Physician Dispensing: Can I? Should I?

Session reviewed common pitfalls and questions to consider for physicians looking into the dispensary business.

Don’t make a decision on physician dispensing based on information from sales or marketing personnel, said Jennifer Bolen, JD. First, consult your lawyer.

Bolen’s presentation, “Physician Dispensing: Can I? Should I?” highlighted a number of issues that physicians should consider before opening up their own dispensaries. Bolen provided recommendations on how to effectively run a dispensary and avoid DEA scrutiny. Although creating a dispensary has many benefits and may provide more convenience to both the physicians and the patients, doing it correctly requires careful planning and extensive research, Bolen said. “As a patient myself, I would love to be able to go to the doctor and get my medicine right there."

Obtaining DEA registration is just one part of the equation; often, states will require physicians to then follow state laws and possibly the policies of professional licensing agencies to decide whether dispensing will be allowed without additional steps. There are three general categories that most states fall into in terms of physician dispensing. Some states do not require a license for physicians to dispense, some do require a license, and some do not allow dispensing at all.

It is also important for physicians to realize that a dispensary is not equal to a pharmacy, she said. Significant legal distinctions separate the two. However, they do share commonalities. Like a pharmacy, physicians who choose to open up a dispensary must be sure to have accountability and security measures in place. That way, when a physician’s dispensary is investigated or inspected, the burden and stress of the situation will be minimized, she explained.

Proactively taking precautionary steps is the key to running a successful dispensary, Bolen noted. Among some of the items to be aware of are that states that allow physician dispensaries have laws governing whether separate registration is required, the types of requirements for staff on site, and requirements for filling and dispensing medications.

Ethical concerns involved in operating a successful dispensaries include making sure to have patient informed consent, making sure the patient has a choice of where to fill prescriptions, formulary selection issues, and the challenges associated with legal compliance. The patient must have freedom of choice to choose whether he or she wants to receive medication from the dispensary, she said. Additionally, legal compliance can be burdensome for the physician, depending on the state criteria. Opening a dispensary will create more need for safety protocols that will affect how the practice is run, such as additional documentation, which can take a toll on a practice. “You have to look at these issues quite broadly and beyond the little paper they give you that says ‘look at how much money you can make’,” she said.

Before deciding about opening a dispensary, a physician must look at clinical considerations, including questions like “what are the legal requirements relative to the act of dispensing?” and technical considerations, including questions like “why is it called a dispensary instead of pharmacy?”

Bolen suggests the following checklist before considering operating a PD: interview potential suppliers, assess the physical changes that will have to be made to the office, assess the need for security tools, and evaluate the expected record-keeping process.