[ Wednesday, October 06, 2004 ]


PDMA Redux: You've probably never heard of the Prescription Drug Marketing Act of 1987. It was intended to stop drug diversion, which is the resale of drugs by hospitals and other entities that can buy them cheaply or in bulk. The law basically requires that hospitals and nonprofits that buy prescription drugs cannot resell the drugs except to the end user pursuant to a prescription, to entities (other than retail pharmacies) under common control, to entities in a group purchasing organization, or in emergency situations. The stated reason for the law was to protect the drug supply, since multiple resales could conceivably allow counterfeit or tampered drugs to enter the market. The real reason was that hospitals and other big purchasers could buy the drugs on the cheap, resell them at a price lower than the price retail pharmacies charged, and still make a profit at the expense of retail pharmacies. The retail pharmacies got their lobbyists to push the bill and get it passed. I became a bit of an expert in the PDMA back in the late '80s and early '90s.

So my curiousity was piqued when I saw that House had passed new legislation designed to prevent the "illegal diversion and misuse of prescription drugs." The bill would require the States to set up programs to monitor diversion and misuse of prescription drugs. I am not sure what they were going after, but I suspect it has to do with Canadian importation.

What does this have to do with HIPAA? I'm so glad you asked. One of the major concerns about the bill is its impact on patient privacy. States would have to submit their monitoring programs to HHS, which would vet them. The States would have to indicate how their programs would protect patient privacy. The bill specifically would apply HIPAA to the programs, except when pharmacies are transferring information to state-established databases. Some wanted HIPAA to apply to all parts of the programs, but that would make them harder to establish.

This bill must go to the Senate's ridiculously-acronymed Health, Education, Labor and Pensions Committee before it can get to the President's desk, and they are likely to push for more privacy protections.

UPDATE: Thanks to HIPAAlert from Phoenix Health, I've learned a little more about this bill. The underlying point of the bill is to provide federal funding to states that will allow them to set up prescription drug monitoring systems, so the states can track prescription drug use and attempt to stop the illegal use of prescription drugs. To get funding, the program would have to require pharmacists to report prescriptions of certain drugs, presumably oxycontin and similar narcotic/pain drugs (see Rush Limbaugh story, above). That information could be shared with other states, and be used by the state program to ferret out individuals who are seeking multiple prescriptions of these types of drugs. The whole effort makes a lot more sense, once you know this background.

Jeff [8:51 AM]

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