Compliance and Consequences

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The Do’s and Don’ts of Compliance in Medical Meetings

By Kaitlyn Wallace

Questions of medical ethics, pharmaceutical power, and intense government oversight may seem outside of the day-to-day work of modern meeting planners. After all, what business of ours is it if– for example– physicians choose to accept gifts from pharmaceutical and medical device companies, even if in exchange for a change in prescribing practices?

But as of September 30th, 2014– the date of the first payments recorded on the CMS Open Payments database, established in response to the 2010 Physician Payments Sunshine Act– it is our business. In fact, for meeting professionals who specialize or work with the life sciences industry, it became one of the most important aspects of our business, with consequences of noncompliance reaching into the millions of dollars.

The Sunshine Act

In 2010, the Physician Payments Sunshine Act was passed, mandating disclosure of any “transfers of value” (to use the language of the legislation) greater than $10 between pharmaceutical and medical device companies to healthcare providers (HCPs). These regulations were established largely in response to fears over the growing power and influence of pharmaceutical and medical device companies over the prescribing practices of physicians, seen to be accomplished primarily through large gifts, exorbitant speaker fees and luxurious travel and accommodations– all done outside of the public view. In order to minimize the growing power of big pharma, and to retain physician autonomy over prescribing practices, the CMS Open Payments database was established, which now displays these payments and other “transfers of value” as public record.

Despite the obvious positive ethical ramifications of this law– increased transparency and better incentives for ethical prescribing practices– this has created a logistical nightmare for health industry meetings and events, requiring an expanded role for the modern meeting planner, which must include data collector and compliance liaison to a wide variety of clients. And due to the stringency of these new requirements, the stakes have never been higher. So how can we, as meeting planners, do our part to ensure compliance? Why should we care about reporting “transfers of value,” and what are the consequences for failing to do so?

Varying Regulations

Compliance for the meeting planner is a slippery subject; it looks different with different clients, for different situations, and in different places. This means it is essential to stay up to date on compliance regulations– and not just in the area of “transfer of value” reporting. The healthcare industry is subject to a wide variety of codes in areas such as privacy and ethics, including HIPAA (the Health Insurance Portability and Accountability Act, which is largely concerned with privacy) in the United States and GDPR (General Data Protection Regulation, concerned with protecting patient data) and the EFPIA Code (the European Federation of Pharmaceutical Industries and Associations Code, concerned with transfers of value from pharmaceutical and medical device companies to HCPs, much like the Sunshine Law in the US) in the EU. Further, codes vary by country: 88 countries currently have regulations in place to oversee transfers of value between pharmaceutical and medical device companies and HCPs, and most outline violations that are punishable by fines.  In addition to the many different codes which vary from country to country, medical meeting planners must be aware that some states enforce compliance laws more stringently than others.

Though medical meeting planners should be following best practices in all locations, planners should be particularly careful in states such as Vermont, which is regularly cited as the gold standard for compliance in the United States. As Pat Schaumann, President of Schaumann Consulting Group, LLC., and author of Breaking the Code to Healthcare Compliance explained: “I don’t think anyone is giving it a blind eye. What does differ is how much they are enforcing.” In order to ensure compliance with local, national, and international standards, meeting planners must now become experts in detailed and difficult legislation regarding both privacy and expense reporting.

This might seem like an impossible task. After all, we are not lawyers or politicians– how can we be expected to enforce the law when the law itself is so highly variable? The good thing is this: in general, meeting planners will not be fined for failing to comply with Sunshine Act regulation; this burden usually falls on the sponsor or client (usually a pharmaceutical or medical device company). This means that the job of the meeting planner is to assist our clients in remaining compliant primarily through data tracking and strict adhesion to budget. Meeting planners must coordinate with each individual client in order to execute their compliance standards, which, though regulated by the same legislation, often vary widely in their stringency.

As Peter Lahr, Vice President of Scarritt Group (an international meeting planning company specializing in the medical meetings) explains, “Sponsors often have their own specified spend caps that are more aggressive than the ruling government.” To this end, every aspect of meeting planning must be reviewed with scrutiny, including routine expenses such as speaker fees, travel and accommodation, meals, and sponsor giveaways– all of which must be broken down by HCP recipients under Sunshine Law and reported. Peter Lahr elaborates: “Everything from putting together the right budget, negotiating the right costs and staying on budget during execution are critical.” Tracking these “transfers of value” for each HCP and reporting them accurately (and on time) is detailed and often time-consuming work, but is essential to helping your client remain compliant. Missing one step could put your client at risk for heavy fines.

Remaining Compliant

This is the most important role of the modern medical meeting planner: helping your client avoid the heavy fines that come with stringent enforcement of the Sunshine Law. Data must be reported accurately and on time in order to avoid these fines. One unintentional offense can cost your client between $1,000 and $10,000. An offense committed knowingly can cost $10,000 to $100,000. These ranges cover only single offenses; multiple offenses can increase fines into the millions. As Pat Schaumann reminds us: “Compliance is not a choice. It’s the law.”

We must also consider the ethical and professional problems with noncompliance. The Sunshine Law was enacted in the first place to combat what some saw to be overreach of pharmaceutical power into physician prescribing practices. Like all concerned citizens, we want to do our best to ensure that our HCPs can provide the highest standard of care, unencumbered by financial and personal interests. Despite being an unintended side effect of legislation meant to regulate an industry outside our own, we should do our part in allowing Open Payments to do its job as an agent for transparency and ethical prescribing practices. As Pat Schaumann summarizes: “There are ethics tied into all our businesses. It’s within everyone’s interests to follow best practices. We have to remember that we are not only representing our companies and our clients, but we are also representing ourselves.”

And finally, the professional point of view– it is always essential to help our clients retain a high degree of trust and professionalism. With medical meetings, however, this responsibility is heightened further. As Peter Lahr emphasizes, “Confidence and trust levels with patient and medical teams are greatly impacted by compliance reputation. Noncompliance has a huge negative impact on those trust and confidence levels. This is the biggest price to pay for noncompliance.”

Meeting planning is a hectic enough industry as it is. Between coordinating vendors, communicating with clients, and making sure everything goes off without a hitch, meeting planners have enough to balance without dealing with detailed regulations and intense government oversight. But for medical meeting planners, compliance must become a routine part of the job; the stakes for our clients are just too high. And as Pat Schaumann reminds us: “This is here to stay. This is not a fad. Use common sense when planning for the medical industry.”

Kaitlyn Wallace is a contributing writer from St. Louis.

For more information, see:

Breaking the Code to Healthcare Compliance, by Pat Schaumann