Do LTC pharmacies have to maintain proof of delivery?
Yes! If audited, LTC pharmacies must have proof that the medications billed were indeed dispensed, and if you are dispensing a 28-day cycle in 7-day increments, you should have four manifests for each cycle. Proof of dispensing should be readily retrievable for the same length of time as your prescription records. The longest record retention requirement is usually for Medicare and is 10 years plus the current contract year.
Do the PBM return-to-stock (RTS) time frames apply to LTC medications?
Yes! LTC pharmacies must abide by RTS time frames. Though LTC pharmacies generally require additional time from when a claim is billed to when it is delivered to appropriately package and verify medications for facilities, the medications must still be dispensed within the RTS limit. Upon audit, claims found to be dispensed outside the RTS limit will be subject to full recoupment with a difficult appeal pathway. Refer to the PAAS Return to Stock tool found under the ‘Days Supply Charts’ in the left navigation on the PAAS Member Portal for the RTS limit of over a dozen PBMs. Also, medications delivered before they are billed are at risk for full recoupment so be sure the delivery date is on/after the date of service billed. If your pharmacy routinely sets claims for future adjudication, be cognizant of the delivery date to avoid this pitfall.
What elements should be on a LTC delivery manifest?
Humana publishes the most comprehensive guidelines for LTC audit documentation requirements and their guidelines are conservative enough to satisfy most, if not all, PBMs. According to Humana, a signature log for LTC requires:
a. Patient name
b. Date of service
c. Prescription number(s)
d. Facility name
e. Date of delivery to facility
f. Signature of individual who accepted delivery at the facility
The auditor did not accept my delivery manifest because the delivery date was missing, but the manifest date was printed on our papers – why was it not accepted?
Auditors require handwritten delivery dates on LTC signature logs to show the true dispensing date. A pre-printed date on the manifest is a function of when the manifest was created. Without the handwritten date, there is no way to prove that medication was dispensed on the same date the manifest was printed, therefore, pre-printed dates are generally not accepted by auditors.
Are there any waivers in place due to the COVID-19 public health emergency?
The COVID-19 Public Health Emergency (PHE) was renewed again by the Secretary of Health and Human Services on October 13th which extended the “end date” an additional 90 days. Most PBMs have their signature waivers tied to the PHE and will accept other forms of documentation in lieu of an actual signature. While these waivers are in place, it is important to note that proof of dispensing is still mandatory! The best practice is to document “COVID-19 delivery” with the date and time along with the name or initials of the delivery person, plus the name of the person receiving the medication. It should be noted, however, that a few state Medicaid programs have reinstated the signature requirement. Refer to the PAAS COVID-19 PBM Concessions document for additional details.
Tips for Tackling PBM Audits—Together
Published November 8, 2022 by Miranda Hester on Drug Topics
Working collaboratively can be key to either avoiding a PBM audit altogether or making the process as painless as possible.
They nearly always cost pharmacies money and require a lot of work to complete, but pharmacy benefit manager (PBM) audits are an unfortunate fact of life. At the National Community Pharmacists Association 2022 Annual Convention & Expo, presenters shared their insights into how pharmacists can tackle these audits in the most effective way possible.
Curious why audits happen? It’s as simple as rising health care costs and improvements in data analytics that find outliers more easily, according to Dana Westberg, CPhT, analyist at Pharmacy Audit Assistance Service (PAAS), to say nothing of the revenue generated by them, as one of the most common penalties is financial recovery. Bad actors also make PBM audits necessary: Westberg cited 2 cases, one involving a pharmacy in Texas that had $10 million in dispensing expenses and another involving pharmacy owner/accountant who was indicted for a $1.5 million scam.
Trent Thiede, PharmD, MBA, PAAS president, cited his own examples of bad actors, including one case of a pharmacist who billed products that were never dispensed over a period of time that netted $7.2 million, another about a group of ghost pharmacies in Miami that billed for products for pharmacies that did not exist, purchased no prescription drugs, had no real customers, and performed no actual pharmacy business.
Those bad actors have led to a 50% increase in audits over 5 years. Desktop audits remain the most common form. Onsite audits decreased with the onset of COVID-19, but were replaced by virtual audits, which “tend to be very large, very time consuming and you also have a phone interview with the auditor,” according to Westberg.
