- Allowed for email bulk purchase notifications (and subsequent acknowledgements)
- Permit pharmacies to notify Caremark up to 21 days after the bulk purchase has occurred
- Repositioned from a bulk purchase request to a bulk purchase notification (seemingly automatic approval – with Caremark’s acknowledgement)
Despite some concessions, pharmacies are still left wondering how the policy impacts their business, and what they can do about it. Two items to consider:
- Understand how your drug utilization and inventory turns impact bulk purchasing, and where consideration should be given for bulk purchase notifications.
- Support advocacy efforts at the state and federal level to fight back against PBM practices. With Rutledge and Wehbi garnering support nationally, states can regulate PBMs successfully.
Understanding Caremark’s Invoice Audits
Caremark invoice audits typically review claims and aggregate purchases over a 12-month period. Upon a pharmacy’s request during the audit, the 30 days prior to the 12-month period will be included for purchase consideration. For example:
Claims date range = 1/1/2021 – 12/31/2021
Invoice date range = 12/1/2020 – 12/31/2021 (extra 30 days on the front end)
Of note, all PBMs have similar limits regarding this lookback (or buffer) period which varies from 30 to 90 days. PAAS National® has experience navigating invoice audits with purchases beyond 90 days prior to the window, but ideally, this should be on an exception basis.
Some PBMs (e.g., OptumRx) may ask for a full dispensing history report from the pharmacy to reconcile the purchases against, creating a much greater hurdle for pharmacies to jump successfully. Caremark invoice audits generally focus on Caremark claims, meaning you don’t have to prove purchases for all claims in the 12-month period, just purchases for Caremark claims.
Consider the following audit scenarios:
Audit Example 1: Pharmacy purchases exactly what they dispensed throughout claims/invoice date range
| Total Quantity Dispensed for particular NDC (all payors): |
15,000 |
| Caremark Claims Dispensed (30% of all payors for this NDC): |
4,500 |
| Bulk Purchases (outside the 30 day grace-period with no notification): |
0 |
| Purchased during invoice date range: |
15,000 |
| Result: |
Pharmacy has surplus of 10,500 |
Audit Example 2: Pharmacy bulk purchased a 6-month supply prior to the invoice date range
| Total Quantity Dispensed for particular NDC (all payors): |
15,000 |
| Caremark Claims Dispensed (30% of all payors for this NDC): |
4,500 |
| Bulk Purchases (outside the 30 day grace-period with no notification): |
7,500 (not counted) |
| Purchased during invoice date range: |
7,500 |
| Result: |
Pharmacy has surplus of 3,000 |
Audit Example 3: Pharmacy bulk purchased a 6-month supply prior to the invoice date range and Caremark represents 60% of all claims dispensed.
| Total Quantity Dispensed for particular NDC (all payors): |
15,000 |
| Caremark Claims Dispensed (60% of all payors for this NDC): |
9,000 |
| Bulk Purchases (outside the 30 day grace-period with no notification): |
7,500 (not counted) |
| Purchased during invoice date range: |
7,500 |
| Result: |
Pharmacy has shortage of 1,500 |
The percent of your claims billed to Caremark will vary compared to peers, and more importantly, every medication will have a unique percentage that is billed to Caremark. If Caremark prefers Ventolin® over ProAir® and Proventil®, then your percent of Ventolin® claims for Caremark will be proportionately greater.
It’s great to understand the situation, but who has time to calculate this for the thousands of NDCs on a pharmacy shelf? No one. So, pharmacies are going to need to make a concerted effort to think about what purchases might exceed a reasonable threshold for their pharmacy, as a percent of Caremark claims.
Frequently Asked Questions:
Does this mean that my pharmacy cannot make bulk purchases?
No. Remember that Caremark (and most other PBM) invoice audits look at aggregate purchases over a specific time period that often exceeds 12 months. Congruently, PBMs are typically comparing your total purchases against claims billed to that specific PBM. Depending on the specified date range of a future PBM invoice audit, this may be a non-issue.
