Must Read!!! Attorney General in State of Tennessee Issues Opinion Letter on Inspection Fees for Out-of-State Pharmacies Licensed in Tennessee

STATE OF TENNESSEE



OFFICE OF THE ATTORNEY GENERAL

January 9, 2014,

Opinion No. 14-05

Inspection Fees for Out-of-State Pharmacies Licensed in Tennessee

QUESTIONS

1. Does the Tennessee Board of Pharmacy have the statutory authority to enact a rule imposing a fee or charge on Tennessee-licensed pharmacies that are physically located in other states and that engage in the practice of compounding sterile products, where such fee or charge is related to the additional expense incurred in inspecting these pharmacies and would not be imposed on similar pharmacies located inside the state?

2. Would such a rule violate the Commerce Clause of the United States Constitution?

OPINIONS

1. Based upon the provisions of the Tennessee Pharmacy Practice Act, and particularly of recently enacted Tenn. Code Ann. § 63-10-216, the Tennessee Board of Pharmacy is not authorized to enact a rule that would implement licensing-related inspections of out-of-state compounding pharmacies by Board personnel and that would impose additional fees or charges upon those pharmacies for the costs of such inspections.

2. Because of the answer to the first question, the question about the Commerce Clause is pretermitted.

ANALYSIS

In an effort to ensure that the same compounding standards are followed by all licensees that compound sterile products, regardless of physical location, the Tennessee Board of Pharmacy is

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No timetable for Tenn. House vote on compounding bill

04/9/2013 | Tennessean (Nashville) (tiered subscription model), The

The Tennessee House has yet to schedule a vote on a bill approved by senators to allow providers to obtain compounded treatments during shortages without a patient-specific prescription. The state Department of Health acknowledges the hardship of balancing efforts to ease shortages with measures to ensure patient safety, said Dr. David Reagan, the state's chief medical officer. The measure is neither endorsed nor opposed by the department, Reagan said.

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TN Senate drops drug rule Bill would allow compounding with no prescription for a specific patient

The Tennessee Senate on Thursday overwhelmingly approved a measure that would allow pharmacists to compound drugs without having a prescription for a specific patient, a key safeguard that exists under current law.

The measure was approved on a 29-1 vote, without a word of dissent, after a presentation by Sen. Ferrell Haile, R-Gallatin, who is a pharmacist. Sen. Todd Gardenhire, R-Chattanooga, cast the only vote against the bill.

A House version of the bill, sponsored by Rep David Shepard, a Dickson Democrat, has cleared the House Health Committee and is awaiting a House floor vote. Shepard, like Haile, is a pharmacist.

The Tennessee Pharmacists Association pushed for adoption of the bill, which would create a loophole for hospitals and other health care providers to obtain compound drugs without having to identify a patient. It would do so by permitting compounders to ship drugs without having received a patient-specific prescription in cases when a product “is not commercially available.

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TN board moves toward new rules on compounding pharmacies

Tennessee pharmacies that compound medicine could see more inspectors more often under proposals the state pharmacy board set into motion Wednesday.

To do that, the board would beef up its inspection staff and pay for it by increasing licensing fees for all pharmacists and pharmacies.

The board told its staff to draft rules implementing those and other potential changes for its review, possibly as early as May. It’s unclear which proposals will become reality and when, as the rule-making process can last several months or longer.

“We have made progress,” board member Nina Smothers, a pharmacist, said following the nearly 4½-hour meeting.

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TN drug compounding bill loses safeguard Meningitis culprit broke the same rule this bill would erase

March 5, 2013

Six months after moldy medicine caused an outbreak of a deadly new form of meningitis, Congress does not have a single bill before it to improve regulation of compounding pharmacies, and the only legislation proposed in Tennessee would strip away an important safeguard.

The one proposal pending before the Tennessee General Assembly would eliminate the requirement that compounded drugs be prepared only with a patient-specific prescription.

New England Compounding Center, the maker of the moldy medicine, violated this requirement when it mass-produced and sold steroid drugs that were injected into people’s spines as a pain treatment, federal and state regulators have charged.

The sponsor of the state legislation, Sen. Ferrell Haile, R-Gallatin, is a pharmacist.

