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Clarifying Confusion in the Physician Payment Sunshine Act

November 06, 2014

Confusion in the PPSA

Today we are going to be clarifying issues related to the PPSA, or Physician Payment Sunshine Act. The CMS issued its final rule with comment period on the PPSA on Friday, October 31st. Most of the 1185 pages in the final rule deal with other issues; however, seven of those pages (589-596) deal with CME directly. Since its release news reports and even one long time CME consultant have been confused by the final rule and have reported misinformation, such as “the CME exemption for sunshine reporting has ended.” However, that is not true and not the case with the final rule. So let’s clear up the confusion with three important takeaways.

CME Exemption when three conditions met

The proposed rule allowed for CME payment exemption only when three conditions are met: •Accredited activity fell under one of a small number of accreditation boards (ACCME, AAFP, and others) •The manufacturer did not pay the speaker directly •The manufacturer did not select the speaker

Exemption for CME payments in two areas

The exemption for accredited CME payments was set forth in two different areas in the proposed final rule: 403.904(g) and 403.904(i). Now, it’s important to note that the (g) section lists the approved accreditation boards mentioned above. The (i) section defines what are called indirect payments that are excluded from reporting under the PPSA. CMS wants to remove the (g) section in its final rule, because they believe it’s duplicative of a lot of the information in the (i) section, and because they do not want to play favorites with one accreditation board over another.

Major confusion in the final rule

CMS states in one section of the rule that payments that don’t meet the definition of “indirect payment” both need to be reported and are at the same time “not reportable.” So clearly there is still some confusion even at CMS.

Ruling clear in several areas

However, the rule is clear in several areas and the big takeaway is from the following quote in the final rule:
When an applicable manufacturer …provides funding to a continuing education provider, but does not either select or pay the covered recipient speaker directly, or provide the continuing education provider with a distinct, identifiable set of covered recipients to be considered as speakers for the continuing education program, CMS will consider those payments to be excluded from reporting under §403.904(i)(1).
As well, in the preamble to the final rule, CMS explained:
If an applicable manufacturer conveys “full discretion” to the continuing education provider (they let the accredited provider do their jobs) those payments are outside the scope of the rule (78 FR 9492)

Final takeaway

There is still some confusion about whether accredited nursing, pharmacist, and other CME will be covered by the exemption. Overall though, this is a win for accredited CME and patients alike. As always, if you have any questions about CMS proposed final rule, or any other CME related questions, feel free to contact us here.