Frequently Asked Questions:
WHY DISPENSE?
WHAT ARE THE PATIENT BENEFITS?
Over 90% of your patients would prefer to get their medications at the point of care.
- Reasons include:
- Convenience (no additional trips to the pharmacy)
- Compliance (compliance rates are 60-70% higher than prescriptions from a retail pharmacy, reducing long term care costs hundreds of dollars for each $1 invested in compliance)
- Cost (no difference for insured patients; for uninsured patients, medications are generally the same or lower than retail pharmacy)
- Care (drug formularies and therapeutic substitutions can be handled easier - reducing overall medication cost nearly 50%)
WHAT ARE THE PAYER BENEFITS?
Payers benefit from lower short term and lower long-term health care costs incurred by patients.
WHAT ARE THE PHYSICIAN BENEFITS?
Medicine, like so many professions, is slow to adopt change. Unfortunately, with politicians promising the results of physicians’ labor free to citizens at least every two years in exchange for votes, inaction has been and will continue to be unhealthy for those who practice medicine.
The stark facts are that the average primary care physician is making $150,000 per year and must gross nearly $500,000 to do that. That income is being attacked from many angles.
For instance, the 10% proposed decrease in Medicare/Medicaid payments would reduce all payer payments if imposed. If that is coupled with a 3% increase in overhead, the $150,000 current net quickly becomes $90,000.
Major investors are putting nurse practitioners in kiosks in drug stores creating assembly line “health care” to generate prescription and retail sales for pharmacies. These investors intend to have a massive impact on the market and their personal wealth at the expense of primary care physicians. They are counting on physician lethargy.
Each physician is spending 1/2 to 1 hour on pharmaceutical matters each day for no revenue. For every three physicians there is the equivalent of a full time employee handling pharmacy issues for no revenue. This overhead totals about $30,000 annually per physician in order to comply with pharmacy and payer/PBM requests. This overhead creates no revenue. by using this overhead to deliver medications, the physician can provide better health care while increasing practice income $20,000 - $100,000.
WHAT ARE THE LEGAL REQUIREMENTS?
IS PHYSICIAN DISPENSING LEGAL?
Yes, in all but six states - NY, NJ, TX, MT, UT, and MA. NY and NJ have exceptions for HIV and oncology practices. TX has certain exceptions for low-density areas. AR law allows for physician dispensing but it is enforced in such a way that the law is meaningless. The Federal Trade Commission has issued opinions indicating that the laws restricting physician dispensing are illegal restraints of trade and should fall if challenged. If you are in one of the restricted states and are interested in a challenge to the law, please let us know.
IS THERE A SPECIAL LICENSE TO DISPENSE?
The rules vary in states where physician dispensing is permitted. PTC consultants will assist you in fulfilling any requirements during the training and installation process.
WILL I BE A FULL SERVICE PHARMACY?
No. Dispensing physicians are not required to have a pharmacy license and are not considered a pharmacy.
MAY I DISPENSE MEDICATIONS FOR OTHER DOCTORS?
No. You can only dispense medications for your patients.
WILL MY PROFESSIONAL LIABILITY INSURANCE INCREASE?
No. Remember that dispensing includes providing samples and injections to your patients. You are already dispensing and it is covered by your insurance.
IS THERE ANY SALES TAX THAT WE NEED TO CHARGE?
No, except for a few states. The PTC9000 is programmed to handle any sales tax.
DO WE NEED A VENDOR LICENSE?
No.
IS PHYSICIAN DISPENSING ETHICAL?
Yes. Often physicians and others see an inherent conflict of interest in the dispensing of medications for a fee. Those folks are correct. It is, in fact, a conflict. And so, we might add, are the following: scheduling additional office visits; ordering X-rays, blood tests, urine tests, hospital stays or surgery; or any other act in the medical profession for which a physician gets compensated. Conflicts are a basic part of everyday life. Conflicts only become problems when the resolution of the conflict is done improperly. That is the ethical part.
To be sure, that professional judgment must be devoid of consideration for any personal economic or emotional benefit to the professional. This requires a deliberate act on the part of the professional and often runs contrary to human nature. In the case of our health care, we have entrusted that ethical responsibility to our physician. We expect our physician to charge for the professional judgment and all services provided. The provision of medication is simply another service for which our physician is entitled to a fee. The act of dispensing medications is in no way an adverse reflection on our physicians’ ethics. Considering the lower cost, greater convenience, greater compliance and better health care resulting for the patient, it is one of the more positive statements that could be made about that professional’s ethics.
SHOULD I DISPENSE IN MY PRACTICE?
IS THIS THE TIME TO BEGIN DISPENSING?
It is always a good time to provide better patient care at a lower cost. With increasing costs and decreasing reimbursements, the answer is an emphatic "Yes".
WILL I BE ABLE TO PROCESS CLAIMS FOR MY PATIENTS WITH PRESCRIPTION INSURANCE?
In most cases, yes. Over 90% of the payers will reimburse dispensing physicians using the PTC9000. Patients’ copays will be the same as a retail pharmacy. Once you tell us your primary payers, we can be more precise.
WILL I BE ABLE TO DO REFILLS FOR MY PATIENTS?
Yes.
WILL I BE ABLE TO DO WORKERS’ COMPENSATION CLAIMS?
Yes. Some states provide reimbursements that are very profitable. PTC will work with you to help achieve your objectives.
HOW MUCH MONEY CAN I EARN USING THE PTC9000?
Most physicians can increase net income by $20,000-$100,000 annually.
WILL THE MEDICATIONS I DISPENSE BE QUALITY MEDICATIONS?
Yes. PTC is fully licensed by the FDA and offers only brands and top rated generics. PTC is also licensed in the state of Florida. Florida has the most rigorous regulatory policy of all states requiring drugs to be pedigreed and authenticated to assure the prevention of counterfeit drugs from entering the distribution system.
WHY AREN’T THERE MORE PHYSICIANS DISPENSING?
Virtually all physicians are dispensing. The easiest example is samples that are dispensed for free. Historically physicians dispensed. Pharmacy, symbolized by the mortar and pestle, was the manufacturer. Because of the proliferation of drugs and the lack of computerized control, pharmacy became a distribution system in the 20th century. That distribution is no longer required and is neither as efficient nor as accurate as physician dispensing.
WILL I BE ABLE TO GET ALL MEDICATIONS FROM PTC?
Yes. PTC can provide any FDA/DEA approved drugs.
WHICH PRACTICES BENEFIT THE MOST FROM DISPENSING?
The PTC9000 should be in every practice where sufficient prescriptions are written - over 40,000. Urgent care and family practice clinics tend to do very well. The PTC9000 is not limited to any specialty. Specialties served include: cardiology, pediatrics, neurology, pain management, urology, oncology, hematology, infectious disease/HIV, internal medicine, hospice, orthopedic and more.
HOW WILL THIS AFFECT THE LOCAL PHARMACIES?
The goal is to provide better healthcare to your patients. You can do a better job. Only one-third of patients use the same pharmacy regularly.
HOW DO WE COMPETE WITH THE CHEAP GENERICS PROVIDED BY VARIOUS MASS MERCHANDISERS?
While dispensing can bring additional net income to your practice, your first objective will always be patient compliance. If your patient is properly complying with your medication order at another source, that is good.
Most of the drugs on these “$4.00 lists” are sold by PTC to our customers at $4.00 or less. The dispensing physician has the prerogative to set pricing. Most choose to compete by service - convenience, care and compliance. Few patients choose a physician based on price. Give your patients the alternative and let them make the choice.
HOW DOES THE PTC9000 WORK?
DO I NEED ADDITIONAL STAFF TO DISPENSE?
Remember: Each physician is spending 1/2 to 1 hour on pharmaceutical matters each day for no revenue. For every three physicians there is the equivalent of a full time employee handling pharmacy issues for no revenue. This overhead totals about $30,000 annually per physician in order to comply with pharmacy and payer/PBM requests. This overhead creates no revenue. By using this overhead to deliver medications, the physician can provide better health care while increasing practice income $20,000 - $100,000.
Typically the answer is no. Because using the PTC9000 generally frees up pharmacy compliance time now spent by nurses and physician extenders, some clinics choose to hire a pharmacy tech. This allows more productivity from nurses and physician extenders who can usually bill for those services. PTC consultants will help you make this decision.
IS DISPENSING TIME CONSUMING?
No. After training by PTC consultants and some experience, dispensing can typically be done within a couple of minutes.
AM I GOING TO HAVE TO COUNT PILLS TO DISPENSE TO MY PATIENTS?
No. Each medication comes to you prepackaged and sealed containing the precise drug and count ordered. There is never an open bottle of pills. With bar code technology, the chances for error are virtually eliminated.
HOW MUCH DO I NEED TO CHARGE MY PATIENTS FOR THE MEDICATIONS?
For insured reimbursements, you will accept the amount paid by the payer. For others, you choose the price you want to charge. PTC consultants will work with you to establish the right pricing. Physicians using the PTC9000 are averaging over $6.00 profit per medication and an average cost per medication of about $30.00. This $36.00 average total cost compares with an average of about $73.00 in a retail pharmacy.
WHAT ARE THE SECURITY REQUIREMENTS?
Generally, all medications must be securely locked in a cabinet. Controlled substances require double locked security. A few states require some security devices. Most practices already have sufficient security in place. PTC consultants can advise you on any specific requirements in your state.
HOW MUCH SPACE WILL I NEED?