Westberg shared 4 strategy elements to prevent audits, which include…
DMEPOS Mini-Series #7 – Immunosuppressive Drugs for Transplant
This month, we continue with our DMEPOS mini-series by discussing yet another challenging category –Join today!
- Must be used for a covered transplant:
- Kidney, heart, liver, bone marrow/stem cell, lung, or intestinal
- Pancreas, in limited situations – See the Local Coverage Determination (LCD) link under PAAS tips for detailed requirements
- The transplant was performed at a Medicare-approved facility
- The beneficiary was enrolled in Part A at the time of the transplant
- The beneficiary was enrolled in Part B at the time the drugs were dispensed
- Delivery requirements – See the LCD link under PAAS tips for detailed requirements
- Standard Written Order
- See our April 2021 Newsline, DMEPOS Documentation Requirements
- Medical Records
- Must indicate the date and location where the transplant occurred
- These records can be obtained from the original hospital discharge after the transplant or a current visit as long as the date and location are mentioned
- Pharmacies should maintain these records in the patient’s file for any future audits
- Continued need and use of immunosuppressive medication is established at the time of the transplant pending it continues to function successfully
- Proof of Refill Request (PORR – requirement if delivered or mailed) must contain:
- Name of the beneficiary, date of the request, description of item, quantity remaining or proof of exhaustion
- PORR may not be obtained more than 14 days before exhaustion of current supply or delivered/mailed to the patient more than 10 days before exhaustion
- Proof of Delivery
- See our June 2021 Newsline, DMEPOS Proof of Delivery and Refill Request Requirements
- Medicare limits the quantity on immunosuppressive drugs dispensed to a 30-day supply
- Auto-immune disorders like arthritis, lupus and psoriasis can be treated with immunosuppressives
- Medicare Part B does not pay for immunosuppressives for beneficiaries who do not meet the transplant coverage criteria, bill Medicare Part D instead
- Document a diagnosis code on immunosuppressives that are being used for non-transplant indications when billing for Part D
- See the LCD, checklists and other helpful forms and billing guidance under your DME MAC
- Jurisdiction B and C, CGS: LCD, Checklist
- Jurisdiction A and D, Noridian: LCD, Checklist
Documentation needed upon an audit on immunosuppressive drugs for a transplant:
PAAS Tips:
OIG Telehealth Fraud Concerns
In September 2022, the U.S. Department of Health and Human Services Office of Inspector General (OIG) put out a report on program integrity risks concerning Medicare telehealth services during the first year of the COVID-19 pandemic. The OIG states that in the first year of the pandemic, more than 28 million Medicare beneficiaries (roughly 2 in 5) used telehealth – amounting to a dramatic 88-fold increase from the previous year. Because of this, the OIG wanted to find out if providers were appropriately billing telehealth services, while looking to identify the best way to further protect the Medicare program and beneficiaries from fraud, waste, and abuse (FWA).
The OIG did some brief data analysis of telehealth claims from March 1, 2020 through February 28, 2021 of 742,000 providers. They found that 1,714 providers posed a high risk to Medicare due to concerning billing practices like; billing for services that were not medically necessary or that were never provided. Other reasons for scrutiny included being in the same medical practice as another provider who engaged in high-risk billing practices (i.e., guilt by association).
High risk providers were identified by the OIG when they billed:
The OIG’s recommendations to CMS included strengthening target oversight and monitoring of telehealth services, providing education on appropriate billing for providers, improving transparency, identifying companies who provide telehealth to Medicare beneficiaries, and following up with providers identified in the OIG report as high risk.
PAAS Tips:
Missing DUR and SCC Documentation Can Lead to Recoupment!
Many pharmacy teams are overwhelmed with the increasing daily workload. This can result in data entry staff creating shortcuts, like entering override codes to get claims processed. PAAS National® wants to remind pharmacies that lack of documentation to support clinical drug utilization review (DUR) or submission clarification codes (SCC) can put claims at risk of audit recoupment.
In particular, Express Scripts® and Prime Therapeutics® audit for DUR and SCC documentation. High dollar claims submitted with override codes are frequently flagged for audit. The Express Scripts® Provider Manual addresses Prospective/Concurrent Drug Utilization Alerts and the mitigating DUR override codes. The guidance compels the dispensing pharmacist to document the rationale for the override on the prescription.
