MINUTES OF THE meeting
of the
ASSEMBLY Committee on Health and Human Services
Seventy-Second Session
April 23, 2003
The Committee on Health and Human Serviceswas called to order at 1:38 p.m., on Wednesday, April 23, 2003. Chairwoman Ellen Koivisto presided in Room 3138 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
Note: These minutes are compiled in the modified verbatim style. Bracketed material indicates language used to clarify and further describe testimony. Actions of the Committee are presented in the traditional legislative style.
COMMITTEE MEMBERS PRESENT:
Mrs. Ellen Koivisto, Chairwoman
Ms. Kathy McClain, Vice Chairwoman
Mrs. Sharron Angle
Mr. Joe Hardy
Mr. William Horne
Ms. Sheila Leslie
Mr. Garn Mabey
Ms. Peggy Pierce
Ms. Valerie Weber
Mr. Wendell P. Williams
COMMITTEE MEMBERS ABSENT:
None
GUEST LEGISLATORS PRESENT:
Senator Valerie Wiener, Senatorial District No. 3
STAFF MEMBERS PRESENT:
Marla McDade Williams, Committee Policy Analyst
Terry Horgan, Committee Secretary
OTHERS PRESENT:
Bill Moell, Administrator, Division of Purchasing, Department of Administration
Fred Hillerby, representing the Nevada Board of Pharmacy
Mary Wherry, Deputy Administrator, Division of Health Care Financing and Policy, Department of Human Resources
Ted D’Amico, M.D., Medical Director, Department of Corrections
Robin Keith, President, Nevada Rural Hospital Partners
Liz MacMenamin, representing the Retail Association of Nevada
Ben Graham, representing the Nevada District Attorneys’ Association
Chairwoman Koivisto:
The Committee on Health and Human Services will come to order, please. [Roll taken.] We have three bills before us today. Senator, if you would come forward and start.
Senate Bill 277 (1st Reprint): Requires using agencies to purchase prescription drugs, pharmaceutical services, or medical supplies and related services only through Purchasing Division of Department of Administration under certain circumstances. (BDR 27-26)
Senator Valerie Wiener, Clark County Senatorial District No. 3:
[Introduced herself.] I appreciate your scheduling these bills this way, Chairwoman Koivisto. I will start with S.B. 277, which will address the purchase of prescriptions, drugs, services, and medical supplies by state agencies. I’m introducing this particular bill because there’s never been a better time to encourage timely, efficient, and cost-effective purchasing practices within our state agencies.
You’ll find that in Section 1, subsection 1, we require a using agency to purchase prescription drugs, pharmaceutical services, or medical supplies and services, through the Purchasing Division. For this purpose, a “using agency” includes officers, boards, and agencies in the Executive Branch of our state government.
[Senator Wiener, continued] Section 1, subsection 2 does allow one or more using agencies, together or with other governmental entities, whether inside or outside the state of Nevada, to purchase prescription drugs, services, et cetera, from an entity other than the Purchasing Division. To purchase from another entity, the using agency or agencies must obtain best value for their purchase, and the Purchasing Division must not be able to match that value. In other words, they’re allowed to get the best deal.
Section 2 defines “best value” as the greatest possible economy consistent with the grades or qualities of the supplies or services that they’re purchasing.
In Section 1, subsection 3, you’ll see that the using agencies, once they’ve [made a purchase] must, within a ten-day period of the initial purchase, provide the Purchasing Division with certain information, including the price or prices of the product or service, and the name, address, and telephone number of the entity where they acquired these best values.
It’s a simple bill and it’s [coming] at a time when we’re challenged, as all of us are experiencing daily. Creating opportunities for cost efficiencies in government, [encouraging] best [value] practices for our agencies, and helping the Purchasing Division utilize these best values to strike their own deals on behalf of Nevada is a great way for us to be doing business. For these reasons, I seek the Committee’s support for Senate Bill 277.
Bill Moell, Administrator, Division of Purchasing:
[Introduced himself.] We support this bill. It challenges the Purchasing Division to leverage pricing whenever possible and to work diligently to find the best deals. As you’re well aware, the procurement of medical supplies and services and pharmaceuticals is extremely complicated, and we by no means think we’ve got the corner on the market. A perfect example is family planning supplies. The Health Division buys their family planning supplies through a “region 9 cooperative” that beats anything we can come close to. What we want to do is be aware of any of those [purchasing options], and if we do have an opportunity to leverage that pricing we want to do so.
I want to make this very clear, and I testified in the Senate in exactly the same way, the one thing it does not cover is third-party providers. For instance, the Public Employees Benefit System has a third-party provider that does prescription drugs, and Medicaid [uses] third-party providers. This is only covering medical supplies, prescription drugs, and pharmaceuticals administered by state agencies to their clients and their patients.
Assemblywoman Pierce:
What agencies does [that] entail?
Bill Moell:
It entails several budget accounts in the Health Division, the Department of Corrections, and MHMR [Mental Health and Mental Retardation]. It includes the universities, some of the medical school programs, and that type of thing. It covers a wide gamut of state agencies. I think there are 11 that use this. This also can be applied to certain community hospitals that are run by counties.
Assemblywoman Pierce:
What does MHMR stand for?
Bill Moell:
Mental Health and Mental Retardation, if that’s the correct name. [Sorry], MHDS [Mental Health and Developmental Services]. I apologize; I remembered it by the old name.
Assemblywoman Angle:
I have a question concerning prescription drugs. Oftentimes, best value is not best quality. Does this mean that they would have to prescribe generics just because that’s best value? Could you [elaborate]? I have a prescription I don’t want a generic for, [so] does this mean I would have to have the generic because that’s the best value?
Bill Moell:
It’s not the job of Purchasing to tell physicians what to prescribe. It’s not the job of Purchasing to tell pharmacists how to do their jobs. It is the job of Purchasing to make sure that whatever they prescribe and whatever a [prescription is filled] with is the best value. It’s our responsibility to go out and see if we can’t leverage those purchases and get value.
