The impact of the Sunshine Act's Open Payments regulations on reporting the costs of pharmaceutical and medical device meetings has a substantial impact on meals. And while there are no legal limits on spending, voluntary industry regulations like those put out by the Pharmaceutical Research and Manufacturers of America (PhRMA) have tight caps, and many companies have adopted even tighter ones out of concern that reporting "excessive" dining bills will attract public perception problems.
And, of course, corporate and third-party planners are not the only meetings suppliers affected by the Open Payments regulations. The hoteliers and restaurateurs that work with them have been working just as long and hard to prepare for the new regulations.
For hotel companies, that means first deciding if the business is worth the extra work. Medical meeting planners have said for several years that some hotels have been less eager to work with them since the companies started imposing strict meal and room price caps, even though those are voluntary.
Even so, most are adapting, according to Schaumann. The pharmaceutical industry "is the second-largest business in the world by revenue," she says. "Why would you turn your back on it?"
That concern has not come up at Hyatt Hotels and Resorts, agrees Bonnie Weiss, the hospitality company's director of global pharmaceutical sales, Americas. "This is great business, it's short-term business, and it is reoccurring business," she says.
In addition, the web-based group-billing tool Hyatt unveiled two years ago is a big boon, as it allows planners to track per-attendee charges, from room rates to meal costs to A/V charges in real time, rather than getting a book-size printout several weeks later. This makes it easy for planners to track and export data for reporting purposes, Weiss says.
"Hotels with pharmaceutical business are putting together special menus, but because each company has its own caps, there are always adjustments to make," Weiss says. "The majority of meals are now buffets. When we do have plated meals, the number of courses is down from four to three. Bar service is restricted or discontinued."
Hyatt has made ongoing education of appropriate hotels' sales and cater staffs a priority, Weiss adds. "And they have someone they can go to — me — with questions."
Far from being scared off by the regulations, Brazilian steakhouse chain Fogo de Chão sees them as an opportunity. "The pharmaceutical business is a very important target for us in the 2014-2020 time frame," says Kirsten Knauer, director of sales of Fogo de Chão. "We have a lot to offer and not a lot of people know about it. Especially the pharmaceutical business has not thought about how well this concept would fit what they are looking for."
Fogo de Chão gaucho chefs grill 16 cuts of meat on skewers and then bring them from table to table, slicing off portions at customers' request. So while it is still a plated meal, it is less formal and more festive. All locations have boardrooms for 10 to 20 and private dining rooms for up to 120.
"From our perspective we're offering a very nice, high-end product, but at a reasonable rate and without a lot of crystal chandeliers and all that," Knauer says. "We don't have that perception issue, we don't fall into that, 'oh my goodness you can't go there, you'll get us in trouble.'"
Aside from putting in place technical upgrades like increasing the available Internet bandwidth for streaming, high definition webinars, Fogo de Chão has trained its group sales staff extensively on Open Payments, and all the individual restaurants managers have had training as well, she adds. "Having an understanding of what the law really is, we can advise [potential clients]. People come to us and find we're very understanding and credible, that we know where the tricks and the traps lie. That makes it clear and easy for them to have a great event and not have to worry that we're violating some parameter [of the regulations]."
This means "educating our staff on what the needs of a pharmaceutical group are: number one, quiet, number two, privacy," Knauer adds. "It means understanding that when the event starts, its time for the staff to get out of the room. Understanding that we can't have two competing groups going on at the same time, even though we have more than enough space for more, because that eliminates any question mark about whether or not they would be competing with each other."