Founded in Wisconsin in 1984, Centene started as a nonprofit Medicaid plan and grew to become the nation’s largest Medicaid managed care organization serving over 26 million managed care members. Nearly 1 in 15 people in America have services through Centene, including Medicaid, Medicare, the Health Insurance Marketplace, TRICARE, and correctional facilities.
At the end of October 2021, Centene® executives said the company would be making a $30 billion request for proposals from outside contractors to take over the pharmacy benefit manager (PBM) side of their business. The request for proposal is expected to launch in 2022 and be awarded in 2023. Estimates show PBMs make $400 billion a year nationwide, so why would Centene® decide to divest such a lucrative part of their business?
Centene® reasoned that managing pharmacy benefits was simply not among its core functions. While not stated, the entanglement in several legal battles surely plays a role. The Ohio Attorney General, Dave Yost, filed suit against Centene® in March 2021. The Attorney General accused Centene® of using multiple PBMs to perform the same functions and overbilling taxpayers tens of millions of dollars. The Ohio Medicaid plan managed by Centene®, Buckeye Health Plan™, had hired Envolve™ (a Centene® subsidiary) to handle pharmacy benefits. Envolve™ then hired Health Net™ Pharmacy Solutions (another Centene® subsidiary) which contracted with CVS Caremark®. Centene® claims CVS Caremark® only handled claims payment processing while Envolve™ did everything else, including, specialty management, data analytics, drug utilization review, and formulary management; however, CVS Caremark® contradicted this. Talk about a tangled web of PBM opaqueness!
Centene® was also accused of pocketing dispensing fees charged to the state and meant for pharmacies while these pharmacies had Medicaid reimbursement rates lower than the cost of dispensing. Centene® does not deny they pocketed $6.7 million in dispensing fees meant for pharmacies but has stated this practice was not prohibited by their contract and was entirely appropriate under their spread-pricing contract with Ohio’s Medicaid department.
While Centene® has not admitted wrongdoing, it has agreed to pay Ohio $88 million and set aside $1 billion to settle future potential suits. Kansas, Mississippi, Arkansas, Georgia, Oklahoma, New Mexico, and the District of Columbia are also taking a serious look into Centene®’s conduct.
Webinar: PBM FWA Trends and COVID-19 Vaccine Audit Risks
On November 18, 2021 PAAS National® hosted PBM FWA Trends and COVID-19 Vaccine Audit Risks webinar. PAAS Audit Assistance members have access to the recorded webinar, in addition to many other tools and resources on the PAAS Portal.
This webinar reviews:
Don’t Jump the Gun: Refill Too Soon Recoupments
Pharmacies know the importance of billing accurate days’ supply on prescriptions; however, there may be circumstances that can make this challenging. Medications that only come in one size or an unbreakable package may exceed what the patient will use during the plan limit timeframe. Claims dispensed for a plan limit, but the true day’s supply is greater, are an easy target for refilling too soon.
Pharmacies must be diligent in monitoring refills for claims submitted for a plan limit but will last the patient longer. The PBM only sees the days’ supply submitted on the claim. Once a prescription is audited, the directions for use will reveal the true days’ supply.
These claims are an easy target for audit as the PBM already received the initial/rejected claim days’ supply (suspected as the true days’ supply) and a subsequent claim with a shortened days’ supply (to meet plan limits). Based on this information, the PBM will audit subsequent refill too soon occurrences with a high margin of success.
Examples of prescriptions that pharmacies may need to dispense over the plan limit
Here is an example of a pharmacy putting claims at risk for refilling too soon:
As you can see, adjusting the days’ supply by 4 days (to meet the plan limit) put a claim in jeopardy of refilling too soon.
PAAS Tips:
Beware: Same Ingredients, Different FDA Indications
Ozempic® is an injectable diabetic medicine used to improve glycemic control in adults for type 2 diabetes management. Please see our May 2021 Newsline New Package Size Available for Ozempic® for reference on how to bill for Ozempic®. On June 4, 2021, the FDA approved a new drug treatment for chronic weight management called Wegovy™ which has the exact same ingredient – semaglutide.
Similarly, Victoza® is also used to improve glycemic control in patients 10 years and older for type 2 diabetes and is composed of an ingredient called liraglutide. Saxenda® also contains liraglutide but is used for chronic weight management. Pharmacies need to be aware that there is an audit risk if the prescriber is ordering for off-label use.
PAAS Tips:
PBM Provider Manual Updates – What You Need to Know
Pharmacy Benefit Managers (PBMs) update their provider manuals on occasion (some more frequently than others) and although the changes are applicable to the practice of all pharmacies contracted with that PBM, it can be difficult to keep track of the method by which each PBM updates their manual and where to find it.
PAAS Tips:
Bill it Right: AndroGel® Pump 88 g vs 75 g
Pharmacies have recently reported receiving telephone calls from Caremark’s audit department regarding claims for AndroGel® (testosterone) pump (and generics) related to incorrect package size billed. Pharmacies submitted 88 grams as indicated on the wholesaler ordering website and listed on the outside of the manufacturer’s packaging, but Caremark representatives stated that 75 grams is the correct package size. Pharmacies subsequently contacted PAAS National®, concerned that Caremark was trying to underpay them for these products.
The correct billing unit as defined by NCPDP is 75 g. See further discussion below for more details.
According to the AndroGel® product labeling, Section 16 How Supplied/Storage and Handling
Each 88 g metered-dose pump is capable of dispensing 75 g of gel or 60 metered pump actuations; each pump actuation dispenses 1.25 g of gel.
Additionally, NCPDP (the organization that sets the industry standards for how drugs are billed) has posted QUIC Form Resolutions where participants such as manufacturers, payers, processors and providers can submit requests to NCPDP for discussion and clarification about certain products.
Here is the resolution from May 2011 NCPDP Workgroup 2 Meeting discussing AndroGel® Pump
Requested clarification for the billing unit quantity. At the May 2011 WG2 meeting the form was discussed. Issue: Clarification is requested regarding the billing quantity for AndroGel 1.62% metered-dose pump. The outer packaging and product label state “Total contents: 88 g.” The labels also state “Multi-dose pump capable of dispensing 60 metered pump actuations” and “each actuation delivers 1.25 g of gel.” Based upon the latter statements, the pump is capable of delivering 75 g of gel. Is the billing quantity 88 or 75?
Discussion: There was discussion on Androgel. There is a new strength of Androgel at 1.62 %. The label shows 88 grams but it only delivers 75 grams. The compendia have it listed differently and they need to be consistent. This product came out May 4th. It is anticipated that the compendia will coordinate the change to 75 grams at the end of the quarter. (note, subsequent to the meeting it was noted that all compendia changed the package size to 75 grams before the end of the quarter as the product was just launched).
Post WG Meeting Note: The Product Review and Billing Unit Exceptions Task Group discussed on their call of May 24th and it was agreed that 75 grams should be the package size.
PAAS Tips:
Update: Medicare Part D Mandatory e-Prescribing Requirements
In our February 2021 Newsline article, PAAS alerted pharmacies to the delay in enforcement of Electronic Prescriptions for Controlled Substances (EPCS) for Medicare Part D until January 1, 2022. As this new deadline approaches, CMS is once again considering extending compliance actions to January 1, 2023. While no decision on the extension has been made yet, pharmacies can find the proposed rule at https://www.federalregister.gov/documents/2021/07/23/2021-14973/medicare-program-cy-2022-payment-policies-under-the-physician-fee-schedule-and-other-changes-to-part.
Once EPCS in Medicare Part D becomes mandatory, there are likely to be many exceptions where e-prescribing may be waived. As of January 19, 2021, sixteen states had already implemented their own EPCS requirements with twelve additional states looking to implement ECPS requirements by the end of 2021. What does this mean for pharmacy audits?
State required EPCS has been around for many years, going back as far as 2013 in New York state, and each state has laid out prescriber exceptions to the requirement, and in most cases, the pharmacy is not responsible for knowing if the prescriber has an exception in place. It is a good idea to check with your Board of Pharmacy if you are unsure of your state’s current EPCS requirements and exceptions.
Centene® – Why Are They Leaving the PBM Game?
Founded in Wisconsin in 1984, Centene started as a nonprofit Medicaid plan and grew to become the nation’s largest Medicaid managed care organization serving over 26 million managed care members. Nearly 1 in 15 people in America have services through Centene, including Medicaid, Medicare, the Health Insurance Marketplace, TRICARE, and correctional facilities.
At the end of October 2021, Centene® executives said the company would be making a $30 billion request for proposals from outside contractors to take over the pharmacy benefit manager (PBM) side of their business. The request for proposal is expected to launch in 2022 and be awarded in 2023. Estimates show PBMs make $400 billion a year nationwide, so why would Centene® decide to divest such a lucrative part of their business?
Centene® reasoned that managing pharmacy benefits was simply not among its core functions. While not stated, the entanglement in several legal battles surely plays a role. The Ohio Attorney General, Dave Yost, filed suit against Centene® in March 2021. The Attorney General accused Centene® of using multiple PBMs to perform the same functions and overbilling taxpayers tens of millions of dollars. The Ohio Medicaid plan managed by Centene®, Buckeye Health Plan™, had hired Envolve™ (a Centene® subsidiary) to handle pharmacy benefits. Envolve™ then hired Health Net™ Pharmacy Solutions (another Centene® subsidiary) which contracted with CVS Caremark®. Centene® claims CVS Caremark® only handled claims payment processing while Envolve™ did everything else, including, specialty management, data analytics, drug utilization review, and formulary management; however, CVS Caremark® contradicted this. Talk about a tangled web of PBM opaqueness!
Centene® was also accused of pocketing dispensing fees charged to the state and meant for pharmacies while these pharmacies had Medicaid reimbursement rates lower than the cost of dispensing. Centene® does not deny they pocketed $6.7 million in dispensing fees meant for pharmacies but has stated this practice was not prohibited by their contract and was entirely appropriate under their spread-pricing contract with Ohio’s Medicaid department.
While Centene® has not admitted wrongdoing, it has agreed to pay Ohio $88 million and set aside $1 billion to settle future potential suits. Kansas, Mississippi, Arkansas, Georgia, Oklahoma, New Mexico, and the District of Columbia are also taking a serious look into Centene®’s conduct.
Updated PAAS National® Dispense In Original Container Chart
Dispensing medications outside of FDA packaging requirements may put your claims at risk of recoupment. Medications sensitive to light and/or moisture may require pharmacies to dispense the medication in the original container. Product testing by the manufacturer will determine if this is required. This information will be listed in the product labeling section How Supplied/Storage and Handling. Because manufacturers submit this language to the FDA for approval, be aware there are inconsistencies in how this information appears for different products. Pharmacies can access this information from the package insert or the FDA’s DailyMed website (https://dailymed.nlm.nih.gov/dailymed/).
Prescription claims submitted to PBMs for an NDC that is required to be dispensed in the original container are an easy target for recoupment when the dispensed quantity does not match the package size. Pharmacies that cycle fill medications or service LTC facilities must be aware of these packaging requirements and dispense appropriately as well.
PAAS National® offers our members a chart of medications with special packaging requirements, see the Tools & Aids section of the PAAS Member Portal.
The three additions to our chart include:
PAAS Tips:
HIPAA Guidance Regarding COVID-19 Vaccination Status in the Workplace
On September 30th, the U.S. Department of Health and Human Services’ (HHS) Office for Civil Rights (OCR) released guidance regarding the Health Insurance Portability and Accountability Act (HIPAA) of 1996 Privacy Rule and its application to the workplace, specifically discussing the disclosure and request of COVID-19 vaccination status.
The Privacy Rule (45 CFR Parts 160 and 164) applies specifically to covered entities (CEs), such as health plans, health care clearinghouses, and health care providers who maintain or transmit individually identifiable health information, called “protected health information (PHI).” The Privacy Rule does not regulate a CE’s or its business associates’ (BA) ability to request the vaccination status of an individual, it regulates how the CE and BAs use and disclose the PHI obtained. The Rule expressly states that a member of the CE’s workforce is not considered a BA and the rule does not prohibit an employer from requesting the vaccination status of its employees, a patient, or a visitor and the Rule does not limit an individual from disclosing their own information to another person. In other words, even though a pharmacy is considered a CE and staff must abide by the Privacy Rule daily when utilizing and disclosing PHI, when the pharmacy is acting in its capacity as an employer the Rule does not regulate its ability to ask employees, customers, or patients about their vaccination status. The employee, customer, or patient might believe they do not have to share this information per HIPAA; however, that is not a valid assertion since HIPAA does not regulate or prohibit an individual from sharing their own information. Outside of HIPAA, there may be other applicable state or federal laws which could overlap HIPAA regulations – refer to your healthcare attorney for additional clarifications.
Additionally, the Privacy Rule does not dictate what information can be requested of its employees as a condition of employment. Even the federal equal employment opportunity laws do not prevent an employer from requiring staff to be vaccinated before entering the workplace, as long as reasonable accommodations are made per the Americans with Disabilities Act (ADA). If an employer maintains confirmation or proof of vaccination, the ADA requires those records be stored separately from the individual’s personnel file. Furthermore, an employer can require each member of its workforce to sign a HIPAA authorization to obtain proof of vaccination directly from a covered health care provider and an employer may require its workforce to disclose their vaccination status to a patient, if asked.
The Privacy Rule does prohibit a CE and their BAs from using or disclosing an individual’s medical records, including vaccination status, to an individual’s employer or other entity unless the individual approves the request in advance, or the release pertains to treatment, payment, or other healthcare operations (TPO). Unless the individual has restricted the release of their PHI, the pharmacy can share the individual’s vaccination status with entities such as the individual’s primary care provider, their insurance company, and the state immunization database without the patient’s consent. For disclosure to an entity outside TPO, patients must first approve the release of their protected information (including vaccination history). Be sure to keep all HIPAA-related documentation for a minimum of six years.
PAAS Tips:
Accepting Gifts Can Be an FWA Violation
The U.S. Department of Justice issued a press release on September 30, 2021, outlining that a former public official accepted “gratuities” (aka gifts or kickbacks) in exchange for referring business to a specific outside vendor. The employee was sentenced to eight months in federal prison and required to pay almost $8,000 in restitution.
According to the press release, David Laufer worked at Walter Reed Medical Center and was the Chief of the Prosthetics and Orthotics Department. Mr. Laufer reportedly accepted thousands of dollars in cash and other gifts such as airline tickets, lodging and entertainment tickets from Pinnacle Orthopedic Services in exchange for steering business from 2012 to 2016. Mr. Laufer repeatedly hid these outside compensations from his employer despite being required to complete annual Confidential Financial Disclosure Forms intended to identify and deter this type of activity. Mr. Laufer also denied receiving any benefits from Pinnacle during interviews with federal agents as part of a corruption investigation at Walter Reed.
The press release makes it very clear that Mr. Laufer was fully aware that his activity was wrong and made multiple explicit attempts to avoid detection. Despite the efforts of his employer to prevent (through disclosure forms) and detect (through investigation) this bad actor was able to break the rules.
Just think how bad things would have been had his employer (the federal government) not had certain FWA prevention/detection elements in place.
PAAS Fraud, Waste & Abuse and HIPAA Compliance members have an electronic Code of Conduct, Business Ethics and Conflicts of Interest Policy that employees must sign annually as well as a policy about Receiving Gifts and Entertainment-Conflicts in Section 3.2.2 of the FWAC/HIPAA Policy and Procedure Manual.
PAAS Tips: