Tuesday, April 30, 2013

FL Repackaged Drugs - People Are The Losers

As I've mentioned before, in particular with the Florida repackaged drug bill that is circulating the legislature there, compromise means that somebody isn't going to be happy.

And that's the case with Florida school districts, and other public entities, that relied on Florida Statute 440.13(12) (c).

The provision allows carriers and employers to pay for drugs at the discounted rate for which they have contracted, even if an injured worker elects to obtain the drugs through a provider that is not a party to the contract.

According to Scott B. Clark, risk and benefits manager for the Miami-Dade Public School District, that provision of law has saved the school district $3 million since November 2009.

Not an insubstantial amount of money when public funds for education are squeezed tight.

Florida state lawmakers continued toward passing the repackaging bill on Monday. The House Health and Human Services Committee held an emergency meeting Monday morning and amended HB 605, filed by Rep. Matt Hudson, R-Naples, to reflect the compromise included in SB 662, which eliminates 440.13(12)(c). The Senate passed its version of the bill by a vote of 39-0 on Monday.

The legislative staff of the Florida Senate said in an analysis released last Thursday that eliminating the ability to pay the discounted rate also will cost the state Division of Risk Management $210,337 a year.

Though te National Council on Compensation Insurance (NCCI) has not released an official report on the compromise, interest groups were told last week that the bill should reduce overall workers' compensation costs by 0.7% and save about $20 million a year.

The deal was negotiated by the Florida Insurance Council, the Florida Chamber of Commerce and Associated Industries of Florida on one side and the Florida Medial Association and Automated Healthcare Solutions on the other.

Interestingly, the states pharmacies aren't opposed to this deal.

"We feel that it's better than the status quo at this point," said John Fleming, communications director for the Retail Federation, which represents Florida's major pharmacy retail chains.

This could be because of the increased competition against pharmacies represented by well-financed direct to patient marketing ability of physician dispensing outlets.

And it could be that retail pharmacies are just tired of the whole argument.

As part of the compromise, proponents also added language that would require doctors to pay for repackaged drugs within 60 days in order to retain a supply of the drugs. The amendment would prohibit dispensing physicians from possessing any repackaged drugs for which payment hasn't been made to the "supplying manufacturer, wholesaler, distributor or repackager within 60 days of the doctor dispensing the drugs.

This provision was added to encourage doctors to pay repackagers in situations when the drugs aren't dispensed within 60 days.

Of course there isn't any enforcement or inspection mechanism, so this provision has no reality to it and won't make any difference on the street. It's just malarky language - there to appease someone with no real chance of having any effect on behavior.

Where does insurance stand?

Sam Miller, executive vice president of the Florida Insurance Council, said business groups and insurers saw the compromise as the only way to get a price cap on repackaged drugs written into Florida law.

"This is a big issue and NCCI is saying we're going to save $20 million," Miller said. "With a vote of 39-0 in the Senate, it's fairly clear they're going to bring this home for landing."

I called this Ali Law in an earlier post; - where a special interest plays "rope a dope" and is obstinante for so long, that eventually everyone else gets tired and just gives up, so they work up something to make the issue go away. Clearly, that is the case with this bill.

Usually in a compromise everyone walks away with something - not everything they want, but at least a tidbit to ease the pain of what was given up in return.

But in the case of the Florida repackaged drug war, there are only losers - the people of the State of Florida.

It's a bad law, but it will be the law because those in the ring punching it out are tired.

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