VA Pharmacies Provide an Assortment of OTC Products

VA physicians prescribed OTC products for veterans more than 7 million times in fiscal year 1995, accounting for about one-fifth of all VA prescriptions. The most frequently dispensed OTC products included (1) the medications aspirin, acetaminophen, and insulin; (2) the dietary supplements Sustacal and Ensure; and (3) the supplies alcohol prep pads, lancets, and glucose test strips. Other Health Care Plans Provide Few, If Any, OTC Products

Unlike VA, other public and private health care plans cover few, of any, OTC products for their beneficiaries. VA recovered an estimated $7 million of total OTC costs (about 4 percent) through veterans’ copayments. Opportunities to Reduce Federal Expenditures

A variety of actions could help reduce the level of federal resources devoted to the provision of OTC products. VA pharmacies could dispense considerably fewer OTC products. Reducing OTC Product Handling Costs

VA pharmacies could significantly reduce their OTC product dispensing costs of $48 million by providing more economical quantities of medications and supplies. As previously discussed, each VA facility offers a different assortment of OTC products. Over the last 3 years, 45 pharmacies have reduced the number of OTC products provided to veterans. Interestingly, wide disagreement exists within VA about providing OTC products on an outpatient basis. Recommendations to the Secretary

We recommend that the Secretary of Veterans Affairs require the Under Secretary of Health to limit OTC products for nonservice-connected conditions to those most directly related to VA hospitalizations or those considered most essential to prevent hospitalization; standardize the availability of OTC products to give veterans more consistent levels of access to them systemwide; reduce VA’s dispensing costs for OTC products by (1) providing, when appropriate, more economical quantities (more than a 90-day supply) of medications and supplies and (2) limiting mail service to certain situations; require veterans to make copayments at the time OTC products are direct facilities to apply the statutory income threshold to determine which veterans owe medication copayments.
Why GAO Did This Study

GAO reviewed the Department of Veterans Affairs' (VA) provision of over-the-counter (OTC) medications, medical supplies, and dietary supplements to veterans, focusing on: (1) what OTC products VA pharmacies dispense; (2) how VA provision of OTC products compares with that of non-VA health care providers; (3) how much VA spends on OTC products and how much VA recovers through veterans' copayments; and (4) opportunities to reduce federal expenditures for OTC products.

What GAO Found

GAO found that: (1) all VA pharmacies provide some OTC products that are available through other local outlets; (2) the most frequently dispensed OTC products were medications, dietary supplements, and medical supplies; (3) individual VA pharmacies offer a different assortment of OTC products; (4) some pharmacies restrict which veterans may receive OTC products or in what quantity; (5) other public and private health care plans cover few, if any, OTC products for beneficiaries; (6) in fiscal year (FY) 1995, VA pharmacies dispensed OTC products more than 15 million times at an estimated cost of $165 million, including $48 million in handling costs; (7) VA recovered about $7 million through veterans' copayments; and (8) to reduce the resources devoted to dispensing OTC products, VA could more narrowly define when to provide OTC products, more efficiently dispense OTC products and collect copayments, and further reduce the number of OTC products dispensed on an outpatient basis.