Mikulski, Cardin Introduce Legislation to Reduce the Waste from Unused Prescription Drugs and Preserve Billions in Medicare Savings

September 12, 2013

WASHINGTONU.S. Senators Barbara A. Mikulski and Ben Cardin (both D-Md.) today announced that they have introduced legislation that aims to reduce the amount of unused prescriptions drugs dispensed at long-term care facilities and protect billions of dollars in savings intended by the Medicare Short-Cycle Dispensing program created in the Affordable Care Act. The bill, the Medicare Efficient Drug Dispensing Act of 2013 (S. 1493) would ensure that prescription drug plans sponsors (PDPs) help reduce wasteful spending by prohibiting them from using payment structures, such as prorated daily dispensing fees, that actually encourage the dispensing of unused drugs.  

Reducing waste at long-term care facilities (LTCs) saves Medicare money, protects the environment by limiting the pharmaceuticals that are disposed of in drains, toilets and trash bins, polluting our waterways. The program was scored as saving $5.7 billion over 10 years but those savings have been put in jeopardy as PDPs switched from paying pharmacies at LTCs a flat, professional fee each time they fill a prescription to a fee tied to the number of days' supply of drugs the pharmacy dispenses. The Medicare Efficient Drug Dispensing Act of 2013 is supported by the Senior Care Pharmacy Alliance.  

"I believe that 'Honor Thy Father and Mother' is a good commandment to live by and a good policy to govern by," Senator Mikulski said. "That's why I've continued to fight to save and strengthen Medicare to ensure that health care for seniors is affordable, accessible, reliable and undeniable. Too often facilities are forced to buy more than they need and perfectly good, and expensive, drugs go to waste. This legislation will save taxpayers money by making sure that Medicare is only paying for the drugs that people use."  

"We should be directing scarce resources where they are needed most to help the millions of men and women who rely on Medicare to keep their prescription drugs affordable. Dispensing and charging Medicare for doses of medicines above and beyond what is prescribed by a doctor is wasteful and expensive," said Senator Cardin, a member of the Senate Finance Committee Health Care Subcommittee.  

Tying the professional fee to the amount of medication dispensed ignores the clinical oversight necessary to provide care under the unique CMS requirements for LTC pharmacies. It also creates an incentive for pharmacies, per their contracts, to over dispense medications in a manner that inherently creates waste and higher costs for Medicare Part D. This is the exact opposite of the intended outcome of the short-cycle dispensing policy.