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By Gary A. Shangold, M.D.
and Michael J. Koren, M.D.
Gary A. Shangold, M.D., F.A.C.O.G., C.P.I., is chairman of the Association of Clinical Research Professionals Board of Trustees.
Michael J. Koren, M.D., F.A.C.C, C.P.I., is immediate past president of the Academy of Physicians in Clinical Research.
As Oct. 1 rolled around and Americans began the process of enrolling in a health-care plan under Obamacare, amidst the chaos people around the country weren't sure exactly how this law would affect them. Between changing health-care costs, enrollments from state to state not functioning correctly and the federal government shutdown, regular Americans simply wanted to know how this all would impact their daily lives. Lost in all this confusion is a portion of the law called Open Payments, a provision that will have real negative impacts on medical innovation and the vitality of American clinical research.
Being dwarfed by the more “front-page” and “political/emotional point-making” components of Obamacare, Open Payments is one of many components that has received little to no media coverage. By history, it failed to pass Congress twice as “The Physician Payments Sunshine Act” and was among the many sections added to the Patient Protection and Affordable Care Act by individual legislators before endorsing their support for the overall bill during the opportunistic hullabaloo that spawned the famous saying “we have to pass the bill so you can find out what is in it.” This provision of the act essentially requires manufacturers of drugs, devices, biologics, etc., to submit to the federal government information concerning their payments or other transfers of value to physicians and teaching hospitals for posting on an annually updated public website. The intent was to make public the details of gifts, travel, meals and other transactions that would seem to be inducements for a physician to favor one product over one that would be more appropriate for the patient's care. Open Payments extends beyond such gifts and demands information on categories such as consulting, speaking honorariums and other “work for hire.” While the merits of disclosing information on “work for hire” transactions are debatable from a standpoint of business and personal privacy issues (even the legislators don't publicly disclose when they have these potential conflicts of interest on bills they write and vote for), the payment details at least generally correlate to what the physician actually was paid to perform the service. Research is one category that has its own special reporting rules, but the way research-related payments are required to be reported has absolutely no correlation attributable to the work of that physician or the amount he or she actually received. These “Transparency Reports” are anything but transparent as the amounts reported as research payments actually will: 1) be misleading to the public; 2) hinder medical research rather than embolden it; and 3) not even offer the protection they purport. We intend to describe each of these three concepts.
Addressing the first issue, that research-related payments are misleading, we offer the following details of the act. Unlike the other categories Open Payments puts forth (i.e. consulting, food, travel), the research payments include the entire research grant and attributes it to the principal investigator physician. This includes items that the physician never actually sees or even knows about such as practice overhead, salaries for clinical research coordinators and other support staff, ethics board fees and even the amounts that are paid to the participants, among many other things, including subcontracted services required by the research such as hospitalization, radiology scans, lab work and study supplies. Even so, many physicians never even see the checks as they are employees of a hospital, clinic, university or foundation and their salary is the same regardless of what the manufacturer pays for research. If we reported other income in the same manner Open Payments requires research payments to be reported, we would report that fast food cashiers are earning much more than $15/hour as we would attribute to them all the cash that their register takes in and hide the fact that they were only paid at or slightly above minimum wage. Clearly one can see how inaccurate such a representation would be and if we want true transparency in research payments, Open Payments needs to change and not report the equivalent of what the fast food cash register took in but what payments the physician actually received that actually would be of interest to a concerned patient.
Addressing the second issue, that of taking resources away from patient care and innovation, we offer the following.
According to the Federal Register, estimated costs associated with compliance with the act are $269 million in year one and $180 million annually thereafter, which most people believe is grossly underestimated. This means that time and money spent to ensure compliance with Open Payments will be diverted from patient care, research budgets, clinical trials and other areas of education and innovation that propelled our industry into such a vital position within the U.S. economy. And, like many other parts of the act, the Centers for Medicare & Medicaid Services (CMS), the government bureaucracy in charge of facilitating this law's implementation, fails to properly account for hours spent disputing disclosures with a manufacturer or time spent discussing them with an interested patient.
In addition to diverting funds towards more accountants and lawyers rather than patient care and medical innovation, research shows that Open Payments will make physicians and researchers less likely to collaborate with industry at all. According to a 2010 survey conducted by the Association of Contract Research Organizations (ACRO) and the Academy of Physicians in Clinical Research (APCR), 13 percent of respondents would be “less likely to participate” or “would not participate at all” in future clinical research trials. This is truly unfortunate for the patients who want to (or need to) enroll in studies of promising new therapies.