Pharmacists must be made aware of DUR messages at point-of-sale and use professional judgement before proceeding with dispensing. These DUR rejects are in place to prevent potential harm to patients. Allowing these claims to automatically be overridden without pharmacist review goes against the PBM Provider Manual, risks patient safety and can lead to claim recoupment.
DUR codes can be found as follows:
Pharmacists must review each Service Code and, using professional judgement, submit the appropriate Professional Service Code and Results of Service Code. Simply documenting the override codes utilized does not provide the auditor with explanation of why it was appropriate to use the code; be sure to have a full clinical note explaining the situation. This documentation must be accessible for auditor’s review.
Claims billed with SCC codes also require documentation. Remember, the PBM can see the initial claim rejection and resubmission with an override code. This second claim is an easy target for audit.
Here is a short list of commonly used SCC codes as defined by NCPDP:
PAAS Tips:
Akorn Agrees to Pay Nearly $8 Million to Settle False Claims Allegations
Akorn Operating Company LLC (Akorn) has agreed to pay $7.9 million for allegedly violating the False Claims Act causing Medicare to pay for invalid prescription drugs according to a recent Department of Justice press release. The pharmaceutical manufacturer was cited for causing the submission of false claims to Medicare Part D by continuing to sell generic drugs under “prescription only” (Rx-only) labeling after the brand name drugs were converted to OTC products. Medicare Part D does not reimburse for OTC drugs.
Brand name Rx-only drugs can be converted to OTC with FDA approval. Manufacturers of generic equivalents must then either seek approval for converting their product to OTC or seek withdrawal of their generic’s Rx-only approval and stop distribution.
The generic drugs in question are diclofenac sodium 1% gel, olopatadine hydrocholoride 0.1% and 0.2% eye drops, and azelastine hydrochloride 0.15% nasal spray. Diclofenac and olopatadine converted from Rx-to-OTC in February 2020 and azelastine converted in June 2021.
Instead of pursing approval or withdrawal of their own generics, Akorn admittedly continued to manufacture and sell these products with Rx-only labeling to increase profit for the company, even after learning of the Rx-to-OTC switch of the brand name drugs. Eventually, Akorn applied for OTC conversion with the FDA for olopatadine in January 2021 and diclofenac in March 2021. For azelastine, they applied for withdrawal rather than conversion in January 2022. FDA approved this withdrawal in February 2022.
Whistleblowers in this case under qui tam provisions will receive approximately $946,000 of the recovery.
Yes, LTC Delivery Manifests ARE Needed!
PAAS National® analysts often see LTC pharmacies struggle with providing sufficient documentation to satisfy proof of dispensing for an audit. Below are a few commonly asked questions and answers about LTC delivery manifests – follow the advice below to decrease your risk of recoupment.
Do LTC pharmacies have to maintain proof of delivery?
Yes! If audited, LTC pharmacies must have proof that the medications billed were indeed dispensed, and if you are dispensing a 28-day cycle in 7-day increments, you should have four manifests for each cycle. Proof of dispensing should be readily retrievable for the same length of time as your prescription records. The longest record retention requirement is usually for Medicare and is 10 years plus the current contract year.
Do the PBM return-to-stock (RTS) time frames apply to LTC medications?
Yes! LTC pharmacies must abide by RTS time frames. Though LTC pharmacies generally require additional time from when a claim is billed to when it is delivered to appropriately package and verify medications for facilities, the medications must still be dispensed within the RTS limit. Upon audit, claims found to be dispensed outside the RTS limit will be subject to full recoupment with a difficult appeal pathway. Refer to the PAAS Return to Stock tool found under the ‘Days Supply Charts’ in the left navigation on the PAAS Member Portal for the RTS limit of over a dozen PBMs. Also, medications delivered before they are billed are at risk for full recoupment so be sure the delivery date is on/after the date of service billed. If your pharmacy routinely sets claims for future adjudication, be cognizant of the delivery date to avoid this pitfall.
What elements should be on a LTC delivery manifest?
