A large medical device and equipment trade organization, as well as a two large manufacturers of supplies, have voiced qualified support for a law that would disclose companies' payments to physicians.
The trade group and companies testified this week before the Senate Special Committee on Aging to support the proposed legislation, called the Physician Payments Sunshine Act.
Proposed last year in the Senate by Sen. Herb Kohl (D-Wis.) and Sen. Chuck Grassley (R-Iowa), the bill has also received strong support from various physician groups, such as the American Medical Student Association and the National Physicians Alliance.
In recent months, increased attention has been paid to financial relationships between physicians and suppliers, particularly to common practices through which pharmaceutical companies provide gifts or other potential inducements to physicians.
For example, an article in the New England Journal of Medicine last April found that 94 percent of physicians who participated in a survey reported some kind of financial link to the pharmaceutical industry, ranging from free food to reimbursement for continuing medical education and paid consulting work.
The bill proposed by Kohl and Grassley, S. 2029, would require drug and device companies to report, on a quarterly basis, any payment or transfer of value to any physician. Disclosures would include identifying information on the physician, the value of the payment and date the payment was made, the nature of the payment and the medical condition or issue addressed, if any.
The bill would establish penalties of $10,000 to $100,000 for companies that fail to report contributions to physicians.
Medtronic, in its testimony on Tuesday, said the bill should be made more inclusive to ensure that all medical companies participate.
"The bill can and should go even further by requiring the same level of disclosure by all companies in the industry, regardless of size and including those companies owned in whole or in part by physicians," said Bill Hawkins, Medtronics' president and CEO.
Medtronics said that companies with yearly revenues of less than $100 million are currently not covered by the proposed legislation, and those smaller companies account for more than 75 percent of the companies in the industry, Medtronics contends.
AdvaMed conditioned its support if key changes are made to the bill, specifically if the federal legislation would pre-empt state disclosure laws; apply the requirements to all companies; require compliance by physician-owned manufacturers, distributors and group purchasing organizations; exempt reporting of items costing less than $100; and other stipulations.
"Continued innovation in medical technology relies on direct interaction with physicians who have first-hand clinical experience with advanced medical treatments," said AdvaMed CEO Stephen Ubl. "The importance of the relationship between physicians and medical technology innovators cannot be understated. It is a critical component of the engine that drives the next wave of medical advancements."