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CMS Publishes Final Short Cycle Dispensing Rule

by Published On: Apr 15, 2011Updated On: Apr 22, 2011

On April 5, 2011, the Centers for Medicare and Medicaid Services (CMS) released its final rule regarding implementation of Section 3310 of the Patient Protection and Affordable Care Act (ACA). Section 3310 requires short cycle dispensing of Medicare Part D medications in long-term care (LTC) facilities. The final rulle contains significant changes from the proposed rule. The changes that are most important to LeadingAge members include:

  • 1-Year Delayed Implementation – The final rule is set to become effective on January 1, 2013. Under the proposed rule, the requirements were to take effect on January 1, 2012 for most pharmacies and nursing facilities.
  • Dispensing in 14-Day or Less Increments – Rather than the original proposed requirement for 7-day or less dispensing of medications, CMS settled on a 14-day or less requirement out of concern for increased labor and dispensing fees associated with the shorter cycle requirement. CMS explained that the 14-day cycle was a more prudent approach to implementing Section 3310 intitally and would place less of a burden on pharmacies and facilitie. It would also allow CMS to collect data to determine the impact of the longer fill cycle requirement on unused drugs in LTC facilities. Nevertheless, CMS noted that nothing precludes facilities and pharmacies from selecting a shorter cycle or prevents Part D sponsors from incentivizing the adoption of more efficient dispensing techniques.
  • Excluded Drugs – In keeping with its proposed rulemaking, CMS excludes generic drugs from the short-cycle requirement.  It eliminated proposed additional exclusions for  “drugs difficult to dispense” and  drugs needed for “acute illnesses.”  Instead, the final rule requires short-cycle dispensing only for solid oral doses of brand name drugs.  It also specifically excludes antibiotics, drugs that must be dispensed in their original container as indicated in the Food and Drug Administration Prescribing Information, and drugs that are customarily dispensed in their original packaging to assist patients with compliance, like oral contraceptives. Controlled substances in solid oral doses will be subject to the short cycle requirement.
  • No Extension of Requirements to Assisted Living – CMS acknowledged that medication packaging requirements needed for Part D beneficiaries residing in assisted living facilities may be different from the needs of those residing in nursing homes due to the different levels of functional independence of the residents in such facilities.  As a result, it declined to require short cycle dispensing in assisted living, though it stated that nothing in the rule would preclude pharmacies and assisted living facilities from agreeing to implement such a program.
  • Elimination of Requirement to Return Unused Drugs to the Pharmacy – CMS stated that the comments it received regarding barriers to returning unused drugs to the pharmacy, as required under the proposed short cycle rule gave the agency a better understanding of existing State and Federal requirements on long-term care facilities to manage waste. As a result, that requirement has been eliminated from the final rule. Part D sponsors, however, will still be required to report on the amount of unused brand name and generic drugs. The agency stated that sponsors should be able to fulfill this requirement on the basis of existing data reported to them by pharmacies.
  • PACE Programs Generally Excluded from Short Cycle Requirement – CMS explained that most beneficiaries enrolled in PACE programs receive services in the community and thus will be exempt from the short cycle requirement. Only those PACE enrollees who are in nursing facilities will be subject to the requirement for 14-day or less dispensing of Part D drugs.

Overall, LeadingAge is pleased with the changes effected by the final rule. We encourage CMS to use the delayed implementation period to continue to assess how best to achieve the goal of reducing waste while facilitating timely access of nursing home residents to needed medications.


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