KPhA Weekly Pharmacist Legislative Update
Kentucky Legislative Update
February 24,2012
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Legislative Update

Gaming legislation was in the forefront this week in Frankfort as the Senate defeated a constitutional amendment to allow casino gaming. The initiative was supported by Governor Beshear but was handily defeated in the Senate on Thursday

 

Despite the focus on gaming, it was a busy week for pharmacy legislation. The House passed the pharmacy audit bill (HB 349) while the Senate Judiciary Committee began hearings on an anti-prescription drug abuse bill (SB 100). In a surprise move the senate bill requiring a prescription for pseudoephedrine was withdrawn on Thursday by the bill's sponsor.

 

House Passes Pharmacy Audit Bill

The House gave unanimous approval to HB 349 on Friday. The bill, sponsored by Representative Tommy Thompson (D-Owensboro), amends Kentucky's existing pharmacy audit law to address issues raised by pharmacists during the interim. The bill was amended on the floor to address concerns raised by the Attorney General about the confidentiality section of the bill.

 

HB 349 specifies that an auditing entity may not recoup payments because of clerical errors or omissions unless there is evidence of fraud or an actual overpayment has been made. Under the provisions of HB 349, recoupment of overpayments is limited to the actual amount of the overpayment and would not include the dispensing fee. The bill also limits the length of time an auditing entity can require a pharmacy to keep records. HB 349 limits record retention to two years or the period of time required by state or federal law.

 

Another significant provision of HB 349 is the removal of the exemption for managed care organizations (MCOs) serving the Medicaid population. The current law exempted these entities from the auditing restrictions. With the expansion of managed care in the Medicaid late last year, private companies are now responsible for providing benefits to the majority of the Medicaid population.

 

The passage of the bill by the House is a major victory for the pharmacy community. The measure now goes to the Senate for consideration.  

 

Generic Pricing Bill Recommitted

SB 125,a bill addressing the use of "maximum allowable cost" (MAC) pricing methodologies by pharmacy benefit managers (PBMs) was recommitted to the Senate Appropriations and Revenue Committee on February 22. SB 125 was approved by the Senate Health and Welfare Committee last week. The move may be a signal that significant opposition by PBMS and health plans is taking hold and Senate leaders are unwilling to advance the bill. The sponsor of the legislation, Senator Julie Denton (R-Louisville), is working with the pharmacy community and the opponents of the bill to achieve agreement so that a revised bill can be brought up for a vote by the full Senate.

  

As currently written, SB 125 specifies that PBMs may only use MAC pricing when three or more generic products are available in the market. It requires PBMs to notify pharmacies how MACs are calculated and provides for notification when MACs are implemented or discontinued.

 

A key provision of SB 125 is a requirement that PBMs update their MAC prices weekly. This provision ensures that pharmacies will be adequately reimbursed for generic drugs as prices change in the marketplace. PBMs also will be required to establish an appeals process and respond to appeals in a timely manner.

 

SB 125 also establishes that PBMs must provide pharmacies with a "generic effective rate" in their contracts. This rate would provide a benchmark for pharmacies to evaluate the contract and to make decisions on whether or not to participate.

 

Finally, the bill requires managed care organizations (MCOs) serving Medicaid recipients to disclose their MAC prices to pharmacies in their networks. Fee-for-service Medicaid has historically made their MAC price lists available to pharmacies but the MCOs have been reluctant to disclose their pricing even to contracted pharmacies.

 

Panel Advances Bill on Tamper-Resistant Opioids

The House Health and Welfare Committee approved HB 377 at its Thursday meeting. The bill sponsored by Rep. Addia Wuchner (R- Florence) restricts the substitution of "tamper-proof" opioid drugs. The formulation of these drugs purportedly makes it more difficult for abusers to crush the pills or otherwise alter them for illegal purposes. The bill overrides Kentucky's generic drug law by prohibiting the substitution of these drugs by specifying that when a prescription is written for an opioid analgesic drug incorporating a tamper resistance technology, a tamper resistant technology drug must be dispensed. The doctor does not have to designate "do not substitute" on the prescription for these drugs.

 

Committee Begins Hearings on Anti-Drug Abuse Bill

The Senate Judiciary Committee began hearings this week on a comprehensive anti-prescription drug abuse bill sponsored by Sen. Jimmy Higdon (R-Lebanon). SB 100 calls for the licensing and regulation of pain clinics. It also proposes major changes in the state's electronic prescription drug reporting system (KASPER). Working directly with KPhA and its members, Higdon put forth a revised version of the bill at Thursday's committee meeting. The new version removes the requirement that pharmacists run a KASPER report prior to dispensing any controlled substance prescription. Instead it substitutes a provision that would require pharmacists to obtain a government-issued photo ID from any person picking up a controlled substance prescription. If the person picking up the prescription was not the person that the prescription was written for, the pharmacists would have to enter the name and other identifying information of the person into the KASPER database.