Chairwoman Koivisto:
Any other questions from the Committee? [There was no response.] I will bring S.B. 277 back to Committee and let’s go on to S.B. 327.
Senate Bill 327: Provides for reuse of certain prescription drugs. (BDR 39-66)
Senator Valerie Wiener, Clark County Senatorial District No. 3:
I am here today urging your support for S.B. 327, which provides for the re-issuance of certain prescription drugs. This legislation is the result of what I heard at several health leadership conferences during the past two years. With all the focus we’re placing on health care responsiveness and fiscal responsibility, it’s important that we establish a statewide policy that ensures the best use of prescription medications.
[Senator Wiener, continued] We know prescription costs are skyrocketing and we are still experiencing substantial waste. S.B. 327 will facilitate a substantial accountability for prescriptions that currently end up in the garbage can. S.B. 327 addresses how we can more efficiently and cost-effectively use prescriptions in four major arenas: public and private mental health facilities, skilled nursing intermediate care facilities, nonprofit care facilities, and state correctional facilities and institutions.
Section 1 allows—and I want to stress that this is not a mandate, it is a permissive opportunity—for public or private mental health facilities to return a prescription drug that is dispensed to a patient in that particular facility but will not be used by that particular patient [because] maybe the patient’s allergic to the medicine or maybe the medicine is not effective for that patient, or the patient might die before the expiration of the prescription drug. For whatever reasons, there’s prescription medication left over. Currently in Nevada law we are required to dispose of or destroy those medications. S.B. 327 would allow unused medication to be returned to a dispensing pharmacy to be reissued to fill prescription needs of another patient in that facility.
Here are the big “ifs” to the [program]:
· the drug is not a Schedule II drug under Chapter 453 of NRS [Nevada Revised Statutes].
· the drug is dispensed in a unit dosage in an individually sealed dose or in a bottle that is sealed by the manufacturer of the drug.
· the drug is returned unopened and sealed in the original manufacturer’s packaging or bottle.
· the usefulness of the drug has not expired.
· the packaging or bottle contains the expiration date of the usefulness of the drug.
· the name of the original patient, the prescription number and any other identifying information has been obliterated from the packaging before the bottle or vial is returned.
The dispensing pharmacist to whom that drug is returned “may,” again the permissive, reissue the drug to fill another prescription for another patient in that same facility if the drug is suitable according to the standards that the Pharmacy Board would establish. Please note that no drug is returned to the dispensing pharmacy to be used to fill other prescriptions more than one time. Any mental health facility that wants to take advantage of this opportunity must adopt written procedures for returning the drugs to a dispensing pharmacist, and the procedures must provide for appropriate safeguards to ensure that the drugs are not compromised or illegally diverted during the return. The procedures must also require the maintenance and retention of records that relate to the return of such drugs. All procedures must be approved by the State Board of Pharmacy which in turn shall adopt regulations to help facilitate the program and, without limitation, those regulations must include requirements for returning and reissuing the drugs and for maintaining the records that relate to the return and reuse of the drug.
[Senator Wiener, continued] Section 2 addresses the needs of patients in skilled nursing and intermediate care facilities, and the medical needs of the indigent. This section and all of those specifics and requirements about return and re-issuance, et cetera, parallel the practices, policies, procedures, and requirements that I just explained. In addition, the dispensing pharmacist in this particular section can transfer a drug to a nonprofit pharmacy, designated by the State Board of Pharmacy, for the purpose of reissuing the drug to other patients free of charge. A pharmacy that reissues to the medically indigent will be immune from civil liability for damages sustained by any act or omission if the person, pharmacy, or facility complied with procedures, regulations, and requirements of this act, and the act or omission does not amount to gross negligence or willful misconduct.
Because of the additional opportunity to dispense reissued drugs to the medically indigent, this section also requires the pharmacy board to adopt additional regulations that deal with the transferring of drugs from the dispensing pharmacy to the nonprofit pharmacy as well as additional regulations for the record keeping in those transfers.
The fourth major area in Section 5 of S.B. 327 allows for return and re-issuance in correctional facilities. When the bill was originally drafted, careful use of language would have allowed for transfers between correctional facilities and at different levels of government. [However], we did have concerns so that [language] was taken out before the bill ever went to the Committee. It’s very carefully drafted now [so that medicines] could be reused in the same correctional facility.
Section 4 requires the State Board of Pharmacy to prepare an annual report that deals with tracking the program. The report would include information about the number of drugs that were returned to dispensing pharmacies, the number of drugs that were transferred to nonprofit pharmacies, the number of drugs that were reissued to fill other prescriptions, an estimate about how much money we’ve saved through this program, and anything else the Board deemed might be necessary to establish in that report. In adding the report requirement to the bill we did a lot of looking around the country. Though there are [similar] programs in other states, we didn’t find any state that tracked [their program] to see how cost-effective or -efficient it would be. I thought it was a very important component to put into the bill so we can see just how Nevada benefits from such a program.
[Senator Wiener, continued] We are keenly aware that we could be more efficient in how we distribute and, in this case hopefully, redistribute medications in this state. We are not being efficient. We are throwing a lot of medicine away that could have a very important effect on the lives of maybe thousands of people in Nevada. When I mentioned this to Mr. Monte Fast of FISH [Friends In Service Helping], he came up to me on the Floor of the Senate and said, “I heard you have this bill that could be so important to us here in Carson City,” and that was a nice testimonial.
I hope that, based on what I’ve shared with you and the intentions of this particular piece of legislation, I can urge your support at this time. With the best of intentions and the greatest of hopes, [I look forward to helping] Nevadans and Nevada with this type of policy and program in place.
Chairwoman Koivisto:
How many other states have this program?
Senator Wiener:
I can’t tell you how many others. I can tell you that at many of the conferences I’ve attended I heard from two or three different legislators who gave me horror stories about their states and about the full-time employees who do nothing but go around to facilities and throw medicine away. I [decided to see] if it would make sense in Nevada. Carlos Brandenburg is here to let you know what we could do in Nevada to be more efficient with the use of medicines. I can’t tell you how many [states], but there were more than a handful.
[The states] liked [the program] enough but they just didn’t track it so I don’t know what the efficiencies are. I would hope that Nevada could be a role model for showing the efficiencies of doing this. Again, extraordinary safeguards [would] be in place to make sure that we do it right.
Assemblyman Mabey:
I’m a physician; I work in a hospital and I [want to know] if the pills come in individual packages that are sealed?
Senator Wiener:
One example is what we call the “blister” packs that are foil-sealed. There are those that come in vials that are protected by the original manufacturer. They’d have to be very carefully monitored. What this [bill] does not address [are situations] where a pharmacist would actually count out [the pills]. The key here is to protect the medication from contamination.
Assemblyman Mabey:
Does it cost a lot more buying them individually sealed versus …?
Senator Wiener:
I couldn’t respond to that.
Assemblyman Mabey:
I know we’re trying to save money by not throwing them away, but if it costs a lot more money to package each pill...
Senator Wiener:
I’ll venture to say it doesn’t cost a lot more money, especially [considering] how much we’re throwing away, but I couldn’t give you a cost analysis.
Assemblywoman Weber:
Thank you for bringing this concept. It’s very interesting. On the top of page 2, line 1, which is subsection 1, part (d), [where it] says “the usefulness of the drug has not expired,” is that the same interpretation of “does not exceed the manufacturer’s expiration on the label”?
Senator Wiener:
It would probably take the Pharmacy Board people to respond to that and people who actually work in that daily. I know there is a usefulness that goes beyond the expiration date and if there were any question about that, it would probably be done through regulation from those who know how to deal with it daily. It was drafted this way to give them the flexibility to know what they need to do.
Assemblywoman Weber:
When drugs are dispensed there’s a package insert that comes with each drug. On the liability side, if there’s a deviation from the intended use, meaning that the original prescription was to patient X and now we’re sending it back, would that change the FDA’s [Federal Drug Administration] intent on that package insert? It’s a federal question, but at the same time I think in my mind it’s critical to whether we really can do this, if [it can be done that] drugs covered through the FDA [could be] dispensed by way of the regulations of the State Board of Pharmacy.
Senator Wiener:
The Pharmacy Board would have to respond to that, I don’t know.
Assemblywoman Angle:
My questions pertain to the facilities. These are going to be patients within facilities and not outpatients. They’re not going to take the medication out and say it doesn’t work and bring it back?
Senator Wiener:
The intent within the same facility would be that it wouldn’t be dispensed to someone in another facility. If there’s a patient in one facility, they’re not going to physically remove [the medicine] and take it across town to another facility. That would not be the intent.
Assemblywoman Angle:
The patient has to be within the facility as well. [The patient] can’t be an outpatient who could take the medication home with them and then bring it back saying that they hadn’t used it?
Senator Wiener:
They only get one reuse. If we’re taking [a prescription], and part of it’s been used by someone else and there is that protected remainder, if they brought it back, it would be disposed of anyway.
Assemblywoman Angle:
Is it going to stay within the facility?
Senator Wiener:
The intent is to make sure we maintain the controls. I don’t know if there is an outpatient component or not to some of these facilities. We would monitor [dispensing] within that particular operation. I don’t know the day-to-day operations. For example, in a correctional institution where initially I had thought we could let it go to anyone in the whole system, or take it from the state and send it down to one of the counties, we were very [concerned] about tampering and contamination. The intent is to keep it within a strong monitored zone so as to maintain the integrity of the prescription.
Assemblywoman Angle:
Is there any charge to the patient? If you charged the patient for the prescription, but they’re not able to use that prescription, does the charge still stay on the bill or are they [reimbursed]?
Senator Wiener:
We struggled with that. Currently what happens is we throw it away and the patient pays for it anyway. They pay for what they get whether they use it or not under current law and practices. At this point, anything we return is like found money because that’s medicine somebody else won’t have to pay for. Many of these populations are populations that wouldn’t be able to pay for the original drug anyway.
Assemblywoman Angle:
But there is an opportunity here to sell the same thing twice?
Senator Wiener:
It’s not a sale; it’s a use.
Assemblywoman Angle:
If you’re charging a patient for it, it’s not used and comes back, they still pay for it. You didn’t return the money. Then you send it out to another patient and it goes on their bill.
Senator Wiener:
No. It’s not billed twice.
Chairwoman Koivisto:
If it’s not billed the second time and it’s only billed to the first patient, then the next patient is going to get the drug and it’s going to show as free drugs on their billing?
Senator Wiener:
No, that wasn’t the intent either. There are some populations that would probably not get a drug at all, but based on this, they’re going to have access to medications they wouldn’t have paid for in the first place.
Fred Hillerby, representing the State Board of Pharmacy:
We support the bill. Somebody raised the question earlier about the cost. Clearly the cost of these prepackaged unit doses is a little bit more expensive but there are the safety controls you have in dispensing in a facility. That’s important and offsets some of the cost differential.
[Mr. Hillerby, continued] The fact is, Assemblywoman Angle, you only bill for those drugs that were actually administered to the patient. What happens is a person is admitted to a facility. The physician who saw them in the hospital discharges them with the drug, or a prescription for a drug, and that’s filled. Then within a very short period of time, the attending [physician] at the facility may change that drug. [The patient] may have only used 3 out of 30 [pills] that might have been prepared and sent over to the long-term care facility. What has happened, as Senator Wiener said, is they don’t get charged for the 30 [pills], they get charged for what they used and the rest gets thrown out. We’re trying to avoid that. As you read through [the bill], in every setting except for the not-for-profit pharmacy that may give them for free, [the medications are] reused in the same facility, they’re not sent to different facilities.
