Moving the HME Industry Forward


Physician Payments Sunshine Act

November 10, 2014

AMARILLO, TX – The Physician Payments Sunshine Act requires group purchasing organizations (GPOs) and manufacturers of prescription drugs and devices that are covered by Medicare, Medicaid, or CHIP to annually report (1) payments and gifts provided to physicians and teaching hospitals and (2) investment interests held by physicians or a physician’s immediate family member.  

Who must Report?
Manufacturers of prescription drugs, devices, biologicals, and supplies that are covered by Medicare, Medicaid, and/or CHIP must report annually to the Centers for Medicare and Medicaid Services (CMS). GPOs that purchase, arrange for, or negotiate the purchase of such drugs and devices must also report annually to CMS. DME suppliers, that are not manufacturers, are not required to report under the Act.  

What must be Reported?
The manufacturers and GPOs discussed above must report any payments or gifts worth more than $10 provided to physicians and teaching hospitals. As a result, the manufacturers and GPOs must report consulting fees, payments for research activities, charitable contributions, speaking fees, meals, travel, entertainment, royalties and licenses that are transferred to physicians and teaching hospitals.

Manufacturers and GPOs must also report any stock options, ownership or investment interests held by a physician or a physician’s immediate family member. Spouses; natural or adoptive parents, children, and siblings; stepparents, stepchildren, and step-siblings; father-, mother-, son-, daughter-, sister-, and brother-in-laws; grandparents and grandchildren; and spouses of grandparents and grandchildren are all considered “immediate family members.”  

Under the Final Rule published by CMS to implement the Act, CMS clarified certain exceptions to the types of payments and gifts that must reported. For example, discounts and rebates provided by manufacturers are exempt from the reporting requirements. Samples provided to physicians that are intended for use by the patient are also exempt from the reporting requirements. And, limited exemptions are provided for certain speaking fees for certified or accredited continuing medical education programs.

Who Qualifies as a “Physician”?
Doctor of Medicine
Doctor of Osteopathy
Doctor of Dentistry
Doctor of Dental Surgery
Doctor of Podiatry
Doctor of Optometry
Doctor of Chiropractic Medicine

What is the Reporting Process?
Every year, manufacturers and GPOs must report information regarding gifts, payments, and investment interests. Once CMS receives the reported information, CMS will alert physicians through online postings and list-serves. Physicians will then have 45 days to review, dispute, and correct the reported data before CMS releases the information to the public. Physicians will communicate any objections to CMS, and CMS will forward the objection to the applicable manufacturer and/or GPO. However, CMS will not mediate the dispute; the physician and manufacturer/GPO must work together to resolve the dispute.  

Beginning in early 2014, physicians may register with CMS to receive emails concerning data reported under the Act and the 45-day window for objections. Registration with CMS is voluntary but necessary if a physician would like to review the reported data before it is published. Physicians should visit the following link to learn more about registration and the Act:

Jeffrey S. Baird, JD, is chairman of the Health Care Group at Brown & Fortunato, P.C., a law firm based in Amarillo, Tex. He represents pharmacies, HME companies, and other health care providers throughout the United States. Baird is Board Certified in Health Law by the Texas Board of Legal Specialization, and can be reached at (806) 345-6320 or