Amid meningitis crisis, critics say Medicare may promote risky drug

Although traditional pharmacy compounding is small-scale, producing one prescription for one specific patient at a time, the company that produced the tainted steroids in the meningitis outbreak manufactured thousands of doses for hundreds of patients at once, documents show.

OUT OF BUSINESS

The suspicion that Medicare's payment policy encourages large-scale compounding has arisen in part because in the single instance when Medicare denied payment for an entire class of compounded drugs - respiratory medications used in special inhalers called nebulizers - the decision drove compounders out of that business.

At the time, Medicare said that because compounded drugs are not tested for safety and effectiveness, they have the potential of putting a patient at increased risk of injury, illness, or death.

The nebulizer-drugs decision came in 2007, after patient advocates led by Allergy & Asthma Network Mothers of Asthmatics argued to Medicare that the compounded nebulizer drugs had contamination and potency problems, said Sandra Fusco Walker, who led that effort.

That coverage decision is absolutely relevant to the question of Medicare's support for compounding pharmacies, Blumenthal said, because it reflects an awareness of this issue. Whether that should be a precedent for denying coverage of all such (compounded) drugs is a separate question.

The Center for Medicare and Medicaid Services (CMS), which is part of HHS and runs the Medicare, regularly decides whether to cover diagnostic tests, medications, surgical procedures and other medical treatments. It bases those decisions on whether the intervention is reasonable and necessary. For drugs, that

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