Drop The Mug and Pen, Take Two Steps Back, And Hands Behind Your Head

By  |  February 4, 2013 | 

The rules for the Physician Payments Sunshine Act dropped:

Drug, device and medical supply companies must report all payments over $10 to U.S. physicians and teaching hospitals. The data must include date of payment, a description of the service provided, the amount paid and which of a company’s products the payment involved. The data to be released in September 2014 will include payments made from August to December of this year, giving companies enough time to gather and report the information. The companies must turn the data over to the government by March 2014; doctors will then have 45 days to review the information for accuracy before it becomes public The types of payments to be reported include speaking fees, consulting payments, research, gifts, food, entertainment, honoraria, research grants, royalties and license fees, among others.

More from The Hill:

Companies that fail to properly report payments can be fined between $1,000 and $10,000 for each payment not reported, but the fine cannot exceed $150,000. A deliberate failure to report can lead to a fine of up to $1 million. The rule also stated that it preempts similar state laws, creating the possibility of “cost-savings, since a single reporting system for reporting this information is less burdensome than multiple programs.” One question in the minds of consumer advocates is how much disclosure will reveal. For instance, if a company gives a doctor a large sum to lead a drug trial and that doctor spreads the money among other physicians who enroll patients, it’s unclear whether those payments would be reported as coming from the drug company.

On the latter point, I would also question whether showering gifts or money on midlevels, nurses, or ancillary staff can have undo influence (yes).  We all see DME and service companies hosting lunch and learns for staff on the wards–surely not healthy and an activity deserving closer inspection.

What are the 12 direct payments or transfers of value that are exempt from reporting?

  1. A transfer of anything of value which is less than $10, unless the aggregate amount transferred to, requested by, or designated on behalf of a physician by a manufacturer during the calendar year exceeds $100.
  2. Product samples that are not intended to be sold and are intended for patient use.
  3. Educational materials that directly benefit patients or are intended for patient use.
  4. The loan of a covered device for a short-term trial period, not to exceed 90 days, to permit evaluation of the covered device by a physician.
  5. Items or services provided under a contractual warranty, including the replacement of a covered device, where the terms of the warranty are set forth in the purchase or lease agreement for the covered device.
  6. A transfer of anything of value to a physician when the physician is a patient and not acting in his or her professional capacity.
  7. Discounts (including rebates).
  8. In-kind items used for the provision of charity care.
  9. A dividend or other profit distribution from, or ownership or investment interest in, a publicly traded security and mutual fund.
  10. In the case of a manufacturer who offers a self-insured plan, payments for the provision of health care to employee physicians under the plan.
  11. In the case of a physician who is also licensed as a non-medical professional, a transfer of anything of value to the physician if the transfer is payment solely for the non-medical professional services.
  12. In the case of a physician, a transfer of anything of value to the physician if the transfer is payment solely for the services of the physician with respect to a civil or criminal action or an administrative proceeding.


In addition:

  • A resource-based citation list on provider-industry influence can be found here.
  • Conversely, an alternate reference on why we need ongoing collaboration with industry here.

FYI–If you cannot wait for the database, ProPublica has one of their own, compiled from registries obtained from pharma settlements with the FDA (past violations).  Put your own or a colleagues name here to inquire further.


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About the Author: Brad Flansbaum

Brad Flansbaum
Bradley Flansbaum, DO, MPH, MHM works for Geisinger Health System in Danville, PA in both the divisions of hospital medicine and population health. He began working as a hospitalist in 1996, at the inception of the hospital medicine movement. He is a founding member of the Society of Hospital Medicine and served as a board member and officer. He speaks nationally in promoting hospital medicine and has presented at many statewide meetings and conferences. He is also actively involved in house staff education. Currently, he serves on the SHM Public Policy Committee and has an interest in payment policy, healthcare market competition, health disparities, cost-effectiveness analysis, and pain and palliative care. He is SHM’s delegate for the AMA House of Delegates. Dr. Flansbaum received his undergraduate degree from Union College in Schenectady, NY and attended medical school at the New York College of Osteopathic Medicine. He completed his residency and chief residency in Internal Medicine at Long Island Jewish Medical Center in New York. He received his M.P.H. in Health Policy and Management at Columbia University. He is a political junky, and loves to cook, stay fit, read non-fiction, listen to many genres of music, and is a resident of Danville, PA.


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