Consolidation of liens of compound pharmacy
The consolidation of liens of compound pharmacy may be a positive step in resolving liens as the issues of medical necessity and
utilization review would still apply and as far as we know at this point there is not indication that the board is trying to do away
with compound pharmacy.
The only real issues are how the issues are going to be framed for the consolidation. It cannot be medical necessity as then each
case would have to be shown that the compound pharmacy was necessary and or reasonable and therefore not a common issue
of law and fact, the issue would have to be reimbursement rates. The reasons I say it cannot be medical necessity, as medications
do not have to cure only relieve pain or symptoms and that would depend on each injured worker.
The consolidation cannot go to regulating the compound pharmacy as that is the job of the Legislature.
The most important and interesting thing that is going to come out of the consolidation prior to the hearing on Oct. 6, 2010, is
what issues the board feels is common to all compound pharmacy cases.
Compound Medications
• Each ingredient needs an NDC number.
• Ingredients for which there is no NDC number at all are not separately reimbursable. (i.e. distilled water)
• Ingredients whose NDC number doesn’t appear in the Medi-Cal database should be priced per the methodology spelled out in §
9789.40.
• The payment is based on the sum of the fee for each ingredient plus the compound dispensing fee (CDF).
• The CDF depends on the route of administration, dosage form and the date of service.
• The formula is CDF = DF + CF + SF where DF is the dispensing fee, CF is the compounding fee, SF is the sterility fee. For
injections or perfusions the CDF is
multiplied by the number of containers.
Dietary Supplements
• Dietary supplements such as minerals and vitamins shall not be reimbursable unless a specific dietary deficiency has been
clinically established in the injured
employee as a result of the industrial injury or illness.
Los Angeles court schedules conference to discuss consolidation of liens
Compound pharmacy liens are the subject of the court’s motion to
consolidate
The Los Angeles district office of the Division of Workers’ Compensation has made a motion to consolidate lien proceedings
regarding compound pharmacy liens. The hearing is scheduled for 10 a.m. on Wednesday, Oct. 6 in the court’s first floor
auditorium at 320 W. 4th St. in Los Angeles .
All compound pharmacy lien claimants with pending liens should attend, along with their representatives and defendants.
However, injured workers and lien claimants without compound pharmacy liens should not attend.
Parties do not need to bring their files.
The court took this action because there are common issues of law and fact in the approximately 400 compound pharmacy liens
filed each month at the Los Angeles district office. Processing liens is time consuming, and the Los Angeles court can only
accommodate 145 lien hearings per month.
“By consolidating these liens, we’ll save time for not only the court but also the lien claimants,” said Court Administrator Keven
Star . “Rather than try this issue 5,000 times we can do it once.”
Los Angeles Presiding Judge Jorja Frank will preside over the Oct. 6 proceedings, along with Mark Kahn, the associate chief
judge for the southern region. Kahn has jurisdiction over other courts in case the issues go beyond just those cases scheduled in
Los Angeles . The conference will take place:
Wednesday, Oct. 6, 2010 10 a.m.
Div. of Workers’ Compensation
Los Angeles district office
320 W. 4th St., 1st floor auditorium
Los Angeles, CA 90013
CCR § 9789.40. Pharmacy
(a) The maximum reasonable fee for pharmaceuticals and pharmacy services rendered after January 1, 2004 is 100% of the
reimbursement prescribed in the relevant Medi-Cal payment system, including the Medi-Cal professional fee for dispensing.
Medi-Cal rates will be made available on the Division of Workers' Compensation's Internet Website (http://www.dir.ca.
gov/DWC/dwc.home.page.htm) or upon request to the Administrative Director at:
DIVISION OF WORKERS' COMPENSATION
(ATTENTION: OMFS -- PHARMACY)
P.O. BOX 420603
SAN FRANCISCO, CA 94142.
(b) For a pharmacy service or drug that is not covered by a Medi-Cal payment system, the maximum reasonable fee paid shall not
exceed the drug cost portion of the fee determined in accordance with this subdivision, plus $ 7.25 professional fee for dispensing
or $ 8.00 if the patient is in a skilled nursing facility or in an intermediate care facility. The maximum fee shall include only a single
professional dispensing fee for dispensing for each dispensing of a drug.
