The Centers for Medicare & Medicaid Services (“CMS”) recently released guidance on its website describing a two-phase process for applicable manufacturers and group purchasing organizations (“GPOs”) to register and submit data collected from August 1, 2013 through December 31, 2013, relating to their financial relationships with physicians, dentists and teaching hospitals pursuant to the federal Physician Payments Sunshine Act (“Sunshine Act”). Phase 1 data must be submitted by applicable manufacturers and GPOs by March 31, 2014.

Data reporting for the inaugural payment year under the Sunshine Act has begun. On February 18, 2014, Phase 1 for registration and data submission to the CMS Open Payments program for applicable manufacturers and GPOs opened. The Sunshine Act was passed as part of the Patient Protection and Affordable Care Act, and included the National Physician Payment Transparency Program, known as the “Open Payments” program. Under the Sunshine Act, certain manufacturers of drugs, devices, biologics, or medical supplies covered by Medicare, Medicaid or CHIP must annually report specific direct and indirect payments or transfers of value that they make to physicians, dentists and teaching hospitals. In addition, applicable manufacturers and GPOs must report certain ownership interests held by physicians, dentists and their immediate family members. CMS will post reported information on a publicly available website. The final regulations implementing the Sunshine Act were the topic of a prior Saul Ewing Client Alert, which may be found here.

Phase 1 will run from February 18, 2014 through March 31, 2014. During Phase 1, applicable manufacturers and GPOs must register in CMS’s Enterprise Portal and submit 2013 payment data in specified formats. Only an entity’s executive-level officer that can legally represent the organization may complete the initial registration. The executive officer may, however, delegate another individual to perform the data submission. The 2013 data includes information collected from August 1, 2013 through December 31, 2013. By registering, the submitting entity will be given a user ID, which is to then be used for any future data submissions. Entity profile information will have to be updated and validated in each subsequent reporting year.

According to CMS, once the 2013 data has been submitted in Phase 1, the Open Payments Help Desk will reply directly to the submitting entity, and advise whether the submitted data meets all requirements. If data is missing or in an improper format, CMS will provide information on correcting the submission.

Phase 2 is scheduled to begin on or about May 2014 and last for no less than thirty (30) days. During this phase, applicable manufacturers and GPOs will need to complete registration, confirm the accuracy of information submitted in Phase 1 and upload or enter, submit and attest to the accuracy of the 2013 payment data. CMS has stated that for the 2013 program year only, CMS will not enforce penalties for reporting noncompliance until after the close of Phase 2. CMS anticipates disclosing additional information regarding Phase 2.

The multi-phase approach to registration and data submission applies to the 2013 payment year only. CMS expects that for future payment years, registration will open annually on January 1 and close on March 31.

No action is currently needed or required of physicians, dentists or teaching hospitals except awareness that Phase 1 is underway. CMS has stated it will issue guidance for physicians, dentists and teaching hospitals relating to the data reviewing and correcting process.

Manufacturers and GPOs who are submitting data to CMS and providers who will be listed in the Open Payments database should confirm the accuracy of their information, as there may be increased scrutiny for this initial reporting period. Physicians, dentists and teaching hospitals should register in the Open Payments System so that they may review the accuracy of data submitted by applicable manufacturers and GPOs about them, and, if necessary, dispute any inaccurate information.

The underlying purpose of the Sunshine Act and Open Payments program is to increase transparency regarding the financial relationships between manufacturers, GPOs and providers and to discourage the development of inappropriate financial relationships.

More information regarding registration and data submission for the Sunshine Act is on CMS’ website here.