Effective July 1, 2013, Indiana House Bill (HB) 1320 requires that the maximum reimbursement amount for a repackaged drug be computed using the average wholesale price (AWP) set by the original manufacturer for the drug. If the National Drug Code (NDC) of the original drug cannot be determined from the medical service provider’s billing or statement, the maximum reimbursement amount for the repackaged drug is the lowest-cost generic for the drug. The legislation was aimed at reducing prices paid for physician-dispensed repackaged drugs while continuing to allow physicians to write and dispense prescriptions to their patients. As of June 2016, 20 states have made changes to rules governing physician dispensing.
As part of a series of WCRI studies that examine the impact of physician dispensing reforms, this report presents the early results of the price-focused reform on the frequency and costs of physician dispensing in Indiana. The analysis is based on detailed transaction data for physician- and pharmacy-dispensed prescriptions filled by injured workers up through the first quarter of 2014 that capture 9 months of post-reform experience. With additional data covering a longer time period, we will examine the subsequent effects of the reform.
Monitoring Indiana Reforms on Physician Dispensing. Dongchun Wang, Vennela Thumula, and Te-Chun Liu. July 2016. WC-16-48.
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