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Chapter 8: Health and Human Services
Authorize the Use of Automated Drug Dispensing Systems
Summary
In fiscal 1999, Texas spent $178 million on prescription drugs for its
Medicaid-funded nursing home population, and these drug expenditures are
expected to continue rising more rapidly than the general inflation rate. From 4
percent to 10 percent of all medications are needlessly wasted in long-term care
facilities. To reduce drug waste in the Medicaid Vendor Drug Program, Texas
should authorize long-term care facilities to use automated drug dispensing
systems that package and label single doses as needed.
Background
Automated drug dispensing systems use sophisticated computer technology to
package and label single doses of drugs so that they can be administered
precisely to patients in health care facilities. Such devices help eliminate
waste due to changes in doctor’s orders, patient deaths, transfers, etc.,
and they can reduce human error in the administration of medications, since they
label, deliver, and record medication administered to patients with multiple,
built-in checks and verifications.
Automated drug dispensing systems are particularly useful in long-term care
facilities, such as nursing homes, which provide pharmaceutical services.
Various studies over the last 10 years have reported that the percentage of drug
waste in long-term care facilities ranges from 4 percent to 10
percent.[1] Automated drug dispensing systems
help long-term care facilities reduce such waste and administer medications more
accurately, thereby improving their quality of care. A pharmacy manager at a
Florida nursing home that leases an automated drug-dispensing machine told
e-Texas staff the system has cut his facility’s drug waste
by 90 percent.[2]
In addition, such systems facilitate inventory control and, as a North
Carolina nursing home administrator has noted, free nurses to spend more time
with patients.[3] Drug dispensing systems benefit
pharmacists as well, since they eliminate the need to process and credit
returns, allow for less-frequent refills, expedite after-hours orders, and
reduce the number of trips pharmacists must make to nursing homes each
month.
Medicaid Drug Waste
Automated drug dispensing systems could help Texas save on Medicaid drug
costs at a time when such expenditures are rising rapidly. Drug expenditures in
the Texas Medicaid Vendor Drug Program rose by between 11 percent and 16 percent
annually between 1995 and 1999. In 1999, Texas spent $178 million on
prescription drugs for nursing home residents, and that amount is projected to
reach $208 million in fiscal 2000.[4]
At present, medications at long-term care facilities that are discontinued or
left over after the death of a patient are destroyed. Several studies have been
conducted to determine the rate or percentage of drug waste in long-term care
facilities. A 1992 study of selected Central Texas long-term care facilities
found that 7.7 percent of 999 prescriptions dispensed involved some quantity of
waste, and that overall medication waste amounted to 3.7 percent of the cost of
the prescriptions dispensed.[5] A more recent
Massachusetts study found that drug waste totaled 6.7 percent of the cost of all
medications dispensed. Patient deaths and medication discontinuation accounted
for almost 70 percent of the medications destroyed, with the remainder due to
changes in medication or dosage, medication expiration, or patient
hospitalization.[6]
In Texas facilities, a licensed pharmacist must be on site to oversee the
dispensing of medications and cannot operate an automatic drug dispensing
machine from a remote location. Other states, including Florida, New York, and
North Carolina, offer special licenses allowing long-term care facilities with
automated drug-dispensing machines to work with offsite pharmacists. Still other
states, including Kansas, Louisiana, Mississippi, South Carolina, Ohio and West
Virginia, have broader rules and laws that do not preclude the use of the
devices.[7]
Recommendation
State law should be amended to authorize long-term
care facilities to use automated drug dispensing systems that store, package,
dispense, distribute, and label prescription drugs.
Fiscal Impact
Automated drug dispensing systems would eliminate drug waste in nursing homes
by updating patient medication routines on a daily basis. Based on previous
studies, the Medicaid Vendor Drug Program could expect to prevent drug waste
equal to at least 3.7 percent of the program’s drug expenditures in
nursing homes that choose to invest in a system.
If all Texas nursing homes with more than 100 beds purchased or leased an
automated drug dispensing machine, total state and federal savings to the
Medicaid program would be about $5 million annually. Actual savings would depend
upon the actions of individual care facilities and cannot be estimated.
[1] Robert P. Paone et al,
“Medication Destruction and Waste Measurement and Management in Long-term
Care Facilities,” The Consultant Pharmacist (January 1996), p.
32.
[2] Telephone interview with
Oscar Perry, pharmacy manager of Okeechobee Healthcare Facility, Okeechobee,
Florida, August 4, 2000.
[3] Telephone interview with
Kevin Parries, administrator, Fleshers Fairview Healthcare Center. Fairview,
North Carolina, August 4, 2000.
[4] E-mail communication from
Ben Sherman, Texas Department of Health, August 4, 2000.
[5] Brian D. Shinavier and
Kenneth W. Kirk, “Medication Waste in Selected Central Texas Long-term
Care Facilities Under the Same Corporate Ownership,” The Consultant
Pharmacist (April 1992), p. 422.
[6] Robert P. Paone et al,
“Medication Destruction and Waste Measurement and Management in Long-term
Care Facilities,” p. 32.
[7] Telephone interview with
Tom Kraft, KVM Technologies, Inc., Houston, Texas, June 1, 2000.
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