On October 29, 2009, House Speaker Nancy Pelosi unveiled the U.S. House of Representatives' latest healthcare reform bill, HR 3962, titled Affordable Health Care for America Act. Significantly, the bill includes a new version of federal Physician Payments Sunshine legislation that is stricter and more expansive than the version proposed earlier this year in the Senate.
The following are the some of the more significant aspects of the bill:
Covered Entities: applies to certain manufacturers and distributors of covered drugs, devices, biologics, or medical supplies
Covered Recipients: applies to any payment or another transfer of value to a wide range of individuals and entities, including, but not limited to: all prescribers, pharmacies or pharmacists, health plans, pharmacy benefit managers, hospitals, patient advocacy organizations, professional associations, group purchasing organizations.
Data Elements: the annual report will include the following data elements: recipient‘s name, business address, physician specialty, national provider identifier, amount of the payment, date of the payment, name of related drug, device or supply (if available), a description of the form of the payment. With respect to drug samples, the report will include the name, number, date, and dosage units of the sample.
Delayed Reporting Requirements: contains delayed reporting requirements for payments made pursuant to a product development agreement or clinical trial
De Minimis Exemption: exempts from reporting any payments or transfers of $5 or less.
Other Exemptions: loan of a covered device for a short-term trial period; items or services provided under a contractual warranty; 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; in-kind items used for charity care; a dividend or other profit distribution from, or ownership or investment interest in, a publicly traded security and mutual fund; compensation paid to a covered recipient who is directly employed by and works solely for the 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; certain indirect payments; and payments under a self-insured plan. Notably, product samples are not exempt from reporting.
Reporting Deadline: reporting requirement would begin on March 31, 2011 and annually thereafter. There is currently no start date to begin tracking payments and other transfers, but tracking presumably would be required in 2010.
Disclosing Ownership or Investment Interests: requires any manufacturer, distributor, or related GPO, to report annually 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 GPO during the preceding year
Penalties: manufacturers or GPOs 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 GPO 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, or, if greater, 0.1 percentage of the total annual revenues of the reporting entity.
Public Availability: beginning September 30, 2011, submitted information would be available to the public on an internet website
Preemption: would preempt any state (or political subdivision of a state) law or regulation that requires manufacturers or distributors to disclose the type of information required under this provision regarding payments or transfers to covered recipients
No Preemption: would not preempt any state (or political subdivision of a state) law or regulation that requires the disclosure or reporting of (1) any information not required under this provision; (2) the types of information excluded from reporting requirements under this provision, with the exception of the $5 de minimis requirement; (3) information by any person or entity other than an applicable manufacturer, distributor or covered recipient described above; and (4) information reported to a Federal, state, or local government for public health purposes
Click here to download the Affordable Health Care for America Act in its entirety (or scroll down to page 889 to view the "sunshine" provision). R-Squared will be monitoring Sunshine Act developments closely and will post periodic updates and alerts to the website.
To return to the News & Reviews page, please click here.