Introduction

Between the years 1996 and 2005, the annual spending on pharmaceutical industry direct-to-consumer marketing, advertising and promotion to health care professionals rose from $11 billion to practically $30 billion. By 2005, the majority of that activity consisted of professional promotion and over $18 billion worth of free samples. For the pharmaceutical industry, this significant marketing investment is a double-edged sword – while it promotes awareness of drugs and devices to the health care provider community, payments by drug, device and medical supply companies to medical practitioners might be construed as influencing practitioner decisions. The risk lies in the potential for creating a conflict of interest on behalf of that same community of health care practitioners, leading to concerns about the objectivity of physicians and, ultimately, patient safety.

There has been a growing sentiment that establishing rules for physician payment transparency would reduce the impact of pharmaceutical marketing and promote awareness of appropriate prescription and drug safety. While many states already have laws requiring pharmaceutical and medical device manufacturers to publicly report gifts and payments made to physicians and other health care practitioners and providers, provisions for physician payment transparency were included in the Patient Protection and Affordable Care Act of 2009 (H.R. 3590, section 6002), which was signed into law on March 23, 2010.

The inclusion of these provisions in the health care reform legislation has consequences for the pharmaceutical and medical device industry with respect to the ability to capture, manage and organize data in order to generate reports to support compliance with the transparency reporting directives. This paper explores just a few of the data management requirements necessary to support compliance with the reporting requirements for physician payment transparency and disclosure. Using the text of the federal legislation as a starting point, the paper first seeks to understand how some of the key data concepts factor into compliance reporting.

Next, the paper discusses the complexity of the reporting requirements, challenges to establishing the proper business processes for documenting transfers of value, and the need for analytic reporting. Finally, after reviewing the dependence on high quality data, the paper suggests that ancillary benefits can be achieved as a byproduct of instituting best practices for data quality and data governance.