What the New Federal Sunshine Act Means to Mass. Physicians

Earlier this month, federal Sunshine Act took effect. It requires pharmaceutical companies and medical device manufacturers to publicly report all direct and indirect payments to physicians and teaching hospitals that have a value of $10 or more. This applies to all such interactions starting Aug. 1, 2013.

How does this affect physicians?  Physicians are not required to do anything to comply with the federal law. The onus of complying with the law is on the drug and medical device industry.

However, the law gives physicians the chance to review and possibly correct data about themselves before it is published.

Therefore, the AMA says there are few things that physicians should do, to ensure that the public reports are as accurate as possible:

  1. Ensure that your financial disclosures and conflict of interest statements are up to date. These are statements that you provide to employers, advisory bodies or research organizations.
  2. If you have NPI number, ensure that your specialties are accurately identified.
  3. Sign up to receive alerts when your personal report is available for review. The portal to sign up for this will probably be available around Jan. 1, 2014.
  4. At some time between April and August 2014, you will receive notice that your information is ready to review. You will have 45 days to review it. If you dispute anything in the report, you will have another 15 days to resolve the dispute before it’s made public.

CMS will release the public reports by Sept. 30, 2014.

Generally, here’s what will be reported

  • Direct payments of at least $10. If multiple payments of under $10 add up to more than $100 in a calendar year, then the aggregate total is reported. This does include textbooks and reprints, even though Massachusetts law exempts peer-reviewed clinical and scientific information.
  • Indirect payments of at least $10. In this instance, the physician doesn’t get the payment directly, but gets it through a third party on behalf of the manufacturer.
  • Ownership interests by physicians and their family members. However, stock purchases made on the open market, made under terms that are generally available to the public, do not have to be reported.

Exceptions to the reporting requirement include:

  • Continuing medical education
  • Products samples intended for patient use
  • Patient education materials
  • Short-term loans (under 90 days) of medical devices to evaluate the equipment
  • Discounts and rebates
  • Buffet meals, soft drinks, coffee and snacks at big events where it would be difficult for the manufacturer to identify which physicians partook of the food.

Does this change anything in the comparable Massachusetts law? Not really. There has been no indication that the state plans to change its reporting program. The state’s threshold for reporting activity is $50, compared to $10 for the federal reports.

Prohibited activities in Massachusetts remain unchanged, such as:

  • Any payments for entertainment, either to the physicians, or his/her spouses and guests
  • Payments for travel to non-CME events
  • Payments for prescribing prescription drugs or medical devices
  • Meals that don’t meet the new definition of being “modest”

The state law still allows manufacturers to give physicians peer-reviewed information, drug samples intended for patients, and compensation for bona fide professional or consulting services, or training expenses.

A more detailed discussion of the federal law is available from the AMA.

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