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Pennsylvania curbs physician prescription drug dispensing and repackaging

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Pennsylvania curbs physician prescription drug dispensing and repackaging

Pennsylvania is the latest state taking action to limit physician dispensing and drug repackaging to control workers compensation costs and ensure better claimant outcomes.

More than 20 states already limit physician dispensing, cap the price of repackaged drugs or ban the practice. Hawaii, Indiana and North Carolina are among the most recent states to do so.

The workers comp industry has been working hard to curtail costly physician dispensing, targeting states such as Pennsylvania where a high volume of prescription pain medicines for injured workers are sold to them by doctors.

Pennsylvania Gov. Tom Corbett is expected to sign into law this week H.B. 1846, which would cap reimbursement of repackaged drugs at 110% of the average wholesale price; restrict physicians from dispensing Schedule II controlled substances, such oxycodone; and prohibit physicians from dispensing more than a 30-day supply of other medications.

The Pennsylvania Senate last week approved and sent to the governor the measure that would go into effect 60 days after signing.

Several Pennsylvania employers have seen costs on individual claims “skyrocket” because of physician-dispensed, repackaged drugs, “so we're very optimistic that those types of costs will be mitigated,” said Alex Halper, director of government affairs at the Pennsylvania Chamber of Business and Industry in Harrisburg. “We're going to see a significant slowing of the growth of the practice.”

The move follows Florida's passage last year of drug repackaging legislation.

The “big win” in Florida likely led states such as Pennsylvania to follow suit, said Brian Allen, Westerville, Ohio-based vice president of government affairs at Helios, the brand Progressive Medical Inc. and PMSI Inc. adopted in August.

Maryland and Louisiana are still assessing how best to curb the practice, he said.

While he expects some movement in Louisiana in the next 14 months, Maryland has been trying to address physician dispensing for several years.

Maryland also is one four states where Schedule II controlled substances are prescribed most often by physicians to injured workers, the Cambridge, Massachusetts-based Workers Compensation Research Institute said in a recent analysis. Massachusetts, New Jersey and Pennsylvania are the other three states. In Pennsylvania, about 25% of workers comp prescriptions written were for Schedule II narcotics for claims where the injuries occurred from Oct. 1, 2009, to Sept. 30, 2010, with prescriptions filled through March 31, 2012.

The Pennsylvania legislation would remove the “profit motive for a doctor to continue to dispense the medication,” Mr. Allen said. “Hopefully, (physicians will) ... look for other alternatives that might be more beneficial to the injured workers and have less adverse side effects and the propensity for dependence, abuse or diversion.”

Meanwhile, sources say states such as Arizona and California, which cap the price of repackaged drugs, are looking to further curb physician dispensing. States also continue to review rules to ensure “there aren't loopholes that can be exaggerated somewhat,” said Candy Raphan, director of medical management services at third-party administrator Broadspire Services Inc. in Sunrise, Florida.