Transcript MMS CBA HLS - Colorado Bar Association

CMS Physician Payment Sunshine Act
Final Rule: Sunshine or Black Hole?
Michael M. Schmidt
Michael M. Schmidt, P.C.
Denver, Colorado
Colorado Bar Association
Health Law Section
April 20, 2013
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ACA Section 6002-Overview
*Applicable Manufacturer and Applicable
GPOs collect information on payments
and/or ownership interests for and entire
calendar year (except Aug 1-Dec 31, 2013)
*Submit data for entire year to CMS by
the 90th day of the following year.
*CMS aggregates all data by individual
physician or teaching hospital.
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*Allow MFG’s and applicable GPO’s
physicians and teaching hospitals access to their
data for review/correction:
* 45 days to review and initiate disputes
(if necessary)
* 15 days to resolve disputes
•Publish data online by June 30th (Sept. 30,
2014)
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Who is required to report?
*First, Applicable manufacturers of covered drugs,
devices, biologicals and medical supplies:
Covered products are those available for payment
under Medicare, Medicaid or CHIP.
Report all payments or other transfers of value (1) to
covered recipients and (2) physician ownership and
investment interests.
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Who is required to report?
Second, applicable Group Purchasing Organizations
(GPOs)
Report physician ownership and investment interests in such
entities and payments and transfers of value to such physicians
(including indirect or deemed payments or transfers of value).
GPOs include physician owned distributors (PODs) that
purchase products for resale.
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Covered Recipients
Covered Recipient is defined as physicians and
teaching hospitals.
Teaching hospital defined as any institution that
receives GME, IME or inpatient psych IME.
Physician defined under 1861(r) of the SSA.
Excludes physicians that are employees of the
applicable manufacturer.
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Covered Recipients
Payments or other transfers of value made
to covered recipients are reportable.
Ownership or investment interests held by
physicians and their immediate family
members are reportable.
Final rule excludes residents from reporting
requirements.
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What Information Must be Reported?
For each payment or transfer of value, the following must be reported:
*Covered recipient name and address
*Physician specialty, NPI, state license and number
*Amount of payment
*Date of Payment
*Form of Payment
*Nature of Payment
*Name of Drug, Device, Biological, or Medical Supply associated with
payment and NDC if applicable
*Allowed to provide a short context for each transaction
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What information must be reported?
For each ownership and investment interest,
applicable manufacturers and GPOs must report:
*Physician name, address, specialty, NPI and state
license state and number
*Dollar amount, value, and terms of ownership or
investment interest
*Whether interest is held by an immediate family
member of the physician
*Any payments or other transfers of value made to
the physician owner or investor
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Forms and Nature of Payment
*Describes how the payment was made and the
reason for making the payment
*Required to select the category that best matches
the payment
*Changes in the final rule:
*Provided additional category explanations
*Provided multiple categories for reporting
continuing education payments (accredited and
non-accredited)
*Allocation and reporting of meals and food
*Added “space rentals or facility fees” for
teaching hospitals
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Payments or Transfers of Value for Research
*Payments related to research must be reported
in a separate report that includes the name of
the institution receiving the payments and the
principal investigators
*Delayed Publication Rule: Allowed for certain
research, development and clinical
investigation payments….
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Delayed Publication Rule
Payment must be reported for the year that the
payment occurred by applicable manufacturer,
but not published publicly until the later of:
*FDA approval, licensure, or clearance
*Four years after the date of the payment
*Responsibility of applicable manufacturer to
notify CMS that a payment is eligible for delayed
publication and for such payments, when FDA
approval, licensure or clearance has been obtained
or four years has elapsed since the payment was
made.
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Exclusions
CMS lacks statutory authority to add exclusions;
CMS provides more information and detail on
statutory exclusions.
*Final rule clarified exclusion for payments
made indirectly through a third party when
applicable manufacturer is unaware of the
identity of the covered recipient.
*Added a time period for awareness (two
quarters of the next reporting period).
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Exclusions (continued)
*Defined “indirect payments or other transfers of
value” where the MFG or GPO makes a payment or
transfers value to a covered recipient/physician
owner/investor, through a third party, where such
MFG/GPO: requires, instructs, directs, or otherwise
causes the third party to provide the
payment/transfer the value to a covered
recipient/physician
owner/investor.
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Awareness
Retained proposed interpretation of awareness
based on the False Claims Act: (1) means that a
person…(i) has actual knowledge of the
information; (ii) acts in deliberate ignorance of the
truth or falsity of the information or; (iii) acts in
reckless disregard of the truth or falsity of the
information, and
(2)Requires no specific intent to defraud.
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45 Day Review and Correction Period
*MFGs, GPOs, covered recipients, and physician
owners/other investors may review the information
and the MFG or GPO can submit corrections before
CMS makes the information publicly available.
*New process that permits CMS to help manage the
dispute process but not get involved in the arbitrating
of disputes. (At least that what CMS has stated.)
*Physicians/Teaching Hospitals will be able to
initiate dispute process when reviewing their
information.
*Unresolved disputes will be published using the
MFGs or GPOs account of the transaction; but will
be marked as disputed.
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Penalties
CMPs on MFGs and GPOs for failing to submit
required information:
• $1,000-$10,000 for each payment or ownership
Interest not reported as required. Annual max=$150k
• Knowing failure to submit raises the penalties to
$10,000-$100,000 for each payment or ownership
Interest not reported subject to an annual max=$1mm
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Getting Started: Operational Issues
Official Program Name: National Physician
Payments Transparency Program:
Open Payments
CMS program website:
https://go.cms.gov/openpayments
Help Desk/Questions:
[email protected]
Responsible for implementation:
Dr. Shantanu Agrawal
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Key Implementation Dates
Final data templates and teaching hospital list
to be released in May 2013.
Data collection to begin on August 1, 2013 and
deadline for 2013 submission is March 31, 2014.
Registration with CMS Open Payments System
will open January 1, 2014.
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BLACK HOLE ISSUES
1. Confidentiality. Although not required to be
stated, those in the industry will be able to figure
out what projects the physician will be working on
under the contract.
2. Noncompete Violations. This reporting will trigger
a significant amount of work for litigators as they
attempt to enforce non-compete clauses in inventors’
and KOLs’ contracts.
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BLACK HOLE ISSUES
3. Disputes Over Amounts Reported to
CMS.
4. Another unfunded mandate by the
Federal Government. CMS’ own estimates,
which typically are on the low end, state
that the total costs of complying with these
final rules will be at least $269 million
during the first short year and $180
annually thereafter.
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CMS Physician Payment Sunshine Act
Final Rule: Sunshine or Black Hole?
Michael M. Schmidt
Michael M. Schmidt, P.C.
Denver, Colorado
Colorado Bar Association
Health Law Section
April 20, 2013
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