[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5605 Introduced in House (IH)]
110th CONGRESS
2d Session
H. R. 5605
To amend title XI of the Social Security Act to provide for
transparency in the relationship between physicians and manufacturers
of drugs, devices, or medical supplies for which payment is made under
Medicare, Medicaid, or SCHIP, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 13, 2008
Mr. DeFazio (for himself, Mr. Stark, Mr. Berry, Mr. Chandler, Mr. Moran
of Virginia, Mr. Hinchey, Mr. McGovern, Mr. Israel, Mr. Doggett, Ms.
Lee, Mr. Wu, and Mr. Kucinich) introduced the following bill; which was
referred to the Committee on Energy and Commerce, and in addition to
the Committee on Ways and Means, for a period to be subsequently
determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To amend title XI of the Social Security Act to provide for
transparency in the relationship between physicians and manufacturers
of drugs, devices, or medical supplies for which payment is made under
Medicare, Medicaid, or SCHIP, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Physician Payments Sunshine Act of
2008''.
SEC. 2. QUARTERLY TRANSPARENCY REPORTS FROM MANUFACTURERS OF COVERED
DRUGS, DEVICES, OR MEDICAL SUPPLIES UNDER MEDICARE,
MEDICAID, OR SCHIP.
Part A of title XI of the Social Security Act (42 U.S.C. 1301 et
seq.) is amended by inserting after section 1128F the following new
section:
``SEC. 1128G. QUARTERLY TRANSPARENCY REPORTS FROM MANUFACTURERS OF
COVERED DRUGS, DEVICES, OR MEDICAL SUPPLIES UNDER
MEDICARE, MEDICAID, OR SCHIP.
``(a) Reporting of Payments or Other Transfer of Value.--On January
1, 2009, and the first day of each fiscal year quarter beginning
thereafter, each manufacturer of a covered drug, device, or medical
supply who provides a payment or other transfer of value, directly,
indirectly, or through an agent, subsidiary, or other third party, to a
physician; to an entity that a physician is employed by, has tenure
with, or has a significant ownership interest in; or to a covered
organization in which a physician has a significant professional
membership interest, shall submit to the Secretary, in such electronic
form as the Secretary shall require, the following:
``(1) The name of--
``(A) the physician;
``(B) if a payment or other transfer of value was
provided to an entity that the physician is employed
by, has tenure with, or has a significant ownership
interest in, the name of the entity; and
``(C) if a payment or other transfer of value was
provided to an organization so specified in which the
physician has such a significant professional
membership interest, the name of the organization.
``(2) The address of--
``(A) the physician's office;
``(B) in the case of an entity required to be named
under paragraph (1)(B), the primary place of business
or headquarters for the entity; and
``(C) in the case of an organization required to be
named under paragraph (1)(C), the primary place of
business or headquarters of the organization.
``(3) The facility with which the physician is affiliated,
if any.
``(4) The value of the payment or other transfer of value.
``(5) The date on which the payment or other transfer of
value was provided.
``(6) A description of the nature of the payment or other
transfer of value, indicated (as appropriate for all that
apply) as--
``(A) compensation;
``(B) food, entertainment, or gifts;
``(C) trips or travel;
``(D) a product or other item provided for less
than market value;
``(E) participation in a medical conference,
continuing medical education, other educational or
informational program or seminar, or funded research
(such as lab-based, epidemiology, or health services
research) that is not a clinical trial; provision of
materials related to such a conference, educational or
informational program or seminar, or research; or
remuneration for promoting or participating in such a
conference, educational or informational program or
seminar, or research;
``(F) product rebates or discounts;
``(G) consulting fees or honoraria;
``(H) dividend, profit distribution, stock or stock
option grant, or any ownership or investment interest
held by a physician in a manufacturer (excluding a
dividend or other profit distribution from, or
ownership or investment interest in, a publicly traded
security and mutual fund (as described in section
1877(c)); or
``(I) any other economic benefit, as defined by the
Secretary.
``(7) The purpose of the expenditure according to
categories specified by the Secretary, such as consulting,
education, royalty, and research.
``(b) Annual Summary Report.--Each manufacturer of a covered drug,
device, or medical supply that is required to submit information under
subsection (a) during a year shall submit a report to the Secretary not
later than December 31 of the year that summarizes, in such electronic
form as the Secretary shall specify, each submission of information
under subsection (a) made by the manufacturer during the year. The
summary report shall include the aggregate amount of all transfers of
anything of value that is less than $25, including any compensation,
gift, honorarium, speaking fee, consulting fee, travel, discount, cash
rebate, or services.
``(c) Reporting Date for Applicable Clinical Trials.--
``(1) In general.--Notwithstanding subsection (a), a
payment or other transfer of value made for the general funding
of a clinical trial described in paragraph (2) shall be
disclosed in the first quarterly report after the date clinical
trial information for such trial is required to be posted under
section 402(j)(2)(D) of the Public Health Service Act.
``(2) Clinical trial.--A clinical trial described in this
paragraph is an applicable clinical trial for which clinical
trial information is required to be submitted under section
402(j)(2)(C) of the Public Health Service Act.
