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Current Concepts And Controversies With In-Office Dispensing

While there are a variety of perceptions about the nature of in-office dispensing, this author addresses key issues and says it can be a valuable addition to one’s practice for physicians and patients.

     One of the hottest debates in podiatric medicine involves the process of dispensing products to patients. Many feel that dispensing ancillary products provides patients with a plethora of value while opponents argue that dispensing is only a source of physician profit.

     Products that are currently being dispensed by podiatrists include moisturizers, antifungal medications, shoes (both therapeutic and non-therapeutic), diabetic socks, nutrients and a variety of ankle-foot orthoses (AFOs) and braces.

     Physicians who have been the early adopters of in-office dispensing will testify to the effect that it has on patient convenience, compliance and satisfaction. Physicians who are reluctant to embrace in-office dispensing may have certain perceptions about this practice. Accordingly, let us take a closer look at some of these key issues.

Does In-Office Dispensing Subvert Medical Professionalism?

The first point of controversy surrounds the issue of professionalism. Ideally, physicians are perceived as professionals in that they give advice and make decisions from a selfless perspective. The patient seeks this advice because he or she feels that the physician will put aside personal financial gain and treat the patient in the best manner possible. The sale of products dispensed in the office tests this premise.

     The dispensing podiatrist may argue that the best product to improve the patient’s foot health can only be found in a product sold from his or her office. This means that the opportunity to purchase such a product can provide the patient with enhanced care and allows the physician to offer a valuable service. In addition, some proponents suggest that on-site purchases can save time and allow the patient to get a recommendation and product simultaneously. Accordingly, this would enhance both convenience and adherence.

     However, other physicians contend that the practice may promote unprofessional or unethical conduct when a retail component is incorporated into a clinic setting. Certainly, there are two perspectives to this argument.

     The key to finding the truth in this controversy is to analyze the value of products as well as a physician’s normal prescribing pattern prior to engaging in office dispensing. What products do you find valuable and what products are you currently recommending that patients obtain in the local pharmacy? Once one is engaged in dispensing products in the office setting, significant changes in this pattern might be subject to scrutiny. Are you providing something important or merely a biased recommendation? This is the key ethical question that all dispensing physicians must critically ask themselves.

     The second point of controversy is the efficacy of products dispensed in the office. It is a physician’s obligation to be certain that recommended products have an evidence-based nature to their efficacy. Those skeptical about in-office dispensing often associate the practice with “snake oil salesmen” tactics. Physicians can often nullify this argument with a product’s documented efficacy.

     Is it possible to be a physician and businessperson? On this point of controversy, I have a passionate opinion. Long gone are the days when a physician can be successful at his or her craft without regard to business matters. Placing the pure business of in-office dispensing aside (cost of goods, revenue production, profitability, etc.), I firmly believe dispensing speaks to another important business virtue: total quality management.

     Physicians who have successfully adapted to the fee restrictions and reductions of managed care have also realized that they are likely better caregivers as a result. They have evolved from the habit of merely treating the patient’s chief complaint to being keen observers of all current and potential foot health issues they may see in their patients. This renewed emphasis on ensuring and facilitating comprehensive care lends itself well to the dispensing of value-added products and could be a positive socioeconomic effect of managed care in my opinion.

Are There Guidelines Available?

Many professional organizations such as the American Academy of Podiatric Practice Management have weighed in with opinions regarding the practice of office dispensing. While the wording and details vary from organization to organization, the basic spirit of the recommendation is to dispense only value-added products and to preserve medical ethics. Indeed, this is crucial.

     Other important guidelines are dictated by state and federal regulations. For example, some states prohibit physicians from selling prescription medications. Others limit the profitability of their sales. In addition, one must consider the obligation to collect sales tax on these products. Prior to initiating an in-office dispensing program, a physician must perform appropriate due diligence.

Making The Commitment To In-Office Dispensing

If you are interested in incorporating an office dispensing program into your practice but you have some discomfort with the concept of “selling,” there are ways to make it work. You can delegate that responsibility to a staff worker or medical assistant.

     However, regardless of whether you delegate this task to someone on your staff, the success of the dispensing operation is directly related to the level of physician commitment. You must assess your own personal level of commitment and interest in product selection and sales. The most successful dispensing operations are those in which the physician has a high level of interest in selecting and recommending the products.

     When in-office dispensing is handled correctly, I believe it is in the best interest of patients for a number of reasons. As physicians, we know that patients often find themselves overwhelmed by the many choices available at the pharmacy. Aggressive marketing and advertising leads to consumer confusion and frustration when patients purchase expensive products that fail to deliver the promised results. I have been dispensing products for over 10 years now and find it most rewarding. Patients are very appreciative of good sound advice on product selection. The convenience of point-of-service sales greatly enhances patient adherence with use of the product.

     Accordingly, if you are interested in developing an in-office dispensing program but do not know where to start, here are pertinent tips to consider.

What Kind Of Products Should You Carry?

Your main goals when choosing products are to select products that have the best therapeutic value while maintaining a favorable price point. These should generally be the products that you are currently recommending patients to obtain in your local pharmacy.

     Most dispensing podiatrists carry only one or two lines of each type of product and do so very successfully. Limiting the inventory allows you to become very familiar with the products lines available. As your formulary expands, you can choose additional items from various lines on an individual basis. The first thing you need to do is decide which types of products you would like to offer patients.

     I consider four product categories to be essential for anyone who dispenses in the office. These product categories include:

• moisturizers and exfoliants

• antifungals (creams, powders)

• topical analgesics and antibiotics (Biofreeze, Amerigel, Neosporin, etc.)

