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Press Release

Federal Funding Preserved For Hospital Pharmacy Residencies

In a victory for Medicare patients, the Centers for Medicare and Medicaid Services (CMS)  has decided to continue contributing directly to the funding of pharmacy residency training in hospitals. The regulation addresses CMS's annual payment rates for the Hospital Inpatient Prospective Payment System for fiscal year 2004 that begins on October 1, 2003.

CMS had proposed potentially negative changes to the way pharmacy residency programs are reimbursed, eliminating reasonable cost, pass-through Medicare funding. Under the final regulation, published today in the Federal Register, CMS will continue its current reimbursement schedule for first-year pharmacy residencies but will remove pass-through funding for second-year specialty residencies.

"Although we're very happy that funding for first-year residencies has been preserved, the lack of reasonable cost reimbursement for specialty programs is very problematic," said Henri R. Manasse, Jr., Ph.D., Sc.D., ASHP executive vice president and CEO. In its regulation, CMS noted that it would reinstate funding for the latter if it finds that hospitals require second-year pharmacy residencies as an "industry norm."

Pharmacy residencies, which are organized, directed, post-graduate training programs in defined areas of pharmacy practice, provide the knowledge and experience practitioners need to face both current health care challenges and future practice demands.

ASHP and other pharmacy organizations had strongly advocated that CMS reconsider its original proposal because of its potentially devastating effect on care provided to Medicare patients in hospitals.

"In essence, this change would have reduced the number of qualified pharmacists available to lead pharmacy departments and manage high-risk medication therapy in hospitals," Manasse said, adding that ASHP mobilized its members to contact the CMS with their concerns. Agency officials acknowledged the large number of comments on this portion of the proposed rule.

ASHP will now seek a delay in the implementation of the specialty pharmacy residency portion of the final rule until CMS can determine how prevalent such residencies are in U.S. hospitals. "While we are very pleased with the CMS decision regarding first-year residencies, ASHP is dedicated to protecting specialty residencies, as well," said Manasse. "These residencies are extremely valuable programs and contribute significantly to better-trained pharmacists and healthier patients."

ASHP is the 30,000-member national professional association that represents pharmacists who practice in hospitals, health maintenance organizations, ambulatory care clinics, long-term care facilities, home care, and other components of health care systems. ASHP, which has a long history of medication error prevention efforts, believes that the mission of pharmacists is to help people make the best use of medicines. Assisting pharmacists in fulfilling this mission is ASHP's primary objective. The Society has extensive publishing and educational programs designed to help members improve their professional practice, and it is the national accrediting organization for pharmacy residency and pharmacy technician training programs. For more information, visit ASHP's Web site,, or its consumer Web site,