On November 6, 2008, the Medicare Payment Advisory Commission (MedPAC) voted on a series of recommendations for Congress to consider for public reporting of industry financial relationships with physicians and hospitals. Congress is likely to re-introduce the Sunshine Act  next year.

The recommendations, if enacted, will mandate new federal reporting requirements for financial relationships between physicians, drug and device manufactures, hospitals and ambulatory surgical centers. The final recommendations also include a new requirement for drug samples. Draft recommendations were first considered during the October MedPAC meeting.

Changes in draft recommendations are indicated below via italicized text. Each recommendation was approved unanimously.

Recommendation 1
Congress should require all manufacturers and distributors (as well as their subsidiaries) of drugs, biologicals, devices, and supplies to report to the Secretary their financial relationships with:

• Physicians, physician groups, and other prescribers
• Pharmacies and pharmacists, health plans, PBMs, and their employees
• Hospitals and medical schools
• Organizations that sponsor continuing medical education (CME)
• Patient organizations
• Professional organizations

Manufacturers should be required to report payments if the total annual value of payments to a recipient exceeds $100. This threshold would be adjusted annually based on inflation.

Relationships that would have to be reported would include:

• Gifts, food, travel, entertainment, honoraria, research, funding for education and conferences, consulting fees, investment interests, product royalties
• Discounts, rebates, and free samples for patient use would be excluded
• Companies would have to report:
• • Value, type, and date of each payment
  • Name, specialty, Medicare billing number (if applicable), and address of each recipient
  • Name of related drug/device
  • Medicare billing numbers would be available only to researchers through data use agreements

Recommendation 2
Congress should direct the Secretary to post the information submitted by manufacturers on a public website in a format that is searchable, by:

• Manufacturer
• Recipient name, location, and specialty
• Type of payment
• Related drug/device name
•  Year

New Recommendation 3
Congress should require manufacturers and distributors to report to the Secretary the following information about drug samples:

• Each recipient’s name andbusiness address (for individual physicians and physician practices)
•  The name, dosage, and number of units of each sample, and
• The date of distribution
• The Secretary should make this information available through data use agreements.

Recommendation 4
Congress should require all hospitals and other entities that bill Medicare for services to annually report the ownership shares of each physician who directly or indirectly owns an interest in the entity (excluding publicly traded corporations). The Secretary should post the information on a searchable website.

[The earlier version of this recommendation was focused strictly on physicians’ ownership interest in hospitals and ASCs; the approved version applies to physicians’ ownership in all entities that bill Medicare for services.]

Recommendation 5
Congress should require the Secretary to submit a report, based on the Disclosure of Financial Relationships Report (DFRR), of the types and prevalence of financial arrangements between hospitals and physicians.

[The earlier version of this recommendation would have required a report, without specific reference to one focused on the DFRR (which will look at various arrangements between hospitals and physicians in up to 500 hospitals).]