Options for DMEPOS Orders with Quantities Above Policy Limits

Medicare has strict coverage qualifications and limitations for items covered by Part B. This criteria and restrictions can be found within the Local Coverage Determinations (LCD) and Policy Articles set by the Durable Medical Equipment Medicare Administrative Contractor (DME MAC), Noridian or CGS®. The limits are dependent upon the DMEPOS item dispensed; therefore, being familiar with each LCD and Policy Article for the items dispensed by your pharmacy is critical for decreasing the risk of recoupment upon audit. Though the quantities may be limited by the policy, these limits may sometimes be exceeded if appropriate documentation exists to support the medical necessity of the excess supplies.

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Rather than creating a workaround to circumvent the policy limits, below are the three recommended strategies for handling orders written for quantities above policy limits.

  1. Contact the prescriber and confirm the extra quantity is needed. Ensure the medical records have appropriate documentation to support the medical necessity of the extra quantity. PAAS National® encourages pharmacies to obtain records prior to dispensing to ensure they met the policy requirements.
  2. Contact the prescriber and alert them to the policy limit. To save yourself time, utilize the pre-drafted Clinician Resource Letters from CGS® or Noridian. If there is no medically necessary reason to support the use of quantities above the policy limit, ask the prescriber for authorization to update the standard written order to be within policy limits. Update the order by adding a clinical note with the date, the name and title of the person you spoke with, the clarification, and your initials and update the dispensing label to match.
  3. If the prescriber and/or the patient insist on needing the extra quantity and the medical records do not have evidence to support the medical necessity of the extra quantity ordered, consider completing an Advance Beneficiary Notice of Non-coverage (ABN) prior to providing the quantity above policy limits.

PAAS Tips:

  • Exceeding policy limits increases your chances for audit and the need for proper documentation
  • Ensure there is proper documentation for each DMEPOS item your pharmacy dispenses by familiarizing yourself with the LCD and Policy Article, utilizing the DME MAC documentation checklist, and viewing on-demand and live webinars
  • Read the March 2022 Newsline article Self-Audit Series #14 – DMEPOS Items for additional guidance
  • A copy of the ABN form (Form CMS-R-131) and instructions can be found on the CMS website
    • The notice must not exceed one page in length, must be legible, and needs to be maintained for a minimum of five years from the completion of delivery of care (longer if required per State law)
    • For additional details on completing an ABN, see the following Newsline articles
    • Review the DME MAC ABN tutorial for additional tips (CGS®, Noridian)
    • An ABN applies whether the supplier accepts assignment or not, as there are financial liability provisions under Medicare Law – Medicare Claims Processing Manual Chapter 30

Off-Label Use Not Covered Under Medicare Part D

PAAS National® has seen an increase in audit results from Elixir where the pharmacy was cited for “Claim not covered under Medicare Part D (NPD).” These claims were billed for Diclofenac 3% gel, which is only FDA approved for the treatment of actinic keratosis, a rough, scaly patch on the skin that can become cancerous. The prescriptions had directions indicating that the medication was being used for pain or discomfort, in other words, being used off-label.

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PAAS has also seen the NPD discrepancy when pharmacies bill insulin used in a pump to Medicare Part D instead of Part B, or when intravenous (IV) injectable antibiotics are used in footbaths. While it may seem that PBMs selectively enforce these provisions, the reality is they’re pursuing easy targets with high rewards. Audits leverage sophisticated algorithms to identify these claim outliers. Expensive medications with narrow therapeutic indications only increase the likelihood of an audit. Prescriptions being used within FDA guidelines are much less likely to be identified as being used off-label. Consider a Medicare Part D claim for WegovyTM that gets rejected, only to have the prescriber send over a new prescription for Ozempic® 2.5 mg weekly. Not only does the PBM see the original rejection, but they also see an abnormally large quantity of Ozempic ® in correlation to its days’ supply. See our November 2021 article, Beware: Same Ingredients, Different FDA Indications. Every pharmacy wants to help the patient, but you must be mindful of the audit risk.

Section 1860D-2(e)(4) of the Social Security Act defines medically accepted indications for the Medicare Part D program by referencing Section 1927(k)(6). It states that a medically accepted indication is “any use for a covered outpatient drug which is approved under the Federal Food, Drug, and Cosmetic Act, or the use of which is supported by one or more citations include or approved for inclusion in any compendia described in subsection (g)(1)(B)(i)”.

Section 1927(g)(1)(B)(i) lists the three compendia including:

  • American Hospital Formulary Service Drug Information (AHFS)
  • United States Pharmacopeia-Drug Information (or its successor, which is Micromedex)
  • DRUGDEX Information System (also Micromedex).

These NPD discrepancies can be difficult to appeal, so remember to send PAAS your audits as soon as you receive them to have the best chance for success.

PAAS Tips:

  • Medicare gives preference to a “pay & chase” model when it comes to claims – they want their members to receive needed medications and will pay the claim at point-of-sale assuming the medication is being used in an FDA approved manner
  • Check Medicare Part D prescriptions for indications in the directions or diagnosis fields that might indicate unapproved FDA uses or when quantity/dosages exceed FDA guidelines
  • If a medication is being used off-label, find a published study in American Hospital Formulary Service Drug Information, United States Pharmacopeia-Drug Information, or DRUGDEX Information System showing clinical appropriateness of the medication being used in the prescribed manner.

Medicare Not Enforcing Clinical Indications for Certain DMEPOS Categories During the COVID-19 PHE

On January 31, 2020, the Secretary of the Department of Health and Human Services (HHS) declared a public health emergency (PHE) throughout the United States due to the COVID-19 outbreak. On March 13, 2020, HHS authorized many waivers and modifications regarding Medicare Part B and DMEPOS claims to help prevent gaps in access to care for patients affected by the PHE. Please see below for some waivers and modifications to Medicare Part B and DMEPOS claims that may pertain to your pharmacy if you are a DMEPOS supplier.

PAAS Tips:

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  • The COVID-19 FAQs on Medicare Fee-for-Services Billing has a list of Local Coverage Determinations (LCDs) and National Coverage Determinations (NCDs) whose clinical indications are not being enforced during the PHE
  • Two of the many LCDs listed are nebulizers and continuous glucose monitors
  • If there is proof of medical necessity, these items can be billed to Medicare even if the beneficiary does NOT meet all clinical indications
  • If all the coverage criteria are NOT met during the PHE, then those claims must be billed with the “Catastrophe/Disaster related” (CR) modifier attached to the HCPCS code and “COVID-19” narrative to avoid a denial as previously discussed in July 2020 Newsline article Medicare Part B Requires a Claim Modifier if You Are Not Collecting Patient Signatures!
  • It is likely that CMS will come up with an audit plan for DME MACs and other contractors to audit claims billed with a CR modifier
  • Pharmacies using CR modifiers on large volumes of claims could be targeted
  • In addition to the LCD/NCD waivers, the following waivers are also in effect until the end of the PHE
    • Waiver of face-to-face requirements
    • Waiver of proof of delivery signature requirements
    • Replacement of lost, damaged, or destroyed items that cannot be restored
    • Flexibility with telehealth services
    • Verbal orders
  • Pharmacies should use waivers sparingly as the PHE declines
  • Perform a self-audit on your DMEPOS claims (see Self-Audit Series #14: DMEPOS items) – if you find a claim billed due to a waiver and forgot to add the CR modifier, go online, and submit a reopening request to add the CR modifier to the HCPCS code and “COVID-19” narrative
  • If a claim gets audited and is missing the CR modifier, the pharmacy can request a redetermination to add the CR modifier to the HCPCS code and “COVID-19” narrative
  • Many contractors are refraining from auditing pandemic related claims due to waivers, so pharmacies are seeing increased audits on other DME categories that do not have waivers in place such as surgical dressings, urological supplies, ostomy supplies and more
  • To submit a reopening or redetermination request, follow the guidance from your DME MAC

Best Practices for Vaccine Documentation

Without question, vaccine claims are on the rise! Consequently, PAAS National® analysts have recently seen an increased number of PBM audits for these claims. Consider a few best practices to reduce your risk of audit recoupments:

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Billing

Quantity – Submit the correct NCPDP billing unit of each (EA) or milliliter (mL) based on vaccine product

Day Supply – NCPDP recommends that all vaccine claims be submitted as a 1-day supply

Origin Code

  • Submit the origin code in accordance with how you received the prescription
    • 1 – written, prescription obtained via paper.
    • 2 – telephone, prescription obtained via oral instructions or interactive voice response using a phone.
    • 3 – electronic, prescription obtained via SCRIPT or HL7 Standard transactions, or electronically within closed systems.
    • 4 – facsimile, prescription obtained via transmission use a fax machine.
    • 5 – pharmacy, this value is used to cover any situation where a new Rx number needs to be created from an existing valid prescription such as traditional transfers, intrachain transfers, file buys, software upgrades/migrations, and any reason necessary to “give it a new number. This value is also the appropriate value for “Pharmacy dispensing” when applicable such as BTC (behind the counter), Plan B, established protocols, pharmacists’ authority to prescribe, etc.
  • Note that codes 1-4 represent patient-specific prescriptions while code 5 covers various other situations

Prescriber ID

  • Submit the NPI of the prescriber
  • This would be the prescriber of a patient-specific prescription or standing protocol
  • This would be the pharmacist Type 1 NPI (individual) as per state law where pharmacists have prescribing authority or when ordered under PREP Act declaration during COVID-19 pandemic

Documentation

Item Comments Requested in audits
Authority to Administer
  • You may have a patient-specific prescription with all elements required by state law
  • You may have a standing protocol or collaborative practice agreement
  • For situations where you are administering pursuant to a protocol, CPA or PREP Act declaration, PAAS recommends creating a “placeholder prescription” with all normal prescription elements for your files
 Yes
Screening Checklist Not requested by PBMs, however should retain for your records No
Vaccine Administration Record (VAR) Must document every administration (required by law)

Include at least the following:

  1. Date of administration
  2. Vaccine manufacturer
  3. Vaccine lot number and expiration date
  4. Site of injection
  5. Name and title of the person who administered the vaccine
  6. Vaccine information statement (VIS) or EUA Fact Sheet
    • Date printed on the VIS
    • Date the VIS was given to the patient or parent/guardian
 Yes
VIS or EUA Fact Sheet Most current version must be provided prior to each administration (required by law) No

PAAS Tips:

  • Common errors found during audits are wrong quantity billed and missing VAR documentation
  • See CDC website or org for sample forms and additional resources

Billing OTC COVID-19 Tests Brings New Struggles and Opportunities

In addition to the free COVID-19 testing sites nationwide and COVID-19 tests that can be acquired through the federally-established website COVIDTests.gov, private health insurances are required to cover at-home rapid COVID-19 tests at no cost to consumers. As of January 15, 2022, pharmacies are capable of billing up to eight at-home COVID-19 tests per covered individual per month. Along with this opportunity brings about new struggles surrounding how to properly bill an individual’s insurance. Utilizing PBM communications, and guidance published surrounding at-home COVID-19 test billing, PAAS National® created additional resources to assist in proper billing and documentation requirements that PBMs may require.

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PAAS recommends pharmacies have retrievable documentation when billing at-home COVID-19 tests through your pharmacy system. In addition, PBMs such as Prime Therapeutics and Express Scripts have communicated their billing requirements for at-home COVID-19 tests. PAAS developed the Commercially Insured Patient Request and Attestation for OTC COVID-19 Test Billing document to assist with future audits pertaining to billing a patient’s insurance for the testing supplies.

