Preparing For Sunshine Act Rules

How Should Medical Device Technology Companies Prepare For Sunshine Act Rules?

medical-device-sunshine-act | Photo Courtesy of geomphotography http://www.flickr.com/photos/geomphotography/6779619531/sizes/q/in/photostream/

How much is the Physician Payment Sunshine Act going to add to the cost of meeting reporting requirements? Probably a lot more than most medical device technology companies realize, according to a recent article on the Mass Device website.

Jonathan Kellerman, compliance and risk assessment manager at PricewaterhouseCoopers, believes the ?make-it-or-break-it? variable that will determine how well each company handles the costs is its data management system. More mature, consistent and high-quality systems will have an easier time reporting to the Centers for Medicare & Medicaid Services.

It might be easier for smaller companies to comply with the new regulations simply because they have less data to report, but the bottom line is that the edge will go to those that embrace technology and use a CRM system to streamline the process

The new reporting requirements were released in February. As the article explains, ?the measure requires companies to track all interactions with physicians and start reporting the data to CMS by March 31, 2014.?

Specifically, any medical device technology company that interacts directly with a physician will be required to report expenses over $10 spent on that physician. That includes royalties, consulting fees and research fees. This mean there is even more information that companies now must collect. For example, if you buy a physician breakfast that costs more than $10, you?ll have to record that physician?s name, where you spent the money, when the meeting occurred and the reason for that interaction.

Many companies don?t have technology in place to record this type of information. While this can be done manually, using a CRM system is much more efficient. A CRM system can track physician information and record where and when expenses were incurred each day.

How Can Companies Overcome The Medical Device Tax With Technology?

How Can Companies Overcome The Medical Device Tax With Technology? Clearly, the medical device industry was hit hard in 2012. More than 7,000 people were laid off. No wonder an article on the MassDevice website calls it ?the year of the layoff.?

Some of the medical device industry?s biggest companies announced significant workforce reductions in 2012, often in attempts to cut costs ahead of the medical device tax, which went into effect this year.

Medical device company Stryker, for example, planned to reduce its workforce by 5 percent throughout last year due to an anticipated $150 million in medical device tax compliance costs. According to a recent roundup article of industry layoffs on the MassDevice website, the impending tax also played a role in Hill-Rom Holdings? decision to lay off 200 workers, which amounts to 3 percent of its workforce.

Yet others, such as Covidien and St. Jude Medical, downplayed the role the tax played in their job cuts and outsourcing. John Heinmiller, a vice president at St. Jude Medical, described the medical device tax as just one of many financial pressures facing the business.

How Might The Medical Device Tax Spur Interest In New Collaborative Tools?

Using Collaborative Tool to help minimize the impact of the Medical Device Tax.?

As companies continue to deal with the impact of the medical device tax, new technologies and applications can help reduce or eliminate the negative effects. New collaboration capabilities in CRM, SharePoint, Yammer and even Office make it easier than ever to increase productivity of all teams. Teams that can collaborate and help each more effectively can handle high volumes of activities with higher quality.

medical-device-tax | Photo Courtesy of SalFalko http://www.flickr.com/photos/safari_vacation/5961260280/sizes/q/

The 2.3 percent?medical device tax?that went into effect this year has prompted significant layoffs in the industry. This means those still employed are being asked to do more with less.

In 2012, U.S. medical device and diagnostics companies laid off more than 5,000 workers, and employees worked longer hours for shrinking bonuses and stagnant salaries, according to survey results reported on the Medical Device and Diagnostic Industry website.

With many positions eliminated, respondents reported working a median of 50 hours of work per week (up from 48 in 2011), while compensation remained flat.

?The 40-hour work week in the medical device industry is a thing of the past,? says Tom Johasky, general manager and president of Medical Device Recruiters. ?Because of economic conditions, companies are asking their employees to do a heck of a lot more than what they?ve ever done.?