But the ramifications of Open Payments reach beyond the negative economic impact that this regulation will have on the clinical research industry--it also will detract from the quality of patient care and the understanding of the health-care system. Diminished research funding and a skeptical group of physicians, other clinical research professionals and patients could be a real threat to medical advancements that could change the quality of health care for the better. And as far as improving transparency goes, the way Open Payments reports the numbers offers consumers little context for understanding how research dollars are spent, leading to consumer skepticism and apprehension on the part of research hospitals or other potential participants in a clinical trial if it could damage their reputation.
Additionally, there seems to be the intent of stirring the emotional issues that offering Super Bowl tickets and trips to the Bahamas in exchange for increasing prescriptions may bring and equating that to fair market value payments made to compensate for the laborious work done for bona fide research. Scientific American states that, “No empirical data has tied researchers' financial interests in a study to negative outcomes for patients.” And in a startling admission, CMS says that they “have no empirical basis for estimating the frequency of such problems, the likelihood that transparent reporting will reduce them, or the likely resulting effects on reducing the cost of medical care.”
In following, we believe that research collaborations are fundamentally different than the offering of rewards for selling more prescriptions and should be viewed in a different light. Modern medicine would not be where it is today without clinical research. Think of every drug, device or other therapeutic product or procedure you and your loved ones have received. These life-changing products did not simply appear out of thin air. Manufacturers often spend years (and even decades) and millions (and even billions) of dollars working with clinical researchers, physicians and other medical practitioners to create the evidence for each product needed that will make a real difference in patients' lives. Studies show a single drug costs over $1 billion to bring to market and closer to $4 billion if you add in the costs of the drugs that fail to meet safety/efficacy standards. As a result, for example, since 1970, we have reduced the mortality rate from cardiovascular disease by 70 percent, at an average cost of $4 per person a year for cardiovascular research. More recently, from 1980-2000, age-adjusted death rate for coronary heart disease in the U.S. was cut 50 percent, largely due to medicines proven in clinical trials. Hindering clinical trials in any way, as does the current methodology of Open Payments, is not in society's best interest.
Clinical research also is playing an increasingly larger role in the U.S. economy. In 2009, federal- and state-funded research at medical schools and teaching hospitals added close to $45 billion to the U.S. economy overall. Every dollar invested in research at medical schools and teaching hospitals results in $2.60 of economic activity. Additionally, the U.S. biopharmaceutical sector employs more than 810,000 workers and supports a total of 3.4 million jobs across the country.
Finally, we address the issue that the Open Payment methodology, especially for research, is not appropriate for timely informing patients. Information is reported annually for payments of the prior year and posted on the government website on June 30 of each year (excepting the first year being Sept. 30 to work out the kinks). This means that patients will be informed of the payments anywhere from 6-18 months after the payment is made. Also, for certain kinds of research, the public disclosure can be delayed up to four years. Therefore by the time the patient finds out about the payment through this system, it is at a minimum six months but up to four years after the care has been given. This is clearly too late to take any of that information into consideration for the treatment they need that day. All it would seemingly help with is to foster more lawsuits and more bad press. We believe that initiatives not only should work to enhance both the integrity of care and the patient-physician trust but also to do so at the time care is being provided and not set up a system based on distrust and wait-and-see. In the research world, we can accomplish this in many other ways and better protect our patients by using these resources for patient-care staff and items as opposed to having to hire more accountants and lawyers.
When including research payments in the manner they did, lawmakers neglected to consider the debilitating consequences it will have on physicians, clinical researchers, the medical field as a whole and--most of all--patients. Lawmakers should embrace a legislative or regulatory solution that adjusts Open Payments in such a way that compliance will not detract from clinical researchers' ability to do their jobs, allows medical research to continue advancing for the benefit of patients and timely informs (not misleads) patients of the true relationship when manufacturers and physicians/hospitals collaborate for research purposes. Unfortunately, this is no longer the stand-alone legislation that was originally proposed but is hardwired in the Affordable Care Act. Thus to make this simple change will require, quite literally, an act of Congress and signature from the president on a piece of legislation that has, so far, been resistant to being cracked open for higher-profile issues. We recognize that any cracking open of the Affordable Care Act, even for a simple no-brainer that doesn't impact the main purpose of the act such as this, will have resistance mostly based on not wanting to set precedent. But we strongly believe that if we really want to meet the intent of the act of protecting patients and making care more affordable, Open Payments, as currently designed for research payment reporting, needs to be eliminated or drastically changed. The cost and compliance burden of Open Payments will hurt research and, in turn, hurt our country. Let's get rid of it for research.
Copyright 2013, The Bureau of National Affairs, Inc.
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