Jinu Matthew and Vandana Yadav • May 30, 2025
Imagine leaving your doctor’s office not just with a diagnosis, but with the medication you need—right then and there. No extra trip to the pharmacy. No waiting. No chance of forgetting. That’s the promise of physician dispensing, a growing practice that’s beginning to reshape the patient experience in the United States.
Traditionally, most high-income countries separate the roles of diagnosing and prescribing (done by physicians) from medication distribution (handled by pharmacists). But as U.S. healthcare moves toward more integrated, tech-enabled, and patient-centered models, the lines are starting to blur.
Driven by digital health tools, shifting patient expectations, and the push for value-based care, physician dispensing is gaining ground—and raising important questions
Why It’s Catching On: Convenience, Cost, and Control
One of the biggest reasons patients don’t get better? They never start treatment. Studies suggest that 20–30% of prescriptions go unfilled,1 often due to cost, forgetfulness, or the inconvenience of an extra errand. In-office dispensing tackles this issue head-on—ensuring patients leave with medication in hand.
Beyond convenience, many physician practices offer lower prices for generics by sourcing directly from wholesalers. That’s a win for patients. Meanwhile, providers benefit from tighter control over treatment plans, improved adherence, and even a modest revenue stream..
But It’s Not All Smooth Sailing: Ethics and Safety at Stake
Despite its advantages, physician dispensing raises valid concerns. chief among them: conflicts of interest. Could the potential for profit influence prescribing behaviour? This issue has been highlighted in research from the Workers’ Compensation Research Institute, which found that physician dispensing contributed to rising costs in workers’ compensation programs, particularly due to inflated pricing on frequently used medications².
Then there’s the safety issue. Pharmacists do more than count pills—they flag drug interactions, counsel patients, and act as a second line of defense. Without their input, patients could miss out on crucial guidance.
That’s why regulation, transparency, and outcome monitoring are non-negotiables if this model is to succeed responsibly.
The Practical Hurdles: Not Just a Plug-and-Play Solution
While physician dispensing may sound seamless, implementation takes serious work.
- Time pressure: Dispensing involves inventory management, pricing, labeling, and record-keeping—time-consuming tasks for already stretched providers These responsibilities can place a considerable strain on providers³.
- Medication limitations: While generics are usually affordable, others—like insulin, inhalers, and specialty medications—remain costly even in bulk⁴. This can limit the scope of medications that clinics can offer in-house.
- Storage compliance: Temperature-sensitive or controlled medications must be stored according to strict guidelines. Lapses can lead to both regulatory issues and patient harm.
Technology: The Backbone of Modern Dispensing
Technology plays a key role in the scalability and safety of physician dispensing. Platforms like AtlasMD, ProficientRx, and MD Scripts integrate directly with EHRs and e-prescription systems to streamline medication dispensing and inventory management. These tools reduce administrative burden and help clinics meet strict documentation and reporting standards.
Automated medication dispensers like InstyMeds and VendRx go a step further and enhance efficiency. These kiosks securely store and dispense medications, allowing patients to retrieve prescriptions onsite using unique access codes. These systems improve access, minimize delays, and reduce human error in medication handling.
Navigating the Patchwork of U.S. Regulations
In the United States, the regulatory environment for physician dispensing varies considerably by state5. Some states, including Texas and New York, impose strict limitations or outright bans on the practice. Some states, including Texas and New York, impose stringent restrictions or outright bans on the practice. Others, such as Florida, California, and Maryland, permit dispensing under specific conditions, typically involving licensure, documentation protocols, and detailed reporting requirements to ensure patient safety and accountability. Globally, physician dispensing continues to be standard in many low- and middle-income countries, particularly in areas where pharmacy infrastructure is underdeveloped. In contrast, high-income nations generally reserve the role of medication dispensing for pharmacists.
What’s Next? A Balancing Act for the Future
As healthcare embraces value-based care and on-demand access, physician dispensing will likely grow. But not all drugs—or clinical settings—are suited for this approach.
To deliver real value, the model must be:
- Clinically appropriate
- Regulated and transparent
- Digitally supported
- Focused on equity and safety
Done right, physician dispensing can strengthen care continuity, lower costs, and empower patients. Done carelessly, it risks eroding trust and compromising safety. The path forward requires collaboration across clinicians, regulators, technologists, and patients.
References
- Baryakova, T. H., Pogostin, B. H., Langer, R., & McHugh, K. J. (2023). Overcoming barriers to patient adherence: the case for developing innovative drug delivery systems. Nature Reviews Drug Discovery, 22(5), 387-409.
- Wang, Dongchun, Te-Chun Liu, and Vennela Thumula. “The Prevalence and Costs of Physician-Dispensed Drugs.” WCRI. September 2013. https://www.wcrinet.org/reports/the-prevalence-and-costs-of-physician-dispensed-drugs.
- Hunt, J. S., Siemiencuk, J., & Koch, C. (2007). Physicians perspectives on physician drug dispensing using a qualitative focus group methodology. JOURNAL OF PHARMACEUTICAL FINANCE ECONOMICS AND POLICY, 16(4), 57.
- Healthesystems. (2024). Physician Dispensing Whitepaper. https://healthesystems.com/wp-content/uploads/2024/06/Physician-Dispensing-Whitepaper.pdf
- PLPRx. State-by-State Dispensing Regulations. 2024. https://plprx.com/resources/dispensing-regulations/
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