After more than a half-decade of delays, key provisions of
the U.S. Physician Payments Sunshine Act formally became law on Aug. 1,
bringing ramifications for many meeting managers. A measure designed to
increase transparency of financial relationships between doctors and
pharmaceutical and medical companies, the law requires manufacturers of drugs
and medical devices to collect data on certain payments and trades of value,
including expenses related to meetings and events. Next year, those companies
will be required to report that data to the government.
While the days of pharmaceutical companies jetting groups of
doctors to all-expenses-paid junkets at tropical resorts to push their drugs
largely have passed into history—thanks to self-imposed industry regulation
after corporate expense and reporting scandals of the early 2000s—the
pharmaceutical industry remains among the most heavy users of meetings. The new
law requires those in the sector to collect data on what they spent on meetings
attended by physicians. In March 2014, they will be required to report that
information to the U.S. Department of Health and Human Services' Centers for
Medicare and Medicaid Services. If the government disputes data in those
reports, the company must quickly justify or correct those expenditures.
Some of the reported data is slated to become publicly
available on a CMS website from September 2014.
Pharmaceutical companies have had plenty of time to prepare.
Introduced in 2007 and enacted in 2010, the legislation—commonly known as the
Sunshine Act and approved as part of the Affordable Care Act—was delayed as CMS
readied itself to accept the data.
"The companies that have been strategic and progressive
are well-equipped to deal with it," said George Odom, vice president of
integrated travel and meetings at Advito, the consulting arm of BCD Travel.
Pfizer, for example, already has been "in the mode,"
conducting business as though the Sunshine Act already had been in effect, said
Cathie Larocca, director of account management at BCD M&I, which provides
meetings management services to the pharmaceutical giant.
By implementing certain tracking and reporting practices
before it was required to collect the specified data, Pfizer was not impacted
all that much by the Aug. 1 effective date, Larocca said.
"The good part here is that our client took this so
seriously, we have been ready for the actual date," she said.
Edwards Lifesciences also has been anticipating the change,
said senior project leader Jessica McLin. Though the Irvine, Calif.-based
medical device company previously had exercised "conservative"
meetings data management practices, McLin said its T&E policy underwent
some modifications to reflect the requirements of the Sunshine Act.
"Our compliance department has a lot of subject matter
knowledge in regard to the Sunshine Act," she explained. "We put a
broad reach out to the data that we've been collecting and have been modifying
that as appropriate."
Such collection of meeting spend data in a timely and
accurate manner takes significant effort. BCD M&I has a team that works
alongside the meetings management department to aggregate data.
"There are so many components you don't think about,"
Larocca said. "It's not only aggregating data; so much of it is how the
data comes to the suppliers. We've had to work with hotels and ground
transportation providers about how they reconfigure their data."
Companies should review data collection and reporting
processes on a regular basis to ensure they can maintain compliance,
recommended Kevin Iwamoto, vice president of industry strategy for meetings
technology firm The Active Network. "Just because you set it up once, don't
assume you're good to go," he said. "If you view your policies and
programs as works in progress, you're in good shape."
This report
originally appeared in the November 2013 edition of Travel Procurement.