Pharma, device payments to docs set to go public

December 31, 2012

One of the elements in the Patient Protection and Affordable Care Act that may affect urologists is the Physician Payment Sunshine Provision, which requires drug and medical device manufacturers to publicly report gifts and payments made to physicians and teaching hospitals beginning in 2013.

With President Obama’s reelection, the implementation of the Patient Protection and Affordable Care Act continues. One of the elements in the new law that may affect urologists is the Physician Payment Sunshine Provision, which requires drug and medical device manufacturers to publicly report gifts and payments made to physicians and teaching hospitals beginning in 2013. By the end of this article, you should know the relevant aspects of the Sunshine Provision and how it may impact you, your practice, and your patients.

The Physician Payment Sunshine Provision was intended to address the influence that the pharmaceutical industry may have on physician prescribing by making public the financial relationships between manufacturers and the doctors who prescribe their products. According to an interpretation of the law by the Pew Health Group (a research organization), all manufacturers of “drugs, devices, biologics, and medical supplies” that are normally covered by the Centers for Medicare & Medicaid Services must annually report payments to the Department of Health and Human Services, which in turn is required to post the information on a public website and report annually to Congress and each state (www.pewhealth.org/uploadedFiles/PHG/Supporting_Items/IB_FS_PPP_Sunshine_Act_State_Laws.pdf). The law is very specific as to the type of payments that must be reported (in-kind payments like food and gifts are included) and the amount of payments (anything over $10 per event or a total of $100 in 1 year).

The reports will be made in a standard format and include physician name, address, amount/value, and nature of the payment; all of this detail will be available on a public website. The provision was implemented Jan. 1, 2012, and the first reports will be issued in 2013 (for 2012 payments).

How your practice may be affected

How might this affect a urology practice? Pharmaceutical representatives may be discouraged from providing coffee, donuts, or lunches to physician offices because of the burden of tracking mandated by the provision’s reporting requirement. Physicians will certainly be wary about engaging in any activity that could result in public disclosure of an in-kind payment from a pharmaceutical or device company because of the potential for inappropriate conclusions by the public about financial relationships. While samples, coupons, and patient education materials are exempted from the provision, the aforementioned disincentives could significantly impact the relationships of pharmaceutical sales representatives with the physicians whom they “detail.”

In addition, physicians who supplement their income with industry-sponsored speaking engagements will want to carefully evaluate whether public disclosure of those honoraria and related expenses may affect their practice or the perception of patients. Money used to fund clinical research is also included in the Sunshine Provision, and practices that heavily engage in research will have a public record of the payments.

Propublica: A preview of what’s to come

If you’d like an idea of what disclosures might look like under the Sunshine Provision, you need not look further than the Internet. For several years, 12 drug companies-accounting for about 40% of prescription drug sales (as of 2010)-have already been reporting payments to physicians either voluntarily or under an integrity agreement with the Office of the Inspector General. The investigative journalism site Propublica has been tracking these payments under the title “Dollars for Docs-How Industry Dollars Reach Your Doctors,” and has published an engine that allows searches by physician name, practice name, state, company, reporting period, and category (projects.propublica.org/docdollars/companies).

The database contains payments totaling $761 million for the years 2009-2011. Readers may wish to search for themselves in this database, verify the accuracy of the information, and learn exactly how the information is being displayed. Propublica does provide a mechanism for named entities to challenge the data. Finally, the full data set is available in a downloadable format from Propublica at www.propublica.org/forms/dollars_for_docs_data/.

Bottom line: There is already detailed information in the public domain regarding payments to physicians by drug and device manufacturers, and the Physician Payment Sunshine Provision of Obamacare will mandate that all such payments be reported from 2012 forward. Urologists may already have been impacted by drug company reporting and should verify the data in Propublica’s database. Starting this year, look for the data on government-sponsored websites and review your office policies regarding pharmaceutical sales representatives in the context of this new reporting requirement.

Practice Pointers

  • The Physician Payment Sunshine Provision is an element of the Patient Protection and Affordable Care Act that requires drug and medical device manufacturers to publicly report gifts and payments made to physicians and teaching hospitals beginning in 2013.

  • Under the provision, pharmaceutical representatives may be discouraged from providing coffee, donuts, or lunches to physician offices because of the burden of tracking required.

  • Physicians who supplement their income with industry-sponsored speaking engagements will want to carefully evaluate whether public disclosure of those honoraria and related expenses may affect their practice or the perception of patients.

  • The investigative journalism site Propublica is already tracking payments to physicians and has published an engine that allows searches by physician name, practice name, state, company, reporting period, and category.