Governor Newsom signed into law new legislation that prohibits community pharmacies that are part of a chain from establishing performance quotas. Citing the potential for dispensing errors under heavy workloads, the law bans quotas related to the duties for which a pharmacist or pharmacy technician license is required. California law defines chain community pharmacies as 75 or more stores in California under the same ownership. The new law is effective January 1, 2022.

Under the law, a “quota” is a fixed number or formula related to the duties for which a pharmacist or pharmacy technician license is required, against which the chain community pharmacy or its agent measures or evaluates the number of times either an individual pharmacist or pharmacy technician performs tasks or provides services while on duty.

A quota includes a fixed number or formula related to: (1) prescriptions filled; (2) services rendered to patients; (3) programs offered to patients; and (4) revenue obtained. A chain community pharmacy is also prohibited from communicating the existence of quotas to pharmacists or pharmacy technicians who are its employees or with whom it contracts, through employees, contractors, or third parties.

A quota does not mean any of the following:

• A measurement of the revenue earned by a particular licensed chain community pharmacy not calculated in relation to, or measured by, the tasks performed, or services provided by, individual pharmacists or pharmacy technicians;
• Any evaluation or measurement of the competence, performance, or quality of care provided to patients of a pharmacist or pharmacy technician if the evaluation does not use quotas; or
• Any performance metric required by state or federal regulators that does not use quotas.

The law does not prohibit a chain community pharmacy from establishing policies and procedures that assist in assessing the competency and performance of a pharmacist or pharmacy technician in providing care to patients if the measurements used are not, or do not include, quotas.

The California Board of Pharmacy is authorized to take enforcement action against a chain community pharmacy that violates the law, unless, by clear and convincing evidence, the chain community pharmacy demonstrates that the violation was contrary to its policy. Accordingly, chain community pharmacies should adopt written policies prohibiting quotas in California. In addition, other types of pharmacies should take note of the potential policy implications of the new law and a rising concern over pharmacists having sufficient time to provide patient consultations.