What is the Sunshine Act?
Beginning August 1, 2013, the Physician Payments Sunshine Act (the “Sunshine Act”), which is part of the Affordable Care Act, requires manufacturers of drugs, medical devices, and biologicals that participate in U.S. federal health care programs to track and then report certain payments and items of value given to U.S. physicians and U.S. teaching hospitals (defined as “Covered Recipients”).
The Sunshine Act requires that manufacturers collect this information on a yearly basis and then report it to Centers for Medicare & Medicaid Services (“CMS”) by the 90th day of each subsequent year. On June 30th of each year, CMS plans to post the reported payments and other transfers of value on its public website.
Who are "Covered Recipients" under the Sunshine Act?
Manufacturers are required to report payments and transfers of value made to “Covered Recipients.” The term Covered Recipients refers to U.S. physicians and teaching hospitals.
The Sunshine Act defines a “physician” as any of the following types of professionals who are legally authorized to practice:
- Doctor of Medicine
- Doctor of Osteopathy
- Doctor of Dentistry
- Doctor of Dental Surgery
- Doctor of Podiatry
- Doctor of Optometry
- Doctor of Chiropractic Medicine
Medical residents, nurse practitioners and office staff are NOT included in the definition of Covered Recipients.
CMS will annually publish a list of hospitals that meet the definition of a teaching hospital for Sunshine Act reporting purposes.
What are some examples of payments or transfers of value that the Sunshine Act requires manufacturers to report?
The Sunshine Act requires that manufacturers report payments and other transfers of value made to those parties that have been defined as Covered Recipients. This includes the cost of meals provided to physicians, as well as payments made to Covered Recipients in exchange for services provided, such as advisory boards, speaker programs, and consulting engagements. In addition to meals and payments, manufacturers will also have to report other transfers of value provided to Covered Recipients, including, but not limited to, travel and provision of reprints of medical journal articles to Covered Recipients.
Where and when will the reported information under the Sunshine Act be available?
CMS annually publishes the information reported by manufacturers on its Open Payments website, https://openpaymentsdata.cms.gov/, on June 30th of each year.
Where can a physician or teaching hospital review payments and transfers of value that are attributed to them?
CMS encourages physicians and teaching hospitals to register on its website for physicians and its website for teaching hospitals to review the reported payments and transfers of value attributed to them before public release of the data. On the CMS site, physicians and teaching hospitals have an opportunity to dispute payments and transfers of value if they believe there are inaccuracies. The CMS website has more information about the review and dispute process: http://www.cms.gov/OpenPayments/Program-Participants/Physicians-and-Teaching-Hospitals/Physicians-and-Teaching-Hospitals.html
If you are a physician or teaching hospital representative and have a question about a spend amount reported by Celgene, please submit your inquiry to firstname.lastname@example.org
Does the Sunshine Act replace state disclosure and transparency laws?
No, the Sunshine Act does not replace state disclosure and transparency laws.
How are group meals reported under the Sunshine Act
Celgene will follow Sunshine Act reporting guidelines with respect to the valuation and reporting of meals. For a meal that is not separately identifiable (for example, a deli platter) Celgene will calculate the “Per Person Value of the Meal” by dividing the entire cost of the meal by the total number of individuals who ate the meal (this includes physicians, nurses, office staff, etc.).
The “Per Person Value of the Meal” is reported as a transfer of value only to the physician(s) who ate the meal.
For example: A catered lunch costing $165 is brought to a ten physician group practice. Six of the ten physicians and five non-physicians eat the meal. Because the meal costs $15 per participant ($165/11 participants = $15), a $15 meal is reported for each of the six physicians who ate it. However, the meal does not need to be reported for the four other physicians in the group who did not eat the meal or for the five non-physicians who did eat the meal.
Will meals provided to nurses and office staff be reported?
Under the Sunshine Act reporting guidelines, meals provided to nurses and office staff will not be reportable and will not be attributed to physicians. However, some state disclosure laws do require reporting of payments to a broader group of recipients, including non-physician prescribers, nurses and office staff.
Is there a reporting threshold?
For 2013, payments or other transfers of value from Celgene to a physician that are less than $10 will not be reported, unless the total aggregate amount of value Celgene transfers to the physician exceeds $100. In 2014, the threshold amounts were updated to $10.18 and $101.75, respectively. The Open Payments reporting thresholds are adjusted annually based on the consumer price index.
Examples of threshold disclosure requirements:
- On August 15, a U.S. physician eats one meal provided by Celgene valued at $8; on December 15,the same U.S. physician receives a $100 consulting fee from Celgene. The physician receives no other payments or transfers of value from or on behalf of Celgene for the year. This results in two reportable transactions: an $8 food and beverage and a $100 consulting fee.
- On August 15, a U.S. physician eats one meal provided by Celgene valued at $8; on December 15, the same physician receives an $80 consulting fee from Celgene. The physician receives no other payments or transfers of value from or on behalf of Celgene for the year. This results in one reportable transaction: $80 consulting fee.
- On August 15, a U.S. physician eats one meal provided by Celgene valued at $15; on December 15, the same U.S. physician receives an $80 consulting fee. The physician receives no other payments or transfers of value from or on behalf of Celgene for the year. This results in two reportable transactions: $15 food and beverage and $80 consulting fee.
- On August 15,a U.S. physician eats one meal provided by Celgene valued at $8; on December 15, the same physician eats one meal provided by Celgene valued at $7. The physician receives no other payments or transfers of value from or on behalf of Celgene for the year. No transactions would be reportable for the physician.
If a physician directs Celgene to pay another entity instead of the physician, how will the transaction be reported?
The Sunshine Act requires that the payment be reported under the physician’s name and that the entity paid be listed as a third party recipient.
If a physician is paid by a third-party vendor, is that payment reportable under the Sunshine Act?
The Sunshine Act requires that manufacturers report both direct payments to physicians as well as payments made through a third party entity on Celgene’s behalf.
Are payments and transfers of value for international engagements reportable under the Sunshine Act?
Yes. The Sunshine Act requires manufacturers to report all payments or transfers of value made to U.S. physicians regardless of where the activity took place or which Celgene international affiliate provided the payment or transfer of value.
If I have further questions, whom may I contact?
For more information on Celgene’s Sunshine Act reporting practices, please submit questions to email@example.com.