Legal News

Pharmacists who commit insurance fraud better watch out. Not only are regulatory authorities going to come after them the way they do after the Italian Mafia, they're going to use every forensic trick in the book that investigators on the TV show "CSI" employ-and more.

Community R.Ph.s could face a friendlier climate in Congress with Democrats having won the majority of both houses during the mid-term elections. Democrats will now take control of Congressional committees responsible for key pieces of healthcare legislation and financing.

At 5:00 a.m. one April morning last year, agents of the Drug Enforcement Administration and some sheriff's deputies burst into Scherer's Medical Clinic, a pain management center in Slidell, La., near New Orleans. Additional raids that day at area clinics and pharmacies led to the arrest of Scherer's owner, a nurse named Cookie Armstrong, and three staff doctors. All were charged with running narcotic pill mills. Twenty-three patients were also arrested over the next few days.

When First DataBank agreed to settle a lawsuit last month and pledged to stop publishing AWP (average wholesale price) data in two years, it sent ripples through the pharmacy industry. AWP has long been a key measure for determining pharmacy payments, and there is no easy answer for how to replace it. As John Rector, senior VP and general counsel at the National Community Pharmacists Association, cautioned, "This is the very beginning of what will probably be a very lengthy process."

After years of false starts, stalls, and missteps, Congress may soon be ready to tackle the thorny question of how to regulate generic biologic pharmaceuticals, lawmakers noted at the Generic Pharmaceutical Association's 2006 Annual Policy Conference held recently in Washington, D.C.

Predictions of a revolt against Republicans at the ballot box did not deter Mike Barrett, R.Ph., from running for the House of Representatives. Barrett, a pharmacist at a 34-bed hospital, challenged eight-term Democrat Collin Petersen to represent northwestern Minnesota. "Many people have told me that it is probably not a good year to be a Republican, but my district is almost evenly split between both parties with about 10% undecided," said Barrett, pharmacy manager at Long Prairie Memorial Hospital and Home.

Very few drug plan providers left the Medicare market in 2007, but their offerings have shifted. There are fewer plans offering basic coverage and more offering enhanced coverage. Beneficiaries in most states have 50-60 prescription drug plans to consider including 15 or 16 that offer partial or complete coverage in the donut hole.

Squeezed by low and slow reimbursement from Medicare Part D, independent pharmacists have certainly taken their lumps this past year. But they still managed to eke out some victories, according to leaders of the National Community Pharmacists Association, which held its annual meeting in Las Vegas last month.

In a recently issued policy statement, the Drug Enforcement Administration proposed a new rule that would ease current restrictions on prescribing Schedule II controlled substances. Under the new rule, doctors will be able to prescribe 90-day supplies of Schedule II medications such as OxyContin (oxycodone, Purdue Pharma), methylphenidate HCl, and codeine. The public can submit comments about the new rules through Nov. 6.

Closing the only pharmacy in Holly Ridge, a small town in eastern North Carolina, was not an easy decision for Randy Spainhour. The 58-year-old pharmacist knew that the closest pharmacy was 15 miles away and that it would put a big strain on many of his customers. "I felt I had no choice," he insisted. "It was either that or going bankrupt."

A new era is coming for the Medicaid program-one that will spare the state and federal governments from overpaying for drugs and provide more pricing transparency to all parties involved.

Hoping to stem a new season of confusion over Medicare's Part D prescription drug benefit, the Centers for Medicare & Medicaid Services is asking pharmacists to prepare patients for the upcoming enrollment period.

The Medicare Modernization Act (MMA) set minimum federal standards for prescription drug coverage. Plans wanting to participate in the program could offer the standard benefit or a variation that was approved as actuarially equivalent by CMS. Most plans elected to modify the standard design with their own formularies and combination of enhanced benefits. Each plan sought the right combination of premium level, benefit package, formulary structure, and tiered co-pays that they believed would attract and keep an acceptable share of the market while generating a profit to the plan.

A botanical garden offering self-guided tours, an auditorium, a library, and a terrace with a breathtaking view for parties that could accommodate 300 people ... Are these the amenities of a luxury resort? No, these facilities, along with office space and parking, will comprise the new American Pharmacists Association headquarters, now undergoing an extreme makeover.

