Regulatory issues you need to know about in-store clinics

February 5, 2007

Regulatory issues you need to know about in-store clinics

There are many laws, regulations, and issues pharmacists need to be aware of before taking the in-store clinic plunge. At a recent industry conference, Lawrence Earl, M.D., president of MiniMedCare, outlined the following items, which he believes are most important:

  • The Stark law. This law prohibits physicians from referring Medicare or Medicaid patients to an entity for the provision of designated health services if the physician has a direct or indirect financial relationship with the entity. Designated health services under Stark include laboratory, radiology, physical therapy, home health, outpatient prescription drugs, and inpatient and outpatient hospital services.

  • Antikickback laws. These laws apply to anyone who is dealing with a federal healthcare program and it must involve a specific bad intent. "There are certain safe harbors—13 situations where if you are operating under a certain situation, it doesn't violate the antikickback laws," noted Earl.

  • Professional misconduct laws. "You don't want to have a situation where there appears to be undue influence exerted on someone to fill a prescription at your clinic pharmacy," advised Earl. "It may be convenient, but you can't use any unusual incentives or inducements or require that they fill their prescription at that pharmacy."

  • State corporate practice of medicine laws. "These laws vary by state. They refer to any business having operation or management of services of a licensed professional. In most cases, you can have a general business agreement with a licensed professional, but the general business has to be restricted to making decisions about management and administrative functions, including hiring nonprofessional staff, providing the space and equipment, and doing the billing services. The practitioner is the person responsible for setting all the medical policies, including what type of services are going to be offered and what the fees are for the services. It must be clear that the general business entity is not the one providing medical services," said Earl.

  • Health department issues. "Many of the clinics have some type of lab services. Most of them are CLIA-waived procedures, which normally would not require a lab license. However, in some states, particularly New Jersey, the rule is that if you have more than five providers in your practice, even if you are only providing CLIA-waived tests, you have to have a lab license," Earl said.

    Noting that medical waste is also state and federally regulated, Earl cautioned, "In your pharmacy you may not have had to deal with bodily fluid issues. With injections, drawing blood, and taking urine samples—all those things have to be handled and disposed of in a certain way. You need to make sure your provider or someone has come in and contracted with an approved medical waste vendor."

    Earl also advised, "If the clinic is not part of the pharmacy department, generally one does not have to involve the board of pharmacy in any sort of approval process," he said. "If you have to rearrange the pharmacy, for example, if you move a door or a window or make an adjustment, then it may fall under the board of pharmacy. You may have to have notification and inspection before the changes can be approved."

  • Pharmacy steering law. "You can't do anything that forces a patient to be seen at the clinic or give any inducement to fill a prescription at your pharmacy. It doesn't matter whether it's a written, oral, or electronic prescription. It is unlawful for a pharmacist to enter into an arrangement with a healthcare practitioner for the purpose of directing or diverting patients," asserted Earl.

  • Drug and cosmetic laws. If the clinic is dispensing medications, they have to be labeled properly, with expiration date, instructions, and dosage information.

  • Mid-level practitioner issues. Most of the clinics have been set up with nurse practitioners (NPs). "One of the main reasons is they are less regulated and are able to operate independently," explained Earl. "In most states, NPs can diagnose illnesses and prescribe medications limited to their specialty and education. They most often have to have a collaborative agreement with a physician."

    Physician assistants (PAs) must function under the supervision of a physician. "There needs to be a physician that a PA is assigned to. In New York, a physician presence is not required for a PA to work in a clinic, but only two PAs can be assigned to any one physician. In Pennsylvania, you can only have two PAs, but a physician has to be on the premises once a week. New Jersey requires two PAs per physician on a concurrent basis," Earl noted.

  • Zoning and local issues. Finally, Earl advised that there are also zoning issues concerning providing medical services. "You may have to go before a planning board for certain things like signage outside your door," he said.

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