Dispensing Controlled Substances from the Office: A Guide for Physicians

Given law enforcement’s current focus on combating the opioid epidemic, controlled substance-dispensing physicians are under increased scrutiny from local, state, and federal governments. Below is a brief overview of the law and regulations covering physicians’ office-based dispensing of controlled substances, specifically those pertaining to prescription drug monitoring, practice management, security, and diversion prevention.

  • Routinely monitor compliance with your state’s dispensing and PDMP laws.

Any physician dispensing controlled substances from their office must ensure their practice complies with the applicable federal laws and regulations, namely the federal Controlled Substances Act. They also must know and be in compliance with their respective state dispensing laws.  Some states prohibit physician dispensing, others restrict which controlled substances can be dispensed (or their quantity and frequency), while some states require dispensing physicians obtain an additional license, as well as follow their Board of Pharmacy regulations. Many states regulate who must hand the medicine to the patient, often mandating that only the physician can do so. 

More importantly, physicians dispensing controlled substances must know and comply with their respective state’s Prescription Drug Monitoring Program (“PDMP”) requirements. PDMPs are electronic databases that collect designated information on dispensed controlled substances. After conducting any PDMP mandated prescriber queries, approved physician dispensers must promptly report certain dispensed controlled substance information to their respective state’s PDMP.  In most states, dispensing physicians can delegate the PDMP query and data input to a few specifically identified practice employees.

State legislatures have also amended their state PDMP laws to make them more rigorous in light of the opioid crisis, and law enforcement and professional licensing boards are increasingly scrutinizing PDMP records to track controlled substance prescribing and dispensing rates.

  • Protect your practice from theft.

Dispensing controlled substances requires the implementation of a strong system of inventory control and medication security. Having these substances in stock places your practice at greater risk of a break-in and increases the possibility of employee theft.

All controlled substance dispensers are required to provide effective controls to guard against theft and diversion of them and must be bolted or cemented to the floor. Additional controls might include: a wall safe or locked steel cabinet; a storage unit alarm system; video surveillance of medicine storage locations; and employing security personnel. How substantial your security measures need to be is based on your practice location, the type of physical buildings it’s in, the type and quantity of controlled substances stored on the premises, the control of public access to the facility, the adequacy of practice’s alarms and detection systems, and the availability of local police protection.

If you do become a victim of theft, the theft must be reported to the DEA immediately, and may, depending on the state, have to be reported to additional regulatory and law enforcement entities, like the state medical board, state pharmacy board, or local law enforcement.   

  • Always prescribe medication for a legitimate medical purpose.

It goes without saying: both prescribers and dispensers are responsible for ensuring that controlled substances are issued for a legitimate medical purpose by a practitioner acting in the usual course of professional practice. A person who knowingly fills a prescription not issued for a legitimate medical purpose and not in the usual course of professional practice can be found civilly or criminally liable under the Controlled Substances Act. Enforcement actions can cost you your medical license, hospital privileges, DEA authorization to prescribe substances, and revocation of panel participation.

Some state courts have permitted individual controlled substance users who admittedly broke laws to obtain controlled substances to bring civil actions against their doctors and pharmacists for negligent prescribing and dispensing that allegedly caused the users’ drug addiction. Of course, a criminal conviction lead to a prison sentence and a hefty fine and possibly a restitution award.

In addition, malpractice insurance might not provide coverage or even a legal defense for a dispensing physician in a dispensing lawsuit because the court may find that the controlled substances were dispensed not for a legitimate medical purpose and not in the usual course of professional practice.  Such illegal conduct is usually not covered by insurance.  Physicians should contact their malpractice insurance carrier before dispensing controlled substances.

  • Check the background of your employees, train yourself and your staff on drug-seeking behavior, and restrict the number of employees with access to controlled substances.

In most cases, physician controlled substance dispensing removes the pharmacist from the prescription review process. Pharmacists often alert physicians to prescribing errors or a patient’s controlled substance prescription history, leading some to conclude that physician dispensing eliminates a crucial second check of the prescribed drug therapy, potentially increasing the chances of diversion. In light of this, physician controlled substance dispensers must be well trained in identifying drug-seeking behavior among their patients and must thoroughly train their employees in how to recognize it. They must screen prospective employees to ensure they do not have past controlled substance and/or theft felony convictions and can be trusted to work in a security stringent office. 

They should also restrict the number of employees who have access to controlled substances and the prescription and dispensing records.  Many instances of diversion start where a physician or the physician’s employee dispenses a controlled substance to a family member, a mistress, or fellow employee “off the books.” Never prescribe a controlled substance to anyone without logging its dispensation. Dispensers must ensure they and their staff are proactive in monitoring the practice’s patients, its drug supply, its PDMP reporting, and its internal records.

And if at all possible, avoid treating and prescribing a scheduled narcotic to anyone near and dear to you.

  • Don’t be afraid to dispense controlled substances, but be cautious.

Though the potential liability may dissuade practitioners from dispensing controlled substances, it’s possible to do so in a compliant and safe manner that greatly reduces the chances of diversion and law enforcement scrutiny. Consult with experienced counsel or compliance professionals for assistance. There are no ‘do-overs’ when it comes to the DEA so be sure to get it right the first time.

Takeaways from the Annual Pennsylvania White Collar Criminal Defense Lawyers’ Conference

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Newsflash: the Justice Department is still an insider’s club, criminal practice is not for beginners, and courts still penalize defendants who exercise their constitutional right to have criminal charges against them tried by a jury; Western Pennsylvania is the only judicial district in the country regularly prosecuting doctors who prescribe Suboxone, and everyone’s rekindled interest in the Nixon case as a prediction of Special Counsel Robert Muller’s next move.

That’s our “takeaway” from the annual White Collar Criminal Defense seminar featuring top prosecutors, judges, and federal defense practitioners, hosted by the Pennsylvania Association of Criminal Defense Lawyers in Philadelphia this past month. The annual event brings key Justice Department lawyers from Washington, and practice chiefs from the local and neighboring U.S. Attorneys’ Office, together with judges and defense practitioners, to discuss the Government’s enforcement focus and the strategy and tactics to defend them. The program provides insight into current Government initiatives, and a window onto what has changed in the law; what we learned is that the more things change, the more things remain the same.

This year’s program featured the Eastern District of Pennsylvania Federal Judge Wendy Beetlestone, on sentencing practices for criminal defendants in White Collar Cases. The implicit message in her remarks, as well as in those of appellate lawyers at the program following her address, was the implicit bias of the judiciary against criminal defendants who insist on exercising their constitutional right to trial by a jury of their peers on the charges against them. Of course, this sounds counterintuitive to non-lawyers; the federal United States Sentencing Guidelines, however, place an enormous emphasis on having criminal defendants admit their guilt and show remorse, to the extent of rewarding those who plead guilty with a lesser sentence. Unlike plea bargaining in many states, however, federal criminal procedure does not provide for a plea of “no contest,” where the defendant withdraws their plea of not guilty because they believe that taking the prosecution’s offer without a trial “is in their best interest” (California law provides for this in what is known as an Alford plea; in West Virginia it’s referred to as a Kennedy plea).

Sure, the Bill of Rights to the U.S. Constitution provides that every defendant is presumed innocent until proven guilty – but defendants who put the prosecution and the courts through the exercise of a trial are routinely punished for relying on that right.  Since they have not admitted their guilt or shown remorse, this is generally true in practice even if they do not take the stand to testify in their own defense, or present evidence directly disputing that they are guilty of the charge(s), and instead exercise their constitutional right to remain silent.  Indeed, the implicit rule has not changed little: if you must go to trial, be certain that you win because the price of losing is higher than the price of admitting guilt.

And speaking of trials, the overwhelming takeaway from appeals of political trials seems to be that under no circumstances should the defense ever sit quietly while a judge sends an indictment into the jury room, as the “road map” for consideration of the charges. Indictments are in effect the government’s statement of its case, replete with excess and prejudicial allegations which in no instance reflects at all well on the defendant, and further, object strenuously to the judge holding her jury charge conference in chambers, without a court reporter present; there is too much potential to waive legal objections through lack of adequate preservation of the issues. The familiarity and closeness of the government prosecutors and defense lawyers on a personal level emphasized, once again, how many of us as defense lawyers started out as prosecutors, and oftentimes how many prosecutors start out as defense lawyers. 

We hang out together because we speak the same language, we often respect each other, and most of the time we even like each other.  Don’t underestimate the value of personal relationships and familiarity with the system in choosing your criminal defense advocate.  The “Main Justice” Department in Washington and the U.S. Attorneys Office(s), are notorious for being places where “inside baseball” is played, or as we say in Pittsburgh, where only “home cooking” is served.  If your civil lawyer who doesn’t know where the U .S. Attorney’s Office is or who sits in it, tells you they can handle the criminal matter just fine, don’t believe them; this isn’t something you want your attorney to learn at your expense.  

In health care prosecutions, as Buzzfeed recently noted online, the Western District of Pennsylvania seems to remain the only federal judicial district in the country prosecuting doctors who allegedly misprescribed buprenorphine (suboxone).  Doctors beware. 

And finally, what we learned at the White Collar Seminar was that if acting Attorney General Whitaker (or his successor) unseats special prosecutor Mueller, the Chief Judge of the judicial district in the District of Columbia may not maintain an investigation without the Justice Department leading it.  That having been said, former PA Western District U.S. Attorney Harry Littman said just several days ago on TV that, regardless of Special Counsel Mueller’s longevity in office, his plans for the further investigation and possible prosecution of Donald Trump, Jr., the President’s son, Jared Kushner, the President’s his son-in-law, and even the President himself should all be revealed in short order.  Stay tuned!

From the Desk of Efrem Grail: Takeaways from the Annual Meeting of the American Society of Pharmacy Law

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Last week, I was privileged to attend the 29th Annual Meeting of the American Society of Pharmacy Law, on Hilton Head Island, South Carolina.  Here are some few general ‘takeaways’ for our health-care provider and physician practitioner/practice groups specifically, and business clients generally:

    • Compliance isn’t about getting the right answer on any given occasion or, in the words of the United States Sentencing Guidelines Commission’s guidance for business entities, preventing and detecting violations of law in every instance. From “big pharma” all the way to the corner drug store, it’s about having reproducible processes and verifiable systems with integrity in place that conduct due diligence 100% of the time. No system is perfect, no judgment call will always be accurate, and everyone gets it wrong occasionally. The key to defending a civil audit, an administrative enforcement investigation or a federal grand jury inquiry is being able to demonstrate that your business has processes to ensure laws and regulations are in place and employs people dedicated to making sure they are utilized.

 

    • Everyone acknowledges the opioid epidemic is killing our citizens, without discriminating by wealth, race, gender or any other category or classification, and that “something must be done” about it.  But there remains a deep, cultural divide between those in health care who believe the solution is treatment, and those in law enforcement who believe the solution is enforcement – and this culture war shows no sign of détente in the near future.

 

    • There are now over 900 lawsuits against manufacturers, distributors, pharmacies and other defendants seeking money damages arising out of the opioid crisis, giving rise to a cottage industry of opioid case lawyers, on both sides of the cases. We’ll all end up paying for them in the long run.

 

    • Investigation of suspected violation(s) of statutes and regulations of wholesale pharmaceutical distributors, retail dispensers (i.e., pharmacies) and providers varies widely from judicial district to judicial district. Having local connections with regulators and enforcement personnel has no substitute for business and business persons when it comes to knowing how regulations are interpreted in specific regions of the country, and between regions that are connected.

 

    • “PBMs,” or pharmacy benefit managers who, as third-party administrators of prescription drug programs for insurers, government health care provider programs and other payor plans, have an inordinate amount of influence over how we get our medicines in this country, who we get them from, and what we pay for them.

 

Overall, the ASPL meeting was highly informative and worth attending for industry professionals and counsel. As more pharmacies, distributors and retail stores are sued and investigated, attorneys need to be proactive in providing their clients timely advice to avoid the rising costs of legal proceedings.