Aggregate Spend - U.S. Federal Laws

U.S. Federal Laws

On September 6, 2007, Senator Chuck Grassley (R-Iowa) introduced the Physician Payments Sunshine Act of 2007 (S. 2029). In March 2008, Rep. Peter DeFazio (D-Oregon) and Rep. Pete Stark (D-California) introduced a slightly different companion bill in the House of Representatives. (H.R. 5605). These bills were reintroduced in 111th Congress as the Physician Payments Sunshine Act of 2009 (S. 301 and H.R. 3138), again by Senator Chuck Grassley and in the House of Representatives by Rep. Baron Hill (D-Indiana). The bills all aimed to replace the differing state legislations with a single law, common to all 50 states. According to Ashley Glacel, the press secretary for the Senate Aging Committee, whose chairman, Herb Kohl, co-sponsored the bill, the Senate bill is more expansive because it also include Medical Device makers.

The bills would amend the Social Security Act "to provide for transparency in the relationship between physicians and manufacturers of drugs, devices, or medical supplies for which payment is made under Medicare, Medicaid, or SCHIP." The bill proposed that each quarter, beginning on January 1, 2008, companies or their agents which manufacture drugs, medical devices, or medical supplies would be required to disclose all payments over $25 in value made to "to a physician, or to an entity that a physician is employed by, has tenure with, or has an ownership interest in".

The bill would also require manufacturers to provide details on the date, value and nature of the payment, such as whether it was for "food, entertainment, or gifts", "trips or travel", "a product or other item provided for less than market value", "participation in a medical conference, continuing medical education, or other educational or informational program or seminar, provision of materials related to such a conference or educational or informational program or seminar, or remuneration for promoting or participating in such a conference or educational or informational program or seminar", "product rebates or discounts", "consulting fees or honoraria" or "any other economic benefit". Companies would be required to submit a summary report in electronic format. The proposed penalties for breaches were "not less than $10,000, but not more than $100,000", for each such failure.

The proposed federal law would undermine a stronger Vermont law if passed, according to state officials and advocacy groups. The reporting threshold under the proposed federal law is $500 - much higher than the $25 threshold found in a similar Vermont law passed five years ago. If passed, the federal bill would preempt the state law.

In May 2008, the Pharmaceutical Research and Manufacturers of America stated that they supported a revised version of the bill, but only on condition of "the continued inclusion of the provision that preempts state law". In a media statement, the PhRMA president, Billy Tauzi,n stated that "PhRMA believes that preempting local and state marketing reporting or disclosure laws that have been enacted or are pending avoids a confusing myriad of local, state and federal requirements that confuse patients accessing the information and are overly burdensome and costly for those required to report."