Physician Dispensing Legislation Held Up in House Committee

A March 22 Baltimore Sun article reported that legislation (HB 280) to limit the expensive practice of physicians directly dispensing large amounts of medication in workers’ compensation cases is stalled in the House Government Operations Committee.  Certain pharmaceutical companies buy drugs in bulk and repackage them for individual resale by a physician.  Both the physician and the company typically make money from price mark-ups on the medication.  HB 280 would limit the amount of medication a physician could dispense to a 30-day supply to account for immediate patient needs.  MACo supports the legislation.

Economic Matters is one of two committees that would have to approve the bill before it could move to the full House. Supporters are confident they have the votes there, but they are still hunting for the elusive 12th vote it would take to spring the measure from the House Health and Government Operations Committee.

Del. Peter A. Hammen, the Baltimore Democrat who chairs the health committee, has yet to hold a vote. A supporter of the legislation, Hammen said Friday that he intends to delay until he can persuade one more member of the committee to come aboard.

“We’re overpaying for these prescriptions,” he said. “It’s very costly to local governments.”

The article noted the cost disparities between pharmacy- versus physician-dispensed medications:

Along the way, both the repackager and the medical practice often benefit from a large markup. The commonly prescribed painkiller Vicodin, which costs about 37 cents a pill at a typical pharmacy, costs an average of $1.46 when dispensed by a physician, according to the Massachusetts-based Workers Compensation Research Institute. Six states have banned such repackaging.

Patients in workers’ compensation cases have little reason to complain about the price since employers and insurers typically cover 100 percent of the cost. But insurance companies and local governments that self-insure are looking to the General Assembly for a remedy.  …

Sen. Thomas M. Middleton, chairman of the Senate Finance Committee, said another factor driving the bill is a concern that large profit margins give doctors an incentive to overprescribe such potentially addictive drugs as the painkiller Oxycontin.

The bill is opposed by physicians, repackaging companies, plaintiff attorneys, and some labor unions.

HB 280 has a Senate cross-file (SB 215) that has not moved out of the Senate Finance Committee.  The Senate appears favorably inclined towards the bill but is waiting to see if the House will take action.

MACo Testimony on HB 280