• durable medical equipment (DME) and other palliative supplies (braces, splints, inserts, cast covers, pads, etc.)

     When you are ready for more advanced dispensing, you can add more products. Choose the products that you are most comfortable and familiar with recommending. Here is a closer look at each of the categories and some products that you might consider.

     Moisturizers should include both creams and lotions. Elderly patients tend to prefer creams over lotions due to the inherent dryness of their skin. Exfoliants often contain low concentrations of salicylic acid and work well for patients who have dry and hyperkeratotic skin. Gordon Laboratories carries an extensive line of these products.

     Select antifungal products that you would normally have patients obtain in the pharmacy. Be sure that your pricing covers costs and has a markup that can be competitive. Some of the commonly dispensed OTC products include terbinafine (Lamisil cream, Novartis), Tinactin Powder (Schering-Plough) and many more.

     When it comes to topical analgesics and antibiotics, I find Biofreeze (Hygenic Corp.) fits into many clinical protocols. Patients often appreciate topical analgesics as a means of avoiding oral nonsteroidal anti-inflammatory drugs (NSAIDs) or to supplement the oral agent of choice.

     In regard to topical antibiotics, such as Neosporin, one can dispense these individually or as part of a convenient postoperative care kit (i.e., a post bunion surgery kit which also includes a bandage/cast cover). One may package Amerigel (AmerX) as a valuable part of a post-P&A Kit.

What You Should Know About DME

There are many opportunities to expedite healing through the use of DME. Not long ago, the term “DME” was commonly associated with orthotics, crutches and braces. It now encompasses much more.

     Aside from the very well documented value of diabetic shoes for at-risk patients and Cam walkers for injuries and postoperative care of osteotomies, some of the most widely used DMEs include Air Heels (Aircast) and night splints for plantar fasciitis.

     While you should absolutely be participating in the Therapeutic Shoe Program, also consider other important and valuable products such as diabetic socks and compression hose.

     Stop giving away your profits. I witness many podiatrists giving away free money to patients in the form of supplies such as foot pads. Take a look at the many pre-packaged products such as Dr. Jill’s Pads and display these products for sale. Patients indeed understand.

     In regard to prescription DME, physicians should be cognizant of local carrier restrictions and fee schedules prior to starting the program.

Keys To Displaying Available Products

Of course, if patients cannot see the products or they are not displayed in an eye pleasing way, they may never know about all the products you have decided to carry. The initial setup of a dispensing operation is really quite simple. You only need the following four items: a display case, promotional information, storage space for inventory and an accounting system.

     An adequate display case is one of the most important components of the dispensing operation. It is the most effective way to market your office dispensing operation. A reception room display allows your patients to view your inventory and read promotional information. Display cases can be elaborate but much simpler shelving or commercially available displays can function equally well.

     It is also important to have products displayed in the treatment rooms. This gives a patient an excellent opportunity to discuss products with you or your staff, and allows you the opportunity to demonstrate its use.

Addressing Inventory Issues

It is important to have extra space for storing products so you have an adequate inventory. If you do not have the room, most companies can overnight products for quick delivery. A simple accounting system will allow you to track sales and inventory. Utilizing a superbill, much like that generated for patient services, you can streamline your operation and allow the front office to know what to dispense. The superbill should list all items on the formulary and their cost.

     There are a variety of software programs (such as MicroPharmacy at that allow you to keep inventory, generate a sales receipt and keep a log of what patients have purchased. This is invaluable information and these systems are typically easy to incorporate into your practice. Another alternative to holding inventory is Many podiatrists are very pleased with companies like this that handle these issues for you but allow patients to order products through your practice and its Web site.

Ensure Adequate Staff Training And Protocols

It is important to train all staff members to be familiar with the products you carry. While you are most likely to assume primary responsibility for recommending products, physician extenders can participate as well. The receptionist can play a key role and may be called on to answer questions about products as well.

     Although this training is time-consuming, it is a crucial part of operating a successful dispensing program. Your staff needs to understand what the product is used for and how to apply it. They should also be prepared to provide appropriate answers to the most common questions. They also need to understand and comply with all regulatory issues such as CMS 21 standards.

     If you develop and follow clinical practice protocols for the top conditions you treat, you will certainly benefit from in-office dispensing as will your patient. While reluctant doctors often cite the added expenses it creates for our healthcare system, those engaged in in-office dispensing have enjoyed being able to get patients better faster.

     You will generate revenue from a successful dispensing operation. While the revenues generated vary greatly, you will find they are directly proportional to the amount of time spent discussing products and the systems that you have in place to facilitate sales.

     Part of the dispensing program should include systems designed to maximize the opportunities. Doctors are often so busy that they miss the opportunity for comprehensiveness. This is where your systems and staff are crucial. Patient questionnaires are often helpful in identifying candidates and many physicians provide incentives for their staff to do so.

Final Notes

Physician dispensing can improves the health of patients while increasing a physician’s practice revenue. It creates higher patient adherence rates, which, in turn, lower overall health care costs for patients and payers. It is completely safe, legal and endorsed by the APMA, the AAPPM and the AMA. All of these benefits rally on the side of the physician. In-office dispensing is a service that should be part of your practice.

     Dr. Guiliana is a nationally recognized speaker and author on topics pertaining to medical practice management. He holds a master’s degree in Health Care Management and is a Fellow of the American Academy of Podiatric Practice Management. He can be reached at
70 78

John V. Guiliana, DPM, MS
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