The Physician Payment Sunshine Act: What Diagnostic Radiologists Need to Know

If a patient asks why you received $50,000 in travel or research expenses from a medical device manufacturer, are you prepared to respond? Do you know that the fees for the industry talk you gave might be available for public viewing next year? And that dinner you attended to learn the latest imaging advances may be reported as a $200 value to CMS, shown on a searchable internet database?

More than half of physicians do not know that medical device and pharmaceutical companies have to report to CMS almost any payment or “transfer of value” made to physicians, according to an MMIS survey earlier this year. This payment information will be included in a public database as part of the newly-enacted Physician Payment Sunshine Act (also known as Open Payments or the Sunshine Act).

The survey echoes the experience of Nogah Haramati, MD.

“The vast majority of individuals with whom I’ve discussed this act have never heard of it,” said the professor of clinical radiology at Albert Einstein College of Medicine, who wrote about the Sunshine Act for the June 2013 issue of the Journal of the American College of Radiology.

Why should you care?

The purpose of the law is to make financial relationships between vendors and physicians transparent. This move isn’t meant as a form of punishment or judgment, yet, its consequences are not fully realized. Sometimes reports aren’t what they seem. For example, the vendor may report a $50,000 grant in the travel or the research category, leading to misperception issues.

“It may look like the physician went on great junkets to the South Pacific, whereas it was used to send 12 graduate students to a conference in Detroit,” Haramati said.

The law requires that vendors report transfers of value to physicians and teaching hospitals, but it does not include reporting gains by individual medical students and PhD researchers, he said.

“Even if it appears as $200,000 for research, it’s difficult to explain when a patient says ‘you’re getting fat on it,’ and I say ‘but I really run this lab,’” he said. “That database can introduce a credibility problem into the equation, which may be the lawmakers’ intent.”

While physicians can appeal to the vendor if they believe the reported information is incorrect, “they’re under no obligation to change anything,” Haramati said, adding that the government penalties for vendor noncompliance are steep. A physician can request that the vendor re-categorize a payment, but “the vendor will defer to their legal advisors and take what they deem to be the safest route. The relationship with the physician is one thing. Draconian financial penalties are another. It’s hard to argue with the government.”

Lavish dinners, trips, and gifts to physicians dried up years back, and institutions like Haramati’s already have a restrictive vendor policy. Physicians can be fired for receiving anything of value from a vendor. To be on the safe side, Haramati tells colleagues and staff it’s best to avoid attending vendor-sponsored events since a portion of the event cost may be attributed to each physician attending. Haramati requires vendors to provide a written guarantee that he receives no value from and won’t appear in the database for any activity or conference call he participates in. If the vendor can’t provide a guarantee, he pulls out.

“I don’t want to appear in the database,” he said.

A physician concerned about looking bad in the database should take proactive measures to be transparent and up front with patients, said Bob Still, practice administrator at MRI Group in Lancaster, Penn. He recommends that practices participating in clinical trials or working with vendors on new and emerging equipment state this on their websites, since using cutting edge equipment can benefit the patients.

“I don’t think there’s anything wrong with a practice saying they receive remuneration to do this kind of research,” Still said.

Sunshine Act background: What’s Reportable?

Part of the Affordable Care Act, the Sunshine Act requires manufacturers of medical devices, medical supplies, and drugs or biological materials to collect and report any transfers of value greater than $10 to physicians and teaching hospitals to the Centers for Medicare & Medicaid Services (CMS) annually. The information will be available publically on a searchable database.

There’s a long list of what is and isn’t required to report, and the payment type will be noted, as well (i.e. cash, stock, ownership interest, in-kind items/service, etc.). CMS lists 14 categories of payments, such as consulting fees, grants, research, honoraria, travel, and charitable contributions. If a physician requests that payment be made indirectly to another physician or third party that, too, must be reported.

What doesn’t count? CME credit and courses, conference buffet meals and drinks if available to everyone, patient product samples, patient educational materials, medical devices loaned for short-term testing, charity care items, payment for services rendered in legal actions, and anything under $10 (unless it aggregately amounts to $100 or more for the year).

Manufacturers, not physicians, are responsible for reporting the income. It behooves a physician to review the information when available since it’s the physician’s name and reputation at stake.

“We need to make sure that information is correct,” Still said. “It’s not unlike a restaurant owner looking at Yelp to make sure the reviews for the restaurant are accurate.”

Timeframe

Companies were required to begin collecting and tracking payment to physicians and hospitals on August 1, 2013. In January 2014, physicians can sign up with CMS to receive notification of when their personal information will be available for review (estimated to be between June and August). Manufacturers must submit their 2013 data by March 31, 2014. In the future, they’ll report once for the entire calendar year, but this time it’s only for August through December. Information will likely be available to the public in September 2014.

Physicians can dispute a transaction, and if it’s not resolved by the time the database is live, the information will still be included, but marked as unresolved.

How much time will it take you?

For most physicians, the Sunshine Act requires very little work, Haramati said, but it requires attention to detail. Most of the work will be done by the business managers and assistants, those who set up meetings with industry representatives. If a physician doesn’t want to appear in the database, staff members coordinating appointments need to be aware of the law’s consequences and act accordingly.

As an administrator, Still agreed that the work falls mostly on the staff. He recommended that practices make it a routine part of their compliance practice, reviewing payments quarterly. Even so, physicians need to take some personal responsibility for it.

“Physicians need to be cognizant that most of that is tracked by physician and not practice,” Still said.

For those physicians not involved with manufacturers, there may be little to report. General diagnostic radiologists have less contact with manufacturers than interventional radiologists who buy a lot of devices, Still said. Hospital-based physicians probably also have less exposure because the institution is buying the equipment, though the radiology group may participate in purchases as advisors. Imaging center owners have to be more aware of the Sunshine Act, he said, cognizant of ramifications of interactions with the sales people.

As for actual physician time needed, CMS estimated that only 50 percent of physicians in the United States – roughly 448,850 doctors – have an industry relationship requiring database entry. Of those, CMS expects only half to actually review their entries. They estimate five hours of staff time and only a few minutes of physician time to review records if the physician only has several transactions.

Physicians, like Haramati, want to stay out of the database completely, but since industry is so intertwined with medicine – and since physicians don’t have ultimate control – he’s unsure whether that’s feasible.

“Will I succeed? It’s very hard to tell,” Haramati said, noting that he recently lectured at an academic meeting organized by a skeletal radiology professional society in India.

While the meeting was sponsored by several vendors, the professional society paid for his economy travel arrangements.

“I was very careful,” he said. “I received nothing from any vendor. However, am I aware of all vendor funding of the meeting? Will any vendor ascribe a part of the costs to me? I don’t know.”

Resources

Physicians can download a free mobile app to track reportable payments on Apple devices and Android devices. This will make it easier to review payments reported by manufacturers.

Those wanting to learn more about the Sunshine Act can get free CME credit through Medscape. Medscape is offering two opportunities:  1 credit for learning more about the Sunshine Act, and 0.25 credit for learning about how the act applies to your practice.

For additional information about free CME opportunities: http://www.diagnosticimaging.com/practice-management/11-places-get-free-cme-credit