Space requirements are small. A physician seeing twenty patients is statistically writing sixty prescriptions per day including refills. A two-week inventory at near full capacity would be about 600 items. For an easy visual reference, a typical waist high Craftsman steel locking toolbox will hold over 600 pieces. Some solo practitioners use this alternative. Larger steel locking cabinets for multiple physician practices are readily available. Some of our larger clinics build out a room and cabinets that coordinate with their facility. The potential profit in relation to cost and space make those investments minimal. PTC consultants will work through this with you at our initial planning meeting.
HOW IS INVENTORY RESTOCKED?
The PTC9000 is a just-in-time inventory system. The general goal is a two-week inventory with ordering once per week. Par levels and reorder points are set to make ordering as automatic as possible. All records in connection with ordering and restocking are transferred electronically. You will just need to verify physically that if you ordered 10 bottles, you received 10 bottles.
WHAT IS THE TURNAROUND TIME FOR REORDERS?
Orders received by PTC are shipped the next day with minimal exceptions. Those exceptions are most always manufacturer or bulk distributor unavailability. Since our customers pay freight, overnight is at the option of our customer. After several months, inventory management becomes routine.
WHAT HAPPENS TO OUTDATED MEDS? IS THERE A BUY-BACK PLAN?
Most medications shipped by PTC have a two to three year remaining shelf life. Since our customers try and maintain a two-week inventory, outdated medications should not happen with proper system use. The return policy is 100% if returned within 90 days of purchase and 65% if returned thereafter up to within six months of expiration. There is no credit for medications returned within six months of expiration. If PTC ships a medication with less than six months shelf life, special arrangements are made in the event of return.
DOES THIS WORK WITH EXISTING ELECTRONIC MEDICAL RECORD?
EMRs with prescription writers make the process easier. You simply send the prescription to the PTC9000 and the operator picks it up from there. The most efficient way to do that is determined on a case-by-case basis. All the demographic data is initially loaded into the PTC9000. There are 13 common fields between the EMR and the PTC9000. For new clients, a decision must be made about the cost/efficiency gain from a complete interface versus simple communication. The data you capture about dispensing in the PTC9000 will be more information than you have now. The PTC9000 is a full self-contained accounting and billing system so there is no need for an accounting interface. Pharmaceutical billing has no relationship to service billing. It is handled and approved like a MasterCard/Visa charge. Regardless, your EMR will have no pharmaceutical payer information. There must be direct entry of that information into the PTC9000 in order to process claims. Virtually all of our clients choose to communicate with the EMR but not interface. If a full interface is required, we will need to ascertain the complexities with the EMR vendor and determine the appropriate additional cost to the clinic by your EMR vendor. PTC will have no additional charge.
HOW DOES THE PTC9000 WORK WITH E-PRESCRIBING PROTOCOLS?
Insurance companies generally support programs that allow physicians to transmit prescriptions directly to local pharmacies. This cuts medication errors related to legibility, and it generates valuable utilization data that is otherwise difficult to collect. Several companies have developed e-prescribing systems.
Drawbacks to e-prescribing include:
- NO financial benefit to the doctor
- NO convenience benefit to the patient
- NO insurance savings associated with increased compliance or cost-conscious prescribing.
Once the PTC9000 is installed, you simply route your medication order to it and not a pharmacy. You provide all the advantages of e-prescribing (in many cases, absent the unnecessary cost) along with significant patient/doctor/insurance benefits not offered by e-prescribing to a pharmacy.
HOW DO I GET PAID?
HOW MUCH IS CASH AND CARRY? HOW MUCH IS INSURED AND HOW DOES IT WORK?
In today’s market over 75% of the patients have some sort of pharmaceutical coverage and that percentage is increasing. A system relying only on cash and carry is seldom effective. With the PTC9000, the bulk of your claims will be to insurance carriers. You will be enrolled as discussed below. Even with insurance, our customers collect about two-thirds of the money in cash from copays or medications below the copay. Pharmaceutical claims are processed like MasterCard/Visa. Approval is immediate and the money you are due will be paid directly to you on a regular cycle, not less than monthly. There are no write-offs and the PTC9000 does all of the accounting functions.
IS THERE A MASTER LIST OF PARTICIPATING PLANS/PBMs?
Over 90% of the plans reimburse dispensing physicians. That is in excess of 11,000 plans. There are changes every day. We have an electronic list and access to that list as payers is part of the installation. We ask that you provide us your major payers to check against the list.
CAN MEDICAID PATIENTS TAKE ADVANTAGE OF THE FORMULARY?
In many states, the answer is yes. Contact PTC to determine if your state will. In some states, the pharmacy lobby has caused protectionist regulations to be adopted in an attempt to prevent Medicaid patients from using the benefit of physician dispensing. As mentioned in the legal requirements discussion above, we believe these requirements could be legally challenged.
