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Fall Updates
OIG Issues Draft Compliance Program for Pharmaceutical Manufacturers
The Office of Inspector General of the Department of Health and Human Services published a draft compliance program for pharmaceutical manufacturers in the October 2, 2002 Federal Register.1 This program is one in a series of government compliance programs for various types of healthcare organizations (eg, hospitals, clinical laboratories, home health agencies, physicians' practices, and the durable medical equipment and prosthetic and orthotic industry) that provide goods and services for patients in federal health programs.
The purpose of a compliance program is to encourage the use of internal controls to efficiently monitor adherence to applicable statutes, regulations, and federal health program requirements. The draft recommends that pharmaceutical manufacturers establish an internal compliance officer and a compliance committee, as well as create a general corporate statement of ethical and compliance principles that guides the company's operations in accordance with federal healthcare program requirements.
The report highlights several areas of potential risk for pharmaceutical manufacturers. Because the federal government uses pricing and sales data directly or indirectly furnished by pharmaceutical manufacturers to establish payment for covered drugs and biologicals, the draft reiterates the importance of ensuring that manufacturers provide data that are complete, accurate, and clearly consider rebates, discounts, up-front payments, free or reduced price services, coupons, and price reductions.
Another focal point is kickbacks. Payments (of any form) to induce or reward referrals of federal healthcare business are prohibited. Pharmaceutical manufacturers are advised to structure any arrangements about which they have concerns under safe harbor regulations and to obtain a safe harbor ruling on the arrangement in question before its initiation.
Also of concern is the pharmaceutical manufacturer's relationship with healthcare professionals (physicians, pharmacists, pharmacies, pharmacy benefit management companies, and the like). "Switching" or "product conversion" arrangements that offer providers cash payments or other benefits each time a patient's prescription is changed to a manufacturer's product from a competing product are illegal. Consulting and advisory payments to physicians and other healthcare professionals in connection with various marketing and research activities also are included. The publication cautions that pharmaceutical manufacturers must ensure that these activities are not token arrangements created to "disguise otherwise improper payments" and should be of fair market value for the services rendered. Further, it is recommended that pharmaceutical manufacturers adhere to the Pharmaceutical Research and Manufacturers of America's (PhRMA) Code on Interactions with Healthcare Professionals (available at: www.phrma.org).
Finally, manufacturers are cautioned to comply with laws regulating drug samples that forbids selling or billing them to a federal health program.
Patient-to-Nurse Ratio "Deadly"
A strong ratio exists between preventable deaths and patient-to-nurse ratios. This has become a hot issue as the nation deals with a critical shortage of nurses and a growing number of patients. Even worse, many nurses who have worked in the field for years are leaving the profession after attempting for too long to cope with inadequate staffing that endangers patients and compounds job burnout, overall stress, and job dissatisfaction.
A recent large-scale study conducted at the University of Pennsylvania2 found a significant increase in postoperative deaths for every patient added to a nurse's workload. Researchers analyzed data gathered from surveys of 10,184 registered nurses in Pennsylvania regarding their patient-to-nurse ratios and job satisfaction and the outcome data of nearly a quarter of a million surgical patients treated in 168 Pennsylvania hospitals over a 17-month period. Slightly more than half the patients underwent orthopedic surgeries and the remainder was admitted for digestive tract or hepatobiliary surgeries. Twenty-three percent (23%) of the patients experienced a major complication not present on admission and 2% died within 30 days of admission. Higher emotional exhaustion and greater job dissatisfaction among nurses were strongly and significantly associated with patient-to-nurse ratios. The higher the ratio, the higher the job dissatisfaction and mortality following complication rates.
About 4 million surgeries like those in the study are performed each year with a general mortality rate of 2%. The patient-to-nurse ratio at hospitals included in the study ranged from better than 4 to1 to worse than 8 to1, with about half at 5 to 1. Researchers projected that the difference between a hypothetical national ratio of 4 to 1 and 8 to 1 could mean 20,000 deaths.
Six states have passed laws and regulations dealing with patient-to-nurse staffing levels, and 17 states have pending legislation on the issue. Currently, California is the only state to mandate a specific ratio in all nursing units - one RN to every six medical and surgical patients - a law that becomes effective July 2003. Once the law is fully implemented, the ratio will move to one RN to every five surgical patients. The impetus for the California legislation was an increasing shortage of hospital nurses and the perception that lower nurse retention in hospital practice was related to burdensome workloads and high levels of job dissatisfaction and job-related burnout. Some disagree that a mandatory ratio should not be prescribed due to the diversity and complexity of individual hospitals.
1. Office of Inspector General, Department of Health and Human Services. Draft OIG compliance program guidance for pharmaceutical manufacturers. Federal Register. 2002;67(192):62057-62067.
2. Aiken LH, Clarke SP, Sloane DM, Sochalski J, Silber JH. Hospital nurse staffing and patient mortality, nurse burnout, and job dissatisfaction. JAMA. 2002;288:1987-1993.