Most long-term care facilities, to my knowledge, do not have their own pharmacies in-house, it’s a dispensing pharmacy that brings the drugs [in]. [They] would be the ones in control of those drugs so, again, if there was a prescription for another patient for the same drug, it could be used in that facility. It wouldn’t be paid for twice and it wouldn’t be given away free to the second user because [the patient] only pays for what is actually dispensed.
Assemblyman Hardy:
The pharmacy that sells 30 individually blister-packed pills will sell 30 of them whether the person goes home and takes 3 of them or not. I don’t see this benign pharmacy supplying 27 extra pills at no charge. This is getting away from the intent of the bill, but I have a hard time believing that there’s somebody who’s throwing away 27 pills that weren’t paid for by anyone.
Fred Hillerby:
We talked about 30 [pills] but I’m not sure there are always that many dispensed at [one] time. It depends on the prescription that was written. [That] is my understanding, because we recently developed a program with Medicaid where some of the unit doses can be returned and used again and it’s a savings to Medicaid. It’s my understanding that [the patient] only gets billed for what is used, but I can clarify that.
Mary Wherry, Nevada Medicaid Deputy Administrator:
Having been in the provider sector and having dispensed medication as a nurse directly to a patient, but also from a Medicaid perspective, this bill tries to support the integrity of what was originally delivered by the manufacturer, making sure that the lot number is kept intact. As a nurse in a long-term care facility, or in the prison, or in MHDS, I may get a bottle of pills and I pour out one or two, whatever the doctor’s ordered. I take that in and give it to the patient. The bottle stays at the cart so it’s never touched by anybody but health care professionals. Or I get a unit dose [which is] one pill, sealed in its own container. I may get five of those in a drawer, which is enough to get [the patient] through until the pharmacy restocks that drawer again. So that’s the only pill that’s in there and since the seal hasn’t been broken when the patient’s discharged, those can be returned and could be recycled.
[Ms. Wherry, continued] From a Medicaid perspective, people can only bill for what the patient actually receives, so when the pharmacy sends medications out to a facility or out to the floors of a hospital, they send whatever they think that person’s going to use in a prescribed time period. They aren’t sending out a whole lot [of pills] but what comes back is what they have a problem with. This is an opportunity to recycle that. The patient only gets billed for what was actually given. If the pharmacy sends out 12 pills and the patient’s discharged the next day and they still have 10 left in their drawer, the patient only gets billed for the 2 pills because the pharmacy is going to credit back the other 10 pills.
With regard to the package insert, the patients don’t get package inserts, they get patient education done at the bedside, and they may get preprinted materials that the hospital or the facility endorses. Physicians oftentimes have a problem with patients getting the package insert because they look at the side effects and they start to think, “I can’t take this drug because I’m going to have all these things happen to me.” Typically, facilities work with physicians with regard to what information is given about the drug itself. It’s when we go [to a pharmacy] and purchase [the drug] over the counter or through an outpatient pharmacy that we get that insert. That same information is usually available in the Physicians’ Desk Reference and patients can have access or there’s other means of making sure that they have the information they need to help them understand the drug that they would be given.
Chairwoman Koivisto:
Just for clarification, we’re talking an inpatient setting. Is this bill directed at an inpatient setting?
Senator Wiener:
Not necessarily. The nonprofit [pharmacy] may not have the facility and that’s why there are provisions in [the bill]. They may get medicines they wouldn’t get otherwise but would still be under the same protections [regarding] reissuing and transferring, et cetera. It’s not the same scenario as mental health or corrections or the intermediate care nursing [homes].
Assemblywoman Angle:
That’s where I’m having difficulty. FISH doesn’t have a facility so they’re going to let this medication go out on an outpatient basis. That patient takes it away from the facility then brings it back? How does that work?
Senator Wiener:
There’s only one reissue. If [FISH] is going to participate in the program, they’re part of a transfer, which means that if there were medicines that were extra and would otherwise go into the garbage can, [those medicines] would be transferred through the dispensing pharmacy so that is the last use. If the patient brought it back it would be thrown away.
Assemblywoman Angle:
So they never get any new medication, it would come from what hadn’t been used and would be passed on to a nonprofit? [Senator Wiener agreed.]
Anything where the original prescription was is going to be in a facility that’s in a controlled environment but then the reissue may not be in that controlled environment.
Senator Wiener:
And it’s only one time. FISH could get what would [otherwise] go into the garbage can once, it can’t go back.
Mary Wherry:
Another point of clarification that is throughout this bill that we’re very comfortable with is that all these things have to be done according to the State Board of Pharmacy’s regulations. I would assume that they’re going to be extremely cautious, making sure that the appropriate policies and procedures exist within the facilities that are allowing the re-issuance of drugs and within those nonprofit pharmacies that are reissuing the drugs. That’s what gives us a level of comfort that this is a regulated process, not just a recycling program that doesn’t have a lot of controls in it.
Assemblyman Hardy:
You get a bottle of 12 pills; the patient takes 2 pills. The bottle of 10 that’s left is untouched by human hands [except] by the health care people in the facility. You used the words “the pharmacy credits back” those 10 pills. I don’t understand what you mean by “credits back.” Does that mean they’re dumped and the pharmacist says, “Oh, I wish I could have charged for those,” or does the pharmacy actually get those 10 pills back?
