TITLE 856 INDIANA BOARD OF PHARMACY

Economic Impact Statement

LSA Document #07-590

This proposed rule adds 856 IAC 5 to establish standards applicable to all pharmacies and facilities that utilize and rely on automation technology to store, package, dispense, and distribute prescriptions or medication orders. The proposed rule defines "automated medication system".

"Automated medication system" means any technology assisted operation approved by the board which relies on bar code or other automated technology to dispense and distribute medications and which records all transactions related to its operation. This term does not include automatic counting devices or unit-based dispensing cabinets utilized by a pharmacy or facility to automatically count medication for dispensing.

Many companies produce automated medication systems. These systems are utilized by pharmacy benefit management companies, pharmacies, hospitals, ambulatory surgery centers, and nursing care facilities. These systems enable providers to produce medication doses for patients, track supply and drug utilization, and increase security. The systems automatically generate reports covering inventory, drug dispensing, discrepancies, billing, and medication delivery.

There are multiple types of machines that fall under the category of automated medication systems. Examples include:

(1) is actively engaged in business in Indiana and maintains its principal place of business in Indiana;

(2) is independently owned and operated;

(3) employs one hundred (100) or fewer full-time employees; and

(4) has gross annual receipts of five million dollars ($5,000,000) or less.

The proposed rule does not mandate the use of automated medication systems by any entity. If an entity elects to utilize an automated medication system, the entity will be required to comply with the rule. The rule will not affect those pharmacies utilizing automatic counting machines and unit dose dispensing equipment such as are typically found in small retail pharmacies.

The cost of automated dispensing derives principally from the capital investment of renting or purchasing equipment for dispensing, labeling, and tracking. Expenses can be offset by reduced numbers of personnel needed to perform these functions, decreased drug waste, reduction in medication dispensing time, and improved billing efficiency.

Since the rule does not mandate the use of automated medication systems by small businesses, small businesses will incur reporting, record keeping, and other costs to associated with automated medication systems only if they elect to rent or purchase the equipment.

It should be noted that all pharmacies are required to engage in record keeping related to drug delivery by both state and federal law.

The automated medication systems track the information required by the rule. The rule essentially provides baseline requirements to guide affected pharmacies and facilities utilizing automated technology so that they comply with already existing statutorily required record keeping.

The cost of automated dispensing derives principally from the capital investment of renting or purchasing equipment for dispensing, labeling, and tracking. Expenses can be offset by reduced numbers of personnel needed to perform these functions, decreased drug waste, reduction in medication dispensing time, and improved billing efficiency.

These systems enable providers to produce medication doses for patients, track supply and drug utilization, and increase security.

The alternative is to not require records to be maintained but, that was rejected as being contrary to the board's duty to protect patient safety. As noted previously, pharmacies maintain records under existing state and federal laws. This rule defines the protocols for collecting said data through automated systems.

Public safety is the primary Board responsibility. The use of automated medication systems continues to increase because of the ability to track by automation what was formerly done manually. These systems generate reports which include inventory, drug dispensing, discrepancies, patient information, billing, and medication delivery. By placing into rule the requirements for utilizing and maintaining automated systems, affected pharmacies and facilities will have the information they need to remain compliant with state pharmacy and legend drug laws.

Cost-benefit analysis of an automated medication system, Nursing Economics,  July-August, 1996  by Lowell C. Wise,  Janet Bostrom,  Janice A. Crosier,  Sarah White,  Richard Caldwell

Making Health Care Safer: A Critical Analysis of Patient Safety Practices. Evidence Report/Technology Assessment: Number 43. AHRQ Publication No. 01-E058, July 2001. Agency for Healthcare Research and Quality, Rockville, MD.

http://www.ahrq.gov/clinic/ptsafety/

http://instymeds.com/

http://www.cardinal.com/us/en/providers/products/pyxis/

http://www.medco.com

DIN: 20071024-IR-856070590EIA

Composed: May 07,2024 4:26:21AM EDT

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