What you need to know about the Sunshine Act

Dec. 29, 2011

By Kevin Henry
Editor, Proofs

The Dental Trade Alliance advised its members on Dec. 15 that a proposed rule filed by the Centers for Medicare & Medicaid Services (CMS) would increase "public awareness of financial relationships between drug and device manufacturers and certain health care providers."

The proposed rule, dubbed the "Sunshine Act," is the result of the Affordable Care Act, the federal government's health-care reform initiative.

Dr. Peter Budetti, a CMS deputy administrator, explained, “When people are faced with the difficult task of choosing the right doctor, they need all the information they can gather. If your doctor is taking money from manufacturers of prescription drugs, suppliers of wheelchairs orother devices, you deserve to know about it.

“Disclosure of these relationships will discourage the inappropriate influence on clinical decision-making that sometimes occurs while still allowing legitimate partnerships.”

Manufacturers of drugs, devices, biologicals, and medical supplies covered by Medicare, Medicaid, or the Children’s Health Insurance Program would report to CMS payments or "other transfers of value" make to physicians and teaching hospitals. Manufacturers and group purchasing organizations (GPOs) would also be required to disclose CMS physician ownership or investment interests.

CMS said the "increased transparency" would reduce the "potential for conflicts of interest that physicians or teaching hospitals might face as a result of their relationships with manufacturers."

The new reporting requirements would affect drug and biologic manufacturers, medical device or supply manufacturers, and GPOs. These organizations are encouraged to review the proposed rule prior to its posting in the Federal Register. Comments will be accepted until Feb. 17, 2012, and CMS projected a publication of the final rule sometime in 2012.

The Affordable Care Act provides that reporting violation could result in fines up to $150,000 annually "for failing to report," and $1 million for "knowingly failing to report."

You can read more about the Sunshine Act and the Affordable Care Act by clicking here.

Quotes from within the industry about the Sunshine Act and how it could affect the dental industry

From Gary Price, Chief Executive Officer, Dental Trade Alliance

"We're really just beginning to digest what this will mean to our industry. We have just received the proposed rules and we intend to make substantial comments and ask questions about them. We are concerned that the government picks on industries where they see problems and we (the dental industry) are often thrown in. How silly is it to think that a lunch-and-learn for pizza is going to be reported? We have truly reached the absurd. We're obviously hoping there will be modifications made.

"I think the dental industry has to watch this closely. The final rule has not been published yet, and that will probably be about 120 days down the road. We're going to sort out who these rules apply to and how, but for now we're assuming it applies to everyone in the industry. For that reason, we're moving forward aggressively with our comments and questions."

From Eric Shirley, Vice President & General Manager, Midmark Corporation

"Every day, there seems to be more and more information about who has to comply and how. I think it's an ever-evolving topic and it's going to stay that way for the foreseeable future. The government is trying to come up with something that we can all live with, and that's not easy.

"At Midmark, we believe we need to comply with what could be reportable starting on January 1. We're not going to take the approach that we're off the hook since things are still evolving. We're going to gather that information and be ready. I think there are some companies who feel they don't have to immediately comply since things are evolving, and I think that's a mistake. The government isn't going to clarify the dental industry's lives for us. We have to be proactive and be ready."

From Dr. Chris Salierno, Co-Editor, Surgical-Restorative Resource

"Dentists should use products based upon research and clinical preference. I would consider it to be unethical if a practitioner were to use a product simply because he or she is being paid by the company to do so. In that case, transparency with the public is perfectly appropriate."