 

The revised version of SB 100 still requires pharmacists to report data to the KASPER system daily and establishes a multi-state compact for the sharing of prescription drug data. The committee took no action on the measure but a committee vote is expected next week.

 

The House has not taken action on a comprehensive anti-prescription drug abuse bill (HB 4) sponsored by House Speaker Greg Stumbo (D-Prestonsburg). Another bill dealing with controlled substances was introduced today. Senate Minority Floor Leader R. J. Palmer (D-Winchester) introduced SB 173. The details of the Palmer bill were not available at press time.

 

Senate Committee Approves Copayment Bill

The Senate Health and Welfare Committee voted out HB 262 which requires Medicaid managed care organizations (MCOs) to charge copayments for drugs. The bill requires any MCO that was not requiring a copayment for drugs as of Jan. 1, 2012 to implement a copayment structure of at least $1 for generics, $2 for preferred name brand drugs and $3 for non-preferred products. The copayment would be retained by the pharmacy in addition to the current reimbursement paid by the MCO.

 

HB 262 also contains a provision to exempt inter-pharmacy transfers of drugs from the state's drug wholesaling rules. This provision is identical to another bill introduced this session (HB 116).

 

The bill contains emergency clause to the measure making it effective immediately upon the Governor's signature should it pass both the House and the Senate.

 

Prescription Requirement for Pseudoephedrine Withdrawn; Another Bill Filed

In a surprise move on Thursday, Senate Majority Leader Robert Stivers (R-Manchester) withdrew SB 50,a bill making common cold and allergy medications containing pseudoephedrine (PSE) available only by prescription. The measure was one of five bills introduced this session to address the problem of pseudoephedrine being used in the production of methamphetamine. The move came a week after the Senate Judiciary Committee approved the measure by a 6-5 vote.

 

Sen. Stivers indicated that there was not sufficient support in the Senate at this time to pass the proposal but the issue of pseudoephedrine sales is likely far from over. The Chairman of the Senate Judiciary Committee Sen. Tom Jensen (R-London) told the Louisville Courier Journal that a compromise was in the works. According to Jensen, lawmakers are working on a solution where neither side gets everything they want but will allow the General Assembly to begin addressing the methamphetamine issue. On Friday Jensen filed another pseudoephedrine bill, SB 172, which is expected to be the vehicle for a compromise proposal.

 

The issue of pseudoephedrine sales has been hotly debated in the last several sessions of the General Assembly and legislators continue to be sharply divided on how to approach the issue of curbing meth labs.  

 

Four other proposals aimed at further restricting pseudoephedrine sales still remain in play in the General Assembly. HB 79 contains a prescription requirement and requires reporting of dispensed PSE prescriptions to the state's prescription electronic drug reporting system (KASPER). Two other proposals, HB 80 and SB 79, take a different approach by prohibiting any person convicted of an offense relating to methamphetamine from purchasing PSE without a prescription for a period of five years after serving their sentence or expiration of parole. A "precursor block list" would be maintained in the state's electronic PSE tracking system (MethCheck) to alert pharmacies and block sales to these individuals at point-of-sale. Another proposal, HB 166, prohibits pharmacy technicians from dispensing PSE.

 

Committee Approves Bill Clarifying the Fitting of Therapeutic Shoes

The House Health and Welfare Committee gave unanimous approval to a bill that clarifies that pharmacy technicians and pharmacist interns can continue to assist pharmacists in the fitting of therapeutic shoes for diabetics. HB 403, an initiative of the pharmacy community, is sponsored by Rep. Leslie Combs (D-Pikeville).

 

The bill addresses a problem that surfaced after the General Assembly passed a bill licensing pedorthists, orthotists and the fitters of prosthetic devices in 2010. That law, which becomes effective in 2013, has been interpreted to prevent anyone in a pharmacy other than a pharmacist from performing certain tasks relating to the fitting of therapeutic shoes. Combs' bill makes it clear that properly trained pharmacy personnel can assist the pharmacist in these activities.

 

The bill is on the Consent Calendar in the House and is expected to receive a vote next week.

 

DME Dealer Licensing Bill Passes House

The House approved HB 282 by a vote of 93-3 on Thursday. The bill requires durable medical equipment dealers to obtain a license from the Kentucky Board of Pharmacy. The annual fee for a license is initially set at $200. HB 282 contains a number of exemptions from the licensing requirement. Among them is an exemption for pharmacists and pharmacies already licensed by the Kentucky Board of Pharmacy.   Hospice, physicians, nursing facilities and government agencies also are exempt. However, the exemptions do not apply if the entity sells durable medical equipment under a separate corporate entity. The bill is supported by the industry group representing durable medical equipment dealers.

Kentucky Pharmacists Association
1228 US 127 South

Frankfort, KY 40601

502-227-2303

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