Pharmacies across the country must better train employees and develop clear polices to avoid being investigated or prosecuted for fraud and abuse related to Medicare and Medicaid, said Don L. Bell II, general counsel of the National Association of Chain Drug Stores, at an NACDS Pharmacy & Technology Conference held recently in San Diego.

With conflicting statements from the Food & Drug Administration, Centers for Medicare & Medicaid Services, and a Federal District Court judge, the definition and legality of pharmacy compounding once again seems headed to the Supreme Court or Congress for sorting out.

A public interest law firm has sued the government over the restrictions placed on pharmacists and other healthcare providers in helping Medicare beneficiaries choose a Part D plan. The suit claims that the rules in the marketing guidelines are a violation of free speech.

Sometimes the best defense is a good offense. While many pharmacists have been vocal critics of the role of pharmacy benefit managers and the growing use of mail-order pharmacies, much of the focus has been on passing legislation to protect pharmacists or restrict PBMs. Taking a different approach, the Georgia Academy of Independent Pharmacy (AIP) has developed a multitiered plan to compete directly with the PBMs.

After 11 years in business on Main Street in Aspen, Colo., Rodney Diffendaffer, R.Ph., knows too well that the struggle between community pharmacists and the mail-order industry is heating up, with generics fueling the fire. "They get to sell three months of drugs at what comes close to my one-month price," he said. "I'm not allowed to sell a three-month supply. It's not a level playing field. Never has been."

Sometimes the best defense is a good offense. While many pharmacists have been vocal critics of the role of pharmacy benefit managers and the growing use of mail-order pharmacies, much of the focus has been on passing legislation to protect pharmacists or restrict PBMs. Taking a different approach, the Georgia Academy of Independent Pharmacy (AIP) has developed a multitiered plan to compete directly with the PBMs.

The Food & Drug Administration recently issued letters to three pharmacies warning them to "stop manufacturing and distributing thousands of doses of compounded, unapproved inhalation drugs nationwide." The three named companies, RoTech Healthcare, CCS Medical, and Reliant Pharmacy Services, were all warned that if they did not comply, they risked injunctions and the possible seizure of their products in question.

How do I protect myself against liability for "incorrectly" filling transferred prescriptions?

The Department of Health & Human Services approved foundation standards for electronic prescribing in January and is pushing hard for widespread adoption of e-prescribing. But across the Potomac River from HHS' downtown Washington headquarters, the Drug Enforcement Administration has serious fears about controlled substances being e-prescribed. It has indicated, for example, that further security measures may need to be in place before controlled-substance e-prescribing is allowed to go forward.

Hospitals with large indigent patient populations have a new financial ally: the Medicare Part D outpatient pharmacy benefit.

The Institute of Medicine (IOM) recently released Preventing Medication Errors, a 544-page report that is the fourth in its Quality Chasm series. The authors concluded that medication errors harm at least 1.5 million people per year in the United States. In addition, the cost of treating drug-related injuries that occur in hospitals alone conservatively amounts to $3.5 billion per year, according to the Committee on Identifying and Preventing Medication Errors, which wrote the report. The report was funded by the Department of Health & Human Services and the Centers for Medicare & Medicaid Services.

It used to be that if pharmacists dispensed the right drug and right dose and gave the right directions to the right customer, we were free of liability. Thanks to the Omnibus Budget Reconciliation Act (OBRA), however, this is no longer the case. As a result of the OBRA counseling provisions, our profession has succeeded in tremendously increasing the risk of liability for frontline pharmacists. We now have to contend with aggressive lawyers who charge us with these three words: failure to warn.

How can pharmacy graduates obtain a better understanding of the role of pharmacy in the public process of legislation and regulation? How can they learn to advocate for the public good?

RxUSA Wholesale has filed a $1.8 billion lawsuit against 16 drug manufacturers, five drug wholesalers, and the Healthcare Distribution Management Association (HDMA). The New York-based distributor charged a conspiracy to boycott secondary wholesalers, eliminate competition, and maintain artificially high prices.

Washington State pharmacists are wondering if they are expected to be the penmanship police since a new law decrees that prescriptions in cursive handwriting are no longer considered to be legible.