There are scenarios where you are at higher risk:
- Products with low turnover/few turns
- Products where Caremark is the only PBM that covers the drug and represents a high percentage of total utilization at your pharmacy
- Situations where you have only one patient taking a particular medication and they stop for various reasons (discontinued, no longer customer) and you are stuck with open inventory on the shelf
This is a unique business decision for every pharmacy. If the bulk purchase is likely to create an invoice shortage for Caremark, we would encourage pharmacies to file for a bulk purchase notification .
Do I need to purchase inventory every 30 days to remain compliant with Caremark’s policy?
No, and Caremark has removed the original reference that created confusion (strikethrough text below has been removed)
Caremark will not accept purchases occurring outside of thirty (30) days prior to the selected date range unless: (1) Provider notifies Caremark in writing of its intent to make a bulk purchase (i.e., more than thirty (30) days of inventory) of a Covered Item…
What purchases are likely to be an issue?
If the original purchase is outside the invoice date range, it will represent a problem unless you are purchasing enough product during the date range to support Caremark claims. Note, some PBMs reconcile to the 11-digit NDC level.
- Consider an invoice audit for the calendar year 2021. You purchase NDC A prior to the invoice audit date range on 11/30/2020 and use NDC A to dispense for the next 4 months (12/1/2020 – 3/31/2021). The wholesaler subsequently switches the preferred generic, so your future purchases (during the audit window) are for a different product, NDC B.
- You have a patient on Biktarvy® who passes away. You have a quantity remaining on your shelf that cannot be returned to the wholesaler and you’re unable to move the inventory. A year later a new patient starts on Biktarvy® and you use the remaining stock on hand.
These scenarios will likely need to be challenged by a pharmacy in arbitration to get Caremark to relent.
Is this legal?
At a minimum, the requirement is anticompetitive and deserves to be challenged. This type of conduct further supports the Federal Trade Commission investigating the monopolistic practices of PBMs and vertical integration. Surely no CVS Pharmacy is submitting bulk purchase notifications and yet they have dead inventory that would create an issue if Caremark were to audit their pharmacies.
Have pharmacies really been terminated as a result of bulk purchases?
Unexplained invoice audit shortages are serious business and PBMs are quick to conclude that pharmacies are engaged in fraud if the pharmacy cannot provide good reasons for (and solutions to resolve) the shortages.
There are many reasons for invoice shortages other than fraud and include things like: auditor math errors, wholesaler failed to respond, issues with units of measure, wrong NDC billed, wrong quantity billed, wrong time frame, claim not reversed successfully, and more.
While most invoice audits do NOT result in contract termination, any unsupported claims are subject to recoupment. The challenge with invoice audit shortages is trying to find the “root cause(s)” of individual drug shortages so that pharmacies can implement the right corrective actions to prevent a recurrence. This takes some internal investigating and PAAS has extensive experience guiding pharmacies if you are ever in this situation.
What should we do today?
There is no one-size-fits-all answer for every pharmacy. The bottom line is that there is audit risk when making bulk purchases as ALL PBMs have limited lookback periods as explained above. It is important to understand that PBMs look at aggregate purchases over an extended window and that the lookback periods are relative to a yet to be defined audit date range.
Short-term considerations
- Notify Caremark of your intent, or execution, of a bulk purchase no later than 21 days after the purchase at: pharmacyaudit@cvshealth.com
-
- Caremark will acknowledge receipt of the notice – retain this for your records!
- Re-evaluate pros and cons of existing pharmacy buying habits
- Is the larger pack size less expensive, or just more convenient?
- Re-evaluate how you handle stale inventory to reduce risk (return to wholesaler, reverse distributor, pharmacy-to-pharmacy sale in accordance with Drug Supply Chain Security Act 3T exemption)
- See February 2022 Newsline article Caremark® expands “Aberrant” Language and Restricts Bulk Purchases.