Humana publishes the most comprehensive guidelines for LTC audit documentation requirements and their guidelines are conservative enough to satisfy most, if not all, PBMs. According to Humana, a signature log for LTC requires:
a. Patient name
b. Date of service
c. Prescription number(s)
d. Facility name
e. Date of delivery to facility
f. Signature of individual who accepted delivery at the facility
The auditor did not accept my delivery manifest because the delivery date was missing, but the manifest date was printed on our papers – why was it not accepted?
Auditors require handwritten delivery dates on LTC signature logs to show the true dispensing date. A pre-printed date on the manifest is a function of when the manifest was created. Without the handwritten date, there is no way to prove that medication was dispensed on the same date the manifest was printed, therefore, pre-printed dates are generally not accepted by auditors.
Are there any waivers in place due to the COVID-19 public health emergency?
The COVID-19 Public Health Emergency (PHE) was renewed again by the Secretary of Health and Human Services on October 13th which extended the “end date” an additional 90 days. Most PBMs have their signature waivers tied to the PHE and will accept other forms of documentation in lieu of an actual signature. While these waivers are in place, it is important to note that proof of dispensing is still mandatory! The best practice is to document “COVID-19 delivery” with the date and time along with the name or initials of the delivery person, plus the name of the person receiving the medication. It should be noted, however, that a few state Medicaid programs have reinstated the signature requirement. Refer to the PAAS COVID-19 PBM Concessions document for additional details.
“Unauthorized Refills” Audit Discrepancies; How Does This Happen?
Audit results flagging “unauthorized refills” or “overbilled quantity,” can lead to big recoupments. These discrepancies can take significant time and effort for pharmacies to appeal. PAAS National® wants to help educate pharmacies on why this might be happening on your claims, and how to prevent recoupments.
Many states allow pharmacists to increase the dispensed quantity on a prescription without contacting the prescriber for authorization (check with your state’s allowances to ensure you are complying appropriately). Having documentation to support the reason the dispensed quantity changed from the written quantity is recommended to avoid audit issues. See last month’s Newsline article, Quantity Changes Require Documentation.
Consider the FDA guidance for dispensing insulin pens in the unopened (sealed) carton. Pharmacies can fall into the trap of over dispensing what the prescriber has approved. While this is the appropriate way to dispense insulin pens, pharmacies must be aware how over dispensing can happen. PBM auditors are looking at the total quantity prescribed on the prescription. When a prescription is written for a quantity less than the package size, any increased amount must be authorized by the prescriber or be taken out of the total refill quantity (in states that allow accelerated/consolidated refills).
Here is an example:
Insulin pens are not the only prescriptions to watch, other medications that are dispensed according to package size can also be at risk. Software systems should track this information for you, but only if the data has been entered correctly.
PAAS Tips:
Three Common Pitfalls to Avoid When Billing Oral Inhalers
Oral inhalers remain a high audit risk for all PBMs and being able to identify billing pitfalls may mean the difference between a claim safe from recoupment and one lost due to an improper DAW code, early refill, or overbilled quantity.Join today!
- DAW 1 (prescriber prefers brand),
- DAW 2 (patient prefers brand), or
- DAW 9 (plan prefers brand).
- Calculate and bill the true days’ supply based off the directions on the hard copy. If the true days’ supply rejects, follow the Can You Bill It as 30 Days? guidance located on the PAAS Member Portal
- A clinical note should include
- Date
- Name and title of who you spoke with at the prescriber’s office
- The clarification
- The name or initials of the pharmacy staff member documenting the change
- Refer to the following Newsline articles regarding DAW codes:
- Be Proactive on DAW 8 Claims and Prevent Recoupments (January 2022)
- Self-Audit Series #4: DAW Codes (May 2021)
- Print out and post the updated Oral Inhaler Chart for pharmacy billing staff to reference
DAW Codes
Pharmacies are likely used to seeing generic equivalents of Symbicort®, Ventolin®/ProAir®/Proventil® HFA, and Advair Diskus® inhalers by now, but may still be adjusting to the newly released authorized generics of Breo Ellipta® and Flovent® HFA. If a multi-source brand name is being billed with a DAW other than zero, be sure there is supporting documentation such as:
Atypical Directions
Symbicort®, Flovent® HFA and QVAR RediHaler® are examples of retail packages containing 120 puffs, likely based on standard directions of two puffs twice daily, conveniently equating to a 30 days’ supply. However, auditors realize they are commonly prescribed as one puff twice daily. While this change to the directions might seem minor, it doubles the days’ supply for one inhaler – from 30 to 60 days.
