By way of a scant, one-page letter dated October 28th, Centers for Medicare and Medicaid Services (“CMS”) finally issued a belated response to the letter co-signed by Senators Chuck Grassley (R-Iowa) and Herb Kohl (D-Wis.) that demanded answers from CMS for its failure to issue the Federal Physician Payment Sunshine Act (“Sunshine Act”) regulations by the October 1st regulatory deadline. (See prior post: “CMS Called to Task for Missing October 1st Deadline.”) In addition to providing a tardy response, CMS Administrator, Donald M. Berwick, M.D., addressed CMS’ response letter solely to Senator Kohl stating that it would “also provide this response to the cosigner of your letter.” Further, the letter provided limited information in response to demands set forth in the Senators initial demand letter.
CMS pointed to President Obama’s Executive Order 13563 to defend its delay in releasing the proposed regulations. The January 18, 2011, Executive Order 13563 directed all Federal agencies to take steps to reduce regulatory burden. CMS claims it is “carefully reviewing” the statutory requirements of the Sunshine Act and “working hard” to implement the goals of the statute “while minimizing the burden on the regulated parties.” Among other things, CMS’ letter fails to provide a timeline for its issuance of the Sunshine Act regulations or any details of CMS’ prior allegation that it submitted the proposed regulations to the Office of Management and Budget for review. A large portion of CMS’ one-page response detailed the actions taken by CMS to “actively engage” stakeholders regarding CMS’ implementation of the Sunshine Act, which included one special Open Door Forum in March 2011, followed by one request for written feedback from participants of the same, and engaging others in the Health & Human Services Office of Inspector General for their input and assistance.
The Senators released the following comments following receipt of CMS’ meager response:
“The administrator’s response doesn’t tell us anything new. There’s no explanation for the delay and no indication of when to expect completion. It’s an inadequate response any way you look at it. Meanwhile, the U.S. government just settled with a medical device maker for $2.4 million over allegations of kickbacks to doctors to use the company’s products. The payments to doctors are the kind that might be prevented through disclosure as soon as the Sunshine Act is in place. The longer we wait, the more taxpayers miss out on the benefits. I’ll continue to press for answers from CMS.”
- Senator Chuck Grassley
“Given how straightforward and detailed the Sunshine Act provisions were, it’s troubling that the response to our letter would come a month late without any indication on progress, a timeline or what caused the delay. With medical device and pharmaceutical companies facing the January 1, 2012 deadline to begin collecting information about all payments to physicians, the lack of guidance leaves a great deal of uncertainty and I’m sure that’s why many of the affected companies have joined us in calling for swift implementation.”
- Senator Herb Kohl
We continue to eagerly await much anticipated regulatory guidance from CMS. And even without it, come January 1, 2012, life science companies will still be expected to begin capturing information for disclosure of interactions with physicians and teaching hospitals under the Sunshine Act. Will CMS shock industry and issue regulations prior to January 1st? We will just have to wait and see…