Senate moves to exempt pharmacies from ‘Red Flags’ credit reporting rule
ALEXANDRIA, Va. — Independent pharmacists are hailing a move in Congress to exempt pharmacies from burdensome accounting requirements imposed by the Federal Trade Commission.
The U.S. Senate on Tuesday night voted to approve bipartisan legislation that removes community pharmacies and other small businesses from new requirements by the FTC and six other federal agencies regarding the use of credit and debit cards. The so-called “Red Flags” rule, geared toward financial institutions and other creditors, require such entities to develop and implement identity theft prevention and detection programs, and is scheduled to take effect Dec. 31.
The National Community Pharmacists Association today hailed the Senate’s move, long sought by independent pharmacists.
Senators Mark Begich, D-Alaska, and John Thune, R-S.D., authored bipartisan legislation (S. 3987) earlier this year – with the support of Senators Chris Dodd, D-Conn.; Richard Shelby, R-Ala.; and the FTC – to exempt many small businesses from the new rule.
“We commend Sens. Begich, Dodd, Shelby and Thune for their hard work to ensure that reasonable consumer protections can go forward without unduly burdening pharmacists and other providers with unnecessary, time-consuming requirements,” said NCPA EVP and CEO Kathleen Jaeger.
Dodd was quoted by the Congressional Record saying that the legislation “makes clear” that pharmacists and “other types of healthcare providers and other service providers will no longer be classified as ‘creditors’ for the purposes of the Red Flags Rule just because they do not receive payment in full from their clients at the time they provide their services, when they don’t offer or maintain accounts that pose a reasonably foreseeable risk of identity theft.”
In regards to the House vote, the NCPA leader said, “Community pharmacists appreciate passage of this bipartisan, bicameral legislative solution exempting pharmacies and other small businesses from the onerous FTC Red Flags rule, which is intended for financial institutions. Thanks to the House... community pharmacists can continue providing expert medication counseling and other services without an additional regulatory burden.”