Long-term considerations
- Engage PAAS when you are involved in a PBM invoice audit
- Continue advocacy through state and national pharmacy associations to shine a light on unfair PBM practices that make it harder to take care of your patients and remain in business
Is Your Pharmacy Ready for an Unannounced Audit?
Pharmacies are often startled with the limited amount of time a PBM offers prior to an onsite audit. However, PBM auditors, DEA agents, FDA inspectors and state Board of Pharmacy inspectors can also make unannounced visits.
Ensuring your staff members are prepared in case of an unannounced visit is essential. Since these visits occur without warning, the Pharmacist-in-Charge (PIC) and/or owner may not be working or available to assist. Keeping information in a central location and advising staff on how to handle these intimidating visits will make the process go much smoother.
PAAS National® has created a document to help pharmacies prepare for PBM visits. Located on our website, under the Tools & Aids Section, you can find our Onsite Credentialing Guidelines. This tool provides a list of frequently asked questions from auditors. The guide also includes references to the Policy and Procedure Manual for PAAS National® Fraud, Waste & Abuse and HIPAA Compliance members.
PAAS Tips:
Don’t have an FWA/HIPAA Compliance Program? Contact PAAS and receive a $126 discount when you combine services with your audit assistance. Get started today! info@paasnational.com or (608) 873-1342.
Beware: DEA and Wholesalers are Cracking Down on Controlled Substance Dispensing
Take note – the DEA is coming after pharmacies dispensing illegitimate controlled substance prescriptions. Pharmacists should all be aware of their corresponding responsibility and the need for a legitimate medical purpose when dispensing controlled substance prescriptions. A review of recent Department of Justice settlements provides guidance on some prescriptions that require additional scrutiny.
Consider the following dispensing activities to be of high risk:
Dispensing combinations of controlled substances that have no legitimate medical purpose, are highly addictive and specifically used to create or enhance abusive and euphoric effects, is a violation of 21 CFR 1306.04(a). Pharmacists have a responsibility to ensure the appropriateness of the prescriptions they are dispensing. While turning away business is never easy, being fined and sanctioned by the DEA is a much more painful process to endure.
Consider a few DEA settlements over the last couple years:
Drug wholesalers are also pulled into the fray with their responsibility to identify and report “suspicious orders” of controlled substances. McKesson, Cardinal Health, and AmerisourceBergen have all had settlements and/or civil penalties (as high as $150 million) related to Controlled Substance Act violations. In 2019, there were felony criminal charges filed against a distributor and its executives for illegal distribution of controlled substances. Their failure to effectively oversee suspicious orders caused them to go out of business.
Consequently, wholesalers are increasing their constraints on controlled substance purchasing. There are more rigorous applications, wholesaler audits, and purchasing thresholds which cannot be exceeded. PAAS National® has also become aware of wholesalers (nearly immediately) terminating a pharmacy’s ability to purchase controlled substances. In its notice to the pharmacy, the wholesaler flagged the following practices:
PAAS Tips:
When Should I Obtain a Diagnosis Code for Ozempic?
Since Ozempic® was FDA approved December 5, 2017, PAAS National® has fielded many questions regarding dispensing this expensive injectable diabetic medication. The questions relate to dosing, calculations, billing, and off-label use. PAAS cannot overemphasize the importance of calculating the correct days’ supply. Use the chart below and prior PAAS articles to help pharmacy staff calculate the correct days’ supply.
0.5 mg only
Maintenance Dose (0.5 mg)
Off-label use is a concern because of Wegovy™, which has the same analog name (semaglutide) as Ozempic®, but is FDA approved for weight loss. To reduce audit risk, pharmacies should be vigilant in attempting to identify when a prescriber is working around a plan exclusion or prior authorization by prescribing Ozempic® instead of Wegovy™. With the FDA’s approval of 2 mg weekly dosing for Ozempic in March 2022, this became more challenging as higher dosing is not necessarily indicative of off-label use. Keep in mind, federal programs like Medicare Part D and Medicaid do not pay for off-label use and claims billed for non-diabetic patients could be recouped. Consider obtaining a diagnosis code if any of the following apply when starting patients on Ozempic:
Pharmacies dispensing Ozempic prescriptions for weight loss may incur significant audit recoupments. Consider collaborating with prescribers to educate them on the risks to help ensure appropriate billing practices.
