Revised Physician Payments Sunshine Act Would Override State Laws

Recent revisions in the Physician Payments Sunshine Act would override physician sunshine laws at the state level, establishing national rules and regulations requiring drug, biological product and medical device manufacturers with $100 million or more in annual gross revenues to disclose the names and office addresses of every physician who receives a gift valued at more than $25 from one of these companies.

The revised bill would establish a national registry of payments to physicians by large medical device, medical supply and pharmaceutical companies. A key change from the previous version of the bill is that this version would preempt physician sunshine laws passed by the states. Overriding state laws to establish uniform rules and regulations has made the legislation acceptable to the pharmaceutical and medical device industries, leading, in turn, to endorsements from Eli Lilly and Co., Merck, Astra Zeneca, and Johnson & Johnson, among others.

The Advanced Medical Technology Association, the trade association representing device manufacturers, also is backing the legislation, and the Pharmaceutical Research and Manufacturers of America issued a statement on Aug. 8 saying it supports the legislation as long as the bill continues to include a provision that preempts state law.

"We think a national type of registry where everyone is reporting the same thing within the same time frame is beneficial for everyone instead of various states doing this or doing that," said Edward Sagebiel, a spokesperson for Eli Lilly, in an interview with AAFP News Now.

The legislation, which is sponsored by Sens. Charles Grassley, R-Iowa, and Herb Kohl, D-Wis., would apply to payments, honoraria, travel and other rewards to physicians from pharmaceutical companies or medical device manufacturers. It would not apply to drug samples or funding for clinical trials.

According to the legislation, gifts to physicians would be listed in a national database created and maintained by HHS. It would impose fines of $10,000 to $100,000 on companies for each incidence of failing to report a gift to a physician.

The legislation's intent is to let patients decide whether physician prescribing patterns are influenced by perks from the pharmaceutical, biological product and medical device industries. The original bill, which was introduced last fall, attempted to augment rather than override similar initiatives in various states, including Minnesota, Vermont, Maine and West Virginia.

According to the AMA Council on Ethical and Judicial Affairs' Ethical Opinion 8.061, "Guidelines on Gifts to Physicians From Industry," which has been supported by the AAFP since its inception in 1991, physicians cannot accept gifts of substantial value or those with conditions attached. The AMA guidelines also stipulate that all gifts must primarily benefit patients or be related to a physician's work.