Vermont Gift Ban and Disclosure Fines Provide Glimpse of Possible Issues under Sunshine Act

Oct. 21, 2013 – An announcement by the Vermont Attorney General citing 25 manufacturers for allegedly violating the state’s “Prescribed Product Gift Ban and Disclosure Law” gives companies a snapshot of the scrutiny and issues they may face under the Physician Payment Sunshine Act, according to a recent Policy and Medicine posting.  

Policy and Medicine stated Oct. 15 that although the national Sunshine Act “sets a floor for transparency laws … states can require additional obligations that are not contained in the Sunshine Act.” Further, the self-reported violations, which resulted in fines of a total of $25,250 for 24 manufacturers and of $36,000 for one manufacturer, took two to three years to be resolved. “Thus, it could take even longer to resolve such discrepancies or failures under the Sunshine Act given its wider application and more complex reporting requirements.”

In one case, the company was cited for violating the gift ban because it “inadvertently” provided meals outside of Vermont to physicians who practiced in Vermont and noted that its employees who provided the meal were unaware of the physicians’ Vermont ties. “Accordingly, it will be crucial that compliance departments and transparency officials ensure that all applicable licenses of physicians are acquired for Sunshine Act reporting to avoid any violations of Vermont’s gift ban law,” Policy and Medicine advised.

The article also reminds companies that states with transparency laws – including D.C., Massachusetts, Minnesota, Vermont and West Virginia – are likely to use the federal Open Payments database, which will be live in September 2014, “to identify discrepancies or omissions, which could result in state penalties.”Importantly, the article adds that third-party vendors have obligations to “pay close attention to registration and attendance lists for conferences, educational or promotional events or other interactions where payments or transfers of value may be made.” This obligation was underscored recently at the Coalition for Healthcare Communication D.C. meeting, by Kathy Bronshtein, Chief Compliance Officer, Sudler and Hennessey.

For example, Bronshtein suggested that attendee sign-up sheets be used at events, that meals have an opt-out option and that the value of the event to the HCP be made known to event recipients (see related article, Policy and Medicine stated that “It may also be prudent of such providers to include reminders before, during or after conferences.”

To read the full Policy and Medicine post, go to: