Today, the Centers for Medicare and Medicaid Services (CMS) has issued updated guidance that further clarifies the Sunshine Act exemption for continuing medical education (CME). Specifically, in updated Frequently Asked Questions (FAQs) addressing the reporting of indirect payments related to CME (see here for the underlying Final Rule), the agency has clarified that applicable manufacturers subject to Sunshine Act reporting are only required to report CME-related payments to covered recipients if the reporting entity: (1) determines the payment or transfer of value meets the definition of an indirect payment at 42 C.F.R. § 403.902; and (2) if it does meet the definition, must report the payment if the applicable manufacturer knows or has the ability to determine the identity of the covered recipient during the reporting year or by the end of the second quarter of the following reporting year.
In simple terms, if a manufacturer does not condition its financial support of a CME program on the participation of particular physician speakers or faculty, and does not otherwise pay such physicians directly, these payments are excluded from reporting under the indirect payment rules. With respect to physician attendees at CME programs, CMS articulated that a manufacturer would only be required to report the subsidized tuition fee for a CME event if the manufacturer required, instructed, directed or otherwise cause the tuition to go to a specific physician attendee. Thus, CMS concluded that “payments or other transfers of value, including payments made to physician covered recipients for purposes of attending or speaking at continuing education events, which do not meet the definition of an indirect payment,… are not reportable.” Further, CMS emphasized that CME-related payments would not be reportable regardless of whether the manufacturer learns the identity of the covered recipient in the allotted timeframe because the payment or transfer of value did not meet the definition of an indirect payment.
In practice, this guidance confirms that applicable manufacturers may continue to exclude from Sunshine Act reporting grants made to ACCME-accredited CME providers because the ACCME mandates that commercial supporters (manufacturers) convey full discretion to the CME provider regarding physician speakers, faculty, and attendees. Applicable manufacturers likely will need to address whether other accrediting bodies impose similar requirements on a case-by-case basis to exclude such interactions from Sunshine Act reporting. Manufacturers that make CME-related payments directly to teaching hospitals likely must continue to report such payments as direct payments.
In practice, this guidance confirms that applicable manufacturers may continue to exclude from Sunshine Act reporting grants made to ACCME-accredited CME providers because the ACCME mandates that commercial supporters (manufacturers) convey full discretion to the CME provider regarding physician speakers, faculty, and attendees. Applicable manufacturers likely will need to address whether other accrediting bodies impose similar requirements on a case-by-case basis to exclude such interactions from Sunshine Act reporting. Manufacturers that make CME-related payments directly to teaching hospitals likely must continue to report such payments as direct payments.
