March 21, 2011

Donald Berwick, M.D.
Administrator, Centers for Medicare and Medicaid Services
U.S. Department of Health and Human Services
Hubert H. Humphrey Building
200 Independence Avenue, SW
Washington, D.C. 20201

Subject: Implementation of Long-Term Care Alternative Dispensing Provisions of P.L. 111-148

Dear Dr. Berwick:

We are writing to convey our concerns with the Centers for Medicare and Medicaid Services’ (CMS) recently published proposed rule implementing Section 3310 of the Patient Protection and Affordable Care Act with the goal of reducing waste in long-term care settings for residents of nursing homes.  CMS proposes to require that pharmacies dispense brand name medicines to Part D beneficiaries in 7-day supplies or less, rather than the 30-day supplies pharmacies commonly dispense.  We believe that more information is necessary to assess the proposed rule’s true systemic costs and potential impacts on patient care before implementation.

In all, the organizations signing this letter represent …

“Only when data has been systematically collected will the extent of waste of Part D drugs be quantifiable on other than an anecdotal basis.” 
-Pg. 71206 of the 2012 Proposed Part C&D Rule 

Industry shares CMS’s interest in reducing waste in the provision of pharmaceuticals.  Pharmacies currently utilize a number of different techniques in an attempt to achieve this goal, including the use of shorter dispensing cycles for a limited number of expensive medications, automated dispensing systems, and drug take-back and credit programs.  However, the relative costs and effectiveness of these techniques in reducing waste have not been adequately studied or reported in peer-reviewed literature. 

To our knowledge, there has been no study or pilot testing of the proposed 7-day-or-less dispensing cycles showing systemic cost savings.  As discussed in the proposed rule, CMS has based its estimates of program cost on one unpublished survey done by a single pharmacy using expensive and proprietary dispensing techniques.  Further, these data showed savings in drug costs only without considering the actual cost of dispensing an additional three or more times per month.  A recent industry survey suggests that the number of drugs dispensed and not consumed by Part D-covered residents is far lower than CMS estimates.  This study concluded that it will cost far more to implement a 7-day dispensing requirement than can possibly be saved through waste reduction.  A single survey and studies published before 1986 are not adequate evidence to justify a comprehensive launch of this program without further evaluation. 

In an effort to collect the data necessary to obtain reliable information on the extent to which a problem exists, CMS proposes to require pharmacies to collect unused drugs from nursing homes and report their quantities to Medicare drug plan sponsors.  This provision implicates a cornucopia of disposal regulations, such as those requiring specific handling of drugs that are considered hazardous waste.  In addition, neither the Comprehensive Drug Abuse Prevention and Control Act of 1970 (CSA), nor its implementing regulations promulgated by the DEA, explicitly spells out how excess controlled drugs may be properly disposed of by patients.  As a result, pharmacies are currently not allowed to take back controlled substances dispensed to patients in long-term care settings.   Assuming the purpose of this provision is to accurately determine waste, a study or pilot would be a much less onerous way for CMS to quantify the amount of waste purportedly being created by 7-day-or-less dispensing.

The significant time and resources necessary to implement this new system (including addressing technical requirements such as adding claims and reporting capability) for pharmacies, facilities, and plans, as well as its potential impact on patient care, supports conducting a valid unbiased study for use in assessing any newly proposed dispensing methodology requirements.  Informed policy decisions are necessary when creating and changing rules which place administrative burdens on nursing staff, reduce time for patient care, and increase the risk of medication errors and missed doses.  In closing, we respectfully request that CMS postpone its implementation of the rules for 7-day-or-less dispensing (using authority granted by the implementing statute to allow the effective date to be for plan years beginning on or after January 1, 2012) while conducting a proper analysis of the rule’s true costs by using a comprehensive study or pilot of realistic alternative dispensing options. 

We appreciate the opportunity to share our views on this issue, and we are committed to working with you to help develop a study that can be used to gather this critical information.  Should you have any questions or need additional information, please contact one of us or Susan Janeczko, Pharm.D. Director of Long-Term Care for the National Community Pharmacists Association (NCPA) at (703) 600-1223.  Thank you for your continued support of our patients and our efforts to care for them.