PAAS Tips:
Insulin Glargine (Winthrop) – Unbranded Biologic of Lantus®
Insulin glargine labeled by Winthrop U.S. came to market in May 2022, and with it a lot of additional confusion regarding pharmacy level substitution.
Keen eyed observers will notice that Winthrop is “a Sanofi company”, and that both Lantus® and insulin glargine (Winthrop) have the same Biologics Licensing Application (BLA) number BLA021081 – which makes it an “unbranded biologic” of Lantus®.
Please see a few important notes about unbranded biologics from FDA Purple Book FAQ #9:
Remember that pharmacy level substitution of a reference product is only allowed if biologic drugs are either (i) identified as interchangeable OR (ii) an unbranded biologic with the same BLA number. For biologic drugs that don’t fall into these two categories, you must obtain prescriber approval prior to substituting.
Here is a summary table of how to understand insulin glargine products:
BLA 021081
Reference Product
BLA 021081
Unbranded biologic
BLA 761201
Reference Product
BLA 761201
Unbranded biologic
BLA 205692
Reference Product
*Treat this like a situation where prescription is written as “albuterol sulfate HFA inhaler”
PAAS Tips:
Why PAAS Cultural Competency?
Developed by pharmacists for community pharmacies, PAAS National® brings you a tailored approach to Cultural Competency and Linguistically Appropriate Services using the PAAS Care Model. Your training history is documented, retrievable and easily tracked throughout the year. Simply put, the training is more realistic for pharmacy staff, and documented should you ever need evidence of completion – training, done better.
“We understand there is a need to address federal and state requirements and meet PBM credentialing requirements,” stated Trent Thiede, President at PAAS National®, “The PAAS CARE Model can be used in any patient interaction to help identify a patient’s cultural differences and guide the pharmacy on how to proceed.”
The PAAS CARE Model is an acronym for Competence Evaluation, Adherence, Realistic, Evaluate and Educate in the training module. Our adage of “Be aware to CARE” uses real-life, pragmatic examples to serve as a launching pad for enhancing patient experiences. PAAS’ unique approach to training ensures its content resonates with all pharmacy staff, making the goal of cultural competence achievable, across the board.
Plus, if you are already a PAAS Fraud, Waste & Abuse and HIPAA Compliance member, your employees will have the ease of completing their FWA, HIPAA and Cultural Competency training on one screen. No clicking to multiple programs or browsers to access the yearly training for your staff.
If you would like more information about PAAS Cultural Competency Training Program starting at $99/year, please visit paasnational.com/culturalcompetency or contact PAAS National® at (608) 873-1342 or info@paasnational.com.
Beyond-Use Date vs. Nursing Home Storage Policy – Avoid this Recoupment Trap!
Manufacturers go through rigorous testing to bring their products to market and part of the tedious approval process includes stability, sterility, and beyond-use date (BUD) testing. Pharmacies should be familiar with a product’s stability, sterility, and BUD information since these timeframes may come into play when determining the correct quantity and days’ supply to bill. Insulin pens and vials are the most commonly billed products where the BUD may influence the days’ supply. For example, a single vial of Lantus® or NovoLog® is good for 28 days once the top is punctured; therefore, a single vial of either of these insulins should always be billed for 28 days or less. Alternatively, a single vial of Levemir® is good for 42 days once it has been punctured; therefore, a single vial of Levemir® should always be billed for 42 days or less. For additional BUD information, refer to Section 16 of the manufacturer product labeling, or see PAAS’ various Days Supply Charts found in the Tools & Aids section of the PAAS Member Portal.