The Commercially Insured OTC COVID-19 Tests Frequently Asked Questions (FAQ) document answers many questions pharmacies may have surrounding how to go about billing the at-home tests, such as if a prescription is needed to bill for an OTC COVID-19 test or who the prescriber will be if a pharmacy initiates a prescription vs. when a pharmacy does not initiate a prescription. The FAQ document also includes a list of known authorized tests which are covered under the OTC Emergency Use Authorization (EUA), albeit not a fully comprehensive list. As stated by NCPA on February 1, 2022, there have been type 1 consumer recalls on at-home tests falsely alleging to be authorized by the FDA. When placing an order for OTC COVID-19 tests, properly vet the distributor and the product to ensure the at-home tests being ordered are an authorized FDA test.

All PAAS produced COVID-19 materials can now be conveniently located under the COVID-19 Resources page on the PAAS Portal. As additional information is released pertaining to at-home COVID test billing practices and other COVID-related topics, periodically visit the portal for the most up-to-date resources.

Four Tips for Navigating Pharmacy Compliance Audits in 2022

by Tracie Acosta, CPh, Published March 11, 2022 by Pharmacy Times

In recent years, the auditing process has evolved into a full-blown investigation, often requiring pharmacies to submit hundreds of pages of documentation

Compliance audits launched by pharmacy benefit managers (PBMs) have long been a cause of frustration for pharmacies, especially independent community pharmacies with limited manpower and resources compared to large chains. This challenge has only magnified since the onset of the COVID-19 pandemic in early 2020.

PBMs have adapted their practices by switching to virtual audits, leaving them with the ability to review more claims than ever before. As a result, pharmacies that are juggling the chaos of audit documentation, vaccine distribution, prescription refills, and a plethora of other responsibilities stand to lose. It’s no wonder that the average audit in 2020 cost pharmacies $23,978, which is 35% more than the annual average over the previous 5 years, according to the pharmacy audit assistance service, PAAS National.

Traditionally, a PBM would simply check that the pharmacy received a valid prescription, dispensed the proper amount according to the prescription, and submitted a claim for the correct amount dispensed. But in recent years, the auditing process has evolved into a full-blown investigation, often requiring pharmacies to submit hundreds of pages of documentation—and auditors can even use minor clerical errors as excuses to deny payments.

As pharmacy compliance audits grow in sophistication, it’s up to pharmacies to remain diligent in monitoring their operations, especially the following aspects of their operations in 2022. Here are some tips for getting ahead of and managing audits in the year ahead.

Continue to read the full article here.

Top 3 PAAS eNewsline Exclusive Articles

Your monthly printed Newsline is only a fraction of the content. PAAS Audit Assistance members can log in to the PAAS Portal each month to view the full Newsline edition with audit prevention tips and timely information on PBM audit tactics.

PAAS Audit Assistance member can explore additional eNewsline articles on the PAAS Member Portal.

PAAS Audit Assistance Admins can also add employees to the Portal so that their whole staff has access to the eNewsline.

Keep your employees informed to increase engagement and lower audit results!

Top 10 PAAS National Articles of 2021

PAAS Audit Assistance members receive a monthly newsletter with new audit tactics and prevention tips. The printed newsletter, PAAS National® Newsline is only a fraction of the content that we put out each month as members have access to additional content online in the Member Portal, in addition to an archive of articles.

The top 10 Newsline articles for 2021 include:

  1. Audit Risk: Ivermectin Used for Treating COVID-19
  2. COVID-19 Vaccine Billing Guidance
  3. Updated Dispense in Original Container Chart
  4. Are You Documenting DUR and Submission Clarification Codes?
  5. Dispensed Quantity is Different from the Prescription – Do I Need Documentation?
  6. HHS Advisory Opinion on Contract Pharmacies Under the 340B Program
  7. COVID-19 Vaccine Administration Audit Risk (Including a New PAAS Resource)
  8. Fraud, Waste, & Abuse and HIPAA Compliance Updates for 2021
  9. “Forwarding” Unfilled Electronic Prescriptions
  10. Victoza® – One Letter Can Cost You!

PAAS Audit Assistance Admins can also keep their employees informed to increase engagement and lower audit results by adding employees to the Portal so that their whole staff has access to the eNewsline.