(1) If the National Drug Code for the drug product as dispensed is not in the Medi-Cal database, and the National Drug Code for
the underlying drug product from the original labeler appears in the Medi-Cal database, then the maximum fee shall be the drug
cost portion of the reimbursement allowed pursuant to section 14105.45 of the Welfare and Institutions Code using the National
Drug Code for the underlying drug product from the original labeler as it appears in the Medi-Cal database, calculated on a per
unit basis, plus the professional fee allowed by subdivision (b) of this section.
(2) If the National Drug Code for the drug product as dispensed is not in the Medi-Cal database and the National Drug Code for
the underlying drug product from the original labeler is not in the Medi-Cal database, then the maximum fee shall be 83 percent of
the average wholesale price of the lowest priced therapeutically equivalent drug, calculated on a per unit basis, plus the
professional fee allowed by subdivision (b) of this section.
(c) For purposes of this section:
(1) "therapeutically equivalent drugs" means drugs that have been assigned the same Therapeutic Equivalent Code starting with
the letter "A" in the Food and Drug Administration's publication "Approved Drug Products with Therapeutic Equivalence
Evaluations" ("Orange Book".) The Orange Book any be accessed through the Food and Drug Administration's website: http:
//www.fda.gov/cder/orange/default.htm.;
(2) "National Drug Code for the underlying drug product from the original labeler" means the National Drug Code of the drug
product actually utilized by the repackager in producing the repackaged product.
(d) The changes made to this Section in February, 2007, shall be applicable to all pharmaceuticals dispensed or provided on or
after March 1, 2007.
The consolidation of liens of compound pharmacy may be a positive step in resolving liens as the issues of medical necessity and
utilization review would still apply and as far as we know at this point there is not indication that the board is trying to do away
with compound pharmacy.
The only real issues are how the issues are going to be framed for the consolidation. It cannot be medical necessity as then each
case would have to be shown that the compound pharmacy was necessary and or reasonable and therefore not a common issue
of law and fact, the issue would have to be reimbursement rates. The reasons I say it cannot be medical necessity, as medications
do not have to cure only relieve pain or symptoms and that would depend on each injured worker.
The consolidation cannot go to regulating the compound pharmacy as that is the job of the Legislature.
The most important and interesting thing that is going to come out of the consolidation prior to the hearing on Oct. 6, 2010, is
what issues the board feels is common to all compound pharmacy cases.
- Rule §10591. Consolidating Cases--Different Offices Multiple Injured Workers.
For cases involving two or more injured workers, Aany request or petition to consolidate cases assigned to different
offices for hearingin one office of the Workers’ Compensation Appeals Board shall be first referred to the Assistant Chief
of the Division of Workers’Compensation or his or her designee court administrator. Any request or petition to
consolidate cases for hearing assigned to different workers’ compensation judges in the same office shall be referred to the
presiding workers’compensation judge of that office. The Assistant Chief or presiding workers’ judge court administrator
shall set the request for conference to obtain agreement of all the parties to the place of hearing. If the parties do not agree
to the place of hearing, the Assistance Chief or presiding workers’ compensation judge court administrator shall make a
determination of the request for consolidation, giving due consideration to whether there are common issues of fact and
law as well as whether judicial economy and expediency warrant and justify the request. Any party aggrieved by the
determination of the Assistant Chief or presiding workers’ compensation judge court administrator may request
proceedings pursuant to Labor Code section 5310
Compound Medications
• Each ingredient needs an NDC number.
• Ingredients for which there is no NDC number at all are not separately reimbursable. (i.e. distilled water)
• Ingredients whose NDC number doesn’t appear in the Medi-Cal database should be priced per the methodology spelled out in §
9789.40.
• The payment is based on the sum of the fee for each ingredient plus the compound dispensing fee (CDF).
• The CDF depends on the route of administration, dosage form and the date of service.
• The formula is CDF = DF + CF + SF where DF is the dispensing fee, CF is the compounding fee, SF is the sterility fee. For
injections or perfusions the CDF is
multiplied by the number of containers.
Dietary Supplements
• Dietary supplements such as minerals and vitamins shall not be reimbursable unless a specific dietary deficiency has been
clinically established in the injured
employee as a result of the industrial injury or illness.