Pharmacies billing for nursing home patients may come across yet another “date of importance” – the maximum time a product may be stored according to the facility’s storage policy. PAAS National® analysts see pharmacies billing eye drops, inhalers, and insulin products as a 28-day or 30-day supply even though the directions on the prescription, the manufacturer product sterility information, and the BUD all support a longer days’ supply. Using the Levemir® example from above, if a pharmacy had a prescription for a Levemir® vial 100 units/mL, injecting 12 units subcutaneously nightly (dispense 10 mL), a single vial would have 83.3 doses or 83 days of medication. However, the BUD of a single vial is only 42 days; therefore, this should be billed as a 42-day supply. If a nursing home facility has a policy to discard all insulin vials after 28 days, then a pharmacy would be tempted to bill this as a 28-day supply but be aware of the repercussions this billing process could have! Nursing home practices and policies do not invalidate FDA/manufacturer sterility testing. Adjusting the days’ supply to 28 days to follow the facility’s policy often leads to “invalid day supply” penalty fees and full recoupments on early refills since PBMs will not take into consideration nursing home policies when determining days’ supply.
PAAS Tips:
DMEPOS Mini-Series #2 – Ostomy Supplies
PAAS National® often sees recoupments on ostomy supplies due to unsupported medical records. Insufficient documentation accounted for 86.8% of improper payments for ostomy supplies in 2019, around $65.5 million. Please see the tips provided below to help ensure Medicare B coverage and payment for a beneficiary’s ostomy supplies.
PAAS Tips:Join today!
- Coverage
- Beneficiary must have a surgical created opening (stoma) to divert urine or fecal matter outside the body
- The location, construction and skin condition surrounding the stoma must be discussed in the medical record
- Diagnosis driven by the type of ostomy the beneficiary has:
- Colostomy – opening into the colon (large intestine)
- Ileostomy – opening into abdominal wall (small intestine)
- Urostomy – opening into abdominal wall that connects to urinary tract
- Ostomy supplies are not separately payable when in a covered home health stay
- Continued Medical Need
- Once the initial medical need has been met, the ongoing need for ostomy supplies is assumed to be met.
- If the beneficiary continues to meet the medical guidelines, no further documentation is required
- Coding Guidelines
- Diagnosis must be documented in the medical record as well as submitted on the claim for coverage consideration
- Barrier (also known as a Wafer or Faceplate) – protects skin from stoma output and keeps the pouch in place
- Solid barrier
- Liquid barrier – liquid OR spray and individual wipes OR swabs may be used but not both
- Pouches – can be one-piece or two-piece
- Tape and adhesive – an AU (Item furnished in conjunction with a urological, ostomy, or tracheostomy supply) modifier code must be billed for tape and adhesive
- If a continent stoma:
- use only one type of supply per day
- can be a stoma cap, stoma plug, stoma absorptive cover or gauze pads
- Covered diagnosis, Healthcare Common Procedure Coding System (HCPCS) codes, modifiers and maximum allowances per month can be found in the LCD and policy articles
- Quantity of supplies needed depends on the type of stoma, condition of skin surface, location, and construction
- If beneficiary resides in a nursing facility, pharmacies are limited to billing a one-month supply
- If beneficiary resides in their home, pharmacies can bill for a 3-month supply and will need a narrative on the claim for the 3-month supply
- See the June 2022 Newsline article CGS® and Noridian Self-Service Tools and Resources for Durable Medical Equipment, Prosthetics, Orthotics and Supplies for guidance on claim status, eligibility, same or similar items and more
- Additional Resources
- Jurisdictions JB and JC Portal – MyCGS
- Jurisdictions JA and JD Portal
A Lifeline for Pharmacy Audits
“Five letters strike fear in the hearts of pharmacists all around: audit. In 2022, audits are on the rise, and pharmacies need to be on guard. Luckily, Trent Thiede can guide you through the process of your next audit. Trent is the President of PAAS National®, an audit assistance service dedicated to helping pharmacies survive predatory audits, compliance issues, and whatever new tricks PBMs keep up their sleeves. In this episode, Trent explains how you can stay prepared, proactive, and protected next time your pharmacy faces an audit,” stated Pioneer Rx Pharmacy Software.
Join Trent Thiede, President of PAAS National® in the most recent podcast A Lifeline for Pharmacy Audits, hosted by Jeff Key, President of PioneerRx and Marsha Bivins, Director of Marketing of PioneerRx
Understanding Caremark’s Restrictions on Bulk Purchases
Community pharmacies have been fed up with PBM antics for a long time. Egregious audits, absurd DIR fees, arduous credentialing requirements, unconscionable contracts; we run out of adjectives before we run out of PBM issues. Amidst the backdrop of a public health emergency and drug supply chain shortages – where pharmacies and staff are being pushed to the brink – Caremark has further clarified their policy to constrain a pharmacy’s ability to maintain profitability.
While this restriction is now formalized in the Provider Manual, it has been Caremark’s informal policy to only consider purchases 30 days prior to the audit date range. Caremark initially provided an avenue for exceptions to this policy by allowing pharmacies to request bulk purchases via U.S. mail 7 days in advance of an intended purchase. Requiring pharmacies to mail the request was intentional, making the process difficult and drawn out for pharmacies to request and receive approval. In response to strong provider pushback, Caremark issued a rare mid-year update to their Bulk Purchasing Notification on May 6, 2022. Primarily, the update has done three things:
Despite some concessions, pharmacies are still left wondering how the policy impacts their business, and what they can do about it. Two items to consider:
Understanding Caremark’s Invoice Audits
Caremark invoice audits typically review claims and aggregate purchases over a 12-month period. Upon a pharmacy’s request during the audit, the 30 days prior to the 12-month period will be included for purchase consideration. For example:
Claims date range = 1/1/2021 – 12/31/2021
Invoice date range = 12/1/2020 – 12/31/2021 (extra 30 days on the front end)
Of note, all PBMs have similar limits regarding this lookback (or buffer) period which varies from 30 to 90 days. PAAS National® has experience navigating invoice audits with purchases beyond 90 days prior to the window, but ideally, this should be on an exception basis.
Some PBMs (e.g., OptumRx) may ask for a full dispensing history report from the pharmacy to reconcile the purchases against, creating a much greater hurdle for pharmacies to jump successfully. Caremark invoice audits generally focus on Caremark claims, meaning you don’t have to prove purchases for all claims in the 12-month period, just purchases for Caremark claims.
Consider the following audit scenarios:
Audit Example 1: Pharmacy purchases exactly what they dispensed throughout claims/invoice date range
Audit Example 2: Pharmacy bulk purchased a 6-month supply prior to the invoice date range
Audit Example 3: Pharmacy bulk purchased a 6-month supply prior to the invoice date range and Caremark represents 60% of all claims dispensed.
The percent of your claims billed to Caremark will vary compared to peers, and more importantly, every medication will have a unique percentage that is billed to Caremark. If Caremark prefers Ventolin® over ProAir® and Proventil®, then your percent of Ventolin® claims for Caremark will be proportionately greater.
It’s great to understand the situation, but who has time to calculate this for the thousands of NDCs on a pharmacy shelf? No one. So, pharmacies are going to need to make a concerted effort to think about what purchases might exceed a reasonable threshold for their pharmacy, as a percent of Caremark claims.
Frequently Asked Questions:
Does this mean that my pharmacy cannot make bulk purchases?
No. Remember that Caremark (and most other PBM) invoice audits look at aggregate purchases over a specific time period that often exceeds 12 months. Congruently, PBMs are typically comparing your total purchases against claims billed to that specific PBM. Depending on the specified date range of a future PBM invoice audit, this may be a non-issue.
There are scenarios where you are at higher risk:
This is a unique business decision for every pharmacy. If the bulk purchase is likely to create an invoice shortage for Caremark, we would encourage pharmacies to file for a bulk purchase notification .
Do I need to purchase inventory every 30 days to remain compliant with Caremark’s policy?
