Some of you may recall the Enron scandal of 2001.

Remember the famous Abbott and Costello bit from the 1930’s known as “Who’s on First?” That classic scene often comes to mind when I think of CPAs explaining all of the changes to the attestation standards to their clients. I envision CPAs around the country having comical conversations like the following:

Imagine, for a moment, that you are sick and require a major operation. Among the many thoughts that would immediately cross your mind would be the need to find “the best” doctor available. What criteria would you use when selecting the best doctor? I bet that the following attributes would weigh heavily in your decision:

On Monday, we posted an article announcing that the DEA had issued new regulations for “Electronic Prescriptions of Controlled Substances.” Since then we have further reviewed the ruling and also spoken with many clients and prospects that have contacted us on the subject. The following points provide additional context and background for any service provider (ASP, SaaS, etc) that provides an application for generating and fulfilling prescriptions of controlled substances. The primary goals of ruling are to 1) maintain a protected “closed system” for prescription fulfillment 2) reduce the risk prescription forgery and diversion and 3) promote the use of Electronic Health Records (EHR) building on the incentives and goals outlined in the Health Information Technology for Economic and Clinical Health (or HITECH) Act components within the American Recovery and Reinvestment Act of 2009 (a.k.a. the Recovery Act). Controlled substances make up approximately 10% of all prescriptions. That said, the classifications of controlled substances approved for medical use (schedules II through V) are carried by most major pharmacies. The control requirements, highlighted below, as well as the third-party audit requirements are focused on electronic prescription applications, which can be installed on a standalone basis or hosted by an Application Service Provider (ASP). A medical provider (i.e. doctor) or pharmacy is not required to undergo a third-party audit unless it develops the e-Prescriptions software itself. It is also worth noting that requirements for identity management and access control not only aim to protect access to data but to restrict who can generate, approve, and fulfill a prescription thus reducing the risk of unauthorized fulfillment of controlled substances (referred to as diversion). e-Prescription technologies have been available for some time and there are standards for the communication of prescription data between a medical provider and a pharmacy. For instance the SCRIPT standard (currently in version 10 release 6) specifies the data field requirements such that the data can be shared across different applications. The DEA clearly noted that it has “not been able to identify any organization that sets standards for or certifies pharmacy applications for security issues.”

With the medical industry quickly moving towards electronic records and transactions, why wouldn’t pharmacies do the same?