Federal Regulation of Pharmacy Practice

• OBRA-90• HIPAA• Medicare• Medicaid• Long-Term Care• Federal Antitrust Laws

OBRA-90

• Omnibus Budget Reconciliation Act of 1990

• First Federal law to address practice standards for pharmacists

• Changed practice (slowly)• Acknowledges pharmacists role in

assuring safe and effective drug use

OBRA-90

• Requirements– Drug use review (DUR)– Pharmacist must review patient’s drug

regimen– Must identify and resolve problems– Goals:

• increase chances of desired outcomes• Decrease chance of adverse effects, ineffective Rx

OBRA-90

• Bottom line – save $$ for the Federal Govt!

• Better use of drugs = lower costs• Also added requirement to review

medications of LTC residents

OBRA-90

• Three major provisions1. Rebates

• States pay lowest price offered by manufacturer2. Demonstration project funding

• To see if pharmacists can reduce drug costs and/or improve patient outcomes

3. Drug Use Review• Retrospective (data mining looking for patterns)• Prospective (individual patient with new Rx)• Educational Programs (to “educate” prescribers)

Prospective DUR• Review of patients entire drug regimen• Biggest impact on individual RPh’s• Requires patient medication counseling• Documentation of RPh comments

– Types of problems to assess:• Therapeutic duplication• Drug-disease contraindications• Incorrect dose or duration• Drug allergies• Clinical abuse/misuse

OBRA-90

• Expected outcomes:– Identify problems then correct them– Call prescriber and/or talk to patient– Document actions– Problems with OBRA 90…

• No pay for pharmacists to do this• Often overlooked in busy pharmacies• Beginning to see reimbursement for specific areas

Medication Counseling

• RPh must “offer to discuss”:– Name and description of medication– Dosage form, dose, route, duration– Special directions– Common, severe side effects– Techniques for self-monitoring– Storage– Refill information– What to do if a dose is missed– Product identification (not in Federal law)

Medication Counseling

• Counseling is specific to the patient, not the drug

• Patient may refuse counseling• Counseling must be offered by RPh (not

technician or clerk)– Pharmacy must have system to identify Rx

that require counseling• Advisable to have written waiver for those

who refuse

Pharmaceutical CareOAR 855-041-0100

(1)Patient Counseling and Monitoring:(a) Prior to dispensing all new prescriptions, the

pharmacist or pharmacist intern shall review the patient's record, and initiate and provide oral counseling to the patient or to the patient's agent or caregiver in all ambulatory care settings and for discharge medications in hospitals unless: (A) counseling is refused, or (B) counseling in a form other than oral counseling is provided pursuant to Board rules.

Pharmaceutical CareOAR 855-041-0100

(b) Counseling on refill prescriptions shall be such counseling as a reasonable and prudent pharmacist would provide and may include:(A) monitoring for compliance, (B) intended or expected outcomes, (C) adverse drug reaction, (D) inquiries about over-the-counter medications,(E) generic changes, and(F) the accuracy of the medication.

Pharmaceutical CareOAR 855-041-0100

(c) A pharmacist may provide counseling in a form other than oral counseling when a reasonable and prudent pharmacist would determine in the particular circumstances that a form of counseling other than oral counseling would be more effective.

(d) Patient counseling shall be in person whenever practicable. Whenever the prescription is delivered outside the confines of the retail drug outlet by mail or other third party delivery, counseling shall be in writing and by free access to the pharmacist by phone.

Pharmaceutical CareOAR 855-041-0100

(e) Before providing professional advice to the patient or patient's agent, the pharmacist shall, when applicable: (A) assess the patient, including age, sex, height and

weight, chronic medical conditions, medication history, allergies, drug reactions and drug idiosyncrasies, other disease states of the patient, and, when the prescription is a refill, whether the drug has been taken according to the prescriber's directions, therapeutic response and adverse events; and

(B) perform a drug utilization review as defined by Board rule in OAR 855-006-0005.

Pharmaceutical CareOAR 855-041-0100

(f) When providing professional advice during oral counseling, the pharmacist shall provide such information as a reasonable and prudent pharmacist would provide in the circumstances, which may include: (A) the name and description of the drug; (B) the dosage form, dose, route of administration, and

duration of drug therapy; (C) the intended use of the drug and expected

outcomes; (D) special directions and precautions for preparation,

administration, and use by the patient;

Pharmaceutical CareOAR 855-041-0100

(E) common severe side effects, common severe adverse effects, common severe interactions and therapeutic contraindications that may be encountered, including their avoidance, and the action required if they occur; (F) the possible dangers of taking the drug with alcohol, or taking the drug and then operating a motor vehicle or other hazardous machinery; (G) techniques for self-monitoring drug therapy; (H) proper storage; (I) prescription refill information; (J) action to be taken in the event of a missed dose; and (K) any other information a reasonable and prudent pharmacist would provide relevant to the patient's drug therapy, including information specific to the patient or the drug.

(g) Counseling shall be initiated and provided confidentially.

Authority for Counseling Rules ORS 689.015“Practice of pharmacy” defined. The “practice of pharmacy” means the interpretation and evaluation of prescription orders; the compounding, dispensing, labeling of drugs and devices (except labeling by a manufacturer, packer or distributor of nonprescription drugs and commercially packaged legend drugs and devices); the administering of vaccines and immunizations pursuant to ORS 689.645; the administering of drugs and devices to the extent permitted under ORS 689.655; the participation in drug selection and drug utilization reviews; the proper and safe storage of drugs and devices and the maintenance of proper records therefor; the responsibility for advising, where necessary or where regulated, of therapeutic values, content, hazards and use of drugs and devices; the monitoring of therapeutic response or adverse effect to drug therapy; and the offering or performing of those acts, services, operations or transactions necessary in the conduct, operation, management and control of pharmacy. [1979 c.777 §4; 1999 c.350 §3]

OBRA-90: Documentation

• RPh must make “reasonable effort” to obtain and record at least:– Name, address, phone #, DOB, age, gender– Disease states, allergies, reactions,

medication list (profile), devices– Pharmacist’s comments on drug therapy

HIPAA

• Health Insurance Portability and Accountability Act of 1996– Intended to improve insurance continuity– Prohibits discrimination– Regulates privacy and security of health

information– DHHS writes rules to implement this law

HIPAA

• Protection of privacy and security of health information from:– Unauthorized access– Alteration– Deletion– Transmission

• All healthcare entities (pharmacies, hospitals, clinics, insurers, etc.) must develop P&Ps, train employees

HIPAA

• Covered entities• Protected Health Information (PHI)

– Anything that can identify the patient (prescriptions, payment/insurance information)

• Notice of Privacy Practices– Must be provided to all patients and posted in

pharmacy and on internet (if applicable)– Written acknowledgement of receipt

HIPAA

• Protected Health Information (PHI)– Specific rules for disclosure– Treatment, payment, operations (TPO)– Communication with other healthcare

professionals involved in patient’s care– Transferring prescriptions– Board of Pharmacy, other regulatory agencies– May only disclose “minimum necessary” info– Patient may authorize additional disclosure

HIPAA

• Incidental disclosure– Can happen, but try to avoid!– Patient counseling and confidentiality

• Has been a big problem for pharmacies• Must make effort to protect confidentiality

• De-identification of PHI– Can remove all identifiable information and

use– See p. 237 for list of “identifiable” information

OAR 855-041-0103 Confidentiality (1) No licensee or registrant of the Board who obtains any

patient information shall disclose that information to a third party without the consent of the patient.

(2) Section (1) of this rule does not apply to: (a) any disclosure made to the Board; (b) any disclosure made to a practitioner or to another pharmacist

when the pharmacist reasonably believes that disclosing such information is necessary to protect the patient's health or well being; or

(c) to a third party when disclosure is otherwise authorized or required by law.

HIPAA

• Use of PHI– Teaching - OK– Public health, legal disclosures - OK– Marketing - NOT OK!!

A Bad Example from 2002NEW YORK (AP) - A 16-year-old boy was among southern

Florida residents who received unsolicited samples of the antidepressant drug Prozac in the mail in a much-criticized and highly unorthodox marketing campaign. "I was livid," said the boy's mother, Sue Grinstead of Palm Beach. "My son knew enough not to take it, but what about the other kids?" A spokesman for the Walgreen Co. drugstore chain, Michael Polzin, confirmed the family's account that a month's supply of Prozac was sent to 16-year-old Michael Grinstead. He said the boy's name was among others sent by a local doctors' office to a Walgreen's in Palm Beach with instructions to send them the drug samples.