FDA/CMS Announce Long Delayed Ruling on Sunshine Act

As some of you may know, the FDA/CMS (Centers for Medicare and Medical Services) have been (very) late in issuing their final ruling as to when physician Sunshine Act reporting will begin. Those of you who follow me via Twitter and on the i3 Community site know that I’ve been posting updates about the Sunshine Act compliance deadlines and extensions communicated by the FDA and CMS since December of 2011 (http://i3.infinityinfo.com/blogs/tags/tag/sunshine-act).

Well, they finally made their decision today and released the details the life science industry has anxiously been awaiting – http://www.modernhealthcare.com/article/20130201/NEWS/302019903?AllowView=VW8xUmo5Q21TcWJOb1gzb0tNN3RLZ0h0MWg5SVgra3NZRzROR3l0WWRMWGJWdjBBRWxiNUtpQzMyWmVwNTMwWUpieWk=.

In a rare act of kindness, the CMS has provided manufacturers and GPO?s a bit of extra time to get things in order. By law, manufacturers and GPO’s were only required to provide a 3 month notification of when data collection should begin, however, they have now given 6 months notice.

Starting August 1, 2013, drug and device companies will be required to collect data about payments, gifts and other transfers of value given to physicians and teaching hospitals (greater than $10). This final ruling also requires manufacturers and GPOs to report the first round of data collection to the CMS by March 31, 2014. Data must be submitted annually by the 90th day of each calendar year thereafter.

What does this mean? Companies that have not yet implemented a solution for meeting the reporting requirements of the law now have a bit of breathing room, although not much. Microsoft Dynamics CRM provides an excellent platform for adding functionality that will allow companies to more easily meet these requirements – Infinity would love to show you how!

If you have any questions or would like to discuss further, please don’t hesitate to reach out to me at mhammons@infinityinfo.com.

September 14, 2012

Sunshine Act Update – September 2012

Back in December of last year and May of this year I wrote a couple of blog posts about the Sunshine Act compliance deadlines and extensions communicated by the Centers for Medicare & Medicaid Services (CMS).

If you?ve been wondering what?s happening with the final decision on Sunshine Act deadlines, you are not alone.

Sen. Richard Blumenthal (D-Conn.) was quoted this week criticizing the still vague time frame of when CMS expects companies to start reporting (sometime in 2013 is still the official answer). See article in Modern Healthcare.

So no details yet, however, the law requires allowing 90 days for the companies to prepare and the collection of data through the next January before reporting it publicly in March.

Infinity attends a lot of healthcare, pharmaceutical, biotech and medical device events and we hear there are quite a few organizations that don?t have a system or process in place yet. There is a little time left but we advise organizations to be ready for this as soon possible. Let us know if you need help.

May 17, 2012

Texas Medical Association Says Scrap ICD-10

Texas doctors, through the Texas Medical Association, submitted comments to HHS (Department of Health and Human Services) recommending HHS scraps the implementation of ICD-10 completely. (International Statistical Classification of Diseases and Related Health Problems, 10th Edition).

Original article: Healthcare business news and research ModernHealthcare Article – Texas Suggests Scrapping ICD-10

The Texas Medical Association makes some really good points.

ICD-10 has been around since the mid-1990?s and the US is just now getting around to ?officially? adopting them. Given that that ICD-11 is due in 2015, and the costs/benefits of going to ICD-10 are minimal vs. going straight to ICD-11, it?s just makes sense to go straight to ICD-11.
ICD-11 is being revised using Web 2.0 principles and designed specifically for incorporation into electronic medical health records.
Given that it?s taken more than 20 years to move from ICD-9 to ICD-10, this makes even more sense. Why adopt ICD-10 just in time to be replaced with a better standard?

Another great point, ?HHS should recognize that the costs of going to ICD-11 directly are less than incurring the remaining costs of implementing ICD-10 in 2013 and then implementing ICD-11 sometime soon thereafter.”

