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Drug and Device Companies to Disclose Payments Made to Physicians for CME

by | Apr 15, 2015 | Blog, Insurance/ Eligibility Verification

The Centers for Medicare and Medicaid Services (CMS) has released their proposed rule for physician payment in the Affordable Care Act (ACA). This is a major reversal of policy, according to which CMS now wants the industry to report payments to physicians for continuing medical education. This move would eliminate the current exemption for continuing medical education (CME) in the open payment programs (commonly known as Sunshine Act) that requires drug and device companies to directly disclose payments and items of value given to physicians and teaching hospitals. The recent reversal was included in the proposed physician fee schedule for 2015 involving changes benefiting primary-care medicine at the expense of payments to specialties.

The proposed rule recommends changes in the physician quality reporting system, Medicare shared savings program and Medicare incentive programs for electronic health records (EHR) and the Physician Compare Tool on the website. Moreover, this move would expand the telehealth services that qualify for Medicare reimbursement.

Initially, the sponsorships for continued medical education (CME) were given a pass in the Open payments system as CMS considered that adequate safeguards were already in place. Experts suggest that the current exemption could prompt drug and device companies to shift their marketing dollars to CME and away from direct promotional programs for their products. The end result is that these programs may direct physicians to unduly prescribe products that the industry is pushing.

Experts in the medical field feel that CME organizations that fund these education events would be seriously hit by this move. The new policy change would considerably impact all stakeholders such as physicians, educators and commercial supporters in the CME system who had prepared for the current rule implementation.

The new rule changes advised in the relative value units that verify Medicare payments to physicians must be revenue-neutral. This means a relative increase in payments in one specific will lead to cuts in some other area. Medicare payments for radiation oncology services and radiation therapy centers were cut by 4% and 8% respectively. The rule would increase payments for internal medicine (2%), geriatrics (1%) and family practice (2%). Further, independent laboratories would receive a 3% hit based on increases in the cost of running such an organization. CMS has been consistent in its efforts to make significant amendments in the Affordable Care Act (ACA). Much of their efforts have been concentrated on identifying misvalued medical codes and making adequate adjustments where required.

Many experts in the healthcare domain feel that the proposed changes may not be as significant as they appear. Even though the proposal eliminated CME exemption it does not provide guarantee to alter the indirect payment rule (that does not require reporting in case of indirect payments to companies if the funder is not aware of the doctors receiving funding). The new rule will be published in the Federal Register on July 11 and comments will be accepted till September 12. It is expected that industry and medical communication companies may put forth significant efforts to prevent CMS from implementing this change.

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