Short Cycle Dispensing

The Patient Protection and Affordable Care Act (Section 3310)

Section 3310 of the Patient Protection and Affordable Care Act requires Medicare Part D Plans to employ utilization management techniques to reduce the per-fill quantity of prescription medications dispensed to beneficiaries residing in LTC facilities. The intent of this "short cycle dispensing" provision is to reduce unused medications by moving from traditional 30-day fills to biweekly, weekly, or daily fills.

The rationale behind this mandate is that shorter fills will result in fewer unconsumed medication units ("waste") that normally occur due to medication switching, discharges from the facility, death or other causes. In March 2010, the Congressional Budget Office issued an estimate of budgetary impact that included $5.7 billion in Part D program savings from the implementation of short cycle dispensing.

In November 2010, CMS issued a Notice of Proposed Rule Making that proposed to dispense all brand name drugs to Part D enrollees in LTC facilities in 7-day-or-less increments.

In April 2011, CMS issued a Final Rule to dispense all brand name drugs to Part D enrollees in LTC facilities in 14-day-or-less increments starting January 2013. The rule also requires Part D plans to collect data on the dispensing methodology and amount unused Part D drugs for each dispensing event. The finalized rule acknowledged many of the concerns specified by LTC pharmacies, the LTC industry and Congress. LTCPA appreciates CMS's willingness to meet with the LTC industry throughout the entire process including the review and consideration of LTPCA's study, published September 2011 in The Consultant Pharmacist, that quantifies the level of unused Part D drugs within LTC facilities. 

LTCPA remains concerned, however, about the increased costs and unproven benefits associated with the final rule. Other than the LTCPA study, there is no baseline data by which to determine the amount of unused drugs in the current system. Without this baseline measure, there is no objective way to determine whether the short cycle requirements will save money for the Medicare Part D Program.

Measurement of Unused Rx Drugs in Medicare Part D Nursing Stays | September 2011

This study quantifies unused medications dispensed to Medicare Part D-covered skilled nursing facility residents. The full report includes an additional analysis of the implications on Section 3310 of the Patient Protection and Affordable Care Act, focused on medication dispensing reform (short cycle dispensing) in the LTC domain. Managed Solutions, LLC conducted the research on behalf of LTCPA.

Final Rule on Changes to the MA and Medicare Part D Drug Benefit including Short Cycle Dispensing | April 2011

This CMS Final Rule (pages 30-40, 143) implements provisions specified in the Patient Protection and Affordable Care Act (PPACA), including Section 3310, "Appropriate Dispensing of Prescription Drugs in Long-Term Care Facilities Under PDPs and MA–PD Plans" i.e. short cycle dispensing.

Lawmakers and Industry Call for Delay in Short Cycle Dispensing Rule | March 2011

In separate letters, bipartisan House lawmakers, Senate lawmakers, and industry groups, including those representing LTC facilities, pharmacies, pharmacists, medical directors and pharmaceutical wholesalers, urge CMS to postpone implementation of the short-cycle pharmaceutical dispensing provision of health reform at least until more data is collected on the issue.

Proposed Rule on Changes to the MA and Medicare Part D Drug Benefit including Short Cycle Dispensing | November 2010

This CMS Proposed Rule implements provisions of PPACA which includes "Appropriate Dispensing of Prescription Drugs in Long-Term Care Facilities Under PDPs and MA–PD Plans" i.e. short cycle dispensing. (page 17), to which LTCPA submitted comments.