TMA is not alone as the American Medical Association, a host of state medical groups and medical specialty societies, submitted their own comments calling for at least a one-year delay in ICD-10 implementation.

One can always hope for common sense to prevail, can?t they? In any case, the implementation deadlines are looming and the US will be moving to a new standard; are you ready?

May 9, 2012

Update on Sunshine Act Compliance Deadlines

Back in December I wrote a blog post about the Centers for Medicare & Medicaid Services (CMS) rule change for reporting on the Physicians Payment Sunshine Act. Original post here: http://i3.infinityinfo.com/blogs/entry/sunshine-act-compliance-deadlines-extended

The CMS had decided to extend the data collection start date from January 1, 2012 to ?some later date?. A few days ago, on May 3, the CMS provided some updated information in their blog (The CMS Blog). During the extended comment period they received over 300 comments. that?s a good thing that people are voicing their concerns.

The CMS still hasn?t issued a final date but says in their blog ?CMS will not require data collection by applicable manufacturers and applicable group purchasing organizations before January 1, 2013? and ?CMS intends to release the final rule later this year?.

Some news is better than no news. The window is closing though for companies that will be required to report this information to the FDA. Time is ticking. We have helped a number of companies ensure their systems and processes are up date and compliant. If you are struggling with these rules, give us call, we are happy to help you too!

April 11, 2012

HHS Announces New Compliance Dates for ICD-10

In February this year we heard that Health and Human Services (HHS) was going to delay implementing ICD-10 diagnostic codes (International Statistical Classification of Diseases and Related Health Problems, 10th Revision, or ICD-10). At that time HHS did not announce a new date. You can read more from my related blog post here.

Yesterday, April 9, HHS posted that Healthcare Practitioners and Organizations would have until October 1, 2014 ? providing another year for compliance.Change to the Compliance Date for ICD-10-CM and ICD-10-PCS Medical Data. The deadline was extended in response to physician complaints about the administrative burden of converting to ICD-10.

In 2009, the Centers for Medicare and Medicaid Services (CMS) ordered the change from the ICD-9 code set, which is now in use, to ICD-10, as part of implementing the Health Insurance Portability and Accountability Act. The American Medical Association (AMA) would prefer that HHS implements a more physician friendly replacement, however, HHS has spoken?and so it shall be. Public comments about the proposed regulations will be accepted for 30 days from publication in the Federal Register. Submit your comments to be heard.

I?m not yet convinced a change from approximately 13,000 diagnostic codes used today, to more than 68,000 codes are going to ?improve the quality of care? and “lead to improved accuracy for reimbursement for medical services, fraud detection, and historical claims and diagnosis analysis.” In my experience, simplification (remember KISS) is the better approach. We shall see.

At least there is some common sense in this decision and gives Healthcare Practitioners a little breathing room. A year goes by very quickly though, so no time to rest for the weary.

April 2, 2012

iPharma Connect Conference?The New Commercial Model

The 11th Annual iPharma Connect Conference was held last week in Philadelphia. This year?s theme was ?Digital Innovation for Marketing Decision Makers in the Life Sciences Industry?. I will share some notes on the conference and key trends and ideas that might provide you some value as well.

At its core, digital marketing is about making connections. For Pharma, Bio and Device manufacturers, this is defined by connections with patients, physicians and payers.