Mary Wherry:
The pharmacy gets the pill back but whether they can re-dispense them or not becomes problematic without the authority to do that. If the bottle has been out of the pharmacy then I don’t think they can reissue those [pills]. If the bottle has stayed in the pharmacy, and this is a real issue for hospitals [because] small psychiatric hospitals that have specialized populations, where they’re treating people primarily with psychiatric meds, may have to purchase a huge bottle, because that’s the only way it comes, of a specific type of drug that only one patient in ten years would ever use. So here it sits, on a shelf. They’ve spent $400 buying that bottle and it sits there. There’s no opportunity for them to do anything with that in terms of maybe contributing it to a nonprofit pharmacy through the regulatory process. Those are the types of waste that occur both for the facility and for the recipients who don’t have access to meds because of their cost. It all depends on where the dispensing out of the bottle occurs, at the nurses’ station, or in the pharmacy.
Assemblyman Hardy:
I’m going back to your nurses’ station because that’s what I’m familiar with. The nurse takes the bottle of 10 pills, walks it down to a place and puts it in the hands of a person who takes it back to the dispensing pharmacy. Those 10 pills are not charged to anybody and the pharmacist now throws those away so he or she, the pharmacist, eats the cost of those 10 pills?
Mary Wherry:
The facility eats the cost. If the facility has purchased it from the dispensing pharmacy, then the facility eats the cost.
Assemblyman Hardy:
So the facility had to buy 12 pills. Somebody had to pay for them before the pharmacist let them go. That gets back to my thought that there are no free pills.
Mary Wherry:
For the patient. The original question was, is somebody getting charged twice.
Assemblyman Hardy:
Right. The facility had to pay for them to get them. So [those pills] go back to the pharmacy and then the actual bottle of 10 pills, in this case, as proposed, that bottle would go back to a separate place called a dispensing pharmacy. That dispensing pharmacy would then be allowed to recycle those 10 pills?
Mary Wherry:
The bottle is sealed by the manufacturer, so in that example, a “bottle” is not really applicable.
Assemblyman Hardy:
It has to be sealed and that’s where I get real nervous. [Ms. Wherry agreed that the container had to be sealed.]
Senator Wiener:
That’s why the language in my testimony [used terms such as] “uncontaminated” and “protected,” and that’s one reason why we have just one reuse. That’s why I used the example of a blister pack. If it’s been contaminated in any way it’s not subject to [reuse]. The protections are for the second user, but not a third user. The language was very protective and carefully crafted, hopefully, so we wouldn’t have a contamination issue, but we’d have one more shot at an effective use that otherwise would be the garbage can.
Assemblyman Hardy:
If the pill in its blister pack or in its protective sealed state goes out of the health care facility [could it] come back? We’re not talking about outpatient medicines coming back into a facility and then being used, correct?
Senator Wiener:
That was the reason we had concerns with correctional facilities, [where] needles [could be used to] contaminate a medical product that would go elsewhere. When we talked about “in the facility,” [that referred to] the facility where it originated. The one exception would be the transfer to the nonprofit [pharmacies]. We have a provision where there could be a transfer to nonprofits and we have provisions there for use by that nonprofit. They may not have a facility, but these are medications that otherwise would go in the garbage that could be used in a nonprofit arena. There are some protections for their conduct as well.
Assemblyman Hardy:
The medicine didn’t go to the nonprofit and then come back?
Senator Wiener:
No, it could be transferred to the nonprofit.
Assemblyman Hardy:
So the original medicine is always protected under this proposal so it never is in the hands of anybody except the medical professional who knows what they’re doing and how to handle it. Never opened, never adulterated, and never poked with a needle.
Senator Wiener:
Contamination’s a huge issue.
Mary Wherry:
One of the reasons why a lot of facilities have purchased unit-dosing equipment that they can wheel around is because it really does reduce the amount of waste that has occurred. This contributes itself even more to the opportunity to recycle because they are protected.
Chairwoman Koivisto:
What and where is a “nonprofit” pharmacy?
Senator Wiener:
As we were drafting this, our thoughts were to make it available for those who might be interested. Mr. Fast from FISH [in Carson City] showed an interest, so he may find a way [in addition to the] Catholic charities in southern Nevada. We did craft [the bill] so that if there were large nonprofit organizations that dealt with medically indigent patients in fairly large numbers, the pharmacy board could work with them. Initially, we just had “pharmacies” in terms of transferring for medically indigent people but that caused great grief. The words “nonprofit” and “at no charge” were [added to the bill] so it wouldn’t become an economic issue as much as a humanitarian issue.
The Pharmacy Board would have to designate those [nonprofit pharmacies] and recognize them and establish the regulations for them. I can just say that Mr. Fast was interested enough that he hoped he could find a way to implement it up here in Carson City. I believe his e-mail (Exhibit C) should be [in front of you].
Chairwoman Koivisto:
So currently there aren’t any nonprofit pharmacies but the Pharmacy Board is going to craft regulations so that there can be?
Senator Wiener:
I cannot speak for the Pharmacy Board because they’re not here, but I can say that in the meeting when they were present, because we didn’t have anyone say, “Yes, I’m a nonprofit, I want that,” we established the opportunity that if there are nonprofits that deal with large populations of medically indigent or if there were an application for a nonprofit pharmacy, [the State Board of Pharmacy] would establish those additional regulations for transfer of drugs to a nonprofit. I cannot go on record and state that I know of any nonprofit right now. They weren’t at the table.
Fred Hillerby:
I am not aware of a not-for-profit pharmacy today. Our goal would be if that became an opportunity, by regulations [the Board would] establish what they have to do, in their dispensing practices to the indigent for free, to maintain the integrity of the drugs. They would have standards similar to a regular pharmacy so that we could guarantee that all the controls were in place.
In this regulation, of serious concern to the Board is not only the integrity of the drug in terms of when it’s in the facility but [also when it’s being moved]. Dispensing pharmacies typically are in another location and they currently transport drugs to the pharmacy or to the long-term care facility. They might take the drugs back to their facility and then again back to that same facility. It’s always going to be at the same facility. There are always concerns that the Board has relative to this or any shipping of drugs, be it the wholesalers which we have problems with sometimes because they ship [drugs] all over the place and trying to maintain the integrity to know where they’ve been and whether they have been refrigerated when that was required.
Our regulations would look very closely at that process as we do now when they transport drugs from the dispensing pharmacy to the long-term care facility. That will be our intent, and we’re happy to work with the Senator in the drafting of the bill and look forward to doing the necessary regulatory things to be sure that this is a very safe practice. [This should save money], particularly for the Medicaid program.
Assemblywoman McClain:
Who’s actually going to be reporting to you, the long-term care facilities and the dispensing pharmacies? What’s your audit trail? What’s to keep a facility from saying, “I sent these [drugs] back to the pharmacist,” but it never really happened and they sold them on the street?
Fred Hillerby:
The reporting part of this is a little problematic but we think we can work with both the dispensing pharmacy and the long-term care facilities and also with Mental Health and Mental Retardation. As I understand the bill, in Section 4 it’s our [the State Board of Pharmacy’s] responsibility in all of the settings where this is going to be allowed, to collect data relative to what goes on and what can be attributed in terms of cost savings because of the program. We’re willing to give it a shot. [The language] is permissive and we’re not sure how much of it will go on. Because there have already been steps [taken] we think [this might] help the Medicaid program. We’re going to try to develop the right kinds [of regulations] so we can keep good track of [these drugs] and be able to [supply] information to this body and anyone curious about how it works.
Assemblywoman McClain:
Does anybody have any idea about the volume? Do you know how much paperwork it’s going to take to really keep track of this and keep a good audit trail?
Fred Hillerby:
That’s a little problematic. I don’t know what it’s going to cost to do the tracking, and clearly, if we found that the cost of tracking and reporting discouraged people from participating we’d first go to Senator Wiener and then back to you and say, “Maybe we’ve added a burden that doesn’t need to be there.” It would have been good to know this information but if it discourages people from taking advantage of this, then our recommendation back would be maybe we ought to look at another way [such as] having the Medicaid program talk about its own savings as a result of this feature. That is a concern and we’ll just have to see how it works.
Assemblywoman Weber:
I just want [more information] regarding re-labeling of this package. We’re talking about packaging and expiration dates. If there were 12 pills and now there’s 10, is that package relabeled to state that contents are removed? Is that a regulatory question?
Fred Hillerby:
The re-labeling would be [something] covered in the regulations. We’re not talking about an open bottle of 10 pills; this would be the prepackaged types of drugs which have information already printed on the back of the blister pack. [The Board] will deal with the labeling issue and whatever federal concerns there are will have to be addressed in that process.
Assemblyman Hardy:
I had the opportunity to go to a Central American country and see their pharmacy needs, and I recognized before I went that there were many people willing to donate [medical supplies, et cetera] to such an orphanage. Will this [have the] potential that those kinds of things can be facilitated? Has anybody consulted the Nevada College of Pharmacy to see what the professionals who are involved with teaching [think about this proposal] or asked for their input? If not, maybe they’d be willing to have some input today.
Senator Wiener:
Involving a transfer of a recyclable [drug] for one use, we don’t know of any nonprofit pharmacies in the state of Nevada. The intent at this point would be to keep it in the state of Nevada, so I don’t know yet if we’d go to another country or continent. Regarding the College of Pharmacy, they were not participants in the drafting of the bill but I’d welcome their input.
Chairwoman Koivisto:
Any other questions from the Committee? [There was no response.]
Ted D’Amico, M.D., Medical Director, Department of Corrections:
I’ve been told we [purchase] about one-third of the drugs [used] by the state in our dispensing and administering to the [approximately] 10,000 inmates in the state. That’s a considerable cost to the Department of Corrections. Our pharmacy system runs somewhere around $3-$4 million, I would imagine, in an annual period. At the present time we employ pharmacists who count [the pills] out and put them in a bottle. We’re very strict on making sure those are handled properly and dispensed only by pharmacists or, in special instances, the Board allows us to dispense by nurses for a four-day supply in an emergency. Our bottles go out and are administered to the inmates and they’re dispensed by regulation in amounts of 30 days. For instance, a prescription that has 30 pills would be administered to that inmate at pill call, unless it’s something he can keep on his person.
If he transfers, dies, or gets paroled, we cannot reuse that medicine. We do have to dispose of that medicine. That amounts to quite a bit of loss to my budget throughout the year. We are very interested in this bill from a personal standpoint that we could save some money for the taxpayers by making our pharmacy system a little more cost efficient. We’re in the process now of trying to create an automated system within the Department of Corrections, and hopefully this will be successful and we can eliminate some of our manpower and get into an automated thing that will give us individual doses. We will still have our hands tied even with individual doses because if we dispense up to 30 [pills] for an inmate and then he is not there anymore, we wouldn’t be able to reuse those individual doses without a bill such as this. We would be bound once again by the Pharmacy Board to destroy those medicines and they couldn’t go to someone else. If a bill like this were passed, we could take whatever’s left, those individual doses, and put them back into our system and they could be re-dispensed to another inmate and that would be perfectly legal. We wouldn’t be able to put our medicine out into the community to a nonprofit pharmacy to help the indigent, but we would be able to recycle them within our own system and save money on our own budget, which we can’t do now. A bill like this benefits us within the correctional system and [allows us] to save money in how we dispense medicines and to save money doing what we’re constitutionally required to do, [which is] to provide medicines for the inmates.
[Dr. D’Amico, continued] Sometimes our medicines are very expensive. We have approximately 1,300 mentally ill individuals and we don’t charge for their medications, they come out of our budget. Some of those medicines run $300-$600 per prescription, and sometimes more than that. It would be a big benefit for a bill like this [that] would allow the Department of Corrections to reuse medications in individual-dose packages for other inmates and not have that loss.
