government

Doctors pressured to write prescriptions for OTC drugs

Lawmakers are being asked to rescind a health reform provision that prevents patients from using flexible spending account money on medications without a doctor's order.

By Charles Fiegl amednews staff — Posted May 7, 2012

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Requests for prescriptions to purchase over-the-counter medicines using flexible spending accounts or health savings accounts have become an unnecessary burden for doctors and patients, according to congressional testimony from physician organizations, patient advocates and representatives of OTC drug companies.

Lawmakers are considering the repeal of a health system reform law provision that requires prescriptions for medicines and drugs, even those that have been approved by the Food and Drug Administration to be sold without a physician's order, before patients can cover the costs with funds from tax-preferred health accounts, including health reimbursement arrangements. The provision took effect in 2011, and physicians report that they now are being saddled with the task of writing otherwise unnecessary prescriptions for medications to fight the common cold, flu or allergies.

A coalition that includes the American Medical Association, AARP, the Consumer Healthcare Products Assn., the National Assn. of Manufacturers and the U.S. Chamber of Commerce supports repealing the reform law provision. Limiting tax-preferred coverage of medications that can be purchased over the counter has increased costs and impeded patient care, the groups say.

“The AMA supports two pieces of legislation, HR 2529 and S 1368, which would eliminate this provision and allow patients to save time and money when purchasing over-the-counter medications to treat minor ailments and injuries,” AMA President-elect Jeremy A. Lazarus, MD, said in a statement.

During an April 25 hearing, the House Ways and Means oversight subcommittee discussed the proposed repeal legislation and the impact that the reform law has had on physicians. Republicans and some Democrats support rescinding the provision to free up dollars from tax-preferred accounts.

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Rep. Charles Boustany Jr., MD (R, La.)

The current provision “leads to increased wait times in doctors' offices, greater costs both in time and dollars for consumers, and delays in obtaining treatment,” said Rep. Charles Boustany Jr., MD (R, La.), the subcommittee's chair. “This policy was not enacted to cure a problem or promote better health care spending — this was done to raise revenue, pure and simple.”

Responding to requests to write orders for OTC drugs has become an administrative problem for physician practices, said Joel M. Feder, DO, a partner at Overland Park (Kan.) Family Health Partners. He represented the American Osteopathic Assn. at the hearing.

Insulin and medical supplies that are not considered drugs or medicines, such as bandages, contact lens solution and blood sugar testing kits, do not require a prescription for the use of FSA, HSA or HRA money under the reform law. Thus, practice staff often must make a preliminary determination as to whether a physician's order is needed. The law also has created conflict between doctors and patients, physicians report.

“In my experience, most patients feel inconvenienced and are unhappy with this situation and enter my office with that mindset,” Dr. Feder said. “As a result, I am potentially placed in a difficult and uncomfortable situation with a patient by possibly refusing to provide a prescription, charging for that service, and/or recommending that patient purchase a different, higher-cost alternative.”

For instance, Dr. Feder said he will not write prescriptions for medications that a patient seeks as a source of energy. The patient-doctor relationship would be fractured if that person left the practice as a result and sought an order from another doctor.

“I, along with my colleagues, strive to empower my patients to make decisions regarding their health while still coordinating their care and visiting them when necessary,” he said. “As I work to coordinate the care for my patients … I aim to put practices into place that allow them to stay out of the office as a result of good health.”

The use of OTC medicine is estimated to save the system $102 billion a year, in part through a decreased need for office visits and diagnostic tests, according to a 2012 study commissioned by the Consumer Healthcare Products Assn. This includes about $25 billion in savings from utilization of lower-cost medicines instead of drugs that are kept behind the pharmacy counter.

The reform law, which will limit the amount that patients can set aside in FSAs to $2,500 a year beginning in 2013, is expected to increase government revenue by $18 billion over nine years — revenue that will be used to help expand health coverage to the uninsured population, said Paul Van de Water, PhD. He's an economist and senior fellow with the liberal Center on Budget and Policy Priorities in Washington. Republicans on the subcommittee referred to this as a cost shift from one population segment to another.

Only one in seven working Americans has a flexible spending account or health savings account, and most workers do not have the option of opening such an account through their employers, Van de Water said.

The cost of repealing the over-the-counter provision would be $7 billion over 10 years, said Rep. Xavier Becerra (D, Calif.). He questioned why Congress should offset what effectively is a tax break for just a segment of the population.

“We're giving a select group of Americans a chance to deduct the cost of that flu medicine from their taxes, while the majority of Americans buy the same medicine, buy the same pills, but don't get to deduct those costs from their taxes,” he said. He noted that the reform law does not prevent patients with accounts from accessing the medicines, and the accounts still can be used to cover co-pays, medical care and medical supplies.

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ADDITIONAL INFORMATION

Big spending on over-the-counter medicines

Medicines to treat coughs and colds comprised nearly a quarter of the roughly $17 billion in U.S. over-the-counter retail drug sales in 2010. Tax-preferred health accounts can be used to purchase an OTC drug only if it is prescribed by a physician and qualifies as a medical expense. Supplies and other medical care not considered medicines are exempt from the prescription requirement.

Acne remedies: $350 million

Analgesics, external: $313 million

Analgesics, internal: $2,341 million

Antidiarrheals: $163 million

Anti-smoking products: $485 million

Cough/cold and related: $4,054 million

Eye care: $500 million

First aid: $675 million

Foot care: $336 million

Heartburn: $1,386 million

Laxatives: $832 million

Lip remedies: $419 million

Oral antiseptics and rinses: $722 million

Sunscreens and blocks: $550 million

Toothpaste: $1,288 million

All others: $2,557 million

Source: “Present Law and Background Relating to the Tax Treatment of the Cost of Over-the-Counter Medicine as a Medical Care Expense,” Joint Committee on Taxation, April 23 (link)

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Health accounts will cover these OTC items without a prescription

Not all over-the-counter health items require a prescription for patients to pay for them using money from tax-preferred health accounts. The Internal Revenue Service has issued guidance on the items for which prescriptions are not needed:

  • Insulin
  • Equipment, such as crutches
  • Supplies, such as bandages
  • Diagnostic devices, such as blood sugar testing kits

Source: IRS, “Affordable Care Act: Questions and Answers on Over-the-Counter Medicines and Drugs,” February (link)

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