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New dosages of old drugs are used to raise their prices

New York Times (02/11/15) Meier, Barry: “Over the last 2 years, states nationwide have moved to crack down on so-called physician dispensing of prescription drugs, a practice largely limited to doctors who treat injured workers. Recent studies suggest that doctors and companies have responded by exploiting loopholes in those rules and adopting new strategies to stay a step ahead. One tactic has been to create novel dosages of old drugs to get around cost controls on traditional ones, according to a report issued in January by the Workers Compensation Research Institute. “The regulations stimulated this innovation,” says Richard Victor, the executive director of the research group, which is financed by insurers and state governments. Other studies show that along with the new drug strengths, doctors are finding ways to generate added income by dispensing medical foods and compounded drugs. With physician dispensing, the doctor gives the patient the drug and bills an insurer for its cost. Doctors claim the practice benefits patients because it is convenient and allows physicians to better monitor the patient’s use of medication. Insurers and business groups have long tried to control or eliminate physician dispensing because of its higher costs and because doctors in some states were dispensing large volumes of narcotic opioid analgesics.”

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