No, and Caremark has removed the original reference that created confusion (strikethrough text below has been removed)
Caremark will not accept purchases occurring outside of thirty (30) days prior to the selected date range unless: (1) Provider notifies Caremark in writing of its intent to make a bulk purchase
(i.e., more than thirty (30) days of inventory)of a Covered Item…What purchases are likely to be an issue?
If the original purchase is outside the invoice date range, it will represent a problem unless you are purchasing enough product during the date range to support Caremark claims. Note, some PBMs reconcile to the 11-digit NDC level.
These scenarios will likely need to be challenged by a pharmacy in arbitration to get Caremark to relent.
Is this legal?
At a minimum, the requirement is anticompetitive and deserves to be challenged. This type of conduct further supports the Federal Trade Commission investigating the monopolistic practices of PBMs and vertical integration. Surely no CVS Pharmacy is submitting bulk purchase notifications and yet they have dead inventory that would create an issue if Caremark were to audit their pharmacies.
Have pharmacies really been terminated as a result of bulk purchases?
Unexplained invoice audit shortages are serious business and PBMs are quick to conclude that pharmacies are engaged in fraud if the pharmacy cannot provide good reasons for (and solutions to resolve) the shortages.
There are many reasons for invoice shortages other than fraud and include things like: auditor math errors, wholesaler failed to respond, issues with units of measure, wrong NDC billed, wrong quantity billed, wrong time frame, claim not reversed successfully, and more.
While most invoice audits do NOT result in contract termination, any unsupported claims are subject to recoupment. The challenge with invoice audit shortages is trying to find the “root cause(s)” of individual drug shortages so that pharmacies can implement the right corrective actions to prevent a recurrence. This takes some internal investigating and PAAS has extensive experience guiding pharmacies if you are ever in this situation.
What should we do today?
There is no one-size-fits-all answer for every pharmacy. The bottom line is that there is audit risk when making bulk purchases as ALL PBMs have limited lookback periods as explained above. It is important to understand that PBMs look at aggregate purchases over an extended window and that the lookback periods are relative to a yet to be defined audit date range.
Short-term considerations
Long-term considerations
Prime Therapeutics and Express Scripts Partnership Muddies On-site Audits and Results
In December of 2019, Express Scripts (ESI) and Prime Therapeutics LLC (Prime) announced a three year partnership “designed to deliver more affordable care for clients and their members by enhancing pharmacy networks and pharmaceutical manufacturer value.” This partnership was designed to allow both companies to operate independently with ESI providing services to Prime, including performing some audits.
This partnership has led to some confusion for pharmacies since on-site audits have resumed around the country. ESI has been sending out numerous audit notices, all with ESI branding, which includes phrasing that the audit “may include one or more claims submitted to Prime Therapeutics, LLC.” If pharmacies miss this sentence, they may be underprepared when the auditor arrives having only reviewed ESI documents and forgetting to review Prime claims, and associated documents, as well.
Further confusion arises when results are returned. These results may be emailed to the pharmacy by an ESI auditor and include estimated chargeback amounts. The email may note that any estimated recoupments for Prime claims are automatically generated as 50% or 100% recovery based on the type of discrepancy found. The email also briefly states that Prime will send a statement with actual recoupment amounts once the audit is final.
Once the audit is final, and the pharmacy receives this Claim Adjustment Report from Prime, they may be confused again! This document will come with Prime branding, not ESI, and will have no link to the original audit beyond the prescription numbers that had been audited. Pharmacies may have a hard time understanding where this statement came from if they do not recall the brief mentions of Prime throughout the ESI audit process.
These adjustment reports will include the actual recovery amount and any refunds owed to the patient, usually due to a copay change. The pharmacy is expected to give this refund amount back to the patient and keep a record of doing so. Pharmacies are not allowed to request reimbursement from the patient if additional copays were incurred since the pharmacy is responsible for submitting claims correctly at the time of dispensing.
PAAS Tips: