Workers Comp re-package bill clears 7-4

Jan 19, 2012

Lawmakers are considering a bill that would limit the price doctors can charge workers compensation patients for re-packaged medicine. Regan McCarthy reports the bill passed both chambers once before only to be vetoed by then Governor Charlie Crist in 2010.

Senator Alan Hays, a Republican from Umatilla, says this measure is one of those things people hear about and think ‘there ought to be a law against that.’ And he says that’s exactly why he’s sponsoring this bill. Hays says repackaged drugs are sometimes sold for more than 600-percent of the cost of the medication and he says that’s driving up the cost of Workers Compensation. His proposal would limit that

“There is nothing in this bill that prohibits or restricts the dispensing of medication by physicians. This bill will, however, stop them from ripping off the system for charging extremely inflated fees for the medication.”

Hays says the price increase comes when doctors “re-package” the drugs in their offices.

“Most people think of repackaging something as you take something out of one container and put it in another container and it’s been repackaged. Well, that’s really all that happens here, except that act of changing containers, changing the quantity or the label of the prescription,  allows the assignment of a new national drug code, which then allows them to assign a different cost.”

Under Hays’ bill doctors dispensing repackaged medications to Workers Comp patients would only be allowed to charge the average whole sale price of the drug plus a dispensing fee of $4.18, putting the cost more in line with what’s charged at pharmacies. Hays estimates the change would save 62-million dollars a year, but the senator’s math is in question. Senator Mike Bennett, a Republican from Bradenton says a report from the Chief Financial Officer’s office doesn’t match up with Hays’ claim.

“They said the total dispensing last year was a total of $63 million dollars. When I’m looking at their report and saying the total thing is $63 million dollars and you and the people that are advocating against your bill are saying that it’s going to save $ 62 million dollars, I don’t know about you, but that tells me there’s not going to be much left over for aspirin, much less anything else.”

Lori Lovgren is a spokeswoman from National Council on Compensation Insurance. She says a $ 62 million dollar savings can be realized if “rate making” is taken into account.

“So in this particular case, thirty six million dollars is the savings in drug costs, the rest is the reduction in expenses. The type of expenses I’m talking about are the fact that when you reduce a benefit in the system you also collect less taxes and assessments, you have less cost associated with adjusting particular claims, so those are the dollar costs that are added to the expense costs to come up to that total figure of $62 million dollars.”

Other lawmakers like Senator Mike Fasano, a Republican from Newport Richey, raised concerns about the necessity of the law.

“Why would we want to tell a doctor what he or she can charge when the carriers have every right in the world right now to decide whether that patient can go to a doctor that either dispenses or doesn’t dispense or a physician that overcharges? They carrier has the right to do that now, why pass legislation?”

The bill passed through the Senate Banking and Insurance Committee with an amendment from Democratic Senator Eleanor Sobel of Hollywood. The Amendment would ensure that physicians would continue to be allowed to dispense and fill prescriptions and would keep insurance companies from selecting the pharmacy or dispensing practitioner the patient can use. A similar bill is making its way through the House.