Los Angeles court schedules conference to discuss consolidation of liens
Compound pharmacy liens are the subject of the court’s motion to
consolidate
The Los Angeles district office of the Division of Workers’ Compensation has made a motion to consolidate lien proceedings
regarding compound pharmacy liens. The hearing is scheduled for 10 a.m. on Wednesday, Oct. 6 in the court’s first floor
auditorium at 320 W. 4th St. in Los Angeles .
All compound pharmacy lien claimants with pending liens should attend, along with their representatives and defendants.
However, injured workers and lien claimants without compound pharmacy liens should not attend.
Parties do not need to bring their files.
The court took this action because there are common issues of law and fact in the approximately 400 compound pharmacy liens
filed each month at the Los Angeles district office. Processing liens is time consuming, and the Los Angeles court can only
accommodate 145 lien hearings per month.
“By consolidating these liens, we’ll save time for not only the court but also the lien claimants,” said Court Administrator Keven
Star . “Rather than try this issue 5,000 times we can do it once.”
Los Angeles Presiding Judge Jorja Frank will preside over the Oct. 6 proceedings, along with Mark Kahn, the associate chief
judge for the southern region. Kahn has jurisdiction over other courts in case the issues go beyond just those cases scheduled in
Los Angeles . The conference will take place:
Wednesday, Oct. 6, 2010 10 a.m.
Div. of Workers’ Compensation
Los Angeles district office
320 W. 4th St., 1st floor auditorium
Los Angeles, CA 90013
CCR § 9789.40. Pharmacy
(a) The maximum reasonable fee for pharmaceuticals and pharmacy services rendered after January 1, 2004 is 100% of the
reimbursement prescribed in the relevant Medi-Cal payment system, including the Medi-Cal professional fee for dispensing.
Medi-Cal rates will be made available on the Division of Workers' Compensation's Internet Website (http://www.dir.ca.
gov/DWC/dwc.home.page.htm) or upon request to the Administrative Director at:
DIVISION OF WORKERS' COMPENSATION
(ATTENTION: OMFS -- PHARMACY)
P.O. BOX 420603
SAN FRANCISCO, CA 94142.
(b) For a pharmacy service or drug that is not covered by a Medi-Cal payment system, the maximum reasonable fee paid shall not
exceed the drug cost portion of the fee determined in accordance with this subdivision, plus $ 7.25 professional fee for dispensing
or $ 8.00 if the patient is in a skilled nursing facility or in an intermediate care facility. The maximum fee shall include only a single
professional dispensing fee for dispensing for each dispensing of a drug.
(1) If the National Drug Code for the drug product as dispensed is not in the Medi-Cal database, and the National Drug Code for
the underlying drug product from the original labeler appears in the Medi-Cal database, then the maximum fee shall be the drug
cost portion of the reimbursement allowed pursuant to section 14105.45 of the Welfare and Institutions Code using the National
Drug Code for the underlying drug product from the original labeler as it appears in the Medi-Cal database, calculated on a per
unit basis, plus the professional fee allowed by subdivision (b) of this section.
(2) If the National Drug Code for the drug product as dispensed is not in the Medi-Cal database and the National Drug Code for
the underlying drug product from the original labeler is not in the Medi-Cal database, then the maximum fee shall be 83 percent of
the average wholesale price of the lowest priced therapeutically equivalent drug, calculated on a per unit basis, plus the
professional fee allowed by subdivision (b) of this section.
(c) For purposes of this section:
(1) "therapeutically equivalent drugs" means drugs that have been assigned the same Therapeutic Equivalent Code starting with
the letter "A" in the Food and Drug Administration's publication "Approved Drug Products with Therapeutic Equivalence
Evaluations" ("Orange Book".) The Orange Book any be accessed through the Food and Drug Administration's website: http:
//www.fda.gov/cder/orange/default.htm.;
(2) "National Drug Code for the underlying drug product from the original labeler" means the National Drug Code of the drug
product actually utilized by the repackager in producing the repackaged product.
(d) The changes made to this Section in February, 2007, shall be applicable to all pharmaceuticals dispensed or provided on or
after March 1, 2007.
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