Hot Sessions for 2012 Include:

Keynote address by POZEN?s Chief Commercial Officer on the changing pharma commercial model
Regulatory update on the implications of FDA?s guidance for mobile medical applications
A physician?s perspective on preferred digital channels
Case study for online support systems and today?s patients
Industry panel on war stories and lessons learned from non-effective digital marketing campaigns
Best practices for implementation of multi-channel closed loop marketing capabilities

Keynote Address: The Old Model Just Won?t Cut It ? The Revolution of the Traditional Pharma Commercial Model

The Opening Keynote was kicked off with Liz Cermak, EVP and Chief Commercial Officer of Pozen, Inc., formerly WorldWide VP of Johnson & Johnson. The bottom line is the old model won?t cut it. The days of sample drops and focus on call volume are over or should be). We are now in the midst of the revolution of the traditional pharma commercial model. This echo?s what we have been hearing from the majority of our clients. Highlights include:

Rep access declining rapidly even when allowed office access, gets harder every day
25 percent of physicians are inaccessible, and growing
Sales rep headcount down 26 percent from 2005 peak, today around 75,000
Physicians are now embracing digital
9 of 10 feel one access improves quality care
82% of physicians have smartphones
64% own tablets
Physicians & Patients are seeking more information online

The patient shift has gone from getting information direct from the physician to participatory medicine and coupling your own information from online and community sources with the physician. This shift will continue as patients become more responsible for their own care. I can affirm this as I had a recent healthcare event (I?m fine now) where my physician directed us to online communities for more detailed information about the condition and even said to just ?Google it? one time.

The other major shift is on social. The healthcare industry has been reluctant to embrace it, largely due to regulatory uncertainty. The challenge is, social is happening with or without the industry, so it?s time to jump in. Sidenote: I blogged about the recent FDA Guidance on Social Media, click here. A little more on the social revolution in Healthcare:

It?s a Social world whether we like it or not.
Social accounts for 1 out of every 6 minutes sent online, and growing rapidly.
61 million people use mobile phones for health info in the US.
More than 25 billion pieces of content (web links, news stories, blog posts, notes, photo albums, etc.) are shared each month.
There are currently over 133 Million blogs.
Over 50 Million tweets per day.
YouTube receives more than 2 Billion (with a B) viewers per day.
Digital is the audience connector.

Success in this new model requires:

Customer centric behavior
Consistent messaging and sharing
Audience engagement
Efficient organization workflow

Addressing the new commercial model, Liz described six tenets of the new commercial model

1. Fish where the fish are.

The new model requires pharma to have customer centric behaviors.

2. Shift personal selling to physician centric selling

Expand and use digital sales toolkit.
Provide sources and access to digital and mobile medical information
Use eDetails and live chat.
Shift rep focus to services, right now services are only at 5 percent, must include multi-channel capabilities.

3. Make it relevant to your audience

79 percent of physicians watch video clips on lectures and drug info.
Physicians are interested in connecting beyond the office visit, e.g. digitally, 1:1 presentations.
Pharma must be perceived as trusted partner along the patient health journey, nearly half of all Americans look up health info online, general health and social are high and growing, be part of those interactions.
Gamification is a trend and new behaviors, provides greater chance of improved patient adherence and disease management, makes it more engaging and fun.

4. Facilitate patient and physician connectivity

Previously was more about physician to pharma connectivity
Current use in digital communication is email, secure messaging, online video conferences
Patients are driving the physician relationship shift

5. Social is possible and without fear

The train has left the station.
Social Health issued by 30 percent of population.
Challenge is how to engage and be relevant.
Regulation has paralyzed the industry.
Must balance risk and benefit.
Resulted in >2 Million people screened for COPD, >60 Million impressions.

6. Fully integrated multi channel marketing is now

Communicate consistently and beyond the pill.
Digital marketing is growing rapidly, 2012 digital spend is forecast at 18.9% of major media spend, which is over $39 Billion.
Market research, planning, partnerships, advertising, direct response, CRM, social, mobile, must all be included.
E.g. Drive4COPD campaign, used social media channels (Facebook, Twitter, Email, Digg, etc.) and traditional marketing (magazine ads, banner ads, direct mail).

I have to say, in my experience, Liz hit it out of the park with these tenets. The magic if the internet has empowered patients and physicians alike. The technology shift is happening rapidly. My grandmothers next phone will be a smartphone because she wants to ?surf the net?. Instant access to information is becoming the norm. Organizations and representatives both must adapt with these changing realities. The new commercial model must do all of the six tenets?and then some.