The Grim Reality!

HIPAA - Penalties for Violations

• Unintentional – up to $25,000 per year• Intentional – up to $50,000 and/or up to

one year in prison!• If fraud involved – up to $100,000 and/or

up to five years in prison !• If for personal gain – up to $250,000

and/or up to ten years in prison!

Medicare

• Federal program enacted in 1965• Provides insurance for people over 65 yrs

and people with certain disablities• Part A – hospitalization• Part B – other medical expenses (except

drugs until 2006)• Drug “discount” cards until 2006 (voluntary

program)

Medicare

• Hospitals must comply with “conditions of participation”– CMS can inspect hospitals to assure

compliance• Many requirements for pharmacy services

in hospitals• JCAHO certification usually suffices for

evidence of compliance

Medicare Part D

• AKA: Medicare Prescription Drug, Improvement, and Modernization Act

• Medication Therapy Management (MTM) required for certain patients:– at least two chronic medical conditions– take at least two Part-D-covered medications– are likely to spend more than $4000/year

Medication Therapy Management (MTM)

• A pharmacist or other qualified professional, such as a nurse, can provide MTM

• Drug plans (“insurance company”) to determine the education, skills, and experience of MTM providers

• National Council for Prescription Drug Programs (NCPDP) codes can be used for billing of pharmacist professional services

• Not fully known how this will impact profession

Medicaid

• Programs administered by each state• For “medically indigent”• Funded by both state and federal govts• Federal requirements must be met to get

funding• “Oregon Health Plan” is Oregon Medicaid

– Received waiver from Federal “no rationing” requirement

– Not going so well!!

Medicare/Medicaid Fraud

• Prohibits “kickbacks” for goods or services provided to Medicaid patients– Ex: Pay $100 for drug, charge Medicaid

$110, receive $50 rebate from manufacturer– You gain $60!

• (plus a $25,000 fine and 5 years in prison)– Ex: MD’s can not own a lab and refer all

patients to it

Long-Term Care Facilities

• Nursing Homes, Adult Foster Care, Assisted Living Facilities, etc.

• Characteristics to both community and hospital pharmacy services

• Many federal (and State) requirements• All facilities must have a “consultant

pharmacist”• Residents may self-administer or facility

staff may administer medications

Long-Term Care Facilities

• Consultant pharmacist– Responsible for all aspects of pharmaceutical

care services at facility– Must provide drug regimen review at least

monthly• Report recommendations to MD and director of

nursing• MD may disagree

Long-Term Care Facilities

• Dispensing and Storage– Residents may choose own pharmacy– Unit dose system or traditional bottles– Must lock up DEA C-II medications separately

Federal Antitrust Laws• Lots of financial “mysteries” in pharmaceutical

market• The “players” (and they all want a “piece of the

action”)– Manufacturers– Wholesalers (primary, secondary, etc)– Hospitals– Pharmacies– Group Purchasing Organizations (GPOs)– Health Maintenance Organizations (HMOs)– Preferred Provider Organizations (PPOs)– Prescribers

Federal Antitrust Laws

• Oregon figures prominently!• Sherman Antitrust Act

– Designed to protect competitive markets– Many violations are not challenged– Requires two competitors to make a violation

Sherman Antitrust Act

• Types of violations– Price fixing– Boycotting– Tying arrangements (two or more products/services)– Exclusive contracts– Joint ventures– Pharmaceutical Services Administration

Organizations (PSAOs)– Purchasing cooperatives

Robinson-Patman Act• Passed in 1936• Prohibits discrimination in price between

purchasers of like products (unless it can be cost-justified)

• “Preferential pricing” in hospitals/HMOs– Justified based on competitive pressure & formularies– Hospitals/HMOs prohibited from selling in competition

with retail pharmacies– Portland Retail Druggists Association (PRDA) vs.

Abbott Laboratories (p. 258)– “Own Use” Doctrine