of 2009, Physician Payment Sunshine Provision

 

While the Senate Finance Committee is projected to release their health care reform bill by Friday (almost two weeks passed their deadline), the House formally released their version of healthcare reform H.R 3200, the America’s Affordable Health Choices Act of 2009.

 

The bill is scheduled for mark up by the House Energy and Commerce Committee beginning tomorrow, and all through next week.   The news around the bill has focused almost exclusively on increasing taxes on the wealthy to pay for the trillion dollar plus health care reform package.

 

Within the released bill, there is an updated section regarding the Physician Payment Sunshine Provisions, different from the previously reported summary.

 

The differences between the original bill and this version include :

• Preemption language based on Grassley-Kohl (S. 301) to preempt States from collecting info that is collected at the Federal level. It does not preempt States from requiring reporting of:

 

• Information that is not collected at the federal level;

 

• Information required to be reported to a federal state or local governmental agency for public health surveillance, investigation, or other public health purposes or health oversight purposes; and

 

• Does not affect the discovery or admissibility of information described in this section in a criminal, civil, or administrative proceeding.  The previous House draft had no preemption.

 

• Discounts and rebates that are now explicitly excluded from reporting.  Previous draft required reporting of discounts and rebates.

 

• Removal of language from the previous draft that required manufacturers to report payments made “directly, indirectly, or through an agent, subsidiary, or other third party” to covered recipients.

 

• Delayed reporting for product development and for clinical trials until the date that the trial is registered on clinicaltrials.gov or 2 years after the payment was made, whichever is earlier. The previous version only had delayed reporting for product development agreements.

 

• A new provision that says product development and clinical trial payment info are considered confidential and are not subject to disclosure under FOIA until or after the date on which the info is made public.

 

• A new provision that says the accuracy of information is the responsibility of the manufacturer, and the Secretary must establish procedures to ensure that covered recipients have the opportunity to submit corrections to the manufacturer, and under such procedures, the corrections must be transmitted to the Secretary.

 

• A new provision that National Provider Identifiers must not be made public but can be made available by the Secretary for research or legitimate business purposes pursuant to data use agreements.

• Removal from the previous version language within the annual report to Congress, to include a report on a description of the types and prevalence of financial arrangements between hospitals and physicians.

 

• The definition of “clinical investigation” as “materials derived from human subjects”  has been added.

• Group Purchasing Organizations (GPO’s) have been added to the list of “covered recipients”.     

• A special rule for drug samples, in which there is no requirement to make public information regarding drug samples. 

  

• Penalties for any defined entity that does not comply with reporting, a civil money penalty of not less than $1,000, but not more than $10,000, for each payment or other transfer of value or ownership or investment interest not reported; with an annual penalty not to exceed $150,000;  

  

• Penalties for knowingly failing to report will result in a civil money penalty of not less than $10,000, but not more than $100,000, for each payment or other transfer of value or ownership or investment interest not reported; with an annual penalty not to exceed $1,000,000 or, if greater, 0.1 percent of the total annual revenue;

• The ability for State Attorney Generals to enforce this provision. 

 

• Exclusions from reporting such as payments under $5; the loan of a covered device not exceeding 90 days; services provided under a contractual warranty of a device or product;

For CME this version has the same language as the draft, in that all grants to CME providers by companies will be reportable, but reporting attendees and expenses will not be required.

The Senate Version, due this week (Thursday or early next week), may be very similar to the original bill posted this year with some minor changes. Physician Payment Sunshine Act 2009 Introduced.

U.S. House of Representatives

 

House Democrat American’s Health Choices Act of 2009 7-14-09

 

The Physician Payment Sunshine Provisions 7-14-09