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Federal government to require drug and device companies to report payments to doctors

Consumer Reports News: January 17, 2012 04:53 PM

New standards issued by the government are set to require both drug and medical device companies to disclose payments they make to doctors for consulting work, research, lectures, and the like.

Researchers have found that payments by drug companies can end up influencing medical decisions by doctors about patient treatment, and also add up to higher medical costs by "encouraging the use of more expensive drugs and medical devices," the New York Times reports.

According to the Times, about a quarter of doctors receive cash payments from drug or device makers and almost two-thirds of doctors accept routine gifts such as food.

The new standards, supported by the Obama administration, are part of the health care reform legislation signed into law in March 2010.

In addition, the New York Times reported that doctors who take payment from drug companies "often practice medicine differently from those who do not," and are more willing to prescribe drugs in unapproved ways.

John Santa, M.D., M.P.H., director of the Consumer Reports Health Ratings Center, says:

It seems reasonable that patients know who else their doctors are working for—especially if it conflicts with their needs.

Under the new requirements, there will be a $10,000 penalty for each payment not reported, and a drug company that knowingly fails to report payments to doctors will be subject to a penalty of up to $100,000 per violation (up to $1 million a year). In addition, if a company has a product covered by Medicare or Medicaid, it will have to disclose all payments to doctors not formally employed by the company. The Obama administration initially missed the October deadline to establish these payment-reporting procedures.

In October 2010, an investigation by ProPublica, an independent, nonprofit newsroom for investigative journalism, identified more than 17,000 health-care providers who accepted payments from pharmaceutical companies since 2009. At the time of the report, Consumer Reports, along with other news outlets, joined with ProPublica to help inform the public about its report on such financial arrangements. Our own subsequent survey found that most Americans are skeptical of such financial arrangements.

Under the new standards, payment data by drug companies will be posted online, by the federal government, where it will be available to consumers.

U.S. to Force Drug Firms to Report Money Paid to Doctors [New York Times]
Docs on Pharma Payroll Have Blemished Records, Limited Credentials [ProPublica]
Dollars for Docs: How Industry Dollars Reach Your Doctors [ProPublica]

Maggie Shader

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