June 16, 2013

162017_132140396847214_292624_nThe so-called “Sunshine Act” (The Physician Payments Sunshine Act) is part of the Affordable Care Act that requires the manufacturers of drugs, medical devices, and biologicals that participate in U.S. federal health care programs to submit annual reports to the Centers for Medicare & Medicaid Services (“CMS”) regarding certain payments and items of value given to physicians and teaching hospitals. The Sunshine Act also requires manufacturers and group purchasing organizations (“GPOs”) to report certain ownership interests held by physicians and their immediate family members.

The purpose behind the Sunshine Act is to bring transparency to financial relationships between the medical industry and physicians and teaching hospitals by providing patients and the public with a searchable database of the financial relationships. From August 1, 2013 through December 31, 2013, manufacturers are required to begin collecting and tracking payment, transfer, and ownership information. Manufacturers and GPOs are required to report the data for 2013 to CMS by March 31, 2014. CMS will release the collected data on a public website on September 30, 2014.

The Sunshine Act requires manufacturers of a drug, device, biological, or medical supplies participating in federal health care programs to report to CMS any direct transfers or payments of value to physicians and/or teaching hospitals of $10 or more, with 12 specified exceptions. Indirect transfers (those not made directly to physicians) such as transfers or payments that the physician specifies should be given or paid to another person or entity; transfers or payments that another person indicates are being made on behalf of the physician; and, transfers or payments made by manufacturers to a third party that the manufacturer requires, instructs, or directs to be provided to a specific physician or intended for physicians, must also be reported.

The Sunshine Act requires manufacturers and GPOs participating in federal health care programs to report to CMS certain ownership interests held by physicians and their immediate family members with certain exceptions, such as securities which may be purchased on terms generally available to the public and which are listed on a stock exchange in which quotations are published on a daily basis.

The categories of transfers or payments that manufacturers are required to report are consulting fees, compensation for services other than consulting, honoraria, gifts, entertainment, food, travel, education, research, charitable contributions, royalties or license, current or prospective ownership or investment interest, direct compensation for serving as faculty or as a speaker for a medical education program, and grants.

The American Medical Association (“AMA”) provides the following recommendation for physicians discussing the Sunshine Act with their patients: “When a patient asks about this topic [the Sunshine Act], it is important that you discuss the matter candidly in a way that will enhance the patient’s understanding without compromising trust or the patient-physician relationship. Some of the issues you might want to address with the patient are what sources you rely on for information about medical innovations and new evidence, your role in medical research, and how you believe research will improve outcomes for patients.”


If you may have been injured as result of medical malpractice committed by a physician, you should promptly consult with a local medical malpractice attorney in your U.S. state who may be willing to investigate your possible medical malpractice claim for you and represent you in a medical malpractice case against a physician, if appropriate.

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