Chapter 6 Federal Regulation of Pharmacy Practice

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Chapter 6Federal Regulation of Pharmacy Practice
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Objectives

• Understand the provisions and requirements of
  OBRA-90
• Describe the requirements of HIPAA
• Identify the basic and pharmacy-related
  provisions of Medicare and Medicaid
• Recognize the application of the
  Medicare/Medicaid fraud and abuse laws

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Objectives (contd)

• Describe the application of the Sherman Antitrust
  Act to Pharmacy Practice
• Describe the application of the Robinson-Patman
  Act to pharmacy practice.

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OBRA-90

• Three major areas
• Rebates
• Demonstration Projects
• DUR

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OBRA-90 (contd)

• Rebates
• Manufactures required to provide drugs to
  Medicaid at their best price.
• Best price is the lowest price at which the
  manufacturers sell the product to any customer.

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OBRA-90 (contd)

• Demonstration Projects
• Determine if the outcomes of patient care improve
  and the costs decrease when pharmacists are paid
  to provide DUR services to patients.

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OBRA-90 (contd)

• DUR
• Process has 3 components
• Retrospective review
• Educational programs
• Prospective review

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OBRA-90 (contd)

• Prospective Review has 3 components
• A screen of prescriptions before dispensing
• Patient counseling by the pharmacist
• Pharmacist documentation of relevant information

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HIPAA

• Goal is to improve the efficiency and
  effectiveness of the health care system
• Targets four aspects of health information
• Transaction and code sets
• National provider identities
• Security
• Privacy

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HIPAA (contd)

• Who must comply?
• Covered Entities
• Health Plans
• Health Care Clearing Houses
• Health Care Provide
• Conducting financial or administrative
  transactions electronically

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HIPAA (contd)

• Protected Information
• Electronic information
• All forms of health information that
• relate to past, present, or future physical or
  mental health the provision of care or payment
  for care
• Identify the patient or could reasonably be
  expected to identify the patient.

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HIPAA (contd)

• Notice of Privacy Practices
• Intended use and disclosure of the information
• Legal duties of the pharmacy to protect the
  confidentiality of PHI
• Patients rights
• Complaints
• Contact person
• Acknowledgement of Notice

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HIPAA (contd)

• Use and Disclosure
• PHI can be used for treatment, payment, and
  operations (TPO)
• Minimum Necessary Requirement
• Patient
• Other providers involved with the treatment
• Authorized by the patient
• When required by HHS for compliance and
  enforcement
• When required by law

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MEDICARE

• Title XVIII of the Social Security Act
• Provides for federal health insurance for those
  older than 65 years of age and for certain
  disabled individuals, regardless of age.
• Part Ahospitalization insurance
• Part Bmedical expenses

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MEDICARE (contd)

• Prescription Drug Benefit Program
• Discount cards until 2006
• Disease Management Programs termed medication
  therapy management programspharmacists to
  receive payment to those patients with multiple
  chronic diseases and take multiple covered drugs
  which will likely exceed annual drug costs as
  determined by HHS.

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MEDICARE (contd)

• Conditions of Participation
• Pharmacist supervision
• Drugs locked up
• No outdated drugs
• Limited access to pharmacy when pharmacist not on
  duty
• Drug problems reported to proper individuals or
  entities
• Abuses and losses of controlled substances
  reported
• Drug therapy information available to
  professional staff
• Formulary system

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MEDICAID

• Title XIX of the Social Security Act
• Provides for the health care costs of certain
  categories of indigents including
• The blind
• The aged
• Members of families with dependent children
• Based on individuals income and assets.

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Fraud and Abuse Statute

• False statement of material fact in any
  application
• Antikickback provision
• Enforced by the Office of Inspector General (OIG)

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Sherman Antitrust Act

• Protects competition
• Makes unlawful every contract, combination, or
  conspiracy in restraint of trade
• Prohibits monopolies, attempts to monopolize, or
  conspiracies to monopolize

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Sherman Antitrust Act (contd)

• Types of per se violations
• Price fixing
• Boycotting
• Tying arrangements
• Exclusive contracts
• Joint ventures

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Robinson-Patman Act

• Unlawful to discriminate in price between
  purchasers of like products when the effect of
  the discrimination may substantially injure
  competition, unless the discrimination is cost
  justified
• Pharmaceutical manufacturers sell products at
  different prices to different buyers (often
  termed preferential or differential pricing)