``(d) Penalty for Noncompliance.--Any manufacturer of a covered
drug, device, or medical supply that knowingly fails to submit
information required under subsection (a) or (b) in accordance with
regulations promulgated to carry out such subsection, shall be subject
to a civil money penalty of not less than $10,000, but not more than
$100,000, for each such failure. Such penalty shall be imposed and
collected in the same manner as civil money penalties under subsection
(a) of section 1128A are imposed and collected under that section.
``(e) Public Availability.--Not later than June 1, 2009, the
Secretary shall establish procedures to ensure that the information
reported under subsection (a) and the summary reports submitted under
subsection (b) are readily accessible to the public through an Internet
website that is easily searchable, downloadable, and understandable.
``(f) Report to Congress.--Not later than April 1 of each year
beginning with 2010, the Secretary shall submit to Congress a report
that includes the following:
``(1) The information submitted under subsections (a) and
(b) during the preceding year, aggregated for each manufacturer
of a covered drug, device, or medical supply that submitted
such information during such year.
``(2) A description of any enforcement actions taken to
carry out this section, including any penalties imposed under
subsection (d), during the preceding year.
``(g) Definitions.--In this section:
``(1) Covered drug, device, or medical supply.--The term
`covered drug, device, or medical supply' means any drug,
biological product, device, or medical supply for which payment
is available under title XVIII or a State plan under title XIX
or XXI (or a waiver of such a plan).
``(2) Covered organization.--The term `covered
organization' means an organization that is involved in health
care financing, organization, or delivery.
``(3) Manufacturer of a covered drug, device, or medical
supply.--The term `manufacturer of a covered drug, device, or
medical supply' means any entity--
``(A) with annual gross revenues that exceed
$1,000,000; and
``(B) which is engaged in the production,
preparation, propagation, compounding, conversion, or
processing of a covered drug, device, or medical
supply.
``(4) Payment or other transfer of value.--
``(A) In general.--The term `payment or other
transfer of value' means a transfer of anything of
value that exceeds $25, and includes any compensation,
gift, honorarium, speaking fee, consulting fee, travel,
discount, cash rebate, services, or dividend, profit
distribution, stock or stock option grant, or any
ownership or investment interest held by a physician in
a manufacturer (excluding a dividend or other profit
distribution from, or ownership or investment interest
in, a publicly traded security or mutual fund (as
described in section 1877(c)).
``(B) Exclusions.--Such term does not include the
following:
``(i) Product samples that are intended for
patients.
``(ii) A payment or other transfer of value
made for the general funding of a clinical
trial, other than an applicable clinical trial
for which clinical trial information is
required to be submitted under section
402(j)(2)(C) of the Public Health Service Act.
``(iii) A transfer of anything of value to
a physician when the physician is a patient and
not acting in his or her professional capacity.
``(iv) Compensation paid by a manufacturer
of a covered drug, device, or medical supply to
a physician who is directly employed by and
works solely for such manufacturer.
``(5) Physician.--The term `physician' has the meaning
given that term in section 1861(r).
``(6) Significant professional membership interest.--The
term `significant professional membership interest' means, with
respect to a physician and a covered organization, the
physician is a voluntary paying member of such organization or
the physician receives professional certification through such
organization.''.
SEC. 3. LIMITATION ON TAX DEDUCTIONS FOR ADVERTISING BY CERTAIN
MANUFACTURERS OF DRUGS, DEVICES, OR MEDICAL SUPPLIES.
(a) In General.--Part IX of subchapter B of chapter 1 of subtitle A
of the Internal Revenue Code of 1986 (relating to items not deductible)
is amended by adding at the end the following:
``SEC. 280I. LIMITATION ON TAX DEDUCTIONS FOR ADVERTISING BY CERTAIN
MANUFACTURERS OF DRUGS, DEVICES, OR MEDICAL SUPPLIES.
``(a) In General.--No deduction shall be allowed under this chapter
for any taxable year for any expenditure relating to the advertising,
promoting, or marketing (in any medium) of any covered drug, device, or
medical supply manufactured by the taxpayer if, during the taxable
year, a penalty is imposed on the taxpayer under section 1128G(d) of
the Social Security Act (relating to quarterly transparency reports
from manufacturers of covered drugs, devices, or medical supplies under
Medicare, Medicaid, or SCHIP).
``(b) Definitions and Special Rules.--For purposes of this
section--
``(1) Covered drug, device, or medical supply.--The term
`Covered drug, device, or medical supply' has the meaning given
such term by section 1128G(g) of the Social Security Act.
``(2) Aggregation rules.--All members of the same
controlled group of corporations (within the meaning of section
52(a)) and all persons under common control (within the meaning
of section 52(b)) shall be treated as 1 person.''.
(b) Conforming Amendment.--The table of sections for such part IX
is amended by adding after the item relating to section 280H the
following:
``Sec. 280I. Limitation on tax deductions for advertising by certain
manufacturers of drugs, devices, or medical
supplies.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning ending after the date of the enactment
of this Act.
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