Since the enactment of Open Payments (Sunshine Act), Life Sciences organizations have faced the daunting task of collecting, verifying, and reporting compliance-related spend. The necessary tracking is time-consuming and can be error-prone, leaving exposure to risk.
Penalties for willful or fraudulent reporting to the Centers for Medicare and Medicaid Services (CMS) under the Open Payments program can range from $10,000 to $100,000 per expense report line item.
Life Sciences companies are required to report to CMS any direct or indirect payment or other Transfers of Value (ToV) provided to a Covered Recipient or any payment provided to a third party on behalf of a Covered Recipient during a calendar year. ToVs are broadly defined and can include expenses ranging from simple meals to speaker’s fees to stock options. Companies are required to capture the specifics of expenses that are reportable, including who the ToVs were provided to, the type of expense, amount of expense, form and nature of payment, and related drug or device information.
To reduce the chance of penalties and fines, organizations have been going to great lengths to track transactions and incorporate controls in their spend management systems. Additionally, due to the public nature of Open Payments data, the amount spent on physicians is often cited in the press and can fuel litigation in the age of the opioid epidemic, so reporting only what is required is a priority for many manufacturers.
The expanded scope of the Sunshine Act is a material change to the number and types of Health Care Practitioners (HCPs) that Life Sciences organizations need to track. In 2019 alone, 615,000 physicians received over $2B in general payments and more than $71.5M in research payments. Now more than ever, organizations need to review and strengthen their HCP processes and make sure the tools they use to track HCP spend are robust, evolving, and ready for the 2021 shift.
On October 24, 2018, President Trump signed the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (SUPPORT Act) that amended the definition of a “Covered Recipient” in Open Payments. On Friday November 1, 2019, CMS issued its final rule implementing this change for data collected in 2021 to be reported in 2022:
Note: For simplicity, we will refer to the NP, CNS, CRNA, and CNM providers collectively as Advance Practice Registered Nurses (APRN) for the balance of this article. CMS recently issued guidance classifying PAs and APRNs as Non-Physician Practitioners (NPP).
These are the first significant changes to the Open Payments program since reporting started in 2013. Capturing and reporting expense transactions for required HCPs is an already complex process for Life Sciences organizations, and the addition of NPPs will only increase this complexity. Internal systems, data management, policies, and training will all need to be updated to support the changes to the Open Payments program.
The number of licensed physicians in the United States has been declining and this trend is expected to continue. Conversely, there has been steady growth in the number of licensed NPPs, along with expanded scope of practice and prescribing authority for these professions. Due to these changes, Life Sciences companies interact with NPPs in the same manner as physicians. The difference, up until 2021, is that these interactions were not reportable at the federal level.
Including NPPs will increase the number of possible reportable HCPs by 350k – 400k individuals.
The number of licensed NPPs in the US is only part of the challenge. For example, licensing of APRNs varies from state-to-state. Some states use the APRN Consensus Model, which standardizes education, accreditation, certification, and credential identifiers across their member states - but many do not. This inconsistency results in more than 400 variations of state license credentials for APRNs. Another complication is how states identify RN vs. APRN licenses and which version of the nursing license is reporting in the NPI record. Here are a few examples:
A recent analysis by MedPro Systems identified wide variations in the license or licenses APRNs reported in their NPI records; some only reported an APRN license, some only reported a RN license, and some reported multiple licenses.
We also anticipate changes to existing state and local reporting due to preemption which mandates that federal laws take precedence over state and local laws. States will either have to remove or change in some meaningful way their reporting requirements for NPPs.
The bottom line is that Life Sciences organizations will have thousands of additional HCPs to track and will need to manage the complexity of identification, licensing, and certification differences by state, in addition to the sheer increase in the volume of transactions to be reviewed. Here are five steps to take now to make sure you’ll be ahead of the game:
The upcoming expansion of the Sunshine Act will only increase the burden of capturing and reporting accurate HCP data especially as the volume of transactions that need to be captured increases - making it clear the importance of preparing for the added complexity today.
The MedPro Concur Connect suite of solutions currently supports over 400 Life Sciences companies with accurate HCP data in Concur Expense and Concur Invoice, with seamless integration to any Aggregate Spend reporting solution. NPP license capture is fully supported across the MedPro Concur Connect suite, allowing customers to effortlessly adapt to the upcoming expansion reporting requirements.
MedPro Systems has been closely following CMS’s implementation of these new requirements and has developed best practices for Life Sciences organizations to review and update their internal data processes to meet them.