- Healthcare vendors and manufacturers have spent $7.52 billion in payments and ownership and investment interests to providers and teaching hospitals in 2015, according to a press release from CMS.
The agency published the payment data from healthcare manufacturers as part of its Open Payments Program, which shares transfers of value from some healthcare stakeholders, including drugs, devices, biologicals, and medical supplies manufacturers to physicians and teaching hospitals.
Through the program, which is also referred to as the Sunshine Act, healthcare manufacturers are required to report payments made to providers for research and charity as well as speaker fees, vacations, food and beverage, travel and lodging, royalties and licenses, and investments. The rule aims to increase transparency within the healthcare industry.
“Transparency is empowering physicians to be purposeful about their financial relationships with companies, and there is a notable shift towards charitable contributions and away from other interactions such as honoraria and gifts,” said Shantanu Agrawal, MD, CMS Deputy Administrator and Director of the Center for Program Integrity.
This is the second full year of data available on the CMS Open Payments Program website. The most recent dataset includes 11.9 million records from 2015, with 1,456 total companies making payments to 618,000 physicians and 1,100 teaching hospitals.
In terms of specific payments, healthcare manufacturers made $2.6 billion in general payments that are non-research related, $3.89 billion in research contributions, and $1.03 billion in payments related to ownership or investment interests held by providers and their immediate family members.
Physicians were also paid more than teaching hospitals across all types of payments. While physicians were paid $2 billion in general payments, teaching hospitals received $605 million. Providers also gained $86.39 million in research payments, whereas teaching hospitals were paid $724 million by manufacturers.
One of the program’s main objectives is to provide stakeholders with actionable data that can be used to identify trends in healthcare spending. For example, CMS reported that 2.26 percent, or 637,131 records, of payments were exchanged between physicians and pharmaceutical companies in 2015. The payments were associated with opioid medications.
While the payments ranged from a single penny as a gift to millions in research contributions, CMS also explained that charitable contributions were on the rise compared to previous years.
CMS intends for the information to promote healthcare transparency, especially in relation to collaborations among providers and the manufacturing community. In some cases, these partnerships can involve some conflicts of interest. While the Open Payments Program does not identify issues with specific payments, it provides a forum for stakeholders to analyze these relationships.
Providers are also able to dispute reported payments that manufacturers have submitted on their behalf before CMS publishes the data on the program’s website.
Since the Open Payments Program’s launch in 2014, CMS has analyzed over 28 million records, amounting to $16.77 million in payments from 2013 to 2015.
Despite the Open Payment Program’s attempt to promote transparency, the initiative has faced some bumps in the road since its establishment.
Following the CMS announcement, the American Medical Association (AMA) released a statement yesterday that challenged the accuracy and validity of the program’s 2015 data.
"While we appreciate the efforts of the Centers for Medicare and Medicaid Services (CMS) to verify the data submitted by industry, continued data errors and registration challenges during the previous two years have thwarted many physicians from participating in the review and validation process,” explained the statement.
“The integrity goals of the Open Payments database will not be met as long as physician review is obstructed by a registration procedure that is confusing, time consuming, and overly burdensome.”
The AMA also explained that publishing inaccurate data could cause patients to stop trusting their physicians and discourage research and improvements that could ultimately help patients.
Additionally, an article co-published by the New York Times and ProPublical in early 2015 revealed that the program’s website contained many factual and spelling errors. The authors reported that some drug and device companies had misspelled the name of their products, making it difficult to analyze information.
Other issues included general payments not being linked to a specific product, companies listing products as “unrecognized,” products put in the wrong category, and payments made for multiple products were not broken up.
CMS responded by explaining that it is not a spell-check for the healthcare industry and the data was likely to improve itself as the program continued.
Currently, the program continues to expand and add more records to its dataset in efforts to further promote healthcare transparency and open communications in the industry.