The publicly accessible information about the payments and transfers of value (ToV) made by reporting entities to covered recipients is known as Open Payments data.
The regulatory authorities have made it mandatory for life sciences companies to track and record their financial interactions with healthcare providers and submit the data to the Center for Medicare and Medicaid Services (CMS).
CMS outlines a detailed format for preparing and submitting the data in its Open Payments program. This format ensures consistency, accuracy, and standardization of submitting reports across the life sciences industry.
Once the data is prepared and submitted, the CMS publishes it on its website for the previous program year annually on or before June 30 and refreshes that data in January of each year. The data can be accessed via the Open Payments Search Tool. The individual program year data sets can be downloaded from the Dataset Download Page.
According to the CMS, they have published 80.66 million records that account for $68.44 billion in transfers of value over the past seven years. These include payments ownership and investment interests and a detailed breakdown of the spending of life science companies. Let’s delve deeper into the Open Payments data to learn more useful facts.
What Data is Reported to Open Payments?
The data submitted to the CMS is divided into three prominent categories which are:
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General Payments: These are the payments or transfers of value that are not in connection with a research agreement or protocol
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Research Payments: These are the payments or transfers of value that are not made in connection with a formal research agreement or protocol
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Ownership or Investment Interest: This information is about the ownership or investment interest that physicians or their immediate family members have with the reporting entities.
These payments are reported as:
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Direct Payments: The payments made directly to covered recipients
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Indirect Payments: The payments made to covered recipients via an intermediary such as a medical specialty society
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Third-Party Payments: The payments made to covered recipients via a third-party
Reporting entities can request a delay in publication for specific payment records related to research and development. The delay in publication request can be renewed annually up to four calendar years after the date of payment.
The Law and Policy
The Open Payments Sunshine Act, now known simply as the Sunshine Act, was signed into law by President Barack Obama on March 23, 2010, as part of the Patient Protection and Affordable Care Act (ACA). However, the implementation of the Sunshine Act did not happen overnight. CMS spent two years after the enactment of ACA to solicit public comments and craft final rules.
The first data collection started in 2013, and the initial disclosures were published in September 2014 on a publicly accessible database now known as the Open Payments database.
CMS periodically updates the Open Payments reporting requirements to ensure accuracy, transparency, and alignment with evolving industry standards and regulations.
These updates are essential to maintain the integrity of the data and act as a catalyst for fortifying compliance practices within the life sciences industry.
While the frequency of changes made to the reporting requirements can vary, CMS generally communicates these updates through official channels to ensure reporting entities stay well-informed of the most recent reporting requirements.
Here are a few of the channels where regulatory changes are published:
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Federal Register Notices: CMS often publishes proposed rule changes and updates in the Federal Register, which is the official daily publication for rules, proposed rules, and notices of federal agencies. This allows stakeholders, including reporting entities, to review and provide feedback on the proposed changes.
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Final Rule Publication: After considering feedback from stakeholders, CMS publishes a final rule in the Federal Register outlining the changes to the reporting requirements. This includes details about what has been modified, added, or revised in the regulations.
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Guidance Documents: CMS may release guidance documents, such as manuals, guides, or FAQs, that provide detailed explanations of the updated reporting requirements. These documents aim to help reporting entities understand and implement the changes effectively.
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Open Payments Program Year 2022 Statistics
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Total US Dollar Value: $12.59 Billion
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Total Records Published: 11 Million
| Payments By Type | |||
| General Payments | |||
| Amount: $3.71 Billion | Payments: 13.15 Million | Disputed Amount: $2.23 Million | Disputed Payments: 287 |
| Research Payments | |||
| Amount: $7.58 Billion | Payments: 953,320 | Disputed Amount: $6.73 Million | Disputed Payments: 247 |
| Ownership or Investment Interest | |||
| Amount: $1.29 Billion | Payments: 3,919 | Disputed Amount: $99,966.56 | Disputed Payments: 3 |
| Payments by Entity | ||||
| Entity Type | Number of Entities | General Payments | Research Payments | Ownership or Investment Interest |
| Physicians | Receiving Payments: 588,514 | $2.48 Billion | $68.84 Million* | $1.29 Billion |
| Non-Physician Practitioners | Receiving Payments: 271,682 | $168.53 Million | $410,476.04* | N/A*** |
| Teaching Hospitals | Receiving Payments: 1,240 | $1.07 Billion | $1.58 Billion | N/A*** |
| Companies | Making Payments: 1,742 | $3.71 Billion | $7.58 Billion | $1.29 Billion |
| Summary by State | ||||||
| State | Total | Payments | Mean Amount | Mean Payments | Median Amount | Median Payments |
| Connecticut | $158,966,445.05 | 111,465 | $21,851.06 | 15 | $155.60 | 3 |
| Tennessee | $112,232,759.87 | 240,875 | $9,305.43 | 20 | $193.49 | 5 |
| Minnesota | $51,275,128.45 | 42,699 | $7,833.05 | 7 | $115.42 | 2 |
| California | $448,147,023.21 | 904,279 | $7,107.58 | 14 | $157.84 | 3 |
| District of Columbia | $13,929,186.19 | 29,846 | $6,207.30 | 13 | $166.45 | 3 |
A Total Of 14.11 Million Records Were Published in 2022
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Total Physicians with Payment Records: 588,514
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Total Non-Physician Practitioners with Payment Records: 271,682
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Total Teaching Hospitals with Payment Records: 1,240
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Total Companies Making Payments: 1,742
Open Payments Program Year 2021 Statistics
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Total US Dollar Value: $11.94 Billion
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Total Records Published: $12.23 Million
| Payments by Type | |||
| General Payments | |||
| Amount: $3.13 Billion | Payments: 11.51 Million | Disputed Amount: $2.46 Million | Disputed Payments: 345 |
| Research Payments | |||
| Amount: $7.51 Billion | Payments: 708,938 | Disputed Amount: $14.06 Million | Disputed Payments: 122 |
| Ownership or Investment Interest | |||
| Amount: $1.30 Billion | Payments: 4,087 | Disputed Amount: $0.00 | Disputed Payments: 0 |
| Payments by Entity | ||||
| Entity Type | Number of Entities | General Payments | Research Payments | Ownership or Investment Interest |
| Physicians | Receiving Payments: 536,051 | $2.06 Billion | $77.50 Million* | $1.30 Billion |
| Non-Physician Practitioners** | Receiving Payments: 235,011 | $122.12 Million | $424,947.27* | N/A*** |
| Teaching Hospitals | Receiving Payments: 1,243 | $947.97 Million | $1.66 Billion | N/A*** |
| Companies | Making Payments: 1,829 | $3.13 Billion | $7.51 Billion | $1.30 Billion |
| Summary by State | ||||||
| State | Total | Payments | Mean Amount | Mean Payments | Median Amount | Median Payments |
| Washington | $145,055,172.22 | 70,155 | $16,847.29 | 8 | $114.24 | 2 |
| Utah | $66,557,394.08 | 59,775 | $14,767.56 | 13 | $142.75 | 4 |
| Massachusetts | $95,843,269.58 | 99,804 | $8,815.61 | 9 | $141.03 | 2 |
| Minnesota | $38,434,622.17 | 32,139 | $6,771.43 | 6 | $106.65 | 2 |
| District Of Columbia | $11,785,788.92 | 22,222 | $6,203.05 | 12 | $144.10 | 3 |
CMS has rounded all numbers above one million in the data mentioned above. For example, 1,200,000 would be displayed as 1.2 million. Additionally, the covered recipient research payments total includes:
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Payments where the company making the payment has named an individual/covered recipient as the primary recipient
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Payment made to a research institution or entity where the primary recipient is termed as a principal investigator on the research project
To Conclude
The Open Payments data serves as a crucial beacon of transparency. It’s a tool that sheds light on financial interactions within the industry, ensuring everything is transparent between life sciences companies, regulatory authorities, and the public.
This data reveals three key types of transactions: general payments, research-related payments, and ownership interests. The reporting process is straightforward, involving direct, indirect, and third-party payments.
Behind the scenes, the Sunshine Act forms the legal framework, driven by years of crafting and public engagement. To keep up with the ever-changing landscape, the CMS updates reporting rules periodically, ensuring accuracy and transparency.
In essence, Open Payments data is about trust, collaboration, and better patient care. As compliance professionals, embracing this data means fostering industry integrity and advancing healthcare excellence. However, the substantial volume of data that needs to be reported to the CMS can contribute to inaccuracies and disputes.
Leveraging a data-driven aggregate spend reporting solution to address challenges associated with CMS reporting minimizes the risk of disputes, discrepancies in reported data, disagreement in categorization, and missing information and ensures timely submission of spend reports.
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