Chairwoman Koivisto:
Dr. D'Amico, when you are talking about a 30-pill prescription, where is that prescription held? Is the prescription held somewhere and [the inmate’s] given one pill at a time by some professional person?
Dr. Ted D’Amico:
We have two or three different ways that’s handled. One is a keep-on-person [KOP] allowable for inmates that can carry the medicines with them in the security perimeter and sometimes in the camps—up to two prescriptions. Those medicines are approved by the medical staff as medicines that are not harmful, that they’re not going to kill themselves [with] and those are called KOP medicines. We dispense those up to a 30-day supply at the present time. Some of the people cannot be trusted with their medicines and they are not keep-on-person medicines. We dispense them in lots of 30 days, but they’re held at the facility and they’re held by the nursing staff under controls and security, and then administered by the nursing staff. This is clumsy in one respect because if a person’s on three or four medicines, the nurse has to open the bottle up, put it into another pack, give it to the inmate, and if it’s two or three [medications] the problem is compounded. We think individual dosing and some automation and streamlining of our system will cut down on a lot of nursing time, eliminate workman’s comp problems with carpal tunnel, keep space better available in our facilities, and [provide] better security. That’s why we’re aiming for that. But at the present time we don’t just give [inmates] a bottle [of pills].
All our mental health medicines that are given to patients are administered, as prescribed by the doctor, individually out of a bottle at the prescribed time. All the medicines given to people in the infirmary are given individually at proper times. [Inmates] at the camps and certain [inmates] within the security perimeters are able to carry up to a 30-day supply of medications [with them] called “keep-on-person” and they take [those medications] on their own.
Assemblywoman Pierce:
Instead of you sending pills out in bottles, you’re saying the technology is available to put [the pills] in something like these kinds of things and then send them out and you could have that technology on site?
Dr. Ted D’Amico:
Yes, there is technology available and different methods available [including] the cart systems that are used in nursing homes and individual plastic packages that come out of machines that are sealed with the specific directions printed on them. Those are all secure and safe [and] would be able to be reused by us for other inmates. This saves nursing time for administration [of the drugs], saves storage time, and also would allow us, with a bill like this, to recycle that medicine within our own system. We write [approximately] 8,000 prescriptions a month within our system. The dollar amount of the mental health medicine alone that we’re wasting would be considerable.
Robin Keith, President, Nevada Rural Hospital Partners Foundation:
NRHP [Nevada Rural Hospital Partners] is very supportive of this concept. I do bring to the Committee the need for a technical correction, but I’m going to ask for that with the understanding that I don’t want to do anything to impede this bill and I realize it’s late in the process to be bringing this up. If it’s the Committee’s choice that we just move forward [with the bill] as written, we’ll come back next time and fix this.
The bill is intended to allow drugs that can be reused [from] long-term and intermediate care facilities to be reused. In Nevada’s rural hospitals we have about 240 long-term care beds, but they are licensed as hospital beds. [As an example, in the hospital building] if you go one way, you’re in acute care, and if you go [the other direction] you’re in long-term care. They’re all hospital beds. They are not licensed as intermediate care or as facilities for skilled nursing. Because of that technical definition, we would not be able to apply this law in our long-term care beds. The proposed solution to that is that I contact the Health Division and the Bureau of Licensure and Certification for wording that will correct the problem but not create a lot of other unintended consequences by changing definitions and creating licensure implications that we don’t want to create.
I spoke to Senator Wiener about this and she encouraged me to bring this [problem] forward. Again, I don’t want to impede the progress of the bill, so I’ll leave that with the Committee, and you can tell me whether I should proceed with that or not.
Chairwoman Koivisto:
Could we not just put language in the bill to address that situation without changing definitions?
Robin Keith:
We can insert language in the bill. It’s just that we have to get the language right.
Dr. Ted D’Amico:
I’ve spoken briefly with Carlos Brandenburg with the Division of Mental Health and they also are a big user of medications with their [patients]. There is a possibility for us to put our heads together and to create an automated system that not only includes Corrections, but that may be able to be helpful to the mental health people in their facilities at Lakes Crossing and in some of their clinics. If we can pool our talent, this might not only be beneficial for the correctional system but also for mental health in general. I expect to pursue this with Carlos. Our hands are a little bit tied in the money-saving end of it unless we have a bill like this that will allow us to [track potential savings]. When we go to the Legislature with work programs to say how this is going to save us money, we won’t be hampered by a bill that disallows us to effect this strategy.
Liz MacMenamin, representing the Retail Association of Nevada:
In order to speed things up and not waste your time on lengthy testimony I [am] going on record in support of Senator Wiener’s bill. The concept is a good one and at a time in our state when we need cost savings, this seems to bring some types of cost savings to the state’s budget. We want to assure the Committee that the State Board of Pharmacy, upon regulating this, will more than likely do an excellent job.
Chairwoman Koivisto:
We have heard from everyone who is in support of the bill. I’m sorry that the pharmacy school and the pharmacy students had to leave. Generally what we do is [listen] to the supporters first and then [listen to] the people in opposition. For the record, Professor Wiser from the Nevada College of Pharmacy and Diana Spiro from the College of Pharmacy were both against the bill. Tom Metzger from the College of Pharmacy was neutral on the bill.
Assemblyman Hardy:
I took the liberty of talking with them outside. The questions that came up from the Committee addressed their concerns. I’m not going to speak for them but some of their concerns were transportation and regulation. We discussed the policy that we were talking about and how the State Board of Pharmacy would be the ones writing the regulations, making sure that the transportation, the temperature, and the time were such that it would not involve the degradation of the product, which was one of their concerns. There are ways things are transferred and timing in so doing and they were concerned about that.
[Mr. Hardy, continued] They had some concerns and they will e-mail us and let us know how they feel about it. I think they ended up having their questions answered where we were going, open containers, and pills left over in a bottle kinds of things. They were concerned about those kinds of things that they heard the Committee [ask about].
