The New York Times reports, and fails to explain the implications of what it’s reporting.
Under the new standards, if a company has just one product covered by Medicare or Medicaid, it will have to disclose all its payments to doctors other than its own employees. The federal government will post the payment data on a Web site where it will be available to the public.
Manufacturers of prescription drugs and devices will have to report if they pay a doctor to help develop, assess and promote new products — or if, for example, a pharmaceutical sales agent delivers $25 worth of bagels and coffee to a doctor’s office for a meeting. Royalty payments to doctors, for inventions or discoveries, and payments to teaching hospitals for research or other activities will also have to be reported.
The Obama administration estimates that more than 1,100 drug, device and medical supply companies will have to file reports, generating “large amounts of new data.” Federal officials said they would inspect and audit drug company records to make sure the reports were accurate and complete.
Companies will be subject to a penalty up to $10,000 for each payment they fail to report. A company that knowingly fails to report payments will be subject to a penalty up to $100,000 for each violation, up to a total of $1 million a year.
Top executives are potentially liable because a senior official of each company — the chief executive, chief financial officer or chief compliance officer — must attest to the accuracy of each report.
It’s not difficult to see where these reporting requirements will lead. There are a lot of doctors and medical practitioners of one kind or another across these United States. They will all be required to compile and file these reports annually to the federal government, or their employers will. The federal bureaucracy will have to grow to take in and process all of these reports. Remember the president’s proposal to trim the federal workforce by about 1,200 positions last week? Well, forget about it because this new reporting regime will probably require far more bureaucrats than the president proposed to cut elsewhere.
Presumably these reports will go to the Department of Health and Human Services, which will have to grow a version of the IRS just to deal with them. It will have to add enforcement personnel — investigators. Given the arcana of medical devices and products involved, it’s fair to assume that many of these new hires will not be entry level, but will be medical specialists, at least at the management level. That means they will be highly paid for their expertise, and will transfer some specialists from the life-saving side to the government-growing side, a net drag both on medical care and on the economy. Doctors will face massive fines for any mistakes made on these reports. Their legal and insurance costs will go up, costs which they will pass onto consumers.
To start with, only doctors providing care under Medicare and Medicaid, and companies whose drugs and devices fall within Medicare and Medicaid, will be subject to these reporting requirements. The economics are already against doctors participating in Medicare and Medicaid. Many doctors will see these new requirements as the last straw, and will opt out of Medicare and Medicaid. That will reduce access for those who depend on M&M, and the government will then feel compelled to step in and force doctors back into Medicare and Medicaid, and back into the new ObamaCare reporting regime, in the guise of increasing access. And the bureaucracy will continue to grow.
The kicker: Sen. Charles Grassley, Iowa Republican, helped come up with this plan. Big government and bureaucracy farming aren’t limited to the party of the left.
Of course, merely by analyzing this reporting regime I’ve opened myself up to the accusation that I’m against transparency. Far from it; transparency tends to benefit everyone. The government should be transparent about what it is now requiring of medical professionals, how much it will cost, and whether all of this reporting will improve or harm care and increase or strangle innovation. Remember, we had to pass ObamaCare just find out what monsters were lurking within it.