Consider the implications: If the script reads one puff twice daily and the pharmacy accidently bills the claim for 30 days instead of 60 days, the prescription could easily be refilled early [mistakenly] and the pharmacy that continues to fill the inhaler every 30 days would end up with every other month recouped upon audit for being filled too soon.
This can also happen when the plan limit is set up as a maximum of 30 days and the pharmacy is forced to bill the claim for a 30 days’ supply. Remember, claim adjudication logic (and subsequent rejections) for refill too soon are only effective if the inputted/transmitted days’ supply is accurate.
Alternatively, if the claim is inappropriately billed as three devices as a 90-day supply but it truly would last 180 days based on directions of one puff twice daily, each claim could be flagged for partial recoupment due to billing a supply larger than the plan limit.
Prescribed Quantity
Watch the quantity and unit of measure fields closely on electronic prescriptions for oral inhalers. Prescribers may inadvertently prescribe a quantity of “1 gm” when they truly meant to send over a prescription for “1 inhaler” – these errors should be clarified with a member of the prescriber’s team and documented with a full clinical note prior to dispensing.
PAAS Tips:
Are You Prepared for an OTC COVID-19 Test Audit?
Billing and dispensing OTC COVID-19 tests is widespread throughout community pharmacies. PAAS National® wants to make sure pharmacies are prepared to provide the correct documentation in case of an audit. To date, PAAS has seen:
While the dollar amount of these claims does not seem audit worthy, PBMs are checking for Fraud, Waste and Abuse and contract violations. The PBMs have been known to reach out to the member to verify quantity, manufacturer, and proof of receiving the test kits from the pharmacy.
PAAS has created a COVID-19 Resources section for our members on the PAAS Member Portal. Here you can find the Medicare and Commercially-Insured Patient Request and Attestation for OTC COVID-19 Test Billing and Frequently Asked Questions . These documents have been created for our members to help answer questions and ease the documentation burden so pharmacies can save time and be audit ready.
What documentation to have in case of an audit:
PAAS Tips:
MounjaroTM Off-Label Use for Weight Loss Spells T-R-O-U-B-L-E
PAAS National® analysts have received many phone calls regarding prescriptions for MounjaroTM – in most cases the medication is suspected of being used “off-label” for weight loss. While off-label use by prescribers is commonplace, what’s different for MounjaroTM is the frequency and expense; making it an attractive audit target. This poses significant risk of payment recovery, regardless of the payor.
We strongly advise pharmacies to confirm (and document) whether patients have a diagnosis of type 2 diabetes as that is the only FDA-approved indication as of October 2022 (although Lilly has received a fast track designation from the FDA in review for obesity).
The risk of audit recoupment varies by payor type as described below.
Medicaid and Medicare Part D
Medicaid and Medicare only pay for products when used for medically accepted indications. Claims for off-label use are not covered as per coverage limitations outlined in the Social Security Act. See the March 2022 article Off-Label Use Not Covered under Medicare Part D for additional discussion.
Commercial
Commercial payors have more flexibility to cover off-label uses, if they choose, as coverage criteria is not limited by federal law. However, many private insurers do not cover “lifestyle drugs” for sexual dysfunction, wrinkles or weight loss. Pharmacies should not assume that a claim paid at adjudication (without any type of utilization management tools such as prior authorization or diagnosis code restriction) will remain paid.
Payors assume prescriptions are for the medically accepted indication and respond with paid claims, often without special coverage hurdles to jump through. This results in a pay and chase audit method and PBMs could come back in an audit 1-2 years later stating that the pharmacy “should have known” the drug wasn’t truly covered. Would you be surprised if the PBMs were setting a trap for you?
Let’s look at what OptumRx®, Express Scripts®, Caremark® and have to say about off-label use:
Pharmaceutical Manufacturer Coupons
Pharmacies (and patients) must also be aware of manufacturer savings card “Terms and Conditions” that also limit coverage.
As MounjaroTM has recently entered the market, we have not seen any PBM or manufacturer recoupments due to off-label use; however, if pharmacies overlook the fine print in PBM Provider Manuals and manufacturer Terms and Conditions, it could spell T-R-O-U-B-L-E.
PAAS Tips: