LIVE WEBINAR APRIL 7th: Compliance Issues, HIPAA Enforcement and Audit Risks with COVID-19

Join President of PAAS National®, Trenton Thiede, PharmD, MBA for a LIVE webinar “Compliance Issues, HIPAA Enforcement and Audit Risks with COVID-19” on April 7, 2022 from 2-2:45pm CT as he discusses:

  • Compliance Program Requirements (and why it matters to community pharmacies)
  • Recent HIPAA Enforcement/Action
  • COVID-19 Vaccine Audit Risks (updated)
  • OTC COVID-19 Tests Audit Risks (and Medicare B guidance)
  • Onsite Audit Preparation

We will allow for some Q&A at the end of the webinar.

SIGN UP TODAY!

PAAS Audit Assistance members will have access to a recording on the PAAS Member Portal if they are unable to attend the live event.

Beware and Be Ready! In-Person Onsite Audits Are Resuming

OptumRx and Express Scripts recently sent notices to pharmacies informing them in-person onsite audits will be starting back up in April. PAAS National® has also reviewed audit notices from Caremark and MedImpact with intentions of visiting the pharmacy in person to conduct the audit. We would expect other PBMs to follow this trend as well.

COVID-19 restrictions lead PBMs to conduct their audits virtually since early 2020. Pharmacies would respond to the audit request by submitting documents in for review and having a compliance phone interview with the auditor. With COVID-19 numbers decreasing, PBMs feel now is the time to resume audits onsite.

PAAS analysts have years of experience assisting pharmacies through onsite audits. Pharmacies can receive a pre-audit consultation with an analyst, in addition to specific PBM trends, state laws that are being targeted, and many other tips that can be provided to support you through your audit. We also offer our Onsite Credentialing Guidelines located on the PAAS Member Portal, to help our members prepare for potential questions that may be asked during the auditor’s visit.

PAAS Tips:

  • Engage PAAS as soon as possible after receiving an any audit notification (including onsite)
  • Log on to the Member Portal to search past Newsline articles for safe filling and billing tips, or submit a question online
  • PAAS FWA/HIPAA Compliance members should review their compliance tasks to ensure the pharmacy is up to date
    • MedImpact is specifically looking for written policies and procedures for FWA when onsite

If you do not have a compliance program, contact PAAS today to explore the PAAS FWA/HIPAA Compliance program. Get complaint today and save $126!

Self-Audit Series #14: DMEPOS Items

Medicare Part B/DMEPOS billing and documentation rules are VERY different from most of your pharmacy claims – if you don’t have a strong grasp of these differences, or a process for handling the documentation, then you are sure to experience significant problems.

PAAS Tips:

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Documentation for DMEPOS items

Standard Written Order (SWO)

  • SWOs must include the following six elements:
    1. Beneficiary’s name or their Medicare Beneficiary Identifier (MBI)
    2. Date of the order must be present
    3. General description of the items – HCPCS code a HCPCS code narrative, or a brand name/model number
    4. Quantity to be dispensed
    5. Practitioner’s name or NPI
    6. Practitioner’s signature
  • Other important items to know:
    • Medicare accepts electronic, faxes and written orders. Telephone and transfer orders do NOT satisfy Medicare requirements
    • Must have SWO in your possession prior to billing claims
    • Not required to have a diagnosis code on the order; however, the correct diagnosis code is needed to appropriately bill the claim
    • As of January 2020, pharmacies may obtain and make note of verbal clarifications
  • See our January 2019 Newsline article Billing Medicare Part B – Nebulizer Drugs for requirements of a valid detailed writer order (DWO) if being audited on a claim with an order written prior to 2020

Proof of Refill Request (PORR)

  • Refill requests include the following four elements:
    1. Name of beneficiary (or representative) making the request
    2. Description of each item requested
    3. Date of refill request
    4. Quantity that beneficiary still has remaining
  • NOT required for items picked up at your pharmacy
  • PORR may not be obtained more than 14 days before exhaustion of current supply or delivered to the patient more than 10 days before exhaustion

Proof of Delivery (POD)

  • POD must include the following six elements:
    1. Beneficiary name
    2. Delivery address
    3. Detailed description of the item(s)
    4. Quantity delivered
    5. Date delivered
    6. Signature of beneficiary or representative
  • Important notes:
    • Date of delivery should match the date of service billed (there is no “return to stock” window)
    • Applies to all DMEPOS dispensing – even when picked up at pharmacy
    • Standard “signature logs” used for PBM audits generally do not satisfy requirements
    • Most common items missing on audit = delivery address, detailed description, quantity
    • Many pharmacies will add duplicate Prescription dispensing label to provide

Medical Records

  • In general, medical records should conform to the following:
    • Be created on or before the prescription order (SWO)
    • Support the underlying diagnosis or condition
    • Be signed by the treating practitioner
  • To prove “continued medical need” of ongoing supplies or rental items, medical records must be “timely” which is defined as a record in the preceding 12 months unless otherwise specified (e.g., high utilization of diabetic test strips requires medical records within previous 6 months)
  • Each DMEPOS product category requires different unique elements
  • Best practice would be to obtain records before dispensing items to patients

Billing for DMEPOS items

  • Medicare billing is based on HCPCS codes (not NDCs) and “units of service” (which varies by product)
  • Many pharmacies utilize software vendors such as OmniSYS and Change Healthcare to convert NCPDP D.0 claim information into an “837 file” that CMS claim processors recognize
  • Many DMEPOS items require “modifiers” to communicate various information
    • Example for diabetic test strip claims (A4253): ‘KS’ indicates that the patient is NOT using insulin, while ‘KX’ indicates that the patient IS using insulin
    • Example for claims billed during the public health emergency that do not meet all Medicare clinical indication requirements should be adding a ‘CR’ modifier to the claim if on or after 3/1/2020 and for the duration of the PHE – See March 2022 Newsline article Medicare not Enforcing Clinical Indications for Certain DMEPOS Categories during the PHE for more information on the ‘CR’ modifier

Dispensing for DMEPOS items

  • Must ensure that the signature date matches the date of service billed on the claim
  • Claim must be billed on the date picked up, or the date sent out for delivery
    • If the dates do not match and you identify this error on your own, you can resolve it proactively via a Reopening without having to request a formal appeal
    • If this error is discovered during an audit, pharmacies must appeal via a Redetermination. During the PHE, pharmacies are allowed to write a note to the medical reviewer asking them to adjust the date billed to match the date picked up

Be sure to utilize all the tools and resources available on your local DME MAC website to ensure you are compliant with Medicare’s billing and documentation rules.

  1. Durable Medical Equipment Medicare Administrative Contractor (DME MAC) websites
  2. Noridian Healthcare Solutions
  3. CGS® Administrators, LLC
  4. Supplier Manual
  5. Local Coverage Determinations (LCDs) that outline billing and documentation requirements that are specific for various items
  6. Documentation Checklists – these are created by the DME MACs to aid suppliers in adhering to rules
  7. Dear Physician Letters – letters written by physicians of the DME MACs that suppliers can provide to local prescribers to education them about documentation requirements
  8. Educational, on-demand webinars on a variety of topics

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.

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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.

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