Frequently Asked Questions

Q. What does NCPDP do?

A. We create national standards for electronic healthcare transactions used in prescribing, dispensing, monitoring, managing and paying for medications and pharmacy services. We also develop standardized business solutions and best practices that safeguard patients.

Q. Who is involved in creating NCPDP standards?

A. NCPDP is a not-for-profit membership organization using a consensus-based process for standards development. Competitors as well as trading partners collaborate to achieve solutions they all can support. NCPDP members are pharmacies, pharmacists, physicians, health plans, long term care providers, claims processors, eRx vendors, pharmaceutical manufacturers, and government agencies such as the Centers for Medicare and Medicaid Services (CMS) and Food and Drug Administration (FDA), just to name a few.

Q. What is the forum?

A. NCPDP facilitates stakeholder action groups to identify and analyze industry issues from multiple perspectives, and outline steps to work toward a collaborative solution. Collaborative problem-solving and resolution occurs in task groups and work groups where the voices of all stakeholder groups can be heard.

Q. Who can participate in NCPDP task groups and work groups?

A. Both NCPDP members and non-members can participate in task group and work group meetings. Task groups make recommendations to work groups. Only members have voting privileges in work groups. See Standard Operating Procedures for details of the consensus-based standards development process.

Q. Why should I get involved with NCPDP?

A. Decisions being made in NCPDP’s problem-solving forum impacts the way you do business and the success of your company, as well as the quality of healthcare. Your voice in developing solutions that connect healthcare through technology, saving costs and improving care, provides value to you and your organization.

Q. How much cost savings result from use of NCPDP standards?

A. With three of NCPDP’s major standards – Universal Claim Form, Telecommunication Standard, and SCRIPT Standard - the conservative value in savings is more than $30 billion per year in healthcare costs. Studies have shown that a electronic prescription saves approximately $1 in administrative costs and approximately $0.40 for refilled prescriptions.

Q. How do NCPDP standards improve safety and care of patients and families?

A. It has been proven that the NCPDP SCRIPT Standard, which facilitates ePrescribing, can reduce medication errors by at least 55 percent, which reduces unnecessary hospitalization, and therefore healthcare costs, by approximately $2.8 billion dollars in annual savings. NCPDP also has standards to improve electronic communication for Medication Therapy Management (MTM) services provided to patients with chronic health conditions. We have an electronic solution to help pharmacists efficiently educate patients about high-risk drugs, as required in Risk Evaluation and Mitigation Strategies (REMS) mandated by the FDA. Our standards make it possible to incorporate these and other pharmacist services such as immunizations into a patient’s Electronic Health Record (EHR).

Q. What best practices has NCPDP developed to protect patients?

A. NCPDP published a white paper with recommendations for improved labeling of prescription drugs containing acetaminophen. It mobilized the industry to improve labeling to protect patients from acetaminophen overdose and liver injury. Another white paper is in the works to establish milliliters instead of teaspoons as the dosing standard to protect children from overdose of medications.

Q. How has NCPDP been an industry leader?

A. NCPDP is a dynamic organization, which has innovatively brought together diverse stakeholders to develop solutions to industry needs. NCPDP pioneered real-time claims adjudication at the point of service, electronic transmission of prescriptions, point-of-care access to patient medication history, and computerized order entry and results reporting for pharmacy services. Pharmacy has been on the forefront of adopting and using electronic health information technology due to the visionary work of NCPDP members.

Q. How important are standards in today’s operation of healthcare?

A. Without standards, trading partners would resort to proprietary means of exchanging data to conduct business. Creating standards also fosters innovation. Lawmakers have recognized the value of NCPDP standards by requiring them in healthcare legislation.

Q. Does NCPDP lobby at the state or national level?

A. No. NCPDP does not lobby. It would be inappropriate because we represent all stakeholders. NCPDP educates legislators about NCPDP standards and problem-solving forum. Our members' knowledge and experience is valuable to lawmakers crafting legislation for use of information technology throughout healthcare. Our consensus-building process is a resource for creating other healthcare business solutions.

Q. What does NCPDP do today to collaborate with other standards organizations?

A. NCPDP is the founder of the SCO (Standards Charter Organization), which brings to the table all the other standards organizations in healthcare to facilitate and define a common information model.

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