New Jersey Attorney General: Report on Physician Compensation Arrangements

As a parting shot the New Jersey Attorney General Anne Milgram (she is leaving office once the new Governor Chris Christie is inaugurated on January 19th) issued a report tiled: Physician Compensation Arrangements.  The report calls for state agencies to create new rules around the relationship between physicians and manufactures.  These rules if adopted will essentially stifle ethical relationships between physicians and drug and device companies.

The report which is based on questionable evidence including opinion papers, news reports, Prescription Project statements and blog postings proposes to transfer the focus of state physicians from patient care to reporting and compliance.

Details of the Report:


· Prohibit food from manufactures (in office or at restaurants)

· Requires physicians and staff to pay for own meals at fair market value at promotional events and dinner meetings

· Allows for receipt of modest meals only at accredited events


· Mention but no new restrictions


· As part of their licensed renewal physicians would be required to disclose to the board of medical examiners whether they have accepted more than $200 during the preceding two years from manufactures, either in cash food, travel consulting fees or research funding. 

o   Include the name of the company, value and date of the payment and if applicable the name of the product and whether it is related to marketing, research or education

· Also included in a searchable database

Continuing Medical Education

· Provide credit only to courses that meet ACCME standards

· Require disclosure of compensation from manufactures

· Require 25% of CME to be obtained from evidenced based educational programs or academic detailing (government controlled CME)

Data Mining

· Feature the AMA opt out program on the BME website

· Require pharmacies to maintain documentation confirming that prescribers have consented to the sale of their prescribing information

· Recommendation to legislature to enact restriction on sale of prescription information

Physicians in Training

· Require faculty in state to adhere to the AAMC conflict guidelines on and off campus (no promotional speaking)

· Require medical education directors to include curriculum on conflict of interest in research funding

Physician Accountability

· Prohibit physicians from recklessly providing inaccurate and misleading information in educational or promotional venues.  (not sure who those reckless physicians are or what the definintion of recklessness will be)

· Prohibit physicians from claiming authorship of any article or study unless they, in fact, authored the work in question.

o   Attribution should, however, be deemed appropriate if the physician supervised or reviewed the work of medical students, residents, fellows or researchers.

· Prohibit physicians from misrepresenting financial interests in any required disclosure form, including through the omission of required information.

Health Care Facilities

· Creation of a standardized conflict of interest form for use by all New Jersey licensed health care facilities.

· Facilities should consider whether physicians with financial interests should serve on advisory bodies, such as formulary committees, purchasing committees or groups established to develop practice guidelines, or should conduct clinical trials or participate in IRB research.

· Report also questions whether disclosures of interests should be mandated in in-hospital educational venues before presentations begin (i.e. grand rounds, patient rounds and classroom).

· Creation of a program allow community hospitals to ensure that the acceptance of industry funding for CME does not skew the message of educational sessions.

· Creation of a system to manage conflicts in research to avoid potential detriment to the safety of clinical trial participants or to the integrity of the research.

Academic Detailing

· Creation of academic detailing programs by amending BME regulations to require that a certain percentage of the required CME credits be derived from the completion of courses not subsidized by industry.

· Explore grants that could introduce academic detailing programs in some DHSS regulated venues.

In response to the proposed new rules, the Medical Society of New Jersey suggested that “the state should seek to change the behavior of companies rather than the doctors.” They specifically noted “New Jersey is the only state in the nation that chooses to regulate tens of thousands of individuals and allow large companies to escape scrutiny.”

The report goes beyond what the Pharmaceutical Research and Manufacturers of America (PhRMA) and the Advanced Medical Technology Association (AdvaMed) have adopted in their voluntary codes of ethics.

Specifically, PhRMA and AdvaMed prohibit member companies from providing entertainment, vacations or meals to physicians, unless the meals are modest and at a medical office or in a clinical setting. The proposed New Jersey regulations would go beyond the industry codes, banning all food except at accredited continuing medical education events where physicians must pay the fair market value of modest meals provided.

 “In the area of continuing medical education, the report recommends that CME credit is only received by doctors for courses that are accredited by the Accreditation Council for Continuing Medical Education (ACCME) and specifically bar the CME provider from obtaining advice from a company that subsidizes the course, creating a separation between educational content and the source of the subsidy.”  The ACCME standards for commercial support, already require all accredited courses to disclose relationships with industry and the source of funding, though device training is generally not accredited.

These recommendations will now be considered by the Board of Medical Examiners and the Board of Pharmacy who are being asked to review the report and initiate a rule-making process (which under the new governor is not that likely).

Some of these recommendations can be enacted by the state’s Board of Medical Examiners, while others (including the restriction on sale of prescription data) would require the state to pass a new law.

Interestingly, it should be noted that Attorney General Milgram, who was appointed by the Governor of New Jersey, will soon by replaced by an appointment from the newly elected Governor Christy. Consequently, it would seem that such a last minute report and effort aimed at the drug and device industry is merely a wish list.

The reality is, pharmaceutical and device companies, the largest private employers in New Jersey are creating new drugs and devices to help patients. Placing restrictions directly on the physicians, instead of working with the industry will only deter doctors from taking part in the valuable experience and exposure that industry provides. 

This is the first time that a state official has recommended using the state regulatory process to adopt strict restrictions on industry physician interaction.   It is also the first time that the restrictions are being proposed against physicians.  This should be watched very carefully.

Since these are just proposed rules as of now, physicians, health care providers, and members of the public would do well in asking their physicians how such rules will affect the education and experience of their doctors because the impact will ultimately pass on to their patients.

New Jersey Attorney General:  Report on Physician Compensation Arrangements

Executive Summary of Report

Full Report

    Press Release

Wall Street Journal Blog: No Free Lunch for Doctors Brought to you by the New Jersey AG


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