WILL MEDICARE PAY ME?
Most Medicare D plans will reimburse and are included in the over 11,000 participating plans. You will be paid directly by the plan and not Medicare.
AT WHAT LEVEL (PRACTICE VS PTC) DOES THE REIMBURSEMENT NEGOTIATION TAKE PLACE?
PTC undertakes to get the customer credentialed with all available plans. These contracts are basically take it or leave it. Because this is a volume business, we suggest that our customers take all and work on average profit per unit. Even our best customers will have some prescriptions that will be processed at a loss. These losses are generally immaterial and it would cost more in time and lost business to try and eliminate them. PTC constantly reviews the market to minimize our customers’ losses.
CAN WE OFFER 90-DAY REFILLS TO PATIENTS?
The answer to this depends on the particular payer and the payer’s agreement with the employer. If mail order is mandated then it will cost the patient more to get it from the physician (usually three copays instead of two). Mail order (including 90 day) accounts for about 19% of the pharmaceutical dollars and 5% of the prescriptions. Although there is a lot of talk about mail order, for most practices mail order is not that big of an issue in terms of volume of prescriptions. Mail order is most competitive on high dollar maintenance medications.
HOW ARE MANUFACTURES REBATES DISCOUNTS OR “CLUBS” HANDLED?
Our medication pricing to our customers is based on a fixed margin over our net cost (after any rebates) plus a fixed percentage. No rebates are paid directly to a practice. Discount clubs that are not site specific can usually be processed through the PTC9000. It is up to our customer to make that choice.
HOW DO I GET STARTED?
WHAT IS THE BEST WAY TO FIND OUT WHAT DISPENSING CAN DO FOR MY PRACTICE?
Simply fill out the “Analysis” form on this website and submit. A no-obligation proposal will be sent to you in a few days.
WHAT IS THE COST OF THE PTC9000 LICENSE AND WHAT DOES IT INCLUDE?
PTC currently charges $4,995 for a single site and $3,995 each for multiple sites. It must be paid with the signed contract. The license fee includes extensive training and consulting, an initial supply kit and credentialing with over 11,000 payers. Upon receipt of your contract, we will arrange a meeting within two weeks to develop an installation plan. From contract to dispensing and processing claims usually involves at least three meetings and 90 days.
WHAT DOES THE LICENSEE GET FOR THE MAINTENANCE FEE?
Over one-half of the $235.00 maintenance fee is to maintain drug interaction and allergy databases current in real time and access to the bulk of the third party network. The balance is for support and upgrades provided by PTC. PTC phones are answered 24/7 by a live person. Monday through Friday from 8AM to 6PM Central time access to support is usually immediate. At other times, the calls will be relayed. Support personnel have computer and phone support access at home for off hours. The support fee does not cover anything related to hardware. Spanish patient counseling information is available for an additional $25.00 per month.
WHAT IS A TYPICAL MEDICATION STOCK “STARTER” LIST?
We have found that it is best to work from a general list of medications used in a particular specialty and refine that list to the requirements of a particular physician/clinic. We try and hold the initial inventory to between $2,000 and $5,000 per physician. (Some specialties such as oncology or HIV require more.) During the early stages as the utilization increases, so does the inventory. A solo practitioner using the system at a reasonably good level will have an eventual inventory of $15-20,000 and be making $4-5,000 monthly.
EXACTLY WHAT EQUIPMENT IS REQUIRED?
PTC provides no equipment. A list of the minimum hardware requirements is provided in the Sales Agreement. The PTC9000 operates on a standard PC. In most cases all required equipment is in place except for a dedicated laser printer and a bar code reader. If no equipment is available, all required equipment can be purchased for about $1,500.
DOES THE PROGRAM RUN ON A DEDICATED MACHINE, ON A FILE SERVER OR FROM ANY OFFICE PC?
The set up is designed to meet the customer needs and office flow. It is adaptable to almost any configuration.
IF A CLIENT WANTS TO DISCONTINUE THE PROGRAM HOW COSTLY IS IT TO DO SO?
Actually, the PTC9000 is never “uninstalled”. Once the license has been purchased, it only requires maintenance and support payments to continue, and that all medications dispensed using the PTC9000 be purchased from PTC. One of our more successful customers had management and staff issues in his practice shortly after the initial installation. Use was discontinued. Two or three years later, he exercised stronger leadership and that system produces over $50,000 annual net revenue to him. He paid no additional license fee and PTC completely retrained his staff at no additional charge.
PTC does not ask for any duration to our contract. Our agreements provide for a thirty-day notice on support. There is no commitment to buy medications. We find that by keeping the relationship as a professional relationship, the desire to resolve any issues on both sides is enhanced. We want you as a customer only so long as you wish to be a customer. We hope that is a long time.