“Right now I cannot compound for more than one individual at a time,” Haile said. “That’s why we had all this stuff coming in from other states.”

The effort by Haile is in direct contrast to the situation in California, where the state pharmacy board and some legislators are working to eliminate an existing provision in California law that mirrors the provision in Haile’s bill.

Virginia Herold of the California Pharmacy Board said a pending bill would eliminate a so-called prescriber’s exemption allowing production of compounded drugs without patient-specific prescriptions under certain circumstances.

Traditionally, compounding was used by pharmacists to create a custom medication specifically for one patient.

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Meningitis outbreak: Saint Thomas tried to protect itself from lawsuits

Nashville hospital, defendant in meningitis suit, sought to avoid being identified in early stages of outbreak

Feb. 16, 2013 3:25 AM

Written by

Tom Wilemon and Walter F. Roche Jr.

The Tennessean

Despite distancing itself from the clinic that bears its name, Saint Thomas Health still wound up as a legal defendant in the fungal meningitis outbreak.

Saint Thomas tried to keep from being named as state officials prepared to alert the public about meningitis cases tied to tainted steroid injections at a pain clinic it half-owned. It asserted that the clinic wasn’t actually in its flagship hospital.But the first lawsuit against Saint Thomas Health accuses it of having concocted “the fiction of a corporate veil.”
Saint Thomas Outpatient Neurosurgery Center was used as a “subterfuge” to engage in the “illegal conduct” of purchasing 2,500 vials of medicine from New England Compounding Center in violation of patient safety laws that require specific prescriptions for individual patients, according to the complaint.

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TN Health Department won't disclose info on compounding lab inspections Agency cites state law for refusing to release information

The state Department of Health says it has stepped up inspections of sterile compounding pharmacies in Tennessee after a fungal meningitis outbreak tied to a tainted drug, but it won’t release the results.

Citing a state law, the agency has refused to state the number of violations cited, to say how many corrective actions have been taken, to release individual disciplinary reports against pharmacies or to specify the dates of their last inspections — the same type of information that the agency has released for hospitals, hospices, assisted living centers and nursing homes.

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Tennessee Task Force Reviews State's Compounding Pharmacy Regulations

January 23, 2013 3:55 pm Topics: Compounding

The Tennessee Board of Pharmacy has convened a task force to review the state’s regulations pertaining to compounding and determine how regulations might be strengthened to further protect the public health. At the end of 2012, the Board conducted a survey of the 2,350 pharmacies licensed by the state. Of the 1,893 pharmacies responding, 352 indicated that they engage in sterile compounding, with 65 preparing more than 100 doses per day, reports The Tennessean. The task force is considering amending pharmacy compounding regulations, such as possibly including United States Pharmacopeia (USP) Chapter 797 standards. Other new regulations being considered may require new state legislation. In a meeting of the task force, the importance of sharing information about enforcement actions with other state boards of pharmacy and Food and Drug Administration (FDA) was also discussed. 

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TN pharmacy board learning wide scope of licensed compounding in state Pharmacy Board learning of scope

The Tennessee Board of Pharmacy on Wednesday learned for the first time how widespread the practice of sterile compounding is across the state as it considers additional regulations of the industry.

• Discuss the fungal meningitis outbreak on Facebook
• Continuing coverage of the fungal meningitis outbreak

According to preliminary survey results disclosed to the board at its meeting, 352 pharmacies licensed in Tennessee practice sterile compounding. The mandatory survey was prepared late last year after the national meningitis outbreak that has taken a heavy toll in Tennessee.
So far, 44 people nationwide, including 14 Tennesseans, have died after contracting a rare form of fungal meningitis. The infections came from tainted steroids prepared at New England Compounding Center in Massachusetts.
In response to the outbreak, the pharmacy board created a task force to study the state’s compounding regulations and how oversight could be improved. Compounding involves combining multiple medications to fill prescriptions for specific patients. Often the practice requires sterile conditions to prepare the prescriptions.
Late last year, the board sent surveys to 2,350 facilities licensed in Tennessee. Of the 1,893 that responded, 352 stated they conduct sterile compounding. Of that group, 65 prepare more than 100 doses of sterile drugs daily. Nearly 500 facilities have not yet responded to the survey, so the number could grow.
“The issue is if it’s that wide — and those who didn’t respond are the ones you especially want to worry about — that is a lot of pharmacies involved in this,” said public health expert Dr. Diana Zuckerman, who is president of the National Research Center for Women and Families.

Oversight studied

The pharmacy board is considering recommendations for state legislation that would create new regulations for sterile compounders.
However, board member Nina Smothers, who is leading the task force, said other improvements could be made administratively. For instance, Smothers said, the board could improve oversight by ensuring its inspectors were properly trained in how to inspect compounding pharmacies.
Smothers said adopting the U.S. Pharmacopeia’s model compounding regulations, which are called USP 797, is one possibility. USP 797 was created by the U.S. Pharmacopeial Convention, a nonprofit scientific organization that sets the national standard regarding the strength and purity of medications.
USP 797, which has been adopted in 18 states, provides guidelines for how pharmacists should prepare and handle compounded drugs.

Funding, training

Smothers’ task force also concluded that communication among Tennessee’s board of pharmacy, pharmacy boards in other states and the Food and Drug Administration regarding disciplinary action could improve.
The Tennessee Pharmacists Association’s executive director, Baeteena Black, told the pharmacy board that current laws are generally sufficient but instead the board should be adequately funded, its inspectors properly trained and out-of-state compounding facilities required to comply with state laws.
The board, which is mostly funded by licensure fees paid by pharmacists, has just five inspectors for 1,905 pharmacies and 706 manufacturers, wholesalers and distributors.

Contact Nate Rau at 615-259-8094 or nrau@tennessean.com. Follow him on Twitter @tnnaterau.
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Tennessee Board of Pharmacy Reminds Pharmacies of Difference Between Compounding and Manufacturing

Board Rules for Compounding Reemphasized
In the wake of the tragic events causing harm and loss of life across
the country, including several deaths in Tennessee, due to the fungal
meningitis outbreak, it is important to review the current definitions
and rules for Tennessee-licensed pharmacies practicing the art of
compounding. 
To start this discussion, it is important to understand the difference
between compounding and manufacturing. Refer to the following
definitions:
Tennessee Code Ann. §63-10-204 Definitions.
(4) “Compounding” means the preparation, mixing, assembling, packaging or labeling of a drug or device:
(A) As the result of a prescription order or initiative based on
the prescriber-patient-pharmacist relationship in the course
of professional practice;
(B) In anticipation of prescription orders based on routine,
regularly observed prescribing patterns; or
(C) For the purpose of, or as an incident to, research, teaching
or chemical analysis and not for sale or dispensing;
(12) “Dispense” means preparing, packaging, compounding or labeling for delivery and actual delivery of a
prescription drug, nonprescription drug or device in the
course of professional practice to a patient or the patient’s
agent by or pursuant to the lawful order of a prescriber;
(21) “Manufacturer” means any person, except a pharmacist
compounding in the normal course of professional practice,
engaged in the commercial production, preparation, propagation, conversion or processing of a drug, either directly or
indirectly, by extraction from substances of natural origin or
independently by means of chemical synthesis, or both, and
includes any packaging or repackaging of a drug or the labeling
or relabeling of its container and the promotion and marketing
of such drugs or devices;
(13) “Distribute” means the delivery of a drug or device, other
than by administering or dispensing, to persons other than the
patient or the patient’s agent;
Therefore, be advised that the patient-specific prescription via the
prescriber-patient-pharmacist (also known as the three-legged stool)
is required for the pharmacist to prepare and dispense a compounded
prescription.
To sell a manufactured drug without a prescription in Tennessee, (ie, office or hospital use) a wholesaler/manufacturer/distributor
(W/M/D) license, issued by the Tennessee Board of Pharmacy, is
required as discussed in the July 27-28, 2011 Board meeting minutes:
A company with the business model of providing admixture
pharmacy services, appeared before the board to ask for permission to operate as a pharmacy in Tennessee. The representative
explained that the company would compound sterile preparation in anticipation of institutional pharmacies’ prescription
orders and it would be based on the institution prescriber’s
routine prescribing patterns. The compounded admixture is
not patient specific but the company would like to send the
admixture to institutions based on past usage of the product.
After discussion, a member of the Board made the motion that
based on the business model discussed with this company, it
would be necessary that they be licensed in Tennessee as a
manufacturer/wholesaler/distributor. Furthermore, the motion
stated that if they decided to dispense patient specific, they
would have to be licensed as a pharmacy as well. The motion
was seconded and carried.
Currently, there are pharmacies licensed by the Board that carry
both W/M/D and pharmacy licenses. However, be advised that Food
and Drug Administration and Drug Enforcement Administration
(DEA) regulations may require licensure or other certifications to also
manufacture drug products for sale, purchase, or transfer.
For pharmacists practicing the art of sterile compounding under a
pharmacy license for patient-specific prescriptions, it is advised
to review the current Tennessee Board of Pharmacy rules found at
the following Web link: www.state.tn.us/sos/rules/1140/1140-07
.pdf. Board rules require documentation to be completed and readily
available, including flow hood certification, pre-filter records, training,
and policies and procedures
http://health.state.tn.us/Boards/Pharmacy/index.shtml
December  2012

Tennessee Board of Pharmacy October 23, 2012 Meeting Regarding Surrender of Barry Cadden's License

A teleconference was held to review and discuss the volunteer surrender of Tennessee
pharmacist license #22971 for Barry James Cadden, D.Ph. Dr. Cadden is the pharmacist in
charge for New England Compounding Center and has been charged with violating T.C.A § 4-5-
3205(c) and board rule 1140-01-.06.
Dr. Warren called the meeting to order and to ensure that each participant was connected a roll
call vote was taken.  Dr. Eidson made the motion to proceed with the meeting electronically. Dr.
Kizer seconded the motion. The motion carried with a roll call vote.  Mr. Smith informed the
board of the need  for a motion to determine if the matter or matters to be discussed meet the
following requirements; the subject matters requires timely action, the physical presence of all
members is not possible and the participation by some or all of the members of the board by
electronic or other means is necessary. Ms. McDaniel made the motion that this meeting does
meet the requirements listed. Dr. Kizer seconded the motion. The motion carried with a roll call
vote.
Mr. Smith informed the board that Dr. Barry James Cadden has signed an Agreed Order to
voluntarily surrender his license and Dr. Cadden understands that this action is considered a
revocation and will be reported to the national database. Dr. Eidson asked for clarification of
board rule 1140-01-.06 listed as number 5 in the Consent Order under Stipulation of Fact. Mr.
Smith stated that this was not summary suspension but listed that rule as a notice that the board
could have preceded with a summary suspension. Dr. Eidson asked what are the difference in Tennessee Board of Pharmacy
Board Meeting
October 23, 2012
2
this order and the consent order signed by New England Compounding Center. Mr. Smith stated
that the differences include that New England Compounding Center consent order was based on
an inspection report by the Massachusetts Board of Pharmacy and the sterility of certain drug
products compounded and dispensed by the pharmacy, specifically methylprednisolone acetate
and Dr. Cadden paragraph three states that “On or about October 3, 2012, NECC voluntarily
surrendered its pharmacy license in its home state of Massachusetts. NECC’s Surrender
Agreement states that it relates to an inspection conducted on October 2, 2012.
Ms. McDaniel asked if the Department of Agriculture is the group that tags the vials and does the
investigation or if the Department of Agriculture is working with the Department of Health for
the collection of the medication sent from New England Compounding Center since the
Department of Agriculture is responsible by statute. Dr. Holt stated that the collection of the
medication is being directed by Commissioner Dreyzehner as part of the investigation and that
he doesn’t know if they are working with the Department of Agriculture or not. Ms. Young
stated that the Tennessee Food, Drug and Cosmetic Act which deals with adulterated drugs is
administered by the Department of Agriculture, and that the collection of the medication is not
part of this consent order. Ms. McDaniel asked how many vials have been shipped into
Tennessee. Ms. Young stated that the coordination on the public health end with the collection of
suspect drugs is being handled by the FDA, New England Compounding Center and the
Tennessee Department of Health Epidemiologist. They are trying to determine which product
was contaminated and how many patients were exposed to the product. Ms. Young stated that
she doesn’t believe that an investigation has been started on the pharmaceutical stand point but
that they are trying to complete the investigation as it pertains to the public health, safety and
welfare to the citizens of Tennessee. Ms. McDaniel stated that the reason she was asking about
the number of vials sent into Tennessee is that she is ready to assess a civil penalty to the
pharmacist today. Mr. Smith explained that a civil penalty cannot be assessed today because a
hearing would have to be scheduled and proof shown of the number of contaminated drugs and
the number of victims are not fully known at this time. Mr. Smith stated that Dr. Cadden would
be given the right to present proof of his own, but he cannot submit proof of the revocation of his
license and has no right to appeal this part of the order. Dr. Cadden can submit proof if the board
decides to have a hearing concerning the assessment of penalties. Ms. McDaniel asked Dr. Holt
about the process in which the Board of Pharmacy asses penalties during the regular course of
business through the compliant summary report. Dr. Holt stated that they complainant can appeal
the penalty. Ms. Young states that individuals that have agreed to the assessment of penalties
were due to the negotiation between them, their attorney if they have one, and the Office of
General Counsel and would result to a Consent Order. If the individual chooses not to accept the
Consent Order then the next phase is to file Notice of Charges for a hearing before the board.
Ms. Young stated that with respect to the board of pharmacy, many individuals agree to the
assessment of penalties and do not contest. Ms. McDaniel stated that the board had assessed a
fine on someone and they wanted to negotiate the fine and that this was done before a Consent
Order was issued. Ms. McDaniel stated that during the normal course of a board meeting the
board has assessed the penalty upfront and then we send the Consent Order. Ms. Young stated
that when a complaint has been filed with the board of pharmacy that the complaint is givien to
the board in an anonymous manner with the facts. The board will make a recommendation based
on the facts presented. Once the recommendation has been voted on the Office of General Tennessee Board of Pharmacy
Board Meeting
October 23, 2012
3
Counsel will prepare a Consent Order to send to the respondent and the respondent has the right
to sign the Consent Order and pay the penalty or request a hearing. Ms. McDaniel asked why we
cannot assess the penalty today and give Dr. Cadden the right to agree or disagree. Ms. Young
stated that the difference is that we know who the order is for and this was not a normal
complaint that came into the office anonymously. This order was generated by information given
by the media and the general public. Ms. Young also stated that Dr. Cadden has agreed to the
surrender of his license, not a penalty, and that the board cannot assess a penalty at this time. Dr.
Eidson asked about the Food, Drug and Cosmetic Act and that Ms. Young did not think that
these drugs were adulterated but according to T.C.A. § 53-1-108 (1)(A) which states that “A
drug or device shall be deemed to be adulterated if it consists, in whole or in part, of any filthy,
putrid or decomposed substance”. Ms. Young stated that she wouldn’t disagree if the facts were
proven and that we don’t have legal evidence to present at this point. Dr. Eidson stated that he is
concerned that the Department of Agriculture is not involved in the collection of the drugs and
that he would recommend that the Department of Agriculture get involved. Specifically that they
have authority to go get the contaminated drugs.  Ms. Young stated that she will take the
recommendation back to Commissioner Dreyzehner concerning the collection of the
contaminated drugs. Dr. Warren stated what she is hearing is that the board wants to make sure
that if there is any contaminated product still out in the general population that it has been
collected, removed from possibility of administration to patients, and tagged for future
investigations. Dr. Eidson stated that this was correct and that they would like to have the
number of contaminated vials that has been collected. Dr. Warren stated that the board would
like to have that number at the November board meeting.  Ms. McDaniel stated that she would
still like to recommend a civil penalty. Mr. Smith stated that they can recommend an assessment
of penalty but that the board cannot vote on it. The meeting was sunshined for the surrender of
Dr. Cadden’s Tennessee pharmacist license and the decision before the board is to accept the
Agreed Order or not.  After further discussion, Dr. Eidson made the motion to approve the
Agreed Order as presented for the volunteer surrender of Dr. Cadden’s pharmacist license and to
notify the other boards where Dr. Cadden has a valid pharmacist license. Ms. McDaniel
seconded the motion. The motion carried with a roll call vote. Dr. Eidson made the motion to
authorize Dr. Holt to sign the Agreed Order on behalf of the board. Ms. McDaniel seconded the
motion. The motion carried with a roll call vote. Dr. Eidson asked that the board delay the
discussion of assessing civil penalties until additional information has been received pertaining
to the number of vials sent to Tennessee by New England Compounding Center and how many
were contaminated.
Ms. McDaniel made the motion to adjourn at 11:00 a.m. Dr. Eidson seconded the motion. The
motion carried.
The minutes were approved and ratified at the November 14-15, 2012 board meeting.
Source found here

Tennessee Board of Pharmacy Action Against NECC

To view the voluntary surrender agreement click here

Tennessee reaction to meningitis lauded by Senate panel

By Michael Collins
Published Friday, November 16, 2012

WASHINGTON — A deadly meningitis outbreak that killed 32 people and sickened more than 460 others could have been a lot worse if health investigators hadn’t acted quickly to identify and recall the contaminated medication responsible for the illness, public health officials said Thursday.
Thirteen of the deaths and 81 of the infections were reported in Tennessee, the first state to see the initial cases of fungal meningitis and sound the alarm that led to a recall of tainted steroid injections just a little more than a week later.
Tennessee alone likely would have recorded at least five more deaths and 59 more infections if a recall of the contaminated shots had been delayed just nine more days, said Dr. Marion Kainer of the Tennessee Department of Health.
"In Tennessee, we still have many patients hospitalized and suffering from complications and others who are exposed and frightened that they may become infected," said Kainer, director of the department’s Healthcare Association Infections and Antimicrobial Resistance Program.
Kainer and other public health officials in Tennessee won special kudos from the U.S. Senate’s Committee on Health, Education, Labor and Pensions for identifying the meningitis outbreak and quickly alerting the U.S. Centers for Disease Control and Prevention, which launched its own investigation.
"Tennessee public officials deserve gold medals," said U.S. Sen. Lamar Alexander, R-Tenn., who sits on the committee. Alexander called the state’s response "a textbook case, a model for the country."
Kainer testified before the Senate committee, which is investigating the government’s oversight of a Massachusetts pharmacy that has been the source of the contaminated injections.
Thursday’s hearing marked the second day in a row that a congressional panel has looked into whether the pharmacy, the New England Compounding Center in Framingham, Mass., had been properly monitored by state officials and the U.S. Food and Drug Administration.
The pharmacy’s owner and director, Barry Cadden, declined the committee’s invitation to testify. On Wednesday, Cadden refused to answer questions before a U.S. House panel and repeatedly invoked his Fifth Amendment right against self-incrimination. The Senate committee decided not to subpoena him, saying there was no need to continue the "charade."
Compounding centers operate under what FDA Commissioner Margaret Hamburg called a "crazy quilt" of state and federal regulations.
Traditional compounding centers, which fill special orders placed by doctors for individual patients, are overseen by state pharmacy boards, but the FDA can step in when problems arise. In recent years, however, larger compounding pharmacies have begun mass-producing thousands of vials of drugs that can be shipped nationwide.

Meningitis outbreak: 150 patients received older medications--Shelf Life Too Long

Written By comlim on Kamis, 08 November 2012 | 22:34

By Tom Wilemon and Walter F. Roche Jr. | The Tennessean

Nearly 150 patients who were exposed to potentially contaminated steroid injections in Tennessee got medicine that was more than 7 weeks old, even though industry guidelines say its shelf life should have been no longer than 24 hours.
Almost one in five of those patients developed fungal infection -- a rate dramatically higher than for those who were treated with fresher medicine, according to the Tennessee Department of Health.
The methylprenisolone acetate produced by Massachusetts-based New England Compounding Center is blamed in a nationwide outbreak of fungal meningitis that has sickened 424 people and killed 31, including 13 in Tennessee.
Under best-practice guidelines from the U.S. Pharmacopeia Convention, the drug would be considered a "high-risk" product -- made from nonsterile ingredients and lacking antimicrobial preservatives. In the absence of a sterility test, storage time should not exceed one day at room temperature or three days at a cold temperature, the guidelines say.
In Tennessee, NECC's vials were stored at room temperature, as specified in the package instructions, state health officials said in a paper published Tuesday in the New England Journal of Medicine.
The compounding laboratory claimed to have performed sterility tests on its products, but the Massachusetts Board of Pharmacy has said that testing was inadequate and shipments were made before the safety of medicines had been verified.
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Tennessee Complaint Revoking NECC's license

To view the complaint issued by the Tennessee against NECC click here

Blue Cross Blue Shield Position in Tennessee on Reimbursement for Compounds

COMPOUND DRUG INFORMATION

Compound drugs, which require a prescription from a doctor, are prepared by a pharmacist who mixes or adjusts drug ingredients to customize a medication to meet a patient’s individual needs. 

Differences Between Compound Drugs and Other Prescription Drugs

Compound drugs often have the same active ingredients as brand-name and generic prescription drugs but can differ from these medications in:

• strength – compound drugs can be prepared in strengths not usually available;
• inactive ingredients – compound drugs can be made without some of the dyes, sugars, preservatives and other inactive ingredients found in regular prescription drugs; or
• form – compound drugs can be prepared as lozenges or syrups instead of hard-to-swallow pills or in other forms that are not usually available..

Coverage for Compound Drugs
Check your Evidence of Coverage (EOC) or member handbook to see if your plan covers compound drugs.

If compound drugs are covered by your plan, it’s important to remember that pharmacies that are in-network for regular prescription drugs may be out-of-network for compound drugs. Based on your pharmacy plan, you may not have to pay 100 percent of the drug’s cost if the pharmacy is in-network for compound drug prescriptions.  Check your EOC or member handbook for more information on your plan's required copayment and/or deductible amounts.

You may have to pay more out of your pocket if you have a prescription for a compound drug filled at a pharmacy that is not in-network for compound drugs.  Check your EOC or member handbook for more information on your plan's coverage for compound drugs purchased at a non-participating pharmacy.

If you have mail order benefits, you can obtain your compound drugs from the mail facility and have your mediations shipped directly to you. 

Choosing a Compound Pharmacy

If you use compound drugs, make sure the pharmacy you use is in-network for filling compound drug prescriptions.  You can do this three different ways:

• Call the pharmacy you use and ask if they are in-network for compound drugs.
• Use our “Find a Pharmacy” tool.
• Call the Member Service number on your ID card.

How to Use the Online “Find a Pharmacy” Tool to Find a Compound Pharmacy:

• Select your Pharmacy Network.  It is listed on your BlueCross BlueShield of Tennessee ID card -- for example, RX01.
• Select the “Compound Pharmacy” option in the box underneath the Pharmacy Network field to make sure your search is for pharmacies in-network for compound drugs. 
• You may also enter your favorite pharmacy’s name, your city, state, zip code or county to narrow your search.
• Click the “Search” button once you have selected or entered all the appropriate information.

Remember -- Pharmacies that are in-network for regular prescription drugs may be out-of-network for compound drugs.  If you fill a prescription for a compound drug at a pharmacy that is not in-network for compound drugs, you may have to pay more out of your pocket for your medication.

Information is from here.

 

Correct coding of compound drugs for BCBST in Tennessee

Any legend drug altered from its manufactured form for use by a specific
patient is considered a compound. Since compounded medications do not have an
NDC number, specific HCPCS Level II codes may not be used. Eligible compound
drugs must be billed with the most appropriate HCPCS Level II unclassified/not otherwise classified code. An example of a compounded medication is bevacizumab (Avastin®) for intravitreal
injection.  Bevacizumab is supplied from   the manufacturer in 400 mg and 100 mg
vials with a concentration of 25 mg / mL. It is typically repackaged into single dose
syringes with a concentration of 1.25 mg /0.05 mL for intravitreal injection and must
be prepared under sterile conditions by a compounding pharmacy prior to ocular use.
Effective Aug. 1, 2012, for each date of service compound drugs are administered,
instilled, inserted, or implanted, a reasonable compounding fee will be
reimbursed for commercial and BlueAdvantage claims if the pharmacy
compounding fee is submitted on a separate line item billed with the appropriate HCPCS
code for Pharmacy compounding and dispensing services.  Billing guidelines for compound drugs can be reviewed in the billing and reimbursement section of the BlueCross
BlueShield of Tennessee Provider Administration Manual found online at
www.bcbst.com.

Article is found here.