Caremark® Turns Up the Heat on Proof of Copay Collection Requests

PAAS National® is seeing a rising number of Caremark® audits requesting proof of copay collection. This requested information may be included in a desk, virtual onsite, or invoice audit. The number of claims requested can range from just a few claims to all dates of fill for several prescriptions.

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Having a Point-of-Sale (POS) system may be sufficient for providing proof of copay collection; however, PAAS analysts have seen Caremark® requiring additional documentation to show evidence of payment collection. Providing bank deposits (cash transactions), front and back copies of cancelled checks, and credit card receipts may be necessary.

In addition to proof of copay collection, Caremark® has been known to ask pharmacies to include their policies regarding copay collection and financial hardship, including what documentation is required to determine patient’s financial hardship (i.e., tax returns or approved waiver application). PAAS Fraud, Waste and Abuse and HIPAA Compliance members can reference Section 4.1.5 of their Policy and Procedure Manual for their copay collection policy.

While pharmacies may not be required to collect copays for Medicaid prescriptions, attempts to collect must be made, documented and only waived on a case-by-case basis.

Pharmacies using house charge accounts face additional challenges. Providing itemized invoices showing payments made on the account will likely be required. Written policies and procedures should be in place if charge accounts are used and may be necessary to submit to the PBM.

Secondary payor information (and/or payment) may be necessary when coupons or discount cards are used. Caremark Provider Manual, Section 3.03.03 addresses the use of coupons and other programs. Remember that Medicare, Medicaid and TRICARE prohibit the use of manufacturer coupons and discount programs.

Pharmacies not able to provide sufficient evidence of copay collection not only face full recoupment of claims, but could face termination of contract and risk Fraud, Waste, and Abuse investigations and charges linked to the False Claims Act.

PAAS Tips:

  • See Caremark® 2022 Provider Manual for additional information regarding copay collection:
    • 3.03.03 (coupons)
    • 3.03.04 (proof of payment)
    • 3.03.08 (waivers)
    • 3.03.09 (financial hardship)

Contact PAAS National® at (608) 873-1342 or visit our website, paasnational.com/buy-now for more information on adding our FWA/HIPAA compliance program.

2022 Fraud, Waste & Abuse and HIPAA Compliance Program Updates

PAAS National® continuously monitors legislative and regulatory changes that may impact your Fraud, Waste & Abuse and HIPAA Compliance Program. We keep a close eye on enforcement from the Department of Justice and Office for Civil Rights to help ensure the program meets interpretative standards. Furthermore, PAAS works to keep pace with Pharmacy Benefit Managers as they continue to add credentialing requirements that can be extremely difficult and a significant nuisance to independent pharmacies.

The PAAS National® FWA/HIPAA Compliance Program has implemented changes to ensure pharmacies continue to have a robust program in place. PAAS FWA/HIPAA compliance members can login to the member portal to view the 2022 FWAC and HIPAA Updates.

Administrators should review all Compliance tasks (located in the left-hand navigation on the PAAS Member Portal) at least annually to keep the program up-to-date and in compliance. Section 2.6 Updates of Policies and Procedures of your manual contains information on maintaining open lines of communication and the distribution of changes.

Contact us TODAY at (608) 873-1342 or info@paasnational.com and add FWA/HIPAA for a discounted rate.

“We have been with PAAS for many years and added the FWAC/HIPAA material to our membership and as a compliance officer, I’ve never been more pleased with the program. If you have already made the best choice to have PAAS in your corner, then continue with the best for your FWAC/HIPAA needs.” – Member since 2010 from North Carolina

“PAAS National® Fraud, Waste, Abuse and Compliance educational sessions are unsurpassed. The PAAS National® Policy and Procedure manual that you create for your pharmacy is a must for all pharmacies to have for their staff. All of this keeps your pharmacy up to date with current pharmacy procedures and operations and ensure proper pharmacy practices going forward.” – Member since 2021 from New York

“A pharmacy without the compliance program does not have their bases covered and required work finished. I can sleep at night knowing this program keeps me protected and on task.” – Member since 2009 from Iowa