These days, financial disclosures are a given. If you’ve sat in enough lecture halls or read a doctor-penned—but industry-sponsored—CE course, you are well aware if the presenting doctor has an affiliation with a specific company, or more typically, companies. But now, with the so-called “Sunshine Act” ready to take effect, transparency between physicians and industry is about to be raised to a whole new level—welcome news in some ways, but a boondoggle for industry. Under this new federal mandate, manufacturers are required to annually report any gifts or compensation to doctors, including honoraria, food, travel and research dollars, to the Centers for Medicare & Medicaid Services. CMS will then post this information publicly on the web.

What does this mean for optometry? If you’re a doctor who has received compensation (monetarily or otherwise) from industry, the nature and the specific dollar value of that transaction—with your name attached to it—will be readily available to the public if they choose to look.

“This new regulation is yet another assault on the esteemed place health care providers once enjoyed within society,” says optometrist Art Epstein of Phoenix.  “I don’t know any other profession where people have to disclose income at this level. This is especially odd for health care professionals, where trust between patient and practitioner is a fundamental principle as well as a sworn oath.”

Slated to begin this month but likely held up by the typical bureaucratic grind, the Sunshine Act has many people talking—about whether it’s an invasion of privacy, a welcome addition to the medical community, or ultimately a detriment to the future of industry support of continuing education. Here, several prominent ODs weigh in.

Sunshine Act: Good, Bad or Indifferent?

Pens to Honoraria to Steak Dinners: What Companies Need to Divulge
Under the proposed rule of the Sunshine Act, manufacturers would need to report any financial gifts to doctors that are valued over $10 or an aggregated sum of $100 over a one-year period.

For example, if a company takes you out for an $8 lunch twice in a year, they don’t need to report this to CMS, since the one-time gifts are less than $10 and the total yearly amount is under $100. However, if in the course of one year a company provides you five meals each worth $9, a speaker fee of $150 and pens worth $5, the aggregate amount is greater than $100; the company would have to report each item to CMS.

Based on this financial formula under the current proposed rule, companies would need to report the following:

  • Consulting fees
  • Compensation for services other than consulting
  • Honoraria
  • Gift
  • Entertainment
  • Food
  • Travel
  • Education
  • Research
  • Charitable contribution
  • Royalty or license
  • Current or prospective ownership or investment interest
  • Direct compensation for serving as faculty or as a speaker for a medical education program
  • Grant

Companies would also have to track and report the type of payment they gave doctors. The types of payment include:

  • Cash or a cash equivalent.
  • In-kind items or services.
  • Stock, a stock option, or any other ownership interest, dividend, profit or other return on investment.

CMS has included a few exceptions to this mandatory reporting requirement. For a full list and to view the proposed rule in its entirety, go to

“I think as a whole, disclosure and transparency are positive things, and I’m a big believer it is important to have that,” says Lexington, Ky., optometrist Paul Karpecki. “All the education boards, including ARBO, already have disclosure requirements, and this new rule is simply
adding to it.”

One potential downside: Companies may decide to cut back on industry-supported efforts if the reporting requirements become too onerous, Dr. Karpecki adds. For example, under the proposed rule, companies would be required to report to CMS any gift to a doctor that is over $10 (see Pens to Honoraria to Steak Dinners: What Companies Need to Divulge). So, a billion-dollar drug company will now have to track each gift worth over $10, whether it’s a lunch, consulting fees, pens or research dollars, given to an individual doctor over a one-year period and report all that information to CMS. Large pharma companies will potentially have to track what they gave to thousands of doctors; smaller companies may not have the manpower to track and report this deluge of data.

“This is going to be a cost for companies,” says Dr. Karpecki, both financially and operationally. “Unfortunately, this may not benefit the profession, as money that may have been allocated to professional efforts will now be allocated to tracking and monitoring,” Dr. Karpecki says.

Though the final rule of the Sunshine Act has not yet been issued as of press time, companies are already starting to prepare, ODs say.
Kirk Smick, OD, of Morrow, Ga., cites an example of a company that abruptly stopped using a particular doctor for the rest of 2012. Although there is no mandatory reporting yet, the company didn’t want the financial compensation to this particular doctor to appear inordinately high.

Just what the federal government hopes to achieve with the Sunshine Act is unclear, according to Dr. Smick. “It is somewhat of an insult that they would think that I would prescribe a certain drug or medical device based on a gift,” he says. “That just smacks of their lack of understanding of what being a doctor is about.”

“I can’t imagine very many patients are going to see this information,” Dr. Smick adds. “Secondly, I don’t know that they would care even if they do see it; finally, I think there is a way to put a positive spin on it. If anyone asks me if I am getting money from a company, I will say, ‘You know, I’m pretty well known, and companies invite me to leave my practice to do educational presentations, and of course they pay me for that time out of the office where I normally earn my living.’”

If a patient goes online and discovers their doctor has earned money from a company, Dr. Karpecki doesn’t believe this is going to be a significant negative. “I don’t think patients are going to decide they don’t want to go to a doctor who works with a lot of companies—a lot of times they do just the opposite,” he says.

Optometrist Ben Gaddie of Louisville, Ky., feels that the Sunshine Act will have very little impact on optometry or medicine. “If I were a consumer of eye care, I would want to find the doctor who is helping shape the industry and is a leader amongst his or her peers.” Dr. Gaddie thinks the regulation will, if anything, allow a concerned party to see the company affiliations a particular doctor has so that they can decide if that relationship somehow affects the care that they receive.

“I don’t think it solves any problems,” says Dr. Gaddie, “and I’m not convinced there is a problem to begin with.” Simply put, he says, without doctors acting as consultants or performing research, there would be no innovation in science or patient care. “It’s not a crime to help move your profession or industry forward and ultimately better serve the patients who seek our care.”

The Sunshine Act is just the latest addition to an already toxic health care environment, Dr. Epstein says. “Overregulation creates a typically senseless bureaucratic cluster that ultimately stifles research and innovation. Worse yet, it insidiously impacts patient care. We are regulating ourselves to death,” he says.

Tighter Regulations, Transparency and CEs
New pharma guidelines have become stricter every year, and as a result, relationships between industry and doctors are already under tight scrutiny, which is a good thing, says Jack Schaeffer, OD, of Birmingham, Ala. Long gone are the days of pharma-sponsored CE dinners; the new norm is transparency between doctors and their audience. For example, if a doctor is giving a lecture, it is extremely important for the audience to know the doctor has done research or is on an advisory board, so that the lecture becomes fair and balanced, Dr. Schaeffer says.

“As a medical community, we adopted evidence-based medicine many years ago,” Dr. Schaeffer says, and those principles are evident in every lecture. “Keeping that in mind, there are many anecdotal experiences that add value but may not be supported by research” and these should be disclosed as anecdotal in nature when lecturing. If the clinician’s experience is limited to one drug in a class due to a consulting arrangement, it would be valuable for that limitation to be disclosed.

Dr. Epstein believes the Sunshine Act will have little impact on optometry because the profession was never the recipient of the corporate largesse other medical specialties received in the past. “I have heard stories of a few key optometrists being treated to incredible perks, including international trips, but that was before my time, and I have been around for a while.” 

All health care professions “share a symbiotic relationship with industry, since we depend on the drugs and devices they produce,” Dr. Epstein says. “There are a number of optometrists who work very closely with industry, and some earn significant income from that, but I suspect most people are already aware of those relationships.”

But will the Sunshine Act change the landscape of CE, with doctors opting to skip the lecture circuit due to a sudden spotlight shone on financial compensation they receive? “I don’t think it will have that effect at all because I don’t think we care,” Dr. Smick says. However, he suggests that it may impact some companies if they prefer to shield their consulting relationships from scrutiny. “Maybe I’m a lecturer for the company and that company may not want me to know they are supporting another lecturer more than me,” Dr. Smick says. “They may try to even the playing field a little as a result.”

Since disclosures are in place already, Dr. Schaeffer doesn’t believe the new Sunshine Act will prompt ODs to shy away from industry affiliations. “Almost all doctors who lecture receive money from different companies. That is how CE is paid for,” Dr. Schaeffer says, and there are buffers already in place. At most meetings, pharma companies support the conference, and the organization that plans the meeting pays the doctors for the independent lectures, Dr. Schaeffer adds.

For those ODs just starting out on the lecture circuit, the increased scrutiny of the Sunshine Act may make speaking engagements seem less appealing. “In the future, I do think that people who do research or go on the podium may be less inclined to do so,” says Dr. Epstein. “Becoming a sought-after speaker requires an incredible amount of study and preparation. It’s not as easy or as glamorous as some might think,” he says, to be in the public eye. “You are away from family, and if you have young children, you risk missing moments you can never recapture. Even for the most experienced road warrior, travel wears you out.” Financial scrutiny and the potential for misinterpretation of consulting relationships only adds yet another reason to stay home, he says.

Speaking is also not a get-rich-quick scheme. Dr. Epstein explains that most on the lecture circuit earn the same or less than they would generate if they stayed home and saw patients in their practice.

“People shouldn’t misunderstand,” Dr. Epstein says. “If someone earns a significant amount of money speaking or consulting, they really earned it. No company gives money away. People earning that kind of money are working hard for it, and they have developed skills and abilities that are in demand. There is no skullduggery here. There are no behind the scenes pay-offs.”

Will Top Lecturers Retreat?
Doctors interviewed for this article are mostly familiar faces on the teaching and lecture circuit. When asked if they will refrain or cut back on industry-affiliated educational efforts as a result of the Sunshine Act, each OD said most likely no.

Shedding Light on the Sunshine Act
The Sunshine Act, a part of the Affordable Care Act, was created to increase transparency in the health care system. It would require manufacturers of drugs, devices, biologicals and medical supplies covered by Medicare, Medicaid or the Children’s Health Insurance Program to report to CMS payments or other transfers of value they make to physicians and teaching hospitals.

This would include gifts, consulting fees, research activities, speaking fees, meals and travel arrangements. The proposed rule would also require manufacturers and group purchasing organizations (GPOs) to disclose to CMS ownership or investment interests held by physicians (or the immediate family members of physicians).

CMS’s position is that disclosure of these relationships will discourage the inappropriate influence on clinical decision-making that sometimes occurs, while still allowing legitimate partnerships between physicians and industry.

Companies will not be required to begin collecting data for CMS until after a final rule is published. As of press time, CMS had not issued the final rule and would not comment on a timeline when the rule would be finalized. Once the rule is issued, companies—along with doctors and teaching hospitals—will be allowed to review and correct information prior to its publication. Depending on the timing of the final rule, CMS is proposing that manufacturers and GPOs will be required to submit a partial year on March 31, 2013.

For those who violate the reporting requirements, the penalties are steep. Violators would be face monetary penalties capped at $150,000 annually for failing to report, and $1 million for knowingly failing to report.

CMS is proposing to leave it up to the company and physician to resolve any potential disputes about the information reported. CMS is also proposing that if the dispute cannot be resolved, the transaction will be noted as disputed, and both amounts will be published.

“I really don’t see the need for the regulation, but at the same time, I don’t have anything to hide,” Dr. Gaddie says. “I am proud of the work I do to promote the profession, and I hope that my educational efforts help advance the level of care that other optometrists provide to their patients. It is a mutually beneficial relationship; industry couldn’t survive without the doctors and the doctors would be hard pressed to maintain the level of education and product innovation without industry partners.”

Dr. Epstein says that, although he resents the Sunshine Act’s invasion of his privacy, he doesn’t think it will change the way he conducts his professional pursuits. “I never hid industry relationships. I work with a number of different companies, and I believe that what I offer them has substantial value.” He points out that he has also used his industry relationships to help the profession.

“At this point in my career, people know who I am,” says Dr. Epstein. “I have always been a straight shooter. I say what I think even when it is clearly not in my personal best interest. I believe my colleagues will see me the same way regardless of how I chose to earn my living.”
For those who love to teach, public reporting of earnings from industry won’t stop them. “This isn’t going to affect my attitude for wanting to do these things because I enjoy it and I enjoy teaching,” Dr. Smick says. “It probably won’t have any direct effect on me.”

Company Loyalty
For those doctors who are aligned with a specific company, what will this new regulation mean to them?

“It certainly makes me think that a company now will be able to see that not only am I getting income from them, but also maybe from their competitor,” Dr. Smick says. “What does that mean? It depends on the company, but most of my friends and colleagues don’t want to get bundled into Company XYZ’s camp and viewed as its mouthpiece.” Still, he says some manufacturers do cultivate a cadre of speakers who don’t really lecture for other companies. “That is really going to be borne out. I think companies are going to have to ‘spread it around’ a little more.”

Some speakers give the impression to their audiences that they work with a variety of companies and therefore are not biased, Dr. Gaddie says. “The regulation will allow everyone to see if the speaker is indeed working with everyone or just one entity. It should be interesting,” he says.
With the Sunshine Act, the audience will know if a certain speaker is aligned with a certain company and its products, Dr. Schaeffer says. “But even those individuals are going to still give a fair and balanced lecture. They may just favor one drug over another as long as the efficacy is the same. I can’t think of anyone I’ve seen lecture favor one drug or product over another that is less effective when teaching other optometrists about clinical care.”

Dr. Epstein says some doctors do have issues with bias, but “you can generally tell, and the audience picks that up.”

So in the end, how much of an impact will the Sunshine Act have on optometry?

“The main thing is that there will never be any laws or guidelines that are stricter than the guidelines that we place on each other,” Dr. Schaeffer says. As a participant and planner on the lecture circuit, Dr. Schaeffer says if he or a colleague hears a lecturer or reads an article that they thought was not in the best interest of patient care, that individual would have a very difficult time pursuing a career lecturing or writing. 

Adds Andy Gurwood, OD, of Salus University in Philadelphia: “My general thoughts are that unless an egregious bias is exposed and put forth in a place where it can be easily discovered by the public, the act does no harm. I generally believe that while doctors may work with industry, they continue to do what is right, forgetting about relationships in favor of correct management.” That, he says, is what this legislation is about—revealing the appearance of impropriety.

“I have faith in my colleagues,” Dr. Gurwood says, “and unless it becomes clear that decisions are being made contrary to the standards of care on favor of bias for gain, I consider the issue moot.”

Q&A With the AOA
The Sunshine Act is intended to shine a spotlight on relationships between drug or medical device manufacturers and doctors, optometrists included. At a time when regulations of CE and other industry support have been ratcheted up in recent years, the Sunshine Act takes scrutiny to another level, as industry will need to publicize the majority of compensation and/or gifts they provide to doctors.

We asked the AOA to weigh in on this new law and what it may mean to you and your colleagues.

What are the proposed components of this new regulation and how might they impact optometry?
AOA: Congress passed the law to make transparent the benefits that physicians, including optometrists, receive from manufacturers whose products (drugs and devices) are covered by Medicare. The obligation will be on the companies to track and report what goes to the doctors, and the amounts will be posted on a website that the public can access.

The impact on optometry will depend on what the public does, if anything, with the information. Final regulations from the federal government will spell out exactly which types of manufacturers will be subject to reporting, and the process for doctors to review and correct the information. AOA carefully reviewed the proposed requirements and made suggestions to the government on ways to make the reporting more fair and accurate for optometrists and the public. The law and regulations do not prohibit any activity by manufacturers or optometrists, but sheds light on their transactions.

Optometrists will probably want to carefully review their individual reports, and use the available time and procedures described in the final regulations to make corrections before the information is posted online. Optometrists will also want to be prepared to answer questions from patients and potential patients about the transparency.

Is the proposed regulation a positive or negative addition to the medical community and optometry, and what problem, if any, does it resolve?
AOA: The law was enacted because some physicians receive large benefits from manufacturers, and Congress wanted to make sure that patients, regulators and others would know about those transactions in case the rewards were valuable enough to potentially impact decisions, findings or recommendations made by a doctor. Many physicians receive small or token benefits from manufacturers, which will also be publicly reported.

Optometry is not particularly helped or harmed, since the law does not restrict any relationships with manufacturers. Individual optometrists who appear in the reports might not like the public to know the value of benefits they received from manufacturers. All physicians are subject to the reports, so optometrists will likely not stand out in comparison to medical colleagues. The law does not resolve any problems unless the public learns, as a result of this transparency, there are physicians whose judgments were potentially clouded by the value of their relationships with manufacturers.

Although the final regulation has not come out yet, what is the AOA’s position on the Sunshine Act?
AOA: AOA did not support the law because it does not benefit optometry. But it also does not hinder optometry much, particularly in comparison to other medical specialties. AOA continues to advocate for changes in the law and regulations to make the Sunshine Act less burdensome for manufacturers and less intrusive for optometrists, and to avoid misleading the public about the legal and appropriate relationships between doctors and manufacturers. This will also require more time for the individual OD to monitor what is reported and if the information is correct. We want to make sure that our members have the necessary steps to view or monitor their activity and potentially identify any incorrect activity.

AOA also asked that the next statement be very visible for the public to read: “We recognize that disclosure alone is not sufficient to differentiate beneficial, legitimate financial relationships from those that create conflict of interests or are otherwise improper. Moreover, financial ties alone do not signify an inappropriate relationship.” This is a statement made by CMS.