While signed in 2010, much of the Affordable Care Act didn’t go into effect until 2014. One part of the ACA that aims for more medical transparency is the Sunshine Act.

Never heard of the medical Sunshine Act before? Asking yourself, “What is the Sunshine Act?”

You’re not alone. In broad terms, this act makes medical manufacturers disclose their financial relationships with doctors or teaching hospitals. While it might not sound like a big deal, there are some excellent reasons for it.

So, let’s dig in and look at what the Sunshine Act is and why it matters.

What Is the Sunshine Act?

As noted above, the Sunshine Act makes medical manufacturers tell the government about their financial relationships with doctors or hospitals. Manufacturers will make those reports through a system like the one described on this site.

The rule affects pharmaceutical companies, medical device companies, and similar businesses with products covered by Medicare and Medicaid. In an unusual move, the government will then make most of the information publicly available.

What Is the Relationship Between Manufacturers and Doctors?

Medical manufacturers often court doctors and teaching hospitals. The manufacturers want their products prescribed or used by patients. If the products work well, the doctors often serve as word of mouth advocates.

Manufacturers will routinely take doctors out to lunch or dinner. They may bring doctors out for speaking engagements. Depending on the research, the companies even hire specialist doctors as consultants on projects.

Medical manufacturers often play a role in supporting medical research through financial support.

Why Does the Government Care?

At first blush, it might seem like a waste of time and taxpayer money to collect and publish this information. After all, who else will medical manufacturers talk to about medical products if not doctors?

The concern is that financial relationships between manufacturers and doctors can influence treatment. For example, let’s say a doctor consulted on a new blood pressure medication. Once it goes on the market, the doctor might prescribe it more than other or better medications.

What if a doctor gets funding from a device manufacturer? If the doctor gets a piece of the profits after developing a device, they might use it as a treatment more often than necessary.

By documenting and publishing financial relationships, the government creates a layer of accountability. Anyone can see if their doctor benefits from prescribing a given treatment. It may also help form the basis for legal actions in some cases.

The Sunshine Act Helps Ensure More Responsible Medical Care

What is the Sunshine Act? It’s a move meant to keep medical manufacturers and doctors accountable. With the financial relationships in public view, doctors and or even hospitals will find it much harder to push a specific medicine or device.

It also makes it an easier task for researchers, reporters, or the legal system to identify potential abuses. All of this protects the public good.

Looking for more interesting information? Check out the Crazy Facts section on this site.