The penalties for failing to pay in a timely manner are “not less than $1,000, but not more than $10,000, for each payment or other transfer of value,” to a maximum of $150,000 annually. Only transactions of $10 or more (with some exceptions) must be reported, unless the total annual value provided to a covered recipient exceeds $100.įailure to report and errors in reporting can lead to civil monetary penalties and harm a manufacturer’s reputation. The Sunshine Act requires that applicable manufacturers report payments such as consulting fees, honoraria, gifts, food, entertainment, travel, education, research, charitable contributions, royalties, licenses, grants, speaker payments, ownership or investment interests and any other transfers of value. If physicians or teaching hospitals dispute reported information, those entries are still published on the CMS’ Open Payments Website as “disputed” until they are resolved. This 45-day period is followed by a 15-day industry correction period. Once manufacturers and GPOs submit their annual payment information, physicians and teaching hospitals have 45 days to review their Open Payments data and dispute any errors. Not only does the act require manufacturers to report payments made to physicians and teaching hospitals it also requires “applicable manufacturers and applicable group purchasing organizations (GPOs)” to report on ownership or investment interests held by physicians or their immediate family members in such organizations. (2)
The Sunshine Act requires annual reporting from manufacturers covered under Medicare, Medicaid or the Children’s Health Insurance Program (CHIP). Read the complete Act and its accompanying rules and regulations. The Sunshine Act was designed to shed light on the financial relationships between physicians, teaching hospitals and “applicable manufacturers of drugs, devices, biologicals, or medical supplies”.1 The CMS fulfills the mandate of the law via the Open Payments Program, which collects and publishes annual data from manufacturers about payments made to physicians and teaching hospitals for things like consulting, honoraria, travel, education, research, as well as other transfers of value. Leading up to the Act, certain states were already working to address the physician-manufacturer relationship, by developing their own codes of ethics and regulations concerning monies being paid to physicians. In September 2014, the first data were publicly released. While the Sunshine Act was passed in 2010, the regulations did not come into effect until 2013 when data collection began, with reports being submitted to the CMS (The Centers for Medicare & Medicaid Services). The Act was also meant to discourage inappropriate financial relationships from influencing doctors’ prescribing habits, as well as to contain healthcare costs. The goal was to help patients in their choice of healthcare professionals and in their treatment decisions. When the US Congress passed the Affordable Care Act in 2010, they added The Physician Payments Sunshine Act to make financial relationships more transparent between pharmaceutical manufacturers and physicians. To develop new medicines that improve health and save lives, pharmaceutical companies need to collaborate with outside experts, including researchers who support the scientific development of new molecules and physicians who understand how they will be used in clinical practice. Financial relationships between physicians and pharmaceutical manufacturing has always been an intrinsic part of drug advancement. Maintaining a strong and effective working relationship between the pharmaceutical industry and healthcare professionals (HCPs) is essential to driving medical innovations and improvements in patient care.
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