Sunshine Bill Renews Focus on Conflicts of Interest

While health care players and politicians have long debated the issue of medical transparency, deeper scrutiny of physician–industry relationships has produced a general consensus on one aspect of the dispute: The climate has changed.
Thomas Hoffman, JD Thomas Hoffman, JD, associate general counsel for the ACR®, says, “Physicians need to look before they leap; also, industry (for its part) needs to be more careful because the government, through the Congress—as well as through federal agencies like the OIG—is looking more closely at relationships and what kind of effect these kinds of payments might have on medical decision making.” A prime example of the growing interest in physician disclosure is the Physician Payments Sunshine Act, legislation that was reintroduced this year to cast an even more watchful eye on potential conflicts of interest. Cosponsored by Sens Chuck Grassley (R–IA) and Herb Kohl (D–WI), the revised bill would require physicians to disclose payments of $100 or more from pharmaceutical and device manufacturers. According to American Medical News, Grassley had headed an investigation into “academic physician researchers who received millions in industry payments but allegedly failed to report the income as required by the National Institutes of Health and their universities.”¹ The original bill had a higher threshold for public disclosure, mandating that physicians report payments of $500 or more. The revised version requires physicians to disclose any investments in and ownership of manufacturers, and companies must report payments and other transfers of value—including consulting fees, gifts, entertainment, food, and travel, among others. Failure to report payments as a result of an oversight can warrant fines between $1,000 and $10,000, up to $150,000 per company per year. For those with deliberate noncompliance, fines can total up to $1 million per company. “Radiologists need to realize that the so-called rules have changed,” Hoffman says. “It’s appropriate to take a step back and consider the perception, as well as the reality, of how a payment or something of value might affect their decision making.” Under the proposed legislation, the HHS secretary is responsible for creating a procedure for companies to disclose, in an online format that is easily accessible to the public, the following payments or transfers of value:

• consulting fees,
• honoraria,
• gifts,
• entertainment,
• food,
• travel,
• education,
• research,
• charitable contributions,
• royalties or licenses,
• current or prospective ownership or investment interest,
• compensation for serving as faculty or as a speaker for a CME program, and
• grants.

The new bill also contains a clause that can postpone reporting of payments made for clinical investigations or product-development agreements for up to two years. Following the Lead American Medical News reported that while the original bill also preempted state disclosure laws, the latest version contains language that enables states to enact additional requirements. Maine state Rep Sharon Treat (D), executive director of the National Legislative Association on Prescription Drug Prices, told the publication that the bill delineates a federal standard and allows for states to “fill in the gaps.”¹ In fact, six states, including Minnesota and Massachusetts, have passed laws that govern disclosure of industry payments to physicians. “The federal rules are the floor, not the ceiling,”¹ she told American Medical News. Hoffman points out that many medical institutions, academic medical centers, and private practices have, in some respects, jumped ahead of the bill. Over the last couple of years, leading institutions such as Stanford, Johns Hopkins, and the Mayo Clinic have developed their own codes of ethics and standards for their physicians. “Some have gone so far as to prohibit their physicians and employees from accepting anything of value—even notepads, pens, and coffee mugs, let alone lunches or dinners—from the manufacturer,” Hoffman notes. “Some are also setting up their own Web sites that are available to the public. They’ve realized that it might be better to act rather than react, in this exercise.” Recently, a new piece of legislation written by Sen Max Baucus (D–MT) came out of the Senate Finance Committee proposal. Containing much of the same language as the Sunshine Act, the Baucus bill requires manufacturers to report payments and other transfers of value of $100 or more to the HHS secretary. The Baucus bill also advocates transparency of payments or value transfers to hospitals with residency-training programs. Hoffman explains that while the proposal would preempt state regulations that mandated disclosures, it would also permit states to legislate disclosure of other types of information. Protecting Yourself What role would I play in the research or education, if not for the offer of payment? How key is that payment or transfer of value to my role in assessing the scientific merit of the product? How can payment affect the future and outcomes of my evaluation? Hoffman urges radiologists to raise questions like these when considering the potential impact of an offer of payment or something of value, whether it’s a dinner, reception, or golf outing. Specifically, physicians should ask themselves what effect the payment might have on the assessment of a manufacturer’s drug, device, or biological product. “They can look at the resources that the ACR and others have out there,” Hoffman says. “They should be aware of the code of ethics that industry associations have provided. They also need to look at the OIG guidance on payments by pharmaceutical manufacturers, which also applies to device manufacturers.” Recognizing that the future is cloudy, Hoffman notes that it is possible that the proposal could make its way to President Obama’s desk as part of a health care reform package—but the odds are long. If anything, some part of the disclosure concept could appear in what gets past Congress, Hoffman theorizes, rather than being enacted as a freestanding measure. In the meantime, Hoffman advises radiologists to remain sensible and accept to consulting appointments and the like with caution. “They need to understand that certain payments, gifts, or reimbursements of expenses might be questionable and might be grounds for government investigation,” he says. “The government is not just blowing smoke with this.”Elaine Sanchez is a contributing writer for ImagingBiz.com.