Physician Payment Sunshine: Kohl and Grassley Urge CMS to Complete Regulations by June

As numerous healthcare stakeholders wait for the Supreme Court to determine whether the individual mandate of the Affordable Care Act (ACA) is constitutional, two Senators are eagerly pressing federal health agencies on the progress being made to implement Section 6002 of the ACA—also known as the Physician Payments Sunshine Act.

Senators Charles Grassley (R-IA) and Herb Kohl (D-WI), the authors of the Sunshine Act, sent a letter last week to the Centers for Medicare and Medicaid Services (CMS) asking the agency when the final rules and regulations to implement the Sunshine Act would be ready.

The Senators were already uneasy with CMS for missing a deadline last fall for promulgating the proposed rule.  The deadline was October, but the proposed regulations did not come out until mid-December, causing the reporting deadlines to be pushed back.

As we have covered numerous times over the years, the Sunshine Act requires manufacturers to report certain payments made to doctors over $10 or any amount if the payments total more than $100.

Consequently, Grassley and Kohl requested that the final rule on implementation of the Sunshine act be released “no later than June of this year so that partial data collection for 2012 can commence.  The Senators also urged CMS to work closely with stakeholders to finalize the rules so that they comprise a feasible approach to providing data to the public.

The Senators encouraged CMS to be clear on guidelines and context so that the data posted online is meaningful and understandable.  They urged CMS to narrowly define precise payment categories so that all stakeholders are operating under the same assumptions.  They also told CMS to remove the proposed “other” payment category so that it does not obscure the true nature of some payments.

While the Senators comments are important, it is unlikely that CMS will be able to give the clarity and narrowness they seek.  The magnitude and size of the database that CMS will eventually publish will be enormous, and to put the kind of detailed information for patients to truly understand the nature of these payments would take hundreds of millions of dollars for staff and other resources, which CMS clearly does not have.

The Senators also urged CMS to work with stakeholders to clarify reporting for indirect research payments to avoid unintended consequences.  Specifically, they asked CMS to more clearly define instances when indirect research payments and indirect research payments to third parties are reportable and how and with what context these payments will be reported on the public website.

The Sunshine Act authors also urged CMS to update the website with correct information (corrections from manufacturers or doctors/teaching hospitals) when the Agency is first made aware of inaccuracies in the reported data.  They stated that CMS should include mechanisms by which the agency can update errors on a quarterly basis because prolonged inaccurate data could cause confusion among patients, physicians and manufacturers.  Again, while such comments in general are reasonable, CMS does not have the resources for such work and did not propose this within the projected budget.

Grassley and Kohl agreed that CMS should not be the default dispute arbiter between applicable manufacturers and covered recipients, however, the Senators called on CMS to develop mechanisms by which disputes can be reported as smoothly as possible.  They asked that manufacturers share data with covered recipients before reporting it to CMS.

The Senators also recognized that the public website where the data will be disclosed must be user friendly so that data can be searched, sorted and aggregated without duplication.  They told CMS that the website should define the terms of transfers of value and provide context so that the public best understands what the payments are for and in what capacity, again recognizing that “financial relationships are important for developing new therapies and technologies.”  Moreover, the Senators acknowledged the importance of research transfers, which are often “vitally important to the development of new therapies and technologies.”

However, without context, the Senators recognized that patients could find a large sum of money attached to his/her physician and not know for what the funding was provided.  This could lead to decreased research and enrollment in clinical trials, making research even more difficult than it already is.

The letter also told CMS to increase its outreach to physicians and other covered recipients about Sunshine Act implementation because a recent survey of 500 compliance officers and physicians in the March 1, 2012 issue of “Inside CMS” reported that 47% had not heard of the Sunshine Act.

Implementation Questions.   

Finally, the Senators asked CMS to answer a number of questions by April 18, 2012.

  1. Can CMS commit to completing a final rule by this summer so that data collection can begin in 2012?
  2. Since CMS missed the initial required Congressional deadline, has CMS increased the resources or personnel assigned to the implementation of the Sunshine Act, including a dedicated information technology lead?
  3. Will CMS commit to issuing an RFP to begin designing the website?
  4. Does CMS have a dedicated working group assigned to the implementation of the Sunshine Act, and what technical expertise and program areas are represented?
  5. Does CMS have a public education and outreach plan to raise awareness of the new law with the provider community and with health care consumers?
  6. Has CMS allocated dedicated implementation funds for the Physician Payment Sunshine Act? 


The agency is actively working on the final regulations, there were a significant number of comments the agency must go through and the technical and complicated nature of these comments will make CMS’ job even tougher.  Ultimately, only time will tell if the sunshine rules will be shining in June.


If you have any questions about this post, please call DuVal and Associates @ 612.338.7170


Josh Sandberg

Josh Sandberg is the President of Ortho Spine Partners and Partner for The De Angelis Group. He also serves as Co-Founder and Editor of OrthoSpineNews.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Themed By Curio Display Cabinets