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HIPPA Privacy & Security Rules

Texas Vendor Drug Program

HITECH (Health Information Technology for Economic and Clinical Health) Act

The HITECH Act enhances the existing HIPAA Privacy & Security Rules. The fundamental intention of the Act is to promote the establishment and use of Electronic Health Records (“EHRs”).

The Act provides enhanced requirements to protect Electronic Health Records (EHRs). An electronic record is health-related information on an individual that is created, gathered, managed, and consulted by authorized health care clinicians and staff.

The Act establishes new rules and requirements for the protection of electronic PHI (such as encryption) and the identification, notification, and reporting of a breach (the unauthorized acquisition, access, use, or disclosure of PHI which compromises the security or privacy of such information, except where an unauthorized person to whom such information is disclosed would not reasonably have been able to retain such information). It establishes more severe civil and criminal penalties for violations that apply to Covered Entities, Business Associates and individuals.

Patient Protection and Affordable Care Act of 2010 (PPACA)
On March 23, 2010, the President signed the Patient Protection and Affordable Care Act (PPACA). This Act will provide quality affordable health care for Americans, improve the role of public programs, improve the quality and efficiency of health care, and prevent chronic disease and improve public health. The Patient Protection and Affordable Care Act of 2010 – CMS Provisions download contains information on CMS published regulations, CMS policy instructions, key implementation dates, and other accomplishments that relate to PPACA.

Tax Relief and HealthCare Act of 2006 (TRHCA)
On December 20, 2006, the President signed the Tax Relief and Health Care Act of 2006 (TRHCA).  This Act extends tax relief for millions of American families and small businesses. It maintains key tax reforms, expands commitment to renewable energy resources, makes it easier for Americans to afford health insurance, and helps open markets overseas for farmers and small businesses.  The Tax Relief and Health Care Act of 2006 - CMS Provisions download contains information on CMS published regulations, CMS policy instructions, key implementation dates, and other accomplishments that relate to TRHCA.

Deficit Reduction Act of 2005 (DRA)
On February 8, 2006, the President signed the Deficit Reduction Act of 2005 (DRA). This legislation affects many aspects of domestic entitlement programs, including both Medicare and Medicaid.  The DRA provides states with much of the flexibility they have been seeking over the years to make significant reforms to their Medicaid programs. The  Deficit Reduction Act of 2005 - CMS Provisions download contains information on CMS published regulations, CMS policy instructions, key implementation dates, and other accomplishments that relate to DRA.

Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA)
On December 8, 2003, President Bush signed into law the Medicare Prescription Drug Improvement and Modernization Act of 2003 (Pub. L. 108-173).  This landmark legislation provides seniors and individuals with disabilities with a prescription drug benefit, more choices, and better benefits under Medicare.

CMS works closely with the OIG, Department of Justice and the State’s Attorney Generals Offices to insure program providers do not unfairly bill or commit Fraud on the U.S. or any states for services provided to their programs.

Buying and Selling Pharmacies


There are many aspects to consider when buying or selling a pharmacy.  First, there are many business considerations, for example involving valuation of the business on the part of the seller and due diligence concerning what is being purchased on the part of the buyer.  Whether you are buying or selling the pharmacy, you should have an attorney represent your interest in the transaction, the most important of which are the negotiations of any binding agreements, and obtaining the proper licenses and registrations necessary to operate a pharmacy.  Second, there are many regulatory concerns to consider, especially when you are buying a pharmacy.  These include: (1) obtaining a license for the pharmacy from the Texas State Board of Pharmacy; (2) obtaining controlled substance registrations from the Texas Department of Public Safety and the U.S. Drug Enforcement Administration; and (3) registration in the Medicare/Medicaid programs.  Obtaining the licenses and registrations is time consuming and must be done in proper order, and they are necessary to conduct operations at the pharmacy. 

Compounding in Light of the litigation in Medical Center Pharmacy v. Holder

There has been serious and contentious litigation between compounding pharmacies and the U.S. Food and Drug Administration (“FDA”) and the extend to which the FDA can regulate the practice of compounding.  The lawsuit (Medical Center Pharmacy, et al. v. Eric Holder, et al.) remains on appeal (for the second time) at the United States Court of Appeals for the 5th Circuit.  It is important to note that the FDA can still compel inspections of compounding pharmacies to determine whether the drugs being compounded are exempt or not from the Federal Food Drug Administration and Cosmetic Act of 1938 (“FDCA”) and the Food and Drug Administration Modernization Act of 1997 (“FDAMA”).  If your pharmacy is inspected by the FDA for compliance with the FDCA/FDAMA, you should contact an attorney immediately.