Physicians may soon be entitled to cash bonuses for prescribing Medicare drugs electronically, but pharmacists—not the federal government—could wind up shouldering much of the cost of those bonuses.

New legislation introduced by Sen John Sununu (R, NH) would create "a budget-neutral financial incentive for the rapid adoption of electronic prescribing under the new Medicare prescription drug program." Doctors who abandon their prescription pads and prescribe drugs electronically for beneficiaries of the new Medicare prescription drug program would be entitled to up to $1 for each e-prescription written.

The bonuses would be paid by pharmacy benefit managers and other prescription drug plan (PDP) sponsors. But a "dispensing fee offset reduction" provision in the bill would allow PDP sponsors to recover much of the cost of those bonuses by reducing the dispensing fee for each nonelectronic prescription written by a physician. Under the bill, the bonuses and dispensing fee reductions would remain in force from the onset of the new Medicare Rx benefit (January 1, 2006) until December 31, 2009.

Mr. Rankin is a freelance medical writer.