How Medicare Part D, Medicaid, electronic prescribing, and ICD-10 could improve public health (but only if CMS lets them).

Abstract

A simple change to the Medicare and Medicaid outpatient prescription drug billing systems could improve patient safety and the systems' long-term fiscal stability. Including diagnosis codes on prescription drug claims (codes already in use for other billing purposes) would transform the Medicare Part D and Medicaid prescription drug claims databases into powerful public health research tools--ones that could provide much-needed (and, to date, elusive) information on how prescription drugs work in vulnerable patient populations underrepresented in clinical research. Achieving the full potential of this proposal, though, depends upon the federal agency responsible for Medicare and Medicaid, the Centers for Medicare and Medicaid Services (CMS), maintaining its current reimbursement policy, which is perhaps best characterized as one of benign neglect of the statutory standard for coverage. If, instead of continuing coverage for the vast majority of prescription drugs, CMS decided to deny payment for the millions of prescriptions falling short of the statutory standard (and thus avoid spending billions of federal health care dollars), prescribers would find themselves in an ethical dilemma between truth-telling and effectively treating their patients. Due to the systemic incentives for prescribers and pharmacists to miscode diagnoses in order to get CMS to pay for the prescription drugs needed by patients, the decision to treat patients effectively in the short-term under a strict coverage enforcement policy would undermine the potential to more effectively treat vulnerable patients, reduce prescription errors, and properly allocate federal health care dollars in the future. Even in the midst of a financial crisis, or perhaps especially because of our current financial crisis, we cannot afford to sacrifice improved patient safety and better informed long-term management of federal health care dollars for a short-term reduction in federal spending on prescription drugs.