Chairwoman Koivisto:
Further questions from the Committee on this bill? [There was no response.] Is there anyone else who wants to testify on S.B. 327? [No response.] We’ll bring S.B. 327 back to Committee and go on to S.B. 337.
Senate Bill 337: Revises certain provisions relating to dispensing or distributing drugs via the Internet. (BDR 40-590)
Senator Valerie Wiener, Clark County Senatorial District No. 3:
This particular bill, S.B. 337, revises certain provisions relating to dispensing or distributing prescription drugs via the Internet. Last session I was fortunate enough to bring a very comprehensive Internet pharmacy bill to your Committee that was the end product of work I had been doing as the Senate member on the Attorney General’s Advisory Committee on Technological Crimes. In that Committee we’ve determined over the past four years how substantial the impact is in the Internet pharmacy arena.
I had talked with the Pharmacy Board to see if there were any areas of the bill that needed some tweaking. What I have brought to you is a bill that addresses one concern from the Pharmacy Board and, as we are representatives of the people of Nevada, one concern [addressed in] an e-mail I got from someone who had some ideas to share.
The Pharmacy Board had a concern about prescriptions that were filled by what they called “brokers.” As we send some medications to Third World countries or locations, Sri Lanka to name one, there are some businesses that are willing and eager to reach out to those prescriptions and bring them back [to the United States] and sell them as though they were new prescriptions. At some point these often become illegal drugs because of expirations and other things that taint the drug or affect the potency of the medicine. One portion of this bill addresses that abuse of the Internet pharmacy privilege.
[Senator Wiener, continued] The second concern, which I received in an e-mail, dealt with a gentleman’s issue of having to see a doctor every time he wanted to get [medicine] over the Internet: “Every time I want to fill a prescription you require that I see a doctor.” We reinforced in the bill that the privileges of using the Internet are those that would be with a brick and mortar [pharmacy]. Filling or refilling a prescription is whatever Nevada law allows in terms of the life of the prescription. You don’t have to see a doctor every time you want to order as long as that prescription has validity in Nevada law. [Internet pharmacies] are not held to a lesser standard nor a greater standard, but to the same standard as if you were filling that prescription at a freestanding location.
For these reasons I urge your support for these modifications to existing Nevada law through Senate Bill 337.
Chairwoman Koivisto:
Since we have been [in Carson City] I have received e-mails on the average of 6, 7, and 8 a week offering me any kind of drug I want on the Internet without a prescription. They have an Internet doctor who will get me whatever I want, a “cyber doc.” I don’t think our Internet bill is working.
Senator Wiener:
In current law, it requires that you see a doctor within six months of filling [the prescription]. As a little bit of protection for the rural [counties] or for where we have telemedicine, you can do some telemedicine to get the prescription. Our Pharmacy Board was involved in a major law enforcement effort in the early part of January. To get our law up and running the regulations [had to] get approved by the Legislative Commission, then the Department of Information Technology [had to] create the software to track down the Internet pharmacy sites. There were about 7,000-8,000 identified Internet pharmacy sites. The pharmacy board determined that, of those thousands of sites, there are just hundreds of real site holders. Their software [was able to] determine where the real situs of operation is and there are only hundreds rather than many thousands. Once they determined that, their first targets were those based in Nevada. With the assistance of the Drug Enforcement Agency [and using] the Nevada law, they were able to address a major violation occurring in southern Nevada and closed down a site that did several million units a year.
Some sites, I understand, do post on the home page of their site that they cannot do business in Nevada because we don’t allow the “cyber doc.”
Fred Hillerby:
We support this bill. This is one of two things [where] Nevada is really on the cutting edge. One is the controlled substance tracking system and the other is in the area of the Internet pharmacy. We are beginning to have an impact on that and this bill will help our ability to enforce the law.
Dr. Ted D’Amico:
I’m speaking now as a practicing physician in the state of Nevada. Years ago I was appointed by Governor O’Callaghan to a cancer advisory committee. At that time Laetrile and Gerovitol became big issues in the Legislature. We on the Committee decided that this wasn’t a very good idea. It got passed by the Legislature [using] “smoke and mirrors.” I called Mike [O’Callaghan] and asked him to veto the bill. He said, “That’s just like you doctors. You never come to the Legislature, you never talk about these things, and then you call me up and want me to veto a bill later on. Why weren’t you there when we talked about it?”
I learned a lesson over the years. I’m coming to the Legislature. I think that this is an extremely important bill and I think that we ought to get rid of the smoke and mirrors in the state of Nevada and not make some of the mistakes we’ve made in the past. Going on the Internet, taking lightly our rules and regulations with pharmacies and medicines, is a very dangerous thing for the public. As a physician, and having learned a lesson from many years ago, I would support this bill and I think many of my physician colleagues would agree with me. I implore you to be strict with our medical laws so we can protect our people.
Senator Wiener:
When the bill was first introduced, the media reported [that] what we were trying to do with these two new provisions would make it virtually impossible to buy prescription drugs on the Internet. I have the opinion from Brenda Erdoes, our legislative counsel (Exhibit D), who addressed that and dispelled the media myth. I apologize that it doesn’t have her name on it.
Ben Graham, representing the Nevada District Attorneys Association:
I am testifying in support of [S.B. 337]. The penalties are severe and they should be. Any prosecution under this would be a long-term, undercover type of investigation and it would take a long time to put together. It would be worthwhile then to do that sort of an operation in light of the penalties that you are looking at here. We appreciate the opportunity to participate.
Chairwoman Koivisto:
Questions from the Committee? [There was no response.] We will bring Senate Bill 337 back to Committee and take it [up at another meeting or a work session.]
With nothing else to come before the Committee, we’re adjourned [at 3:04 p.m.].
Terry Horgan
Committee Secretary
APPROVED BY:
Assemblywoman Ellen Koivisto, Chairwoman
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