March 7, 2012

FDA Updates Social Media Guidelines for Pharmaceutical and Medical Device Industry

The FDA recently announced (some) updated social media guidelines for pharmaceutical and medical device firms. The actual title of these guidelines are ?Guidance for Industry: Responding to Unsolicited Requests for Off-Label Information About Prescription Drugs and Medical Devices?.

This is still considered Draft Guidance and is an update to previously released guidance. This is, however, the first time the FDA mentions ?emerging electronic media? with specific examples related to YouTube and Twitter.

The full FDA Draft Guidance can be downloaded here: http://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM285145.pdf

The document is fairly short (12 pages), by government standards, and I highly recommend you read the whole thing if you are responsible for sales, marketing or customer service for pharmaceuticals or medical devices.

I will point out some important bits below, particularly, related to responses as outlined in the FDA document. This is particularly important for maintaining compliance and is a great example of why CRM systems are very important for social media interactions and staying compliant with regulations.

V. RESPONDING TO NON-PUBLIC UNSOLICITED REQUESTS FOR OFF-LABEL INFORMATION DIRECTED TO DRUG OR MEDICAL DEVICE FIRMS

1. Information distributed in response to an unsolicited request should be provided only to the individual making the request directly to the firm as a private, one-on-one communication.

2. Information distributed in response to an unsolicited request should be tailored to answer only the specific question(s) asked.

3. Information distributed in response to an unsolicited request should be truthful, non-misleading, accurate, and balanced.

4. Information distributed in response to an unsolicited request should be scientific in nature.

5. Responses to unsolicited requests for information should be generated by medical or scientific personnel independent from sales or marketing departments.

6.. Information distributed in response to an unsolicited request should be accompanied by the following:

A copy of the FDA-required labeling, if any, for the product (e.g., FDA-approved package insert and, if the response is for a consumer, FDA-approved patient labeling or, for new animal drugs, FDA-approved client information sheet)
A prominent statement notifying the recipient that FDA has not approved or cleared the product as safe and effective for the use addressed in the materials provided
A prominent statement disclosing the indication(s) for which FDA has approved or cleared the product
A prominent statement providing all important safety information including, if applicable, any boxed warning for the product
A complete list of references for all of the information disseminated in the response (e.g., a bibliography of publications in peer-reviewed medical journals or in medical or scientific texts; citations for data on file, for summary documents, or for abstracts)

7. A firm should maintain the following records:

The nature of the request for information, including the name, address, and affiliation of the requestor
Records regarding the information provided to the requestor
Any follow-up inquiries or questions from the requestor

VI. RESPONDING TO PUBLIC UNSOLICITED REQUESTS FOR OFF-LABEL INFORMATION, INCLUDING THOSE ENCOUNTERED THROUGH EMERGING ELECTRONIC MEDIA BY DRUG OR MEDICAL DEVICE FIRMS

1. If a firm chooses to respond to public unsolicited requests for off-label information, the firm should respond only when the request pertains specifically to its own named product (and is not solely about a competitor?s product).

2. A firm?s public response to public unsolicited requests for off-label information about its named product should be limited to providing the firm?s contact information and should not include any off-label information.

The firm?s public response should convey that the question pertains to an unapproved or un-cleared use of the product and state that individuals can contact the medical/scientific representative or medical affairs department with the specific unsolicited request to obtain more information.
The firm?s public response should provide specific contact information for the medical or scientific personnel or department (e.g., e-mail address, telephone number, facsimile) so that individuals can follow up independently with the firm to obtain specific information about the off-label use of the product through a non-public, one-on-one communication.

The customer service module within Dynamics CRM is particularly well suited to helping your team monitor, respond, and document social media interactions. We have a lot experience helping companies maintain compliance with regulations using CRM. If you need help, just call or fill out the request below and let us know.