Indiana law as stated at IC 16-42-22-10 requires that a prescription filled under the Medicaid program, the children’s health insurance program or the Medicare (emphasis added) program must be filled with a generic equivalent drug product and the customer must be informed if the substitution would result in a lower price unless the words Brand Medically Necessary are written on the prescription in the practitioner’s own handwriting on the prescription form, or electronically transmitted, or the practitioner has stated orally that no substitution may occur.  If the practitioner states this orally, they must subsequently forward either a written or electronic prescription with the Brand Medically Necessary instruction appropriately indicated in the practitioner’s own handwriting.

The Alliance asked legal counsel for the Alliance to review the statute for applicability to Medicare prescriptions.  It is counsel’s opinion that the statute does apply.  Pharmacists should be using the same procedure that they use for filling prescriptions for branded products under the Medicaid program when filling prescriptions for branded products under Medicare Part D programs.

We remind all pharmacists to follow the law regarding substitution of generic drugs for all prescriptions filled under the Medicare Part D program.

The pertinent part of the law, as found in the Legend Drug act at IC 16-42-22-10 is reproduced here.

IC 16-42-22-10 Substitution prohibited
     Sec. 10. (a) If a prescription is filled under the Medicaid program (42 U.S.C. 1396 et seq.), the children's health insurance program established under IC 12-17.6-2, or the Medicare program (42 U.S.C. 1395 et seq.), the pharmacist shall substitute a generically equivalent drug product and inform the customer of the substitution if the substitution would result in a lower price unless:
        (1) the words "Brand Medically Necessary" are:
            (A) written in the practitioner's own writing on the form; or
            (B) electronically transmitted with an electronically transmitted prescription; or
        (2) the practitioner has indicated that the pharmacist may not substitute a generically equivalent drug product by:
            (A) orally stating that a substitution is not permitted; or
            (B) for an electronically transmitted prescription, indicating with the electronic prescription that a substitution is not permitted.
    (b) If a practitioner orally states that a generically equivalent drug product may not be substituted, the practitioner must subsequently forward to the pharmacist a written or electronically transmitted prescription with the "Brand Medically Necessary" instruction appropriately indicated in the physician's own handwriting.
    (c) This section does not authorize any substitution other than substitution of a generically equivalent drug product.
As added by P.L.2-1993, SEC.25. Amended by P.L.239-1999, SEC.8; P.L.291-2001, SEC.234; P.L.204-2005, SEC.12.

The law can also be accessed on the Internet at http://www.ai.org/legislative/ic/code/title16/ar42/ch22.html#IC16-42-22-10