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Dispense As Written

February 15, 2009

Physician prescribing practices can have a profound impact on the amount of savings for health care providers and consumers.

For example, in Massachusetts, Medicaid officials took a series of steps over the past three years that they estimate shaved $150 million off the annual tab for drugs. A large part of the savings came from a change in a policy within their mandatory generic substitution program related to the use of “Dispense as Written” prescriptions.

Massachusetts doctors were routinely asking for brand name drugs by writing “Dispense as Written,” and Medicaid was paying $10 million to $11 million a month for brand-name drugs that had generic equivalents. After reviewing the situation, a tougher policy was put into place that requires the doctor to explain why, in writing, and get permission from the Medicaid program in order to force dispensing of a brand drug instead of its equivalent lower-cost generic. Once the new policy went into effect, spending on brand-name drugs with generic equivalents dropped dramatically to $200,000 to $300,000 a month.

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