The reporting system that this option would implement, and the data that would be collected as a result, could become a building block for further regulations that might reduce future costs below the level that they otherwise would attain.
So states a Congressional Budget Office (CBO) Recommendation on the option of requiring drug and device manufacturers to disclose their relationships with physicians who participate in Medicare.
The influential CBO weighed in on financial disclosure in their 2009 Budget Options for Healthcare, Volume 1. The CBO recommendations are taken seriously, and this adds to the support for the Physician Payment Sunshine Act (PPSA).
Pharmaceutical and device manufacturers would be required each year to disclose to the Centers for Medicare and Medicaid Services (CMS) all relationships with physicians who participated in the Medicare program.
All contacts would be subject to disclosure, and CMS would publish the information on its web site.
Contacts would include:
· support for continuing medical education (CME)
· relationships in which physicians were paid to lecture about specific drugs or devices.
A manufacturer that failed to disclose a contact or provided an incomplete report would be fined $10,000 per violation.
It is clear that they have no idea if by disclosing payments they will save money or not.
At this time, the CBO cannot estimate how this option (disclosure of payments to physicians by manufacturers) might affect spending for Medicare but believes that, over time, disclosure has the potential to reduce spending:
· For example, hospitals and health plans could use the data collected under this option to ensure that relationships between physicians and manufacturers did not influence decisions about which drugs became part of a formulary (a list of preferred drugs) or were recommended in practice guidelines.
· Public reporting and disclosure of industry–physician relationships might also encourage physicians to monitor and modify their own behavior.
They note that 94% of practicing physicians have some type of relationship with industry. The CBO’s definition of relationship includes: visits from sales representatives, drug samples, CME support, speaking, and consulting.
The CBO does admit that some of the contacts may prove beneficial for patients:
· For example, manufacturers’ sales representatives visit physicians to market their products and often provide free samples.
· Doctors, in turn, may learn about new pharmaceuticals during those visits and sometimes use the samples to assist patients who have trouble affording a prescription or who need to start on a medicine as quickly as possible.
· With respect to medical devices, manufacturers may be the best sources of training for physicians in the use of a new product.
CBO goes on to describe the relationships between industry and physicians having unintended, unfortunate effects:
· One study found that physicians’ interactions with drug companies or their representatives were associated with rapid prescribing of newer, more expensive drugs and more limited prescribing of less expensive generic medicines
(Why is this, in the government’s mind, always bad? When a new drug for heart disease or cancer or some other serious disease comes on the market, quick uptake can save lives.)
· Another study found that physicians who had had contacts with a drug company were more likely than other physicians to request that the company’s drug be added to a hospital’s formulary, even when the drug offered no therapeutic advantage over pharmaceuticals that were already on the list.
(Again, who is to say what has therapeutic advantage, even though some drugs have similar mechanisms of action, there are subtle differences which include fewer side effects, or may work on a different patient population, or different patients may respond more favorably to what may look like “me-too” drugs.)
According to CBO, the arguments to support this option include:
· Medicare could use the information it would provide to better understand and evaluate relationships between physicians and device and drug manufacturers.
· When choosing a physician, Medicare beneficiaries could consider a doctor’s relationships with the pharmaceutical and medical device industries and could select a physician, at least in part, on the basis of those relationships.
· CMS could use the information, in combination with data from claims, to improve its understanding of physicians’ practice patterns and trends in the utilization of drugs and devices.
CBO does admit there may be some difficulties in setting up a system:
· Such a system could be administratively burdensome. Although manufacturers might have ready access to some of the information that would be required – such as consulting contracts – they might find other data more difficult to collect.
· CMS would need to setup a process for gathering and reviewing the disclosures and then publishing them in a way that would be easily available to and understood by the public.
It is clear from the CBO that they see industry relationships from only the perspective of cost vs. saved lives. They envision the access to the data as a building block for further restrictive legislation and lack a firm grasp on the financial implications of adoption of the disclosure laws.
This still adds one more major voice in favor of disclosure of payments to physicians and passage of the Physician Payment Sunshine Act.
Congressional Budget office: Full Recommendations