Healthcare reform act includes gift ban mandates

March 29, 2010 by MassDevice staff

The healthcare reform act includes provisions covering industry payments to physicians requiring companies to report any gifts or payments worth more than $10.

Gifts ban

The healthcare reform act contains stringent rules mandating the public disclosure of gifts and payments made to doctors by medical device, pharmaceutical and biotech companies.

The so-called "Physician Payments Sunshine Provision" of the Health Care and Education Reconciliation Act of 2010 requires the companies to begin reporting gifts or payments worth more than $10 no later than March 31, 2013. The result, a searchable database containing the names and addresses of each recipient and the details of the payments, will be made publicly available by Sept. 30 of that year, and on June 30 every year following.

The act also mandates stiff penalties for companies that fail to comply. Companies found to inadvertently omit reports could ring up civil fines of between $1,000 and $10,000 "for each payment or other transfer of value or ownership or investment interest not reported," according to the act. Companies found to knowingly skirt the reporting rules could be slapped with civil fines of $10,000 to $100,000. The total amount of fines can't exceed $1 million or 0.1 percent of total annual revenues in a single year.

The payments that will require reporting include "any compensation, gift, honorarium, speaking fee, consulting fee, travel, services, dividend, profit distribution, stock or stock option grant, or any ownership or investment interest held by a physician in a manufacturer" excluding dividends or other profit distributions, according to the act. Some payments are excluded, including:

Comments