'Sunshine Act' Gets Guarded Reaction

The federal government's long-delayed rollout this month of the "Sunshine Act" mandate to disclose financial relationships between drug and device manufacturers and healthcare providers is getting a mostly guarded reception from key groups that will be affected by it.

For the most part, when it came to commenting on the 287-page final rule, those lobbying groups and professional associations avoided trash talking the final rule.

Instead, they followed the cautious lead of PhRMA Senior Vice President Matthew Bennett, who says the drug makers' lobby "is currently reviewing the final regulation of the Physician Payments Sunshine Act and looks forward to seeing how CMS addressed key concerns that were previously raised."

"PhRMA remains committed to the principles of the Sunshine Act and continues to believe that careful implementation is essential to ensuring that Sunshine fulfills its objective of usable, transparent, and understandable sharing of information," Bennett said in prepared remarks.

American Medical Association President Jeremy A. Lazarus, MD, said the nation's largest physicians' association "will carefully review the new Physician Payment Sunshine Act rule."

"Physicians' relationships with the pharmaceutical industry should be transparent and focused on benefits to patients," Lazarus said in prepared remarks. "Our feedback during this rulemaking process was aimed at ensuring the new registry will provide a meaningful picture of physician-industry interactions and give physicians an easy way to correct any inaccuracies. As the rule is implemented, we will work to make sure physicians have up-to-date information about the new reporting process."

The "National Physician Payment Transparency Program: Open Payments"—was mandated under the Affordable Care Act to improve transparency in the healthcare market. The final rule was scheduled to be published 15 months ago and federal officials this week offered no explanation for the late issue, which comes three months after the November election.

"You should know when your doctor has a financial relationship with the companies that manufacture or supply the medicines or medical devices you may need," Peter Budetti, MD, deputy administrator for Program Integrity at the Centers for Medicare and Medicaid Services, said in a media release. "Disclosure of these relationships allows patients to have more informed discussions with their doctors."

The rule requires makers of drugs, devices, medical supplies, and biotech firms covered by Medicare, Medicaid, or the Children's Health Insurance Program to disclose payments or other "transfers of value" to doctors and teaching hospitals.

It also requires manufacturers and group purchasing organizations to disclose to CMS physician ownership or investment interests. CMS will post the data on a public website next year.  Budetti says more transparency will reduce the potential for conflicts of interest that physicians or teaching hospitals face because of their relationships with manufacturers.

Data collection will begin on Aug. 1, 2013. Manufacturers and GPOs will report the data for August through December of 2013 to CMS by March 31, 2014 and CMS will make the data public by Sept. 30, 2014.

Physicians, teaching hospitals, manufacturers and GPOs may review and correct reported information before its publication. CMS is developing an electronic system to facilitate the reporting process.

Reaction to the final rule was mixed at Public Citizen. Michael A. Carome, MD, deputy director of the Health Research Group at the public advocacy group said it "strongly support[s] this new rule and [is] disappointed that it took CMS so long to issue it in final form, now more than a year after the statutory deadline for issuing the final rule has passed."

"We are further disappointed that the date for compliance with the requirements of the new rule are also significantly delayed: initial reports from manufacturers are not due until March 31, 2013 (covering a reporting period that begins in August 2013 and end December 2013) and the initial posting of reported data on a publicly available website will not occur until September 30, 2014. Such delays are unnecessarily long," Carome wrote in an email exchange with HealthLeaders Media. 

However, Carome says, the rule is needed because "financial relationships between physicians and industry can subtly and not so subtly influence the opinions and recommendations of healthcare providers in a variety of settings."

"Such payments and other transfers of value to physicians from drug and medical device companies are intended to influence physician prescribing behavior in order to benefit the companies' bottom line and do not serve the best interests of patients," he says.

"Ideally, many forms of such payment would not be permitted, and indeed, some medical schools have taken steps to restrict such payments to their faculty members. Neither CMS, nor any other agency, has the authority to ban such payments, and it's unlikely Congress would pass a law prohibiting them."

Mary R. Grealy, however, president of the Healthcare Leadership Council, whose members include drug and device makers and biotech firms, said in a statement that "it is important that the public have a clear understanding of the nature of physician-industry interactions."

"The overwhelming majority of these collaborations are focused on developing safer and more effective medical innovations and helping physicians better understand how to utilize new medications and technologies for the benefit of their patients," Grealy said.

"And, in fact, physicians and medical innovation companies alike regularly demonstrate their commitment to transparency, researcher independence and a patient-centered focus."

Blair Childs, a senior vice president with the group purchasing organization Premier, was one of the few with skin in the game to offer a full-throated endorsement of the final rule. He said it "brings sunlight to an area where consumer confidence has been undermined by conflicts of interest."

"With these new requirements, patients will have the information so they can feel more confident that the treatments they receive are based on evidence-based care and their physicians' best judgment, rather than inappropriately influenced by financial relationships," Childs said in prepared remarks.

"We know that even small gifts can be associated with physicians' positive attitudes toward sales representatives, and can increase their rate of administering particular drugs or devices. These regulations are a long-overdue step toward greater transparency in healthcare."

Despite the delays, Carome says that once the rule is implemented it should bring greater transparency to the financial relationships between physicians and the drug and medical device industries.

"Such transparency will allow consumer advocates, patients and other stakeholders to better assess the potential influence such relationships have in (a) the development of recommendations by the advisory committees of the FDA, CMS and other regulatory agencies; (b) the development of clinical practice guidelines by professional associations and government agencies; (c) the opinions expressed by medical school faculty and attending physicians during graduate medical education training; and (d) the medical decision making of healthcare providers in the context of clinical care."

Ultimately, Carome says, the worth of the final rule will be determined by how well companies comply with reporting requirements, how vigorously CMS enforces the rule, and how user-friendly and accessible the database will be for the general public.   

"Given the delays in implementation, we won't be able to assess the impact of the rule for at least a few years," he says.