Medicaid Rx must be on tamper-resistant pads

Although several major exemptions were written into the rules, physicians still could face significant administrative burdens.

By Doug Trapp — Posted Sept. 3, 2007

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A new law requiring tamper-resistant pads for certain Medicaid prescriptions means that many physicians will have to change their prescription-writing habits, depending on how states implement the law.

The Centers for Medicare & Medicaid Services issued guidance Aug. 17 on how to meet the prescription pad provision. It was slipped into a military spending law Congress adopted in late May. The rules focus on written orders, not verbal, faxed or electronically transmitted prescriptions.

CMS exempted from the law prescriptions paid for by Medicaid managed care organizations and those for patients in nursing homes and other institutions, which together constitute a large chunk of Medicaid prescriptions. Of the 53 million Medicaid recipients, nearly two-thirds are enrolled in managed care plans, CMS estimates. It wasn't immediately clear what share of Medicaid prescriptions these two groups generate.

The guidance also allows pharmacists to fill drug orders on an emergency basis as long as the prescriber follows up with a verbal, faxed or compliant written prescription within three days.

But even with the exemptions, the speed at which state Medicaid agencies must implement the law will pose difficulties for physicians and patients in Medicaid, said AMA Board of Trustees Chair Edward L. Langston, MD. "We will continue to work closely with the administration and Congress to delay the implementation date to ensure a smooth transition for patients and physicians," he said.

Seventy-six medical organizations -- including the AMA and 45 state societies -- signed an Aug. 16 letter to the Health and Human Services secretary asking for a six- to 12-month delay in the law's effective date.

House and Senate legislation has been introduced to postpone or scale back the rule. The Senate bill, sponsored by two Democrats, would apply the rules only to Schedule II controlled substances on Oct. 1 and then to all drugs on April 1. The bipartisan House version would limit the law to Schedule II controlled substances.

CMS guidance says states must use pads with one feature to prevent counterfeiting, one to stop unauthorized copying and another to prevent erasure or modification of information. By Oct. 1, written orders must have one of these features. They must have all three by October 2008.

But the guidance left certain questions unaddressed. States will decide who will pay for these new prescription pads and which security mechanisms they must use. The agency pledged to reimburse states that provide the pads to prescribers for free or at a discount.

CMS gave states as much flexibility as it could, but the agency was limited by the law Congress adopted, said Greg Martin, state health policy analyst for the American Academy of Family Physicians. If the guidance goes into effect in October, physicians are in for a confusing first few months. "There's going to be a learning curve," he said.

The American Pharmacists Assn. agreed that CMS is in a difficult situation, but the APhA wondered why the agency didn't use its authority to delay implementation, said John A. Gans, the organization's executive vice president and CEO. "How can we expect a national program to be implemented in a few weeks when it took months for states to implement similar programs?"

Eleven states already have prescription security laws, at least for controlled substances. Some of these programs already might meet federal standards.

The National Assn. of State Medicaid Directors didn't immediately provide a reaction to the guidance. But in a July 10 letter to CMS, the organization requested phased-in implementation of the law and expressed concern that it would cause physicians to drop out of Medicaid.

CMS did not return calls about the prescription pad guidance.

Printers are ready

Providing physicians with enough pads to follow the law is a huge task, but two printers who produce tamper-resistant forms were confident that the industry would be able to meet the demand if the law goes into effect next month.

About 330 million Medicaid prescriptions not paid for by managed care plans were written in 2006, according to the National Assn. of Chain Drug Stores. That's out of a national total of 3.42 billion prescriptions.

"It's going to be a scramble," said J. Harvey Scott, vice president of Minute Man Printers Inc. in Phoenix. Scott prints pads compatible with the prescription security programs in six states. States without programs have already begun placing orders.

Although Scott acknowledged that the law is good for business, he said he has sympathy for states, physicians and especially pharmacists, the latter of whom ultimately will have to make tough decisions on Oct. 1. "They're going to have to be the police force of the whole situation," he said.

Scott said CMS should have taken more time implementing the law, in part to improve awareness. One state Scott contacted but declined to identify wasn't aware that Congress had passed a tamper-resistant pad law.

He also said CMS should have made the pad requirements stronger. It wouldn't be especially difficult for thieves to find paper to counterfeit prescription pads with the limited level of security CMS is calling for, Scott said.

In contrast, California has what some prescription printers regard as the most secure system in the U.S. The state mandates about a dozen security measures. Several are on the pads themselves, including quantity boxes prescribers must check to prevent, for example, people turning 10 pills into 100. Printers must register with the Drug Enforcement Administration and undergo DEA inspections.

The California Medical Assn. supported the program's concept, said Brett Michelin, associate director of CMA government affairs. But some doctors question the need to use the pads for all prescribable medications classified as controlled substances, including less-addictive Schedule V medications, such as cough medicine.

Marc Lilly, CEO of Script IQ Inc. in Seattle, said the types of features used by most states with prescription security programs are not new. One example is thermochromatic ink, which disappears when heated, to prevent photocopying and scanning.

"It just hasn't been applied in health care to any [large] degree," Lilly said. He, too, doesn't expect printers to have difficulty meeting demand related to the federal law, because the paper needed is readily available.

Pad prices in states with security programs vary based on the type of paper, its size, and the number of security features and quantity ordered.

Physicians don't always buy their own prescription forms. New York state, for example, provides tamper-resistant pads to doctors for free. Although the Medical Society of the State of New York initially opposed the program, William Rosenblatt, MD, MSSNY past president, praised state officials on how they worked with physicians on implementing it over an 18-month period that ended in April 2006.

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What's required

CMS has clarified how to comply with the Medicaid tamper-resistant prescription pad law.

  • Written prescriptions must have one feature to prevent unauthorized copying, another to prevent erasure or modification of information, and a third to prevent counterfeiting. States must put one of the three in practice by Oct. 1, 2007, and all three by Oct. 1, 2008.
  • Pharmacists may fill prescriptions on an emergency basis if a prescriber provides a verbal, faxed or compliant written prescription within 72 hours after the order was filled.
  • Prescriptions paid for by Medicaid managed care plans or from nursing homes and other institutions are exempt. Electronic, faxed or phoned prescriptions also are exempt.

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Pad protection

Eleven states have laws requiring tamper-resistant prescription pads, at least for medication classified as controlled substances. Popular security features on these pads include:

  • Thermochromatic ink, which allows certain features to disappear when heated. These are usually replaced with the words "void" or "copy." This is designed to prevent scanning or photocopying of prescriptions. These pads also allow pharmacists to check the authenticity of a prescription by rubbing a specific spot to see if the ink disappears.
  • Erase-proof paper, which does not allow chemical washing or other altering of information.
  • Sequential numbers to track stolen pads.
  • A watermark, for example, of a state seal.

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