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CHAP State Health Care Policy Updates

This week’s update on regulatory and compliance developments at the state level includes a compounding pharmacy bill in Michigan and legislation that seeks to expand private duty licensure requirements to require accreditation in New Jersey.

For more information or to alert CHAP of other industry-relevant policy news, please email Nathan Constable.


S704: Compounding Pharmacy Regulation – This bill would amend the Public Health Code by revising regulations for compounding pharmacies and creating penalties for noncompliance with those regulations, including misdemeanor and felony penalties. Additionally, it would amend Part 177 of the Michigan Public Health Code so that:

  • A person providing compounding services in the state would have to be licensed as a pharmacy or manufacturer, and an outsourcing facility would have to be licensed as a pharmacy.
  • An applicant for a pharmacy license for a pharmacy that would provide compounding services for sterile pharmaceuticals would be required to submit verification of current accreditation through a national accrediting organization.
Status: 6/12/2014 – Ordered Enrolled

New Jersey:

S667: Expands Definition and Licensure Requirements for Health Care Service Firms – This bill expands the definition of health care service firms to include firms that place or arrange for the placement of personnel to provide companion services. The bill further requires that health care services firms obtainaccreditation and comply with auditing requirements. The bill requires that a health care service firm obtain, within 12 months of licensure, accreditation from an accrediting body that is recognized by the Director of the Division of Consumer Affairs.

The bill would also require that, as a condition of licensure, a health care service firm must cause to be prepared an audit every three years. The audit must be conducted by a qualified certified public accountant and include an examination of the subject firm’s financial records, financial statements, the general management of its operations, and its internal control systems. The audit must be divided into legal compliance and financial components, and the financial component must be done in accordance with the Statements on Auditing Standards issued by the American Institute of Certified Public Accountants. A firm that receives State Medicaid funds is also required to submit an annual cost report with its audit, and an opinion from the auditor on the accuracy of the cost report.

Status: Signed into law

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