On October 2, 2008, the Medicare Payment Advisory Commission (MedPAC) reviewed with Congress its draft recommendations regarding public disclosure of financial relationships between physicians and drug and device manufacturers, and physician ownership in hospitals, ambulatory surgical centers and other healthcare facilities. By way of background, MedPAC notes that such relationships are pervasive, that industry-physician ties have benefits and risks, that there have been efforts by the private sector and the government to regulate such relationships, and that five states and the District of Columbia currently require manufacturers to publicly report payments to physicians. Disclosures would include payments over $100 and relationships involving gifts, food, entertainment, honoraria, research, funding for educational conferences, consulting fees, investment interests, and product royalties. Excluded would be discounts, rebates, and free samples for patient use.

The advantages of a national database on physician-industry relationships, according to MedPAC, include discouraging inappropriate financial relationships, allowing the media and researchers to shed light on such relationships, providing payers and plans the opportunity to examine whether industry ties affect physicians' practice patterns, making it easier for academic medical centers to verify financial relationships of researchers, and giving hospitals the ability to check if physicians involved in purchasing decisions have financial ties which might influence those purchasing decisions. However, MedPAC noted that compliance would be costly for manufacturers and there would be administrative costs for government. Moreover, disclosures might discourage beneficial arrangements, likely would not eliminate conflicts of interest, and the information might be of limited use to patients.

MedPAC suggests that the Centers for Medicare and Medicaid Services (CMS) issue a report on the prevalence of non-ownership financial relationships such as leasing and compensation arrangements between healthcare facilities and physicians. This report would draw from CMS's proposed Disclosure of Financial Relationships Report from a sample of 500 hospitals. Noting how difficult it is for payers and researchers to obtain information on ownership and financial relationships, MedPAC says it is important to understand how financial ties affect referrals, quality, and costs.

Many issues remain to be discussed at future MedPAC meetings. But it appears public disclosures of financial relationships may be one more tool that CMS will utilize to eliminate any improper influence on physician decision making.