BILL ANALYSIS ---------------------------------------------------------- |Hearing Date:June 25, 2001 |Bill No:AB | | |1589 | ---------------------------------------------------------- SENATE COMMITTEE ON BUSINESS AND PROFESSIONS Senator Liz Figueroa, Chair Bill No: AB 1589Author:Simitian As Amended:April 30, 2001 Fiscal:Yes SUBJECT: Healing arts: electronic transmission of prescriptions. SUMMARY: Requires the Medical Board in consultation with the Board of Pharmacy to conduct a study on the electronic transmission of prescriptions by physicians. Existing law: 1)Establishes the Medical Board of California within the Department of Consumer Affairs to regulate and license physicians and surgeons and to perform various duties relating to other healing arts practitioners. 2)Establishes the California State Board of Pharmacy to regulate and license the practice of pharmacy. 3)Prohibits dangerous drugs or devices from being sold or furnished without a prescription, and defines a "prescription" as an oral, written, or electronic transmission order issued by licensed prescribers, as specified. Further defines "electronic transmission prescription" as including both image prescriptions (facsimile) and date prescriptions electronically transmited from a licensed prescriber to a pharmacy. 4)Requires generally that an oral or an electronic data transmission be reduced to writing by the pharmacist as soon as practicable, or recorded and stored electronically under specified circumstances. AB 1589 Page 2 5)Allows the patient to have an electronically transmitted prescription to a pharmacy of their choice or to have a written prescription. 6)Permits a prescriber to electronically enter a prescription into a pharmacy's or hospital's computer from any location outside of the pharmacy or hospital with the permission of the pharmacy or hospital, unless the prescription is for specified controlled substances. 7)Provides that it is the intention of the Legislature that pharmacies in this state have the ability to adopt new technologies involving the electronic transmission of prescriptions to reduce the occurrence of dispensing errors and to improve service to California. This bill: 1)Makes Legislative findings that in 1993, approximately 7,000 deaths occurred in the United States as a result of medication errors. 2)Makes further findings that illegible prescriptions result in more than 150 million inquiries each year by pharmacists for clarification of the prescription and that while technology exists or electronic transmission of prescriptions, less than 5 percent of physicians and surgeons use this technology. 3)Requires the Medical Board to consult with the Board of Pharmacy and commission a study that evaluates the electronic transmission of prescriptions by physicians and surgeons and report its results to the Legislature on or before January 1, 2003. 4)Specifies that the reports should include recommendations to encourage physicians and surgeons to use this method to transmit prescriptions and identify systems to protect patients, including the issuance of a "digital certification." 5)Defines "digital certification" as an electronic signature that verifies the identity of the physician and AB 1589 Page 3 surgeon who is transmitting the prescription electronically. FISCAL EFFECT: According to the Assembly Appropriations Committee Analysis dated May 16, 2001, minor one-time costs to the Medical Board ranging from $50,000 to $100,000 (Medical Board Contingent Fund), to commission the study. COMMENTS: 1.Purpose. This bill is sponsored by the author. According to the author, the Assembly Health Committee has been researching various E-health issues, including E-prescription issues. The Palo Alto Medical Foundation has begun testing a new Web-based system that allows patients to view their own medical records, request appointments and renew prescriptions on line. The author further explains that New Jersey is considering new rules to allow physicians to E-mail prescriptions to a pharmacy, a move aimed at reducing errors caused by illegible handwriting. Also, as the industry explores options to make health care delivery more efficient and cost-effective, there is a need to develop standard protocols regarding signature verification, security, and interfacing with current requirements relative to prescribing drugs or oversight of drug prescription will become unsound. 2.Studies Indicate a Need for More Efficient Practices and Processes to Prescribe Medications and Transmit Prescriptions. In November of 1999, the Institute of Medicine (IOM) released a report, "To Err is Human: Building a Safer Health System," which found that approximately 7,000 hospital patients die annually across the country from preventable medication-related errors. The IOM report found that 2 out of every 100 hospital patients will die or be injured as a result of preventable medication errors, and that each medication error increases the cost of a hospital stay by an average of $4,700. The IOM report included several recommendations to address the medication-related errors, including that health care organizations and the professionals affiliated with them establish patient safety programs which incorporate well-understood safety AB 1589 Page 4 principles, such as standardizing and simplifying equipment, supplies, and processes, and that health care organizations implement proven medication safety practices . A white paper from the Institute for Safe Medications Practices (ISMP) called for the elimination of handwritten prescriptions within 3 years. The ISMP paper stated that the health care industry has been slow to adopt new technologies, and that prescription writing is perhaps the most important paper transaction remaining in our increasingly digital society. The ISMP argues that the hurdles until very recently have been clinicians' reticence about computers, a lack of hardware and software that would conveniently allow prescribers to select medications electronically, and fear of the costs associated with such technology. The ISMP asserts that fortunately, the advent of wireless hand-held devices is making it increasingly possible to solve the "handwriting crisis," perhaps on all three counts. 3.Arguments in Support. The California Medical Association (CMA) is in support of this measure and indicates that the CMA continues to examine methods whereby physicians can reduce medical errors through their Project SAFE CARE (Strategic Alliance for Effective Care and Reduction of Errors) Task Force. The Project is currently reviewing several vendors that may have the capacity for electronically prescribing medications in order to develop important criteria that physicians may consider when taking advantage of this technology. It is the belief of the CMA that this bill will assist physicians in accomplishing their goal of ensuring patient safety and reducing medical errors. The California State Board of Pharmacy (Board) is also in support of this bill and indicates that electronic prescribing has been proven to substantially reduce the incidence of medication errors and has the potential to bring substantial operating efficiencies to prescribing and dispensing processes. As explained by the Board, electronic prescribing has begun to take hold in the hospital setting and experience in one hospital found a 50% reduction in medication errors and a two hour AB 1589 Page 5 reduction in the time required to process the order and administer the drug to the patient. A study required by this bill will provide recommendations on how to speed up the adoption of this technology in other settings. 4.Support if Amended. The California Optometric Association (COA) expresses its support for this measure if it is amended to be provider neutral. The COA is concerned that the language limits the study to recommendations pertaining physicians and surgeons and that there are other health care providers who issue prescriptions and should be included in the study as well. They suggest that the term "physicians and surgeons" be replaced by " licensed health care providers acting within the scope of their license ." NOTE: Double-referral to the Senate Judiciary Committee. SUPPORT AND OPPOSITION: Support : California Medical Association California State Board of Pharmacy Support if Amended : California Optometric Association Opposition :None Received Consultant:Bill Gage