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The Sunshine Act

What is the "Sunshine Act"?

"Sunshine Act" is shorthand for The Physician Payments Sunshine Act (also known as section 6002 of the Affordable Care Act of 2010), a U.S. federal law. It requires medical product manufacturers and distributors to record and disclose to the Centers for Medicare and Medicaid Services ("CMS") any payments or other "transfers of value" made to doctors or teaching hospitals located or conducting activities in the U.S. or its territories.

The purpose of the Sunshine Act (and similar state "sunshine" laws) is to make patients aware of the financial relationships between Health Care Provider (HCP) doctors/teaching hospitals and medical product manufacturers and distributors.

The Sunshine Act went into effect in 2013.

Does A-dec support the Sunshine Act?

Yes, A-dec supports transparency and submits requisite information to the CMS.

Is the information submitted by A-dec to the CMS made available to the public?

Yes, the information submitted by A-dec to the CMS is made available to the public June of every year via the CMS https://openpaymentsdata.cms.gov/ website.

Does A-dec report any of the information to the IRS?

No, A-dec reports the requisite information to the CMS only. Please consult your tax advisor with any tax-related questions.

What is a payment or other "transfer of value"?

All of the following payments or other "transfers of value" must be reported to the CMS:

  • General payments made by medical product manufacturers or distributors to doctors or teaching hospitals – cash and cash equivalents, in-kind items or services, consulting and speaker fees, gifts, honoraria, travel and entertainment expenses, meals, education, donations, and grants.
  • Ownership or investment interests of doctors (or immediate family) or teaching hospitals in medical product manufacturers or distributors. Note: several exceptions apply.
  • Research payments made by medical product manufacturers or distributors to doctors or teaching hospitals.

Are there any payments or other "transfers of value" that are not required to be reported to the CMS?

Yes, there are several exceptions, including (a) any payment of less than $10, unless payments total $100 in the aggregate over the course of a year; and (b) food and beverage provided to all participants of large scale conferences or meetings, product samples not intended for resale, discounts and rebates, educational materials intended for patients, devices loaned for the purposes of clinical trials, recall replacements, and warranty services.

What if my state already has similar "sunshine" or transparency laws?

The Sunshine Act reporting requirements preempt (or override) state laws and regulations that require disclosure or reporting of the same information required to be reported on the federal level, unless a state requires this information for reasons other than transparency. Additionally, states are permitted to require reporting of information that is different from the scope of the information reported to the federal government. Thus, different information relating to payments and transfers of value to doctors and teaching hospitals and information about payments to health care providers that are not doctors or teaching hospitals may still be reportable at the individual state level, generally based on where the health care provider is licensed or practices.

Are doctors and teaching hospitals afforded an opportunity to review and dispute information submitted by A-dec or other manufacturers or distributors before the information is made public?

Yes, if the doctor or teaching hospital is registered with the CMS. If the doctor or teaching hospital is registered, then each year from April 1 to May 15 they can review the information attributed to them. If they dispute the information, they must work with the reporting entity to resolve the dispute.

Who at A-dec should I contact if I have more questions?

Talk to your local dealer, your Territory Manager, or email us at sunshineact@a-dec.com. Also, the CMS Open